Exogenous Shocks, Deposit Runs and Bank Soundness: A Macroeconomic Framework
In a model where all banks are initially solvent, an exogenous shock affects confidence, causing a flight from deposits into domestic and foreign currency. Real interest rates increase unexpectedly, affecting firms and raising the share of the banks' nonperforming assets. This increase causes g...
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1. Verfasser: | |
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Format: | Elektronisch E-Book |
Sprache: | English |
Veröffentlicht: |
Washington, D.C
International Monetary Fund
1997
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Schriftenreihe: | IMF Working Papers
Working Paper No. 97/91 |
Online-Zugang: | UBW01 UEI01 LCO01 SBR01 UER01 SBG01 UBG01 FAN01 UBT01 FKE01 UBY01 UBA01 FLA01 UBM01 UPA01 UBR01 FHA01 FNU01 BSB01 TUM01 Volltext |
Zusammenfassung: | In a model where all banks are initially solvent, an exogenous shock affects confidence, causing a flight from deposits into domestic and foreign currency. Real interest rates increase unexpectedly, affecting firms and raising the share of the banks' nonperforming assets. This increase causes genuine solvency problems and accelerates the bank run. Policy simulations show that compensatory monetary policy (increasing currency supply when deposits fall) mitigates the bank run but causes inflation and external imbalances. Combining compensatory monetary policy with tight fiscal policies also slows the bank run and mitigates insolvency, but at a lower macroeconomic cost. A devaluation is shown to have little positive impact |
Beschreibung: | 1 Online-Ressource (31 p) |
ISBN: | 1451951736 9781451951738 |
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spelling | Bléjer, Mario I. Verfasser aut Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework Bléjer, Mario I Washington, D.C International Monetary Fund 1997 1 Online-Ressource (31 p) txt rdacontent c rdamedia cr rdacarrier IMF Working Papers Working Paper No. 97/91 In a model where all banks are initially solvent, an exogenous shock affects confidence, causing a flight from deposits into domestic and foreign currency. Real interest rates increase unexpectedly, affecting firms and raising the share of the banks' nonperforming assets. This increase causes genuine solvency problems and accelerates the bank run. Policy simulations show that compensatory monetary policy (increasing currency supply when deposits fall) mitigates the bank run but causes inflation and external imbalances. Combining compensatory monetary policy with tight fiscal policies also slows the bank run and mitigates insolvency, but at a lower macroeconomic cost. A devaluation is shown to have little positive impact Online-Ausg http://elibrary.imf.org/view/IMF001/02219-9781451951738/02219-9781451951738/02219-9781451951738.xml Verlag URL des Erstveröffentlichers Volltext |
spellingShingle | Bléjer, Mario I. Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework |
title | Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework |
title_auth | Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework |
title_exact_search | Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework |
title_exact_search_txtP | Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework |
title_full | Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework Bléjer, Mario I |
title_fullStr | Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework Bléjer, Mario I |
title_full_unstemmed | Exogenous Shocks, Deposit Runs and Bank Soundness A Macroeconomic Framework Bléjer, Mario I |
title_short | Exogenous Shocks, Deposit Runs and Bank Soundness |
title_sort | exogenous shocks deposit runs and bank soundness a macroeconomic framework |
title_sub | A Macroeconomic Framework |
url | http://elibrary.imf.org/view/IMF001/02219-9781451951738/02219-9781451951738/02219-9781451951738.xml |
work_keys_str_mv | AT blejermarioi exogenousshocksdepositrunsandbanksoundnessamacroeconomicframework |