Columbia Law School
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Finance & Economics
The Comprehensive Capital Analysis and Review and the New Contingency of Bank Dividends
My recent paper explains why, from a bank supervisory perspective, the Federal Reserve’s Comprehensive Capital Analysis and Review (CCAR) program is arguably the single most significant and innovative post-crisis regulatory reform. Established in 2011, the CCAR is an annual Federal …
Sullivan & Cromwell discusses The Cybersecurity Act of 2015
On December 18, 2015, President Obama signed into law the Cybersecurity Act of 2015. The Act, arguably the most significant piece of federal cyber-related legislation enacted to date, establishes a mechanism for cybersecurity information sharing among private‑sector and federal government …
United States v. Coscia as a Case of First Impression
On November 3rd, high-frequency trader Michael Coscia was found guilty in Chicago in one of the most-watched financial trials in recent years.[1] His conviction under Dodd-Frank’s new anti-spoofing provision is important on a number of levels: what it means …
The Governance of Publicly Traded LLCs
The limited liability company (LLC) is not only a widespread business form for non-listed firms but also is used by listed companies. There were twenty publicly traded US LLCs in September 2013—all formed in Delaware. Two more Delaware LLCs have …
The Role of the Chief Legal Officer in Corporate Governance
Corporate governance mitigates agency costs by protecting outside investors from exploitation from insiders, as well as aligning the financial and other incentives of insiders with those of the principal. The literature remains underdeveloped, however, on those tasked with shaping and …
PwC discusses Key Points from Basel’s Re-proposed Standardized Approach for Credit Risk
The Basel Committee on Banking Supervision (BCBS) on December 10th issued the second iteration of its proposed revisions to the standardized approach (SA) for credit risk measurement. Following up on last year’s initial issuance, the proposed revisions are intended …
How Much Information Should Central Banks Share?
Central Bankers are rarely “responsive” to the public through the democratic process. In the United States, most members of the (unelected) Federal Reserve Open Market Committee (FOMC) have no other government experience or aspirations, and in spite of their clear …
The Fall and Rise of Debt in Bank Capital Structures
Debt has undergone a remarkable resurrection in relation to banks’ capital structures. In the immediate aftermath of the crisis it was uncertain whether debt would survive at all in the Basel Committee’s minimum capital requirements for internationally active banks. Today, …
Ethan Allen, Hedge Fund Activism and Prevailing Over Conventional Advice and Practice
Ethan Allen and its management prevailed a few weeks ago against an intense hedge fund activist campaign to remove its entire board of directors.
An analyst of one of our larger shareholders, the Gabelli funds, observed “I’ve never seen a …
The Fed’s TLAC Proposal Would Impose the Costs of Resolving Failed Megabanks on Ordinary Investors and Taxpayers
In two previous posts,[1] I described the financial industry’s “single point of entry” (SPOE) strategy for resolving failed megabanks. The SPOE approach – which has been endorsed by the Federal Reserve Board (Fed) and other regulators – could be …
Is High Frequency Trading Good For Capital Markets?
High frequency trading is all of a go,
With joy to the traders and profits that grow,
It brings to investors an unhappy blow.
Investors and traders in capital markets have always sought to be better informed and to trade …
Regulating Unicorns: Disclosure and the New Private Economy
Headlines about unicorns—private companies with valuations of a billion dollars or more—have dominated newspapers such as The New York Times, The Wall Street Journal, and the like. It has become part of the fabric of the venture capital …
Company Directors Need to Oversee Corporate Political Spending
As political spending surges toward record levels in 2016, post-Citizens United changes in the funding of American political campaigns will require directors to oversee a dramatically deregulated political environment. Corporate money will play a large role in the election, heightening …
Transactionalizing the Casebook: 4 Steps
Are Hedge Funds Good for Firms they Target? Look at the Effects on Their Industry Competitors!
Since the late 1990s, activist hedge funds have become the dominant face of shareholder activism, essentially taking over an arena that was once dominated by pension funds and mutual funds. Hedge fund activism (HFA) has attracted substantial public attention because …
PwC discusses Bank Culture: It’s About More Than Bad Apples
The US Federal Reserve (Fed) again expressed concerns about the culture at financial institutions this month.[1] This has been a recurring theme since the financial crisis, as regulators in the US and abroad have hit industry players with steep …
In Defense of Corporate Persons
Corporate personhood is getting a bad name.
After Citizens United v Federal Election Decision in 2010, protecting the First Amendment rights of corporations to spend money in elections, the nation has seen the development of a broad-gauged movement to overturn …
Tax-Free Perks Abound (At Least for Some)
Skadden discusses Glass Lewis Issuing 2016 US Proxy Policy Guidelines
Proxy advisory firm Glass Lewis recently issued its U.S. voting policy guidelines for the 2016 proxy season. The guidelines include a few key changes, a summary of which is outlined below.
Conflicting Shareholder Proposals. Conflicting shareholder proposals relating to …