Financial Intermediaries and the Real Economy (FIRE) at Frankfurt School of Finance & Management is a research-led think tank that promotes research and best practices on central issues facing economies and financial markets. FIRE builds on Frankfurt School’s high-class faculty to generate insights from the connection between practice and theory.
Our overall objective in the Centre is to conduct and disseminate new research across a wide array of financial topics and bring together academics, practitioners and regulators. Across different initiatives, our team provides high-level as well as in-depth research and analyses, develops and implements innovative projects, advises on policy development and changes, and provides training and workshops. Topics include banks and financial services, financial crises, monetary policy, debt markets, FinTechs and climate risk. Overall, the centre’s work focuses on the role of finance in solving today’s societal problems with a focus on Europe and the European Economy.
Financial Big Data Cluster (safeFBDC) – AI & Monetary Policy (BMWi,€1mn)
We explore the role of artificial intelligence (AI) and machine learning (ML) in central banking. AI/ML can strengthen policy analysis and decision-making, e.g. by providing tools as well as more and enhanced information to complement existing policy data.
Bank Credit and the Macroeconomy – Cross-country evidence (DFG, €141,000)
We empirically investigate the role of bank credit in the macroeconomy across countries with a focus on the U.S. and Europe. In one project, we develop a loan market-based credit spread, explore its predictive power for industry-level and aggregate macroeconomic variables and investigate whether it reflects frictions in the supply of bank lending to non-financial firms.
We investigate and understand the role of financial intermediaries in driving climate change. How should banks and markets be regulated? What is the role of central banks in this process? How do “climate stress test” affect banks and markets?
The outbreak of the COVID-19 pandemic severely affected economies globally. We provide in-depth analyses through academic research, white papers and discussions with industry and policy leaders as to the effects of COVID-19 and the responses of governments and central banks. Our focus is on the effects on firms and banks.
"No credit crunch (yet) – but here is why we should be worried" - 3 reasons why the European bank lending survey (Q2 2020) should worry us
"Corporate Dash for Cash & Crash of Banks’ Stock Prices" - presentation on the Panel: Firms and Liquidity after COVID at the Brazilian Finance Meeting (16 July 2020) - based on work with Viral Acharya
Youtube video from my panel with Heitor Almeida (Illinois at Urbana-Champaign), Raghu Rajan (Chicago Booth) and João Manoel de Pinho Mello (Central Bank of Brazil)
"Bank capital and the European recovery from the COVID-19 crisis" (with M. Schularick and T. Troeger)
Coronomics XXX - Firmen, Liquiditaet und Banken - Interview in Podcast (in German) von Christian Bayer (Uni Bonn) und Ruediger Bachmann (Notre Dame)
"The risk of being a fallen angel and the corporate dash for cash in the midst of COVID" (with Viral Acharya), Review of Corporate Finance Studies 9, 430-47. Youtube video (interviewed by Tim Phillips, CEPR)
Short NBER Video
Press Briefing: COVID-19 – Could this be the trigger for a new financial crisis? (March 2020)
A Protective Shield for Europe' Banks (with M. Schularick)
Berg, T., A. Saunders, and S. Steffen, 2021. Trends in Corporate Borrowing, Annual Review of Financial Economics, forthcoming.
Ilhan, E., Z. Sautner, and G. Vilkov, 2021. Carbon Tail Risk, Review of Financial Studies, forthcoming.
Reisinger, M., and D. Streitz. Handling Spillover Effects in Empirical Research, Journal of Financial Economics, forthcoming.
Cremers, M., A. Pareek, and Z. Sautner, 2021. Short-Term Institutions, Analyst Recommendations, and Mispricing: The Role of Higher-Order Beliefs, Journal of Accounting Research, forthcoming
Acharya, V.V., M. Jager, S. Steffen, and L. Steinruecke, 2020. Kicking the can down the road: government interventions in the European banking sector, Review of Financial Studies, forthcoming.
Burg, V., A. Gombović, and M. Puri, 2020. On the Rise of FinTechs: Credit Scoring using Digital Footprints, Review of Financial Studies, 33(7), 2845-2897.
Berg, T., A. Saunders, L. Schäfer, and S. Steffen, 2020. “Brexit” and the Contraction of Syndicated Lending, Journal of Financial Economics, forthcoming.
Acharya, V.V., B. Imbierowicz, D. Teichmann, and S. Steffen, 2020. Does the Lack of Financial Stability Impair the Transmission of Monetary Policy? Journal of Financial Economics, 138 (2), 342-365.
Acharya, V., and S. Steffen, 2020. The risk of being a fallen angel and the corporate dash for cash in the midst of COVID, Review of Corporate Finance Studies, 9, 430-471.
Ladika, T., and Z. Sautner, 2020. Managerial Short-Termism and Investment: Evidence from Accelerated Option Vesting, Review of Finance, 24(2), 305-344.
Cremers, M., A. Pareek, and Z. Sautner, 2020. Short-Term Investors, Long-Term Investments, and Firm Value: Evidence from Index Inclusions, Management Science, 66(10), 4535-4551.
Krueger, P., Z. Sautner, and L. Starks, 2020. The Importance of Climate Risks for Institutional Investors, Review of Financial Studies, 33(3),1067-1111.
Große-Rueschkamp, B., S. Steffen, and D. Streitz, 2019. A Capital Structure Channel of Monetary Policy. Journal of Financial Economics, 133 (2), 357-378.
Lautenbacher, S., J. Miethe, A. Peichl, S. Rumscheidt, and S. Steffen, 2021. Eigenkapital staerken?! Im Rahmen des Vertrags zur Erstellung volkswirtschaftlicher Studien, IHK für München und Oberbayern, ifo Zentrum für Makroökonomik und Befragungen.
Acharya, V., and S. Steffen, 2020. The risk of being a fallen angel and the corporate dash for cash in the midst of COVID, Covid Economics,10, 44-61.
Acharya, V., and S. Steffen, 2020. “Stress Test” for Banks as Liquidity Insurers in a time of COVID. VoxEU.
Schularick, M., and S. Steffen, 2020. A Protective Shield for Europe’s Banks.
Jannik is working as a research assistant during his Master of Finance studies at the Frankfurt School of Finance & Management. Before joining the SafeFBDC project, he gained experience in Leveraged Finance in Frankfurt, London and Los Angeles.
Hauke is a Master of Finance student at Frankfurt School. He was awarded the GARP Research Fellowship in 2020 and his research focuses on risk management and asset liquidity. Hauke has prior work experience in finance and risk departments at an MDAX Company and the development cooperation sector with international work experience in Egypt and South Africa.
Malte is a Finance student in Frankfurt School’s PhD program. As part of the program, Malte has acquired knowledge in natural language processing and deep learning and has applied his machine learning skills in inflation forecasting for the SafeFBDC: AI and Monetary Policy project. His academic research focuses on financial intermediation and debt markets.
Die automatische Verarbeitung großer und komplexer Datensätze hält damit auch in der Geldpolitik Einzug. Der Frankfurter Finanzwissenschaftler Sascha Steffen geht in einem Forschungsprojekt der Frage nach, wie Methoden der künstlichen Intelligenz (KI) die Arbeit der Währungshüter voranbringen können:
Professor Sascha Steffen von der Frankfurt School for Finance and Management entwickelt mit einem vorerst auf drei Jahre angelegten Forschungsprojekt neue Werkzeuge, die helfen sollen, die Geldpolitik effizienter zu machen.