TY  - UNPD
A1  - Casarin, Roberto
A1  - Costola, Michele
A1  - Yenerdag, Erdem
T1  - Financial bridges and network communities
T2  - SAFE working paper series ; No. 208
N2  - The paper analyses the contagion channels of the European financial system through the stochastic block model (SBM). The model groups homogeneous connectivity patterns among the financial institutions and describes the shock transmission mechanisms of the financial networks in a compact way. We analyse the global financial crisis and European sovereign debt crisis and show that the network exhibits a strong community structure with two main blocks acting as shock spreader and receiver, respectively. Moreover, we provide evidence of the prominent role played by insurances in the spread of systemic risk in both crises. Finally, we demonstrate that policy interventions focused on institutions with inter-community linkages (community bridges) are more effective than the ones based on the classical connectedness measures and represents consequently, a better early warning indicator in predicting future financial losses.
T3  - SAFE working paper - 208 
KW  - Systemic Risk
KW  - Financial Institutions
KW  - Network Communities
KW  - Financial Crises
Y1  - 2018
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/46674
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-466745
UR  - https://ssrn.com/abstract=3178053
IS  - This version: May 6, 2018
PB  - SAFE
CY  - Frankfurt am Main
ER  -