In the aftermath of the 2007–2009 crisis, banks claiming positive diversification benefits are being met with skepticism. Nevertheless, diversification might be important and sizable for some large internationally active banking groups. We use a universally applicable correlation matrix...

This paper explores how corporate taxes affect the financial structure of multinational banks. Guided by a simple theory of optimal capital structure it tests (i) whether corporate taxes induce subsidiary banks to raise their debt-asset ratio in light of the traditional debt bias; and (ii)...

This paper studies international diversification in banking, exploiting a bank-level dataset that covers the operations of 38 global banks and their subsidiaries overseas during 1995–2004. The paper finds that banks with a larger share of assets allocated to subsidiaries in emerging market...

Greater financial integration between core and peripheral EMU members had an effect on both sets of countries. Lower interest rates allowed peripheral countries to run bigger deficits, which inflated their economies by allowing credit booms. Core EMU countries took on extra foreign leverage to...

We assess the evolution of international banking integration at the light of gravity equations on banks’ bilateral consolidated foreign claims data. Our estimates on a panel of 14 reporting countries and their 186 partners between 1999 and 2012 reveal: 1) the forward march of banking...

The paper analyses the process of internationalisation of the banking sector from the perspective of firms' strategies under conditions of oligopoly. The Italian case is interesting from this point of view for its simultaneous dynamics of entry of several foreign players in the market and...

The recent global financial crisis has caused massive upheavals worldwide. The papers in this volume analyze whether financial principles seem to have shifted in recent years, and what that may mean for international financial markets and regulation. What ¡°broke¡± in the current crisis? Is...

This paper analyzes the Eurodollar market, investigating the reasons for its expansion after 1973, and the consequences for monetary policy. In the first part of the paper, the issue of credit and money creation by offshore banks is considered. The nature of the liquidity creation process is...

This paper explores whether the level of de facto financial integration of banks in a country increases the incidence of systemic banking crises. The paper computes a measure of financial integration based on network statistics of banks participating in the global market of inter-bank syndicated...

Although cross-border bank lending has fallen sharply since the crisis, extending our bank ownership database from 1995-2009 up to 2013 shows only limited retrenchment in foreign bank presence. While banks from OECD countries reduced their foreign presence (but still represent 89% of foreign...