Global banks and international shock transmission
Subtitle: evidence from the crisis
By: Nicola Cetorelli, Linda S. Goldberg
Contributors: Goldberg, Linda S.; National Bureau of Economic Research
Series: NBER working paper series -- working paper 15974; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 15974.
Publisher: National Bureau of Economic Research
Published: 2010
Place of publication: Cambridge, MA
Language: eng
Format: [electronic resource] :
Description: "Global banks played a significant role in the transmission of the 2007 to 2009 crisis to emerging market economies.  We examine the relationships between adverse liquidity shocks on main developed-country banking systems to emerging markets across Europe, Asia, and Latin America, isolating loan supply from loan demand effects.  Loan supply in emerging markets was significantly affected through three separate channels: a contraction in direct, cross-border lending by foreign banks; a contraction in local lending by foreign banks' affiliates in emerging markets; and a contraction in loan supply by domestic banks resulting from the funding shock to their balance sheet induced by the decline in interbank, cross-border lending.  Policy interventions, such as the Vienna Initiative introduced in Europe, influenced the lending channel effects on emerging markets of head office balance sheet shocks"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 5/20/2010.

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