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This paper tests financial contagion due to interbank linkages. For identification we exploit an idiosyncratic, sudden … contagion is higher for banks with weaker fundamentals. Third, interbank linkages among surviving banks further propagate the … linkages act as an important channel of contagion and hold important policy implications. …
Persistent link: https://www.econbiz.de/10011605193
contagion only occurs if the correlation between the portfolios of banks is high enough. Without deposit insurance contagious … bank runs can impose such great losses on banks, that banks choose less correlated portfolios to avoid contagion altogether …
Persistent link: https://www.econbiz.de/10010263073
lower bank liquidity requirements, with a higher precision of depositors' information, and with a lower relevance of large … there is contagion and lower if banks can assume excessive risk, but interestingly, a high level of coverage may not be …
Persistent link: https://www.econbiz.de/10010280895
This paper examines common regulation as cause of interbank contagion. Studies based on the correlation of bank assets … and the extent of interbank lending may underestimate the likelihood of contagion because they do not incorporate the fact …
Persistent link: https://www.econbiz.de/10011605242
This paper analyzes the contagion effects associated with the failure of Silicon Valley Bank (SVB) and identifies bank …
Persistent link: https://www.econbiz.de/10014540982
Der aktuell diskutierte Gesetzentwurf für eine Reform der Einlagensicherung in Weißrussland verfolgt das Hauptziel …
Persistent link: https://www.econbiz.de/10010296602
shortcomings in systematic collection of information of the sector. …
Persistent link: https://www.econbiz.de/10011985212
In August 2007 the United Kingdom experienced its first bank run in over 140 years. Although Northern Rock was not a particularly large bank (it was at the time ranked 7th in terms of assets) it was nevertheless a significant retail bank and a substantial mortgage lender. In fact, ten years...
Persistent link: https://www.econbiz.de/10011689937
This paper analyzes the influence of market discipline on the risk-taking incentives of banks. It is shown that market discipline reduces risk if banks can credibly commit to a given level of risk before the interest rate on deposits is set. If, however, the bank can readjust the level of risk...
Persistent link: https://www.econbiz.de/10011430018
We introduce banks, modeled as in Diamond and Rajan (JoF 2000 or JPE 2001), into a standard DSGE model and use this framework to study the role of banks in the transmission of shocks, the effects of monetary policy when banks are exposed to runs, and the interplay between monetary policy and...
Persistent link: https://www.econbiz.de/10010265836