Banks In Distress

Author : Ms.Brenda Gonzalez-Hermosillo
Publisher : International Monetary Fund
Page : 115 pages
File Size : 44,7 Mb
Release : 1999-03-01
Category : Business & Economics
ISBN : 9781451845167

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Determinants of Ex-Ante Banking System Distress by Ms.Brenda Gonzalez-Hermosillo Pdf

This paper empirically analyzes the contribution of microeconomic and macroeconomic factors in five recent episodes of banking system problems in the U.S. Southwest (1986–92), Northeast (1991–92), and California (1992–93); Mexico (1994–95); and Colombia (1982–87). The paper finds that a low capital equity and reserve coverage of problem loans ratio is a leading indicator of bank distress, signaling a high likelihood of near-term failure. Distress is shown to be a function of the same fundamental macro-micro sources of risk that determine bank failures. Focusing on distress has the advantage that the fragility of the banking system can be assessed before a crisis actually occurs.

Author : N. Allen Berger
Publisher : World Bank Publications
Page : 52 pages
File Size : 49,6 Mb
Release : 1999
Category : Electronic
ISBN : 9789080401532

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The Ability of Banks to Lend to Informationally Opaque Small Businesses by N. Allen Berger Pdf

August 2001 Large and foreign-owned institutions may have difficulty extending relationship loans to informationally opaque small firms. Bank distress does not appear to affect small business lending, although even small firms may react to bank distress by borrowing from multiple banks. Consolidation of the banking industry is shifting assets into larger institutions that often operate in many nations. Large international financial institutions are geared toward serving large wholesale customers. How does this affect the banking system's ability to lend to informationally opaque small businesses? Berger, Klapper, and Udell test hypotheses about the effects of bank size, foreign ownership, and distress on lending to informationally opaque small firms, using a rich new data set on Argentinean banks, firms, and loans. They also test hypotheses about borrowing from a single bank versus borrowing from several banks. Their results suggest that large and foreign-owned institutions may have difficulty extending relationship loans to opaque small firms, especially if small businesses are delinquent in repaying their loans. Bank distress resulting from lax prudential supervision and regulation appears to have no greater effect on small borrowers than on large borrowers, although even small firms may react to bank distress by borrowing from multiple banks, despite raising borrowing costs and destroying some of the benefits of exclusive lending relationships. This paper--a product of Finance, Development Research Group--is part of a larger effort in the group to study small and medium size firm financing. The authors may be contacted at [email protected], [email protected], or [email protected].

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 34 pages
File Size : 42,5 Mb
Release : 1990-09-01
Category : Business & Economics
ISBN : 9781451954975

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Banks in Distress by International Monetary Fund Pdf

This paper describes the situation of bank distress which developed in Bangladesh since 1983-84. Since the key problem banks are state-owned, there has been no banking crisis, although costs to the economy have been high. Main causes of distress included preferential and directed lending, and administered interest rates. Inadequate supervision and managerial weaknesses were other contributory factors. Macroeconomic trends played a small role only. The authorities have recently taken major corrective measures. The paper calls for determination in the implementation of these measures to swiftly restore financial stability and limit the overall cost of this long-running distress situation.

Author : Mr.Martin Cihak,Mr.Tigran Poghosyan
Publisher : International Monetary Fund
Page : 39 pages
File Size : 43,7 Mb
Release : 2009-01-01
Category : Business & Economics
ISBN : 9781451871562

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Distress in European Banks by Mr.Martin Cihak,Mr.Tigran Poghosyan Pdf

The global financial crisis has highlighted the importance of early identification of weak banks: when problems are identified late, solutions are much more costly. Until recently, Europe has seen only a small number of outright bank failures, which made the estimation of early warning models for bank supervision very difficult. This paper presents a unique database of individual bank distress across the European Union from mid-1990s to 2008. Using this data set, we analyze the causes of banking distress in Europe. We identify a set of indicators and thresholds that can help to distinguish sound banks from those vulnerable to financial distress.

Author : Olivier Frécaut,Eric Sidgwick
Publisher : Unknown
Page : 28 pages
File Size : 54,7 Mb
Release : 1998
Category : Bank failures
ISBN : UCSD:31822026225128

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Systemic Banking Distress by Olivier Frécaut,Eric Sidgwick Pdf

Author : Ms.Enrica Detragiache,Mrs.Poonam Gupta,Asli Demirgüç-Kunt
Publisher : International Monetary Fund
Page : 28 pages
File Size : 49,5 Mb
Release : 2000-08-01
Category : Business & Economics
ISBN : 9781451857399

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Inside the Crisis by Ms.Enrica Detragiache,Mrs.Poonam Gupta,Asli Demirgüç-Kunt Pdf

Using aggregate and bank level data for several countries, the paper studies what happens to the banking system in the aftermath of a banking crisis. Contemporary crises are not accompanied by declines in aggregate bank deposits, and credit does not fall relative to output, although the growth of both deposits and credit slows down substantially. Output recovery begins in the second year after the crisis and is not led by a resumption in credit growth. Banks, including the stronger ones, reallocate their asset portfolio away from loans.

Author : Charles W. Calomiris,Joseph R. Mason
Publisher : Unknown
Page : 84 pages
File Size : 51,8 Mb
Release : 2000
Category : Bank failures
ISBN : IND:30000076412091

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Causes of U.S. Bank Distress During the Depression by Charles W. Calomiris,Joseph R. Mason Pdf

This paper provides the first comprehensive econometric analysis of the causes of bank distress during the Depression. We assemble bank-level data for virtually all Fed member banks, and combine those data with county-level, state-level, and national-level economic characteristics to capture cross-sectional and inter-temporal variation in the determinants of bank failure. We construct a model of bank survival duration using these fundamental determinants of bank failure as predictors, and investigate the adequacy of fundamentals for explaining bank failures during alleged episodes of nationwide or regional banking panics. We find that fundamentals explain most of the incidence of bank failure, and argue that contagion' or liquidity crises' were a relatively unimportant influence on bank failure risk prior to 1933. We construct upper-bound measures of the importance of contagion or liquidity crises. At the national level, we find that the first two banking crises identified by Friedman and Schwartz in 1930 and 1931 are not associated with positive unexplained residual failure risk, or with changes in the importance of liquidity measures for forecasting bank failures. The third banking crisis they identify is a more ambiguous case, but even if one views it as a bona fide national liquidity crisis, the size of the contagion effect could not have been very large. The last banking crisis they identify at the beginning of 1933 is associated with important, unexplained increases in bank failure risk. We also investigate the potential role of regional or local contagion and illiquidity crises for promoting bank failure and find some evidence in support of such effects, but these are of small importance in the aggregate. We also investigate the causes of bank distress measured as deposit contraction, using county-level measures of deposits of all commercial banks, and reach similar conclusions about the importance of fundamentals in determining deposit contraction.

Author : Asli Demirgüç-Kunt
Publisher : Unknown
Page : 27 pages
File Size : 55,9 Mb
Release : 2006
Category : Electronic
ISBN : OCLC:1291216651

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Inside the Crisis by Asli Demirgüç-Kunt Pdf

Using aggregate and bank level data for several countries, the paper studies what happens to the banking system in the aftermath of a banking crisis. Contemporary crises are not accompanied by declines in aggregate bank deposits, and credit does not fall relative to output, although the growth of both deposits and credit slows down substantially. Output recovery begins in the second year after the crisis and is not led by a resumption in credit growth. Banks, including the stronger ones, reallocate their asset portfolio away from loans.

Author : Mr.T. M. C. Asser
Publisher : International Monetary Fund
Page : 200 pages
File Size : 47,9 Mb
Release : 2001-04-18
Category : Business & Economics
ISBN : 1557759723

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Legal Aspects of Regulatory Treatment of Banks in Distress by Mr.T. M. C. Asser Pdf

This book analyzes and compares the laws of selected industrial countries that are representative of the different approaches to the treatment of banks in distress. It addresses only those banking and economic policy issues that are required for a proper understanding of the banking law or the legal strategies, procedures, and practices that have evolved in the treatment of banking problems. The book does not cover international aspects of bank insolvency, but rather has a domestic focus, given that bank regulation and supervision are still largely a national endeavor.

Author : Suman K. Bery,Valeriano F. García
Publisher : World Bank Publications
Page : 124 pages
File Size : 55,5 Mb
Release : 1997-01-01
Category : Business & Economics
ISBN : 0821338935

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Preventing Banking Sector Distress and Crises in Latin America by Suman K. Bery,Valeriano F. García Pdf

World Bank Technical Paper No. 361. Education has emerged as an essential component of the transition to a market economy in Central and Eastern Europe. Although the countries of the region inherited broadly accessible education systems, the legacies of central planning have constrained the systems from fully adjusting to market economies. This study examines empirical trends in access to and financing of education in nine Central and East European countries by drawing on the findings of a World Bank project that examined the social risks facing people and the policy responses taken by governments since 1989. Chapters address access and participation, the labor market, financing, and staff in the education sector.

Author : Anonim
Publisher : World Bank Publications
Page : 40 pages
File Size : 43,8 Mb
Release : 2005-05-01
Category : Business & Economics
ISBN : 8210379456XXX

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Cross-Country Empirical Studies of Systemic Bank Distress: A Survey by Anonim Pdf

A rapidly growing empirical literature is studying the causes and consequences of bank fragility in present-day economies. The paper reviews the two basic methodologies adopted in cross-country empirical studies-the signals approach and the multivariate probability model-and their application to studying the determinants of banking crises. The use of these models to provide early warnings for crises is also reviewed, as are studies of the economic effects of banking crises and of the policies to forestall them. The paper concludes by identifying directions for future research.

Author : Anonim
Publisher : Unknown
Page : 44 pages
File Size : 51,7 Mb
Release : 1988
Category : Bank examination
ISBN : IND:30000068284193

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Bank Failure by Anonim Pdf

Author : Anonim
Publisher : Unknown
Page : 594 pages
File Size : 43,6 Mb
Release : 1997
Category : Biography & Autobiography
ISBN : PURD:32754067907786

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History of the Eighties by Anonim Pdf

Author : G. Olson
Publisher : Springer
Page : 368 pages
File Size : 49,8 Mb
Release : 2000-08-17
Category : Law
ISBN : STANFORD:36105025267118

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Banks in Distress:Lessons from the American Experience of the 1980s by G. Olson Pdf

The close of the 20th century saw a remarkably high incidence of bank distress and insolvency. This book seeks to identify the causes of this ongoing financial crisis and to draw lessons for the future, with the aim of assisting developed, transition and emerging economies alike to better cope with future crises. Banks in Distress takes as its focus the major financial system crisis experienced by the US in the 1980s, reviewing the evolution of the US banking system and the legislative, regulatory, and monetary policies of the 1980s which set the stage for the crises that followed. The author argues that the financial difficulties in the US, and to some extent the rest of the world, were largely precipitated and exacerbated by government intervention into the American domestic economy through uncoordinated monetary and fiscal policy, as well as the uncoordinated enactment of regulatory, supervisory and enforcement legislation and policy. The book in particular examines the importance of asset valuation, asset value inflation and deflation, and capital adequacy for banking and financial services organizations, an understanding of which is crucial to the development of a coherent regulatory framework. The author considers what can be learned from the US experience and suggests the need for significant changes in the banking law and policy of most developed and emerging economies, arguing that a stable and workable financial system requires transparent, coordinated and proactive governmental policies in the banking, fiscal, monetary and national economic areas.

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 88 pages
File Size : 47,6 Mb
Release : 2014-12-22
Category : Business & Economics
ISBN : 9781498342438

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From Banking to Sovereign Stress - Implications For Public Debt by International Monetary Fund Pdf

This paper explores how banking sector developments and characteristics influence the propagation of risks from the banking sector to sovereign debt, including how they affect the extent of fiscal costs of banking crises when those occur. It then proposes practices and policies for the fiscal authorities to help manage the risks and enhance crisis preparedness.