At its core, a CFP is a crisis management tool. The tool should set out the strategies management expects to use to address liquidity shortfalls. The requirements of a CFP are addressed in the Interagency Policy Statement on Funding and Liquidity Risk Management. If you are facing mounting ...
The article reports on the decision of the Nigerian central bank to provide 200 billion naira to four banks facing serious liquidity crisis in August 2009 and dismissal of three of their chief executives. Over the past two months, a total of almost four billion U.S. dollars have been ...
1 Moreover, they also have higher liquidity per unit of assets (Berger et al., 2019). It follows from this discussion that IBs face different constraints and invest in different products from CBs, thereby facing different risks from CBs. Accordingly, it is not clear ex-ante whether they ...
Can banks maintain their advantage as liquidity providers when exposed to a financial crisis? While banks honored credit lines drawn by firms during the 2007 to 2009 crisis, this liquidity provision was only possible because of explicit, large support from the government and government-sponsored ...
Bankers will hate the idea of yet more capital buffers and rulemaking. But the gains from safety are vast. Depositors and taxpayers from Silicon Valley to Switzerland are facing a mighty scare. They should not have to live with the fear and fragility they thought had been consigned to history...
After controlling for bank-specific risk factors, we find that while the liquidity infusion has made the banks more safe, higher amounts of funds received appears to induce higher investments in non-interest income-related activities. Further analysis aimed at disentangling the effects of the ...
Bankers will hate the idea of yet more capital buffers and rulemaking. But the gains from safety are vast. Depositors and taxpayers from Silicon Valley to Switzerland are facing a mighty scare. They should not have to live with the fear and fragility they thought had been consigned to history...
We find that banks facing a funding squeeze sought to attract deposits by offering higher rates. Banks offering higher rates were also those most exposed to liquidity demand shocks (as measured by their unused commitments, wholesale funding dependence, and limited liquid assets), as well as with ...
MORA. "Are Banks Passive Liquidity Backstops? Deposit Rates and Flows during the 2007-2009 Crisis." NBER Working paper, 2012.Acharya, V. V., Mora, N., 2012. Are banks passive liquidity backstops? Deposit rates and flows during the 2007-2009 crisis. National Bureau of Economic Research, ...
given the economic downturn, the bank is cautious and only offers a smaller extension than what Acme Corp. had hoped for. Now, Acme Corp. is facing a liquidity risk—it has bills to pay,