Euro area macro-financial stability: a flow-of-funds perspective

The global financial crisis (as well as the European sovereign debt crisis) has led to a substantial redesign of rules and institutions – aiming in particular at underwriting financial stability. At the same time, the cr
The global financial crisis (as well as the European sovereign debt crisis) has led to a substantial redesign of rules and institutions – aiming in particular at underwriting financial stability. At the same time, the crisis generated a renewed interest in properly appraising systemic financial vulnerabilities. Employing most recent data and applying a variety of largely only recently developed methods we provide an assessment of indicators of financial stability within the Euro Area. Taking a “functional” approach, we analyze comprehensively all financial intermediary activities, regardless of the institutional roof – banks or non-bank (shadow) banks – under which they are conducted. Our results reveal a declining role of banks (and a commensurate increase in non-bank banking). These structural shifts (between institutions) are coincident with regulatory and supervisory reforms (implemented or firmly anticipated) as well as a non-standard monetary policy environment. They might, unintendedly, actually imply a rise in systemic risk. Overall, however, our analyses suggest that financial imbalances have been reduced over the course of recent years. Hence, the financial intermediation sector has become more resilient. Nonetheless, existing (equity) buffers would probably not suffice to face substantial volatility shocks.
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Metadaten
Author:Günter Beck, Hans-Helmut Kotz, Natalia Zabelina
URN:urn:nbn:de:hebis:30:3-390627
URL:http://safe-frankfurt.de/de/policy-center/publikationen/detailsview/publicationname/-568e4d79c4.html
Parent Title (English):SAFE white paper series, 29
Series (Serial Number):SAFE white paper series (29)
Publisher:SAFE, Sustainable Architecture for Finance in Europe
Place of publication:Frankfurt
Document Type:Working Paper
Language:English
Year of Completion:2015
Year of first Publication:2015
Publishing Institution:Universitätsbibliothek Johann Christian Senckenberg
Release Date:2016/01/12
Tag:bank and non-bank financial intermediation; financial regulation; financial stability; shadow banking; systemic risk
Edition:August 16, 2015
Pagenumber:46
HeBIS PPN:380860449
Institutes:Wirtschaftswissenschaften
House of Finance (HoF)
Center for Financial Studies (CFS)
Sustainable Architecture for Finance in Europe (SAFE)
Dewey Decimal Classification:330 Wirtschaft
Sammlungen:Universitätspublikationen
Licence (German):License Logo Veröffentlichungsvertrag für Publikationen

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