This paper presents Barbados’s Financial System Stability Assessment Update as part of the Financial Sector Assessment Program Update. The domestic banking sector appears sound and profitable and continues to dominate the financial system. The financial system has benefited from the...

This paper discusses key findings of the Fifth Review Under the Stand-By Arrangement for Georgia. The 2010 program sets out a viable exit strategy from official external support, permitting the Georgian authorities to return to capital markets ahead of their large debt rollover needs in...

The Austrian authorities have been making great efforts since 2003 to enhance the quality of banking supervision and keep up-to-date with banking sector developments. Banks face a reputation risk arising from exposure to money laundering/financing of terrorism risk in both domestic and...

The Sixth Review Under the Extended Arrangement with Ireland highlights that Ireland’s policy implementation has continued to be steadfast. Ownership of the program remains strong despite the considerable challenges the country is facing. Ireland’s progress in strengthening the...

This technical note examines the safety net, bank resolution, and crisis management framework in Spain. The financial safety net architecture for the banking sector comprises the Banco de España (BdE), the Fondo de Garantía de Depósitos (FGD), and the Fondo de Reestructuración Ordenada...

This technical note on deposit insurance on the Republic of Belarus explains the status of the deposit insurance system. The current system of deposit insurance is governed by two different pieces of legislation, each in turn elaborated by a separate National Bank of Belarus (NBB) resolution....

This 2009 Article IV Consultation highlights that the U.S. economy has experienced the worst financial crisis since the Great Depression. In the second half of 2008, financial pressures intensified and came to a head with the failure of Lehman Brothers in September. Executive Directors have...

The author models the relationship between a government and former terrorists as a game with both moral hazard and learning. The government is uncertain about both the former terrorists’ ability and skill at providing counterterrorism aid. The government has the option—after...

Why does the military intervene in the politics of some countries but remain under firm civilian control in others? The paper argues that the origins of military intervention in politics lie in a fundamental moral hazard problem associated with authoritarian repression. Dictators must deter...

Sprint finishes in professional cycling are fast, furious, and dangerous. A “red flag rule†(RFR) seeks to moderate the chaos of these finishes, but may induce moral hazard by removing the time penalty associated with crashing. To test for moral hazard, the authors use a 2005 rule...