This paper examines the overall variability of Australian banks’ credit risk during the 1990s. It assesses the extent to which this overall variability can be explained by variability in the level of banks’ aggregate credit risk over time, or alternatively, by variation in the average credit...

As recent experience all too clearly demonstrates, liquid markets do not exist for all financial assets at all times. In some respects, this can be thought of as a market failure. This paper addresses how best to promote asset market liquidity given this market failure, and the appropriate...

This paper reviews corporate finance literature which explains some of the long-term causes of the Japanese banking sector’s poor performance in the early 1990s. It concentrates on the ideas that an adverse selection problem developed in the bank lending market during the 1980s, and that banks...

Links between central counterparties (CCPs) enable participants to clear positions in any linked CCP without needing to maintain multiple CCP memberships. While links enable exposure to be reduced by allowing netting across CCPs, CCPs become exposed to one another through the possibility of a...