This paper argues that using gold as collateral for highly distressed bonds would bring great benefits to the euro area in terms of reduced financing costs and bridge-financing. It is mindful of the legal issues that this will raise and that such a suggestion will be highly controversial....

We identify the determinants of all German banks’ sovereign debt exposures between 2005 and 2013 and test for the implications of these exposures for bank risk. Larger, more capital market affine, and less capitalised banks hold more sovereign bonds. Around 15% of all German banks never hold...

In this paper, we use detailed data on the sovereign debt holdings of all German banks to analyse the determinants of sovereign debt exposures and the implications of sovereign exposures for bank risk. Our main findings are as follows. First, sovereign bond holdings are heterogeneous across...

This paper examines the joint behaviour of sovereign ratings and their macroeconomic/financial determinants (namely uncertainty, GDP growth, government debt-to-GDP ratio, investment-to-GDP ratio and the fiscal balance-to-GDP ratio) in a multivariate Panel Vector Autoregressive (PVAR) framework....

IMF programs are often considered to carry a "stigma" that triggers adverse market reactions. We show that such a negative IMF effect disappears when accounting for endogenous selection into programs. To proxy for a country's access to financial markets, we use credit ratings and investor...

This paper investigates the importance of having a sovereign credit rating for a country's financial development. After controlling for endogeneity and selection bias, we compare different aspects of the financial sector and the capital markets of recently rated countries with otherwise similar,...

In this paper we study the sovereign credit rating determinants of Visegrad Four countries in the period 1993-2012. The sovereign ratings in this study come from four major credit rating agencies namely Moody's, S&P, Fitch and R&I. Besides macroeconomic and socio-political indicators we analyse...

Objective: The objective of the article is to identify the determinants of the EU countries’ sovereign credit ratings with a particular focus on the impact of the euro area crisis. Research Design & Methods: The study is conducted for the 28 EU countries for the years 2004-2018. The research...