LTI@UniTO is a think tank established as a joint initiative of the Università di Torino and of the major Italian market players in long term financing. Through the Fellowship program, LTI@UniTO aims to foster research in long-term investing and to …
Central banks have been called on to contribute to fighting climate change. This column presents a framework for thinking about the issue and identifies some major trade-offs and choices. It argues that climate should be a major part of risk …
Targeted macroprudential policies may spill across sectors, but this does not mean that they are ineffective. This column shows how the effects of a countercyclical capital buffer designed to curb house price growth in Switzerland spilled over into commercial lending. …
Global Outlook: Fragile, Handle with Care. Global growth is expected to recover to 2.5 percent in 2020—up slightly from the post-crisis low of 2.4 percent registered last year amid weakening trade and investment—and edge up further over the forecast horizon. …
European banks have been criticised for holding too much domestic government debt during the recent euro area crisis, intensifying the doom loop between sovereign and bank credit risks. This column deviates from previous research that focused on ‘bad’ reasons for …
The global economy has experienced four waves of debt accumulation over the past fifty years. The first three debt waves ended with financial crises in many emerging and developing economies. The latest, since 2010, has already witnessed the largest, fastest …
Global imbalances are at the core of today’s trade tensions, but official current account statistics may not be sufficient to assess the external positions of financially integrated economies. For instance, balance of payments accounting standards do not prescribe the recording …
Macroprudential regulation is in vogue, but liquidity requirements are typically seen only as a microprudential tool. This column shows how a macroprudential approach to liquidity requirements could improve regulatory efficiency. By concentrating liquidity in systemically important banks, financial stability can …
The Financial Stability Board (FSB) today published the 2019 list of global systemically important banks (G-SIBs) using end-2018 data and an assessment methodology designed by the Basel Committee on Banking Supervision (BCBS). One bank (Toronto Dominion) has been added to …
Macroprudential policies are being implemented around the globe. A key question is whether these policies prompt substitution toward the non-bank financial sector. This column presents compelling evidence of such ‘waterbed effects’ after macroprudential policy action. Substitution towards non-bank credit is …
Filling the investment gap to achieve the sustainable development goals is one of the most important development challenges. Multilateral development banks can play an important role through a stronger engagement to attract additional resources from the private sector. This column …
There are still remarkable gaps in the data available on the overall structure of the financial systems of major economies. This column presents rough estimates for the UK and the US that suggest some surprising structural differences between the two …
One of the markets banks use to fund lending in foreign currencies – namely, using FX swaps to fund FX lending synthetically – has seen large dislocations in its pricing since the Global Crisis. This column documents that such dislocations affect the …
Non-performing assets are a double-edged sword. On the one hand, they often trigger episodes of financial crises. On the other, once a crisis erupts, market participants must have confidence in banks’ reported asset quality metrics in order to regain faith …
The decade since the Global Crisis has seen notable changes in the architecture of supervision, with separation of responsibility for monetary and financial stability having been reversed in many countries on the one hand, and a move towards more cross-border …
This occasional paper describes how the financial stability and macroprudential policy functions are organised at the ECB. Financial stability has been a key policy function of the ECB since its inception. Macroprudential policy tasks were later conferred on the ECB …
This paper describes the conceptual framework that guides assessments of financial stability risks for multilateral surveillance, as currently presented in the Global Financial Stability Report (GFSR). The framework emphasizes consistency in measuring financial vulnerabilities across countries and over time and …
Following the Global Crisis, countries have significantly increased their efforts to cooperate on bank supervision, the prime example being the euro area’s Single Supervisory Mechanism. However, little is known about whether such cooperation helps improve the stability of the financial …
Technology firms such as Alibaba, Amazon, Facebook, Google and Tencent have grown rapidly over the last two decades. The business model of these “big techs” rests on enabling direct interactions among a large number of users. An essential by-product of …
More than ten years have passed since the global financial crisis triggered a comprehensive regulatory reform process. Many important measures have been put in place since then. The title of the next panel discussion therefore raises a very pertinent question …
Focus The paper discusses why the financial system is not as resilient as policymakers currently claim – despite extensive regulatory reforms from a very weak starting point. Contribution The paper discusses different policy strategies for making some of the debt …
A structural feature of cross-border banking is its high degree of concentration, with a small number of very large bilateral links accounting for the lion’s share of total global cross-border bank credit. The largest links are almost exclusively between advanced …
The report summarises the responses received to the survey by Basel Committee member jurisdictions and those of the Basel Consultative Group. In brief, the majority of respondents to the survey currently apply proportionality measures in their jurisdictions. In most cases, …
There is global cycle in capital flows that is intimately connected to global risk. This column argues that, contrary to common wisdom, US monetary policy is not the only factor, or even the main factor, behind global risk and this …
Financial crises play a key role in changing existing policies concerning financial markets and institutions. This column provides new evidence for the negative impact of financial crises on the process of financial liberalisation. It also shows, however, that such interventions …
Deviations from covered interest parity represent, in theory, an arbitrage opportunity. This column shows that post-crisis, financial regulation may explain why this mispricing persists and cannot be arbitraged away. It also finds that more constrained dealers demand an extra premium …
Global growth has continued to soften this year. Subdued investment in emerging market and developing economies (EMDEs) is dampening potential growth prospects. Risks to the outlook remain firmly on the downside, including the possibility of escalating trade tensions. Another concern …
While the decade since the Global Crisis has seen clear improvements in financial regulation and supervision, there is still work to be done in several crucial areas, and political constraints may bite.This column introduces the first report in a new …
Call for Paper CfP deadline: 31 July, 2019 The special issue invites submissions of high-quality empirical research papers on topics related to the theme of changes in banks’ business models and their impact on credit supply. The banking sector is …
Frederic Boissay, Carlos Cantú, Stijn Claessens and Alan Villegas, March 5, 2019 The BIS is launching a public, online and interactive repository of studies on the effects of financial regulations, called FRAME. The purpose of this repository is to keep …
By Linda Goldberg, February 2019 Linda Goldberg of the Federal Reserve of New York talks about her work with Signe Krogstrup on a combined exchange market pressure index, which they use to look at the importance of the global factor …
Matt Lowe, Chris Papageorgiou, Fidel Pérez Sebastián 20 February 2019 Capital doesn’t flow to developing countries as much as economic theory suggests it should, and this might imply that capital is misallocated across nations. This column argues that once public …
Thorsten Beck 04 February 2019 Thorsten Beck argues that recent actions by the Italian and German governments threaten to undermine progress made in the euro area towards a Single Market in Banking and, thus, a more sustainable currency union. Link: …
Friederike Niepmann, Tim Schmidt-Eisenlohr 06 February 2019 The issuance of syndicated loans, including leveraged loans, has grown substantially in the US. Institutional investors increasingly hold these loans. This column discusses how this has created a strong link between the dollar …
Call for Paper Asia–Pacific Journal of Financial Studies (AJFS) invites manuscripts for a special issue on“Advances in International Finance in Emerging Markets” and related issues, scheduled for publication in 2020. AJFS became the first finance journal published in Asia-Pacific region …
The European Central Bank (ECB) is seeking applications from leading researchers for the Wim Duisenberg Research Fellowship. Fellowships are awarded annually. Successful candidates will conduct economic research in the ECB’s Directorate General Research (DG/R) for a period of two to …
The European Systemic Risk Board (ESRB) is an EU body with a mission to prevent and mitigate systemic risks to financial stability. The ESRB is chaired by the President of the European Central Bank, Mario Draghi, and its membership incorporates …
Ashoka Mody, Milan Nedeljkovic 14 January 2019 The ECB’s actions in the wake of the Global Crisis have been described as hesitant, relative to other central banks. Based on analysis of financial markets’ response to the ECB’s interventions during the …
Mathias Hoffmann, Egor Maslov, Bent Sørensen, Iryna Stewen 10 January 2019 Bank-to-bank lending in the euro area has increased, direct cross-border lending has not. The column shows that dependence on domestic banks reduces risk-sharing in a crisis, reducing GDP growth …
Eugenio Cerutti, Catherine Koch and Swapan-Kumar Pradhan, BIS quarterly review, December 16, 2018 Emerging market economies (EMEs) have substantially increased their footprint in the global economy over recent decades. They now produce about 40% of global GDP at market exchange …
Blog entry by Thorsten Beck, December 6, 2018 This week, the Eurogroup (Ministers of Finance of all Eurozone countries) agreed on some reforms for the banking union and Eurozone governance. As always, it is two steps forward and one step …
November 20, 2018 The evaluation is among the first under the FSB framework for the post-implementation evaluation of the effects of the G20 financial regulatory reforms, and forms part of a broader FSB examination of the effects of reforms on …
Meghana Ayyagari, Thorsten Beck, Maria Soledad Martinez Peria 11 December 2018 Macroprudential tools have been implemented widely following the Global Crisis. Using data from 900,000 firms in 49 countries, this column finds that such policies are associated with lower credit …
João Granja, Christian Leuz, Raghuram Rajan 04 December 2018 Risk taking was pervasive during the Global Crisis even in the most unlikely areas, such as stretching to lend at a distance. Using US data, this column examines the degree to …
Tobias Adrian, John Kiff 01 December 2018 The financial system has undergone far-reaching changes since the 2008 Global Crisis. This column casts those changes in terms of shifts in the way financial intermediaries manage their balance sheets, and also discusses …
Daniel Calvo, Juan Carlos Crisanto, Stefan Hohl 23 November 2018. A well designed financial supervisory architecture is essential for the effective functioning of any financial system. Using a survey of 82 jurisdictions, this column describes the state of financial supervisory …
Deutsche Bundesbank released its Financial Stability Review 2018. Link: https://www.bundesbank.de/resource/blob/766586/f9d675a9f6a50562291589f7f3409f5a/mL/2018-finanzstabilitaetsbericht-data.pdf
Job Openings for Economists: The Faculty of Economics and Business Administration at the Friedrich Schiller University Jena and the Halle Institute for Economic Research (IWH) – Member of the Leibniz Association jointly seek qualified candidates to fill a position at …
The European Banking Authority (EBA) published the results of the 2018 EU-wide stress test. Link: https://www.eba.europa.eu/-/eba-publishes-2018-eu-wide-stress-test-results
A new release of the InterConnectedness Newsletter is available for download. Link: http://bankinglibrary.com/interconnectedness_issues/2018Q4Halloween.pdf
A new IMF release is available for download. Global Financial Stability Report October 2018: A Decade after the Global Financial Crisis: Are We Safer? Link: https://www.imf.org/en/Publications/GFSR/Issues/2018/09/25/Global-Financial-Stability-Report-October-2018
Eugenio Cerutti, Stijn Claessens, and Luc Laeven, 18 September 2018 The Global Crisis was a catalyst for the adoption of macroprudential policies around the world. Using newly updated data, this column examines the adoption of macroprudential policy instruments from 2000 …
Björn Richter, Moritz Schularick, and Ilhyock Shim 21 September 2018 Central banks have increasingly relied on macroprudential measures to manage the financial cycle, but their effects on the core objectives of monetary policy to stabilise output and inflation are largely …
Ester Faia, Sébastien Laffitte, and Gianmarco Ottaviano, 20 September 2018 There is a general consensus that lax monetary policy and banking globalisation were two critical factors behind the Global Crisis. This column explores how banks’ decisions to enter foreign markets …
Vincent Bouvatier, Gunther Capelle-Blancard, Anne-Laure Delatte, 11 September 2018 Tax havens are estimated to concentrate 8% of global private financial wealth, reducing annual global tax revenues by about $200 billion. This column uses new country-by-country regulatory data on the foreign …
Bert Smid, Beau Soederhuizen, Rutger Teulings on 29 August 2018: New VoxEU Column The transition to a banking union for the EMU The transition to a European banking union is not straightforward. A key issue is how to prioritise risk …
Signe Krogstrup and Cédric Tille 29 August 2018: How global factors affect banks’ foreign currency funding: It depends on the exposure Volatility in international capital flows can disrupt international trade and finance. This column explores the role of agents’ exposure …
Bolton, P., and M. Oehmke (2018): Bank resolution and the structure of global banks. When banks are too big to fail, resolution frameworks for are hobbled by the mismatch between their global nature and the national scope of regulators. This …
European bank mergers: Domestic and cross-border. The European economy is recovering, and banks are thinking once more about mergers. This column demonstrates that, while cross-border mergers have been predicted before, most European bank mergers have consistently been domestic. Regulatory hurdles …
Database of Macroprudential Measures in the EU/EEA These macroprudential measures include those taken under Articles 124 and 164 of the Capital Requirements Regulation (CRR) to target systemic risks in the real estate sector, and macroprudential measures that are not harmonised …
ECB Macroprudential Database (MPDB) The Macroprudential Database (MPDB) is a comprehensive and harmonised dataset of indicators covering various sub-categories of indicators judged relevant for macroprudential analysis. The database focuses on the indicators that can be used to explain and predict …
European financial crises database The database on financial crises in European countries is an important step towards establishing common ground for macroprudential oversight and policymaking in the EU. The database provides precise chronological definitions of crisis periods to support the …
Completing Europe’s Banking Union means breaking the bank-sovereign vicious circle. Several euro area leaders have recently referred to the need to “complete the Banking Union”. This column, part of VoxEU’s Euro Area Reform debate, asks what would be required for …
The Global Debt Database (GDD) is the result of a multiyear investigative process that started with the October 2016 Fiscal Monitor. The dataset comprises total gross debt of the (private and public) nonfinancial sector for an unbalanced panel of 190 …
As use of macroprudential policy tools is growing, the IMF has initiated an annual survey on macroprudential policy with its membership. The resulting new database provides information on policy measures taken by IMF member countries as well as on the …
Financial globalisation and bank lending: The limits of domestic monetary policy The effectiveness of monetary policy in dictating banking activities is one of the keys to understanding how efficient monetary policy is in tuning the real economy. This column uses …
The ECB’s annual report on financial integration in Europe contributes to the advancement of the European financial integration process by analysing its development and the related policies. For the ECB, the market for a given set of financial instruments and/or …
The Global Financial Stability Report provides an assessment of the global financial system and markets, and addresses emerging market financing in a global context. It focuses on current market conditions, highlighting systemic issues that could pose a risk to financial …
FSB launches survey on infrastructure financing as part of its efforts to evaluate the impact of G20 regulatory reforms. Link: http://www.fsb.org/2018/03/fsb-launches-survey-on-infrastructure-financing-as-part-of-its-efforts-to-evaluate-the-impact-of-g20-regulatory-reforms/
The Macroprudential Policies Evaluation Database (MaPPED) provides details of macroprudential (or similar) policy actions taken in the European Union since 1995. MaPPED has been created to support the empirical assessment of the impact of macroprudential policies. Link: https://www.ecb.europa.eu/pub/research/working-papers/html/mapped.en.html
A new release of the interconnectedness newsletter is available for download. Download here: http://www.bankinglibrary.com/e/fdz/intbanklib/interconnectedness/2018Q2.pdf
The economics of supranational bank supervision. International cooperation on bank supervision is still rare. This column analyses data on supervisory cooperation among a global sample of countries between 1995 and 2013 to show that cooperation among bank supervisors is not …
The Chinese banking system: Much more than a domestic giant. Chinese banks have continued to expand rapidly both domestically and abroad. Together, they constitute the largest banking sector in the world by far. This column places the Chinese banking system …
