Low Interest Rates and Banks’ Profitability – Update October 2020

Low Interest Rates and Banks’ Profitability – Update October 2020

My last post on this topic was in May 2019.

Research continues on this important topic. What are the effects of Monetary policy on Financial Institution?

Please see my previous posts to find the issues. In this post I have compiled papers and articles published since my last post in 2019.

Rational Decision making by the firms
  • Lend More – When margins decline, the volumes must go up to maintain or increase profits. This increases risk taking.
  • Diversify – Look for other sources of earnings
  • Consolidate – Merge with other banks as a business strategy to grow loan volumes.

How do banks make money? What is source of their income? How much is Net interest income? How much is Non Interest Income?

As you can see from the graphs below, Net interest income of banks is going up. Although the net interest margins are down, Banks are earning their income mostly from net interest income.

Volumes of Outstanding loans must be going up to make up for decrease in margins.

Sources of interest income can be

  • Commercial loans
  • Real Estate loans
  • Auto Loans
  • Credit cards
  • Student Loans

Additionally consolidation among the banks can be partially explained by the decling number of banks. See graph below.

Diversification to find other sources of earnings.

Image Source: FRED

Image Source: FRED

Image Source: Statista

Image Source: Liberty Street Economics 2017

Image Source: FRED

Image Source: FRED
Net Interest Income for Commercial Banks in United States

Image Source: FRED
Bank Credit, All Commercial Banks (TOTBKCR)

Image Source: FRED
Loans and Leases in Bank Credit, All Commercial Banks (TOTLL)

Image Source: FRED
Commercial and Industrial Loans, All Commercial Banks (BUSLOANS)

Image Source: FRED

Image Source: FRED
Consumer Loans, All Commercial Banks (CONSUMER)

Image Source: FRED

Key Terms

  • Net Interest Margin
  • Profitability
  • Interest Income
  • Non Interest Income
  • Monetary Policy
  • Fed Funds Rate
  • 10 Year T Bond’s Rate
  • Shadow Banking
  • Search for Yield
  • Risk Taking
  • Housing Loans
  • Auto Loan
  • Deposits
  • Credit Cards
  • Money Markets Mutual Funds
  • Money Markets
  • Capital Markets
  • International Capital Flows
  • Diversification
  • Mergers
  • To Big to Fail
  • Non Core Business

My Related Posts

Low Interest Rates and Bank’s Profitability – Update May 2019

Low Interest Rates and Banks’ Profitability : Update July 2017

Low Interest Rates and Banks Profitability: Update – December 2016

Impact of Low Interest Rates on Bank’s Profitability

Non Interest Income of Banks: Diversification and Consolidation

Evolution of Banks Complexity

Shadow Banking

Funding Strategies of Banks

Low Interest Rates and Risk taking channel of Monetary Policy

Low Interest Rates and International Investment Position of USA

Low Interest Rates and International Capital Flows

Key Sources of Research

Bank profitability and risk‐taking under low interest rates

Jacob A. Bikker1,2 | Tobias M. Vervliet3


How banks can ease the pain of negative interest rates

March 3, 2020 | Article


Bank intermediation when interest rates are very low for long 

Michael Brei, Claudio Borio, Leonardo Gambacorta  

07 February 2020


Implications of negative interest rates for the net interest margin and lending of euro area banks

by Melanie Klein

Monetary and Economic Department 

March 2020

Are Banks Exposed to Interest Rate Risk?

Pascal Paul and Simon W. Zhu

2020-16 | June 22, 2020 | Research from Federal Reserve Bank of San Francisco

Negative rates and the transmission of monetary policy

Prepared by Miguel Boucinha and Lorenzo Burlon[1]

Published as part of the ECB Economic Bulletin, Issue 3/2020.


Is there a zero lower bound?
The effects of negative policy rates on banks and firms

Revised June 2020

The impact of very low interest rates on bank profitability


Bank intermediation activity in a low interest rate environment

by Michael Brei, Claudio Borio and Leonardo Gambacorta

Monetary and Economic Department August 2019

Do Negative Interest Rates Explain Low Profitability of European Banks?1

Nicholas Coleman* and Viktors Stebunovs*


Monetary Policy and Bank Equity Values in a Time of Low and Negative Interest Rates1

Miguel Ampudia2 and Skander J. Van den Heuvel3 May 2019

Negative Interest Rates, Bank Profitability and Risk-taking

Whelsy Boungou


Monetary Policy and Bank Profitability in a Low Interest Rate Environment: A Follow-up and a Rejoinder

By Charles Goodhart and Ali Kabiri

Monetary Policy and Bank Profitability in a Low Interest Rate Environment

Carlo Altavilla, Miguel Boucinha and José-Luis Peydró

Barcelona GSE Working Paper: 1101 | May 2019


Going Negative at the Zero Lower Bound: The Effects of Negative Nominal Interest Rates

Mauricio Ulate Campos Federal Reserve Bank of San Francisco

September 2019


Gauti B. Eggertsson Ragnar E. Juelsrud Lawrence H. Summers Ella Getz Wold

Working Paper 25416

Implications of negative interest rates for the net interest margin and lending of euro area banks

Melanie Klein

Negative Nominal Interest Rates: A Primer


Trends in the Noninterest Income of Banks

Joseph G. Haubrich and Tristan Young


Negative interest rates in the euro area: does it hurt banks?


Interest rate pass-through in the low interest rate environment

Average net interest margin of banks in the United States from 1995 to 2019


Effective Federal Funds Rate (FEDFUNDS)



How low interest rates can hurt competition, and the economy

They help big companies more than small ones, depressing investment and productivity


Monetary Policy Report

June 12, 2020

Federal Reserve

The Long Decline of Global Interest Rates

Posted On :  Published By : BER staff


Markets in the Time of COVID-19

Chapter 4

April 2020



Low Interest Rates and Bank Profits

Katherine Di Lucido, Anna Kovner, and Samantha Zeller

Liberty Street Economics



Bank’s Non-Interest Income to Total Income for United States (DDEI03USA156NWDB)


Net Interest Income for Commercial Banks in United States

Net Interest Margin for all U.S. Banks (USNIM)


Commercial Banks in the U.S. (USNUM)


Loans and Leases in Bank Credit, All Commercial Banks (TOTLL)


Bank Credit, All Commercial Banks (TOTBKCR)


Commercial and Industrial Loans, All Commercial Banks (BUSLOANS)


Consumer Credit


Real Estate Loans, All Commercial Banks (REALLN)


Consumer Loans, All Commercial Banks (CONSUMER)


Low Interest Rates and Business Investments – Update October 2020

Low Interest Rates and Business Investments – Update October 2020

There has been several new research on the topic of Low Interest Rates and Business Investments since my last post.

Decision Making by Firms in Low Interest rates environment

  • Invest and Grow
  • Merge / Consolidate
  • Pay Dividends
  • Buyback Shares
  • Divestures
  • Acquisitions
  • Horizontal Mergers (Market Share)
  • Vertical Mergers (Costs)
  • Innovation M&A (New Tech, New Product)

Key Terms

  • Business Investments
  • Monetary Polcy
  • Zero Lower Bound
  • Interest Rates
  • Fed Funds Rate
  • Corporate Finance
  • Hurdle Rates
  • Capital Budgeting
  • Internal Rate of Return IRR
  • CAGR Compond Annual Growth Rate
  • Cost of Capital
  • Discounted Cash Flow
  • Net Present Value
  • Mergers vs Investments
  • Organic Growth
  • Inorganic Growth
  • State of the Industry
  • State of the Economy
  • Liquidity Financial
  • Bank Lending
  • Capital Markets
  • Economic Growth
  • Corporate Planning
  • Strategic Planning
  • Strategic Management

My Related Posts

Increasing Market Concentration in USA: Update April 2019

Rising Market Concentration and Declining Business Investments in the USA – Update June 2018

Low Interest Rates and Business Investments : Update August 2017

Business Investments and Low Interest Rates

Cash and Investments: Corporate Savings Glut in USA

Low Interest Rates and Monetary Policy Effectiveness

Low Interest Rates and Risk taking channel of Monetary Policy

Low Interest Rates and International Investment Position of USA

Low Interest Rates and Bank’s Profitability – Update May 2019

Low Interest Rates and Banks’ Profitability : Update July 2017

Low Interest Rates and Banks Profitability: Update – December 2016

Impact of Low Interest Rates on Bank’s Profitability

The Decline in Long Term Real Interest Rates

Cash and Investments: Corporate Savings Glut in USA

Why do Firms buyback their Shares? Causes and Consequences.

Short term Thinking in Investment Decisions of Businesses and Financial Markets

Key Sources of Reserach

Lengthy era of rock-bottom interest rates leaving its mark on U.S. economy

Weak demand in U.S. and other rich nations explains historic shift

Washington Post


Do Interest Rates Affect Business Investment? Evidence from Australian Company-level Data

Jonathan Hambur and Gianni La Cava

Low Interest Rates Have Benefits … and Costs

Kevin L. Kliesen

October 1, 2010


Low for Long?
Causes and Consequences of Persistently Low Interest Rates

Geneva Reports on the World Economy 17 Charles Bean

London School of Economics and CEPR

Christian Broda

Duquesne Capital Management

Takatoshi Ito

SIPA Columbia University and CEPR

Randall Kroszner

Booth School of Business, University of Chicago


Low Interest Rates, Market Power, and Productivity Growth∗

Ernest Liu

Princeton University

Atif Mian
Princeton University and NBER

Amir Sufi
University of Chicago Booth School of Business and NBER

August 18, 2020

The Economic Effects of Low Interest Rates and Unconventional Monetary Policy

17 September 2020

Rochelle Guttmann, Dana Lawson and Peter Rickards



Firms’ Investment Decisions and Interest Rates

Kevin Lane and Tom Rosewall


Has Business Fixed Investment Really Been Unusually Low?

By François Gourio

Chicago Fed Letter, No. 418, 2019


Fiscal Policy with High Debt and Low Interest Rates

William Gale

July 1, 2019

The impact of negative interest rates on banks and firms 

Carlo Altavilla, Lorenzo Burlon, Mariassunta Giannetti, Sarah Holton  

08 November 2019


Global Trends in Interest Rates

Marco Del Negro Domenico Giannone Marc P. Giannoni Andrea Tambalotti

Staff Report No. 866 September 2018

Financial stability implications of a prolonged period of low interest rates

Report submitted by a Working Group established by the Committee on the Global Financial System

The Group was co-chaired by Ulrich Bindseil (European Central Bank) and Steven B Kamin (Board of Governors of the Federal Reserve System)

July 2018


Eight centuries of global real interest rates, R-G, and the ‘suprasecular’ decline, 1311-2018.

Paul Schmelzing


Low Interest Rates and Risk Taking: Evidence from Individual Investment Decisions

Review of Financial Studies

49 Pages Posted: 14 Jul 2016 Last revised: 29 Aug 2018

Chen Lian

Massachusetts Institute of Technology (MIT)

Yueran Ma

University of Chicago – Booth School of Business

Carmen Wang

Harvard University – Department of Economics; HBS Negotiations, Organizations and Markets Unit

Date Written: August 22, 2018



James Cloyne Clodomiro Ferreira Maren Froemel Paolo Surico

Determinants of the real interest rate

Remarks by Philip R. Lane, Member of the Executive Board of the ECB, at the National Treasury Management Agency

Dublin, 28 November 2019


Understanding Weak Capital Investment: the Role of Market Concentration and Intangibles∗

Nicolas Crouzet and Janice Eberly

Prepared for the Jackson Hole Economic Policy Symposium Federal Reserve Bank of Kansas City

August 23 – 25, 2018 This version: May 14, 2019

Monetary policy in advanced economies

Low policy rates are here to stay


Have low interest rates led to excessive risk taking?


The Policy Perils of Low Interest Rates

The consequences of prolonged low interest rates in Europe


The Dollar Shortage, Again! in International Wholesale Money Markets

The Dollar Shortage, Again! in International Wholesale Money Markets


During the 2008-2009 global financial crisis, There were many European Banks which got into trouble due to shortage of US Dollar funding in the whole sale international interbank market.  US Federal Reserve eventually extended currency swaps to ECB and other central banks to ease the pressure.

Is it happening now?  There is no banking crisis but there seems to be Dollar Shortage.


Foreign Exposure of European Banks

Liquidity Constraints in Global Money Markets (International Interbank Market)

  • Eurodollar Market

Non US Borrowers got funding from FX Market

  • FX Swap
  • Currency Swap

and Non Bank Sources (Shadow Banking)

  • MMMF
  • ABCP


Funding and liquidity management

Funding can be defined as the sourcing of liabilities. Funding decisions are usually, but not exclusively, taken in view of actual or planned changes in a financial institution’s assets. The funding strategy sets out how a bank intends to remain fully funded at the minimum cost consistent with its risk appetite. Such a strategy must balance cost efficiency and stability. A strategy which targets a broader funding base may entail higher operating and funding costs, but through diversity provides more stable, reliable funding. One which focuses efforts on generating home currency funding may prove more reliable in adverse times but entail higher costs in normal markets. The balance of cost and benefit will reflect a range of factors (see Section 3). Accordingly, funding risk essentially refers to a bank’s (in-)ability to raise funds in the desired currencies on an ongoing basis. Liquidity management is the management of cash flows across an institution’s balance sheet (and possibly across counterparties and locations). It involves the control of maturity/currency mismatches and the management of liquid asset holdings. A bank’s liquidity management strategy sets out limits on such mismatches and the level of liquid assets to be retained to ensure that the bank remains able to meet funding obligations with immediacy across currencies and locations, while still reflecting the bank’s preferred balance of costs (eg of acquiring term liabilities or holding low-yielding liquid assets) and risks (associated with running large maturity or currency mismatches). Accordingly, liquidity risk refers to a bank’s (in-)ability to raise sufficient funds in the right currency and location to finance cash outflows at any given point in time. Funding and liquidity management are interrelated. Virtually every transaction has implications for a bank’s funding needs and, more immediately, for its liquidity management. The maturity transformation role of banks renders them intrinsically vulnerable to both institution-specific and market-related cash flow risks. The likelihood of an unexpected cash-flow shock occurring, and a bank’s ability to cope with it, will reflect not only the adequacy of its funding and liquidity management strategies, but also their coherence under stressed conditions. A bank’s funding strategy will condition liquidity management needs. Hence, the risks embedded in the chosen funding strategy will translate into risks that liquidity management will have to address. Failure to properly manage funding risk may suddenly manifest itself as a liquidity problem, should those sources withdraw funding at short notice. Conversely, inadequate liquidity risk management may place unmanageable strains on a bank’s funding strategy by requiring very large amounts of funding to be raised at short notice.


From The Global Financial Crisis and Offshore Dollar Markets

The Global Shortage of U.S. Dollars

International firms need U.S. dollars to fund their investments in U.S.-dollar-denominated assets, such as retail and corporate loans as well as securities holdings. The funding for these investments is typically obtained from a variety of sources: the unsecured cash markets, the FX swap market, and other shortterm wholesale funding markets.

During the financial crisis, a global shortage of dollars occurred, primarily reflecting the funding needs of European banks. Baba, McCauley, and Ramaswamy (2009) show that European banks had substantially increased their U.S. dollar asset positions from about $2 trillion in 1999 to more than $8 trillion by mid-2007. Until the onset of the crisis, these banks had met their funding requirements mainly by borrowing from the unsecured cash and commercial paper markets and by using FX swaps. Unfortunately, most unsecured funding sources eroded during the crisis. For example, U.S. money market funds abruptly stopped purchasing bank-issued commercial paper after they faced large redemptions associated with the bankruptcy of Lehman Brothers (Baba, McCauley, and Ramaswamy 2009). The reduced availability of dollars resulted in higher dollar funding costs.

The remainder of this article describes the increase in dollar funding costs as reflected in the FX swap market, the primary market enabling global financial institutions to manage multi- currency funding exposures without assuming the credit risk inherent in unsecured funding markets. As liquidity in major unsecured lending markets eroded, the demand for dollar funding through FX swap markets intensified sharply and pushed up the cost of raising dollars through FX swaps. Moreover, heightened demand for dollar funding in conjunction with a reduced willingness to lend dollars noticeably impaired the functioning of the FX swap market, particularly as term liquidity dried up.


Measures of Liquidity Tightening

  • LIBOR-OIS Spread
  • FX Swap implied basis spread


Two Measures

Two measures are used to show the increased cost of dollar funds in private markets during the crisis.

  • The first is the spread between the London interbank offered rate (Libor) and the overnight index swap (OIS) rate.
  • The second measure is the foreign exchange (FX) swap implied basis spread, which reflects the cost of funding dollar positions by borrowing foreign currency and converting it into dollars through an FX swap.






What are the Money Markets

Wholesale money markets

  • Unsecured cash term deposits and loans
  • Money market calculations and conventions
  • Benchmark rates and their determination
  • Libor
  • Euribor
  • Overnight indexed rates such as Eonia and Sonia
  • Treasury bills (a first look at risk-free)
  • Commercial Paper – CP credit ratings
  • Secured money market loans – sale and repurchase agreements (Repos)


Money market derivatives

  • Short term interest rate futures (STIRs): Eurodollar, Short Sterling and Euribor futures
  • Forward rate agreements
  • Interest rate swaps
  • Overnight index swaps (OIS): Sonia and Eonia swaps
  • Monetary policy and the money markets

How a central bank uses money markets to transmit its interest rate intentions.



OTC US Dollar Money Markets:  Sources of short term Funding

A.  Fed Funds Market (Domestic)

B.  Interbank Money Market

  • Cash Market
  • Market for Short Term Securities
  • Market for Derivatives

Cash Market

  • Unsecured – Eurodollar
  • Secured – REPO
  • Secured (Collateralized markets) – FX Swap Market

Short Term Securities Market

  • T-Bills
  • Commercial Paper
  • Certificate of Deposits

Derivatives Market

  • Interest Rates Swaps



Money Markets in EU

In the unsecured market, activity is concentrated on the overnight maturity segment. The reference rate in this segment is the Eonia (Euro Overnight Index Average). It is a market index computed as the weighted average of overnight unsecured lending transactions undertaken by a representative panel of banks. The same panel banks contributing to the Eonia also quote for the Euribor (Euro Interbank Offered Rate). The Euribor is the rate at which euro interbank term deposits are offered by one prime bank to another prime bank. This is the reference rate for maturities of one, two and three weeks and for twelve maturities from one to twelve months.11

The market for short term securities includes government securities (Treasury bills) and private securities (mainly commercial paper and bank certificates of deposits).

In the market for derivatives, typically interest rate swaps and futures are traded.


Is it happening again?

Policy Decisions such as

  • Rising Interest Rates
  • Stronger Dollar
  • Repatriation of Corporate profits from Europe
  • Unwillingness to extend of CB Swap Lines

can cause liquidity crisis which show up in

  • LIBOR rate
  • Eurodollar rate
  • OIS Rate
  • CIP breakdown


Breakdown of CIP – Then and Now




A brief history of the three key periods of global USD-funding shortfalls:

  • The first episode immediately after the Lehman bankruptcy coincided with a US banking crisis that quickly became a global banking crisis via cross border linkages. Financial globalization meant that Japanese banks had accumulated a large amount of dollar assets during the 1980s and 1990s. Similarly European banks accumulating a large amount of dollar assets during 2000s created structural US dollar funding needs. The Lehman crisis made both European and Japanese banks less creditworthy in dollar funding markets and they had to pay a premium to convert euro or yen funding into dollar funding as they were unable to access dollar funding markets directly.
  • The second episode of very negative dollar basis took place during the Euro debt crisis. The sovereign crisis created a banking crisis making Euro area banks less worthy from a counterparty/credit risk point of view in dollar funding markets. As dollar funding markets including fx swap markets dried up, these funding needs took the form of an acute dollar shortage. European banks and companies that had dollar assets to fund had to pay a hefty premium in fx swap markets to convert their euro funding into dollar funding. Those European banks and companies that were unable to do so, were forced to liquidate dollar assets such as dollar denominated bonds and loans to reduce their need for dollar funding
  • The third phase of very negative dollar basis started at the end of last year. Monetary policy divergence has for sure played a role during the end of 2014 and the beginning of this year. The ECB’s and BoJ’s QE has created an imbalance between supply and demand across funding markets. Funding conditions have become a lot easier outside the US with QE-driven liquidity injections raising the supply of euro and yen funding vs. dollar funding. This divergence manifested itself as one-sided order flow in cross currency swap markets causing a decline in the basis. And we did see these funding imbalances in cross border corporate issuance.


Emergent and Related Issues:

  • Global Liquidity
  • Offshore Dollar Money Markets
  • Eurodollar Market
  • International Lender of Last Resort
  • FX Swaps and Currency Swaps Market
  • Cross border funding
  • International Interbank Market
  • Shadow Banking – MMMF, ABCP,
  • Covered Interest Parity (CIP) Breakdown
  • Wholesale Funding Market
  • Global Credit
  • Credit Markets
  • Impact of Global Liquidity on Global Trade
  • Credit Networks of Global Banks
  • International Investment Positions of Banks
  • Derisking by global banks
  • Decline in Correspondent Banking
  • Shortage of Trade Finance


Why has Global Trade dropped so precipitously since 2014?

Is it because of shortage of US Dollars?





Key Sources of Research:


“This Is An Extremely Serious Problem” – Dollar Funding Shortage Hits Record In Japan





Global Dollar Shortage Intensifies To Worst Level Since 2012





Dollar Illiquidity Getting Critical: A $10 Trillion Short Which The Fed Does Not Understand





The VIX Is Dead: According To The BIS, This Is The New “Fear Indicator”





New ICC survey finds worsening global shortage of trade finance





A ‘dollar shortage’ has returned. This is why





Dollar shortage *alert* (plus global trade *alert*)





As goes correspondent banking, so goes globalisation





How do you solve a problem like de-globalisation?





On the ongoing demise of globalisation





Textbook defying global dollar shortages





The Coming Dollar Shortage




Dollar Shortage Goes Mainstream: When Will The Fed Confess?





The Global Dollar Funding Shortage Is Back With A Vengeance And “This Time It’s Different”





The US dollar has been on a tear, and that will spell bad news for the rest of the world




There is a war for capital coming, says UBS





The eurodollar as an economic no-man’s land






Eurodollars, China, TIC data + mysteries





Petrodollars are eurodollars, and eurodollar base money is shrinking





All about the eurodollars





A global reserve requirement for all those eurodollars





On the availability of dollar funding





The dollar shortage problem, evaluated





All about the eurodollars, redux





BIS says we should follow the money





Eurodollars, FX reserve managers and the offshore RRP issue





The BoE as eurodollar dealer of last resort?





FT:  The Eurodollar Market: It All Starts Here





From turmoil to crisis: dislocations in the FX swap market before and after the failure of Lehman Brothers

N Baba




Dollar Funding and Global Banks

Jeremy C. Stein



Click to access stein20121217a.pdf



The US dollar shortage in global banking and the international policy response

by Patrick McGuire and Götz von Peter

October 2009


Click to access work291.pdf



The US dollar shortage in global banking


Patrick McGuire Goetz von Peter


Click to access treasury_1196.pdf




Emergent International Liquidity Agreements: Central Bank Cooperation after the Global Financial Crisis

Daniel McDowell


Click to access mcdowell_eln.pdf



The Financial Crisis through the Lens of Foreign Exchange Swap Markets

Crystal Ossolinski and Andrew Zurawski



Click to access bu-0610-7.pdf



The spillover of money market turbulence to FX swap and cross-currency swap markets

N Baba



Click to access r_qt0803h.pdf



Liquidity Shocks, Dollar Funding Costs, and the Bank Lending Channel During the European Sovereign Crisis

Ricardo Correa, Horacio Sapriza, and Andrei Zlate



Click to access ifdp1059.pdf




John L. Simpson


Click to access 00463515e5285b6a85000000.pdf



Systemic risk in the major Eurobanking markets: Evidence from inter-bank offered rates

J.L. Simpson, J.P. Evans



Click to access jou2-2.pdf



The Eurocurrency interbank market: potential for international crises?.

Saunders, Anthony.

Business Review (1988): 17-27.



The Great Liquidity Freeze: What Does It Mean for International Banking?

Dietrich Domanski and Philip Turner

June 2011


Click to access adbi-wp291.pdf



The Euro-dollar market as a source of United States bank liquidity

Steve B. Steib





The LIBOR Eclipse: Political Economy of a Benchmark

Alexis Stenfors1 and Duncan Lindo

January 2016

Click to access RMF-47_Stenfors-Lindo.pdf



Basics of U.S. Money Markets



Click to access 05.10.2016-moneymarkets-9.15am.pdf



Implementing Monetary Policy – Short-term Money Markets Monitoring



Click to access 09.29.2015-mmarketsv2-1.30pm.pdf



The Dollar Squeeze of the Financial Crisis

Jean-Marc Bottazzia Jaime Luqueb

Mario R. Pascoac Suresh Sundaresand


Click to access 6611902.pdf



Central Bank Dollar Swap Lines and Overseas Dollar Funding Costs





The Global Financial Crisis and Offshore Dollar Markets

Niall Coffey, Warren B. Hrung, Hoai-Luu Nguyen, and Asani Sarkar







When and how US dollar shortages evolved into the full crisis?: Evidence from the cross-currency swap market

Naohiko Baba* and Yuji Sakurai†


Click to access sem_paper_0_349_naohiko-baba.pdf





Funding patterns and liquidity management of internationally active banks





The functioning and resilience of cross-border funding markets



Click to access cgfs37.pdf




The Impact of the Financial Crisis on Cross-Border Funding

Yaz Terajima, Harri Vikstedt, and Jonathan Witme



Click to access fsr-0610-terajima.pdf



Financial Crises and Risk Premiums in International Interbank Markets 

Shin-ichi Fukuda

Mariko Tanaka


Click to access ppr020f.pdf



Dollar Funding and the Lending Behavior of Global Banks

Victoria Ivashina

David S. Scharfstein

Jeremy C. Stein

October 2012

Click to access dollar_funding_october_2012_final.pdf



Financial crises and bank funding: recent experience in the euro area

by Adrian van Rixtel and Gabriele Gasperini

March 2013


Click to access work406.pdf



The Financial Crisis and Money Markets in Emerging Asia

Robert Rigg and Lotte Schou-Zibell

No. 38 | November 2009


Click to access wp38-financial-crisis-money-markets.pdf



Money Market Integration

Leonardo Bartolini Spence Hilton Alessandro Prati


Click to access sr227.pdf



Segmentation in the U.S. Dollar Money Markets During the Financial Crisis

James J. McAndrews

May 19, 2009


Click to access Session2.pdf



Re-thinking the lender of last resort

September 2014


Click to access bispap79.pdf



Towards an International Lender of Last Resort

Stephen G. Cecchetti

September 2014




Global Liquidity: Public and Private

Jean-Pierre Landau



The Global Dollar System

Stephen G Cecchetti

Click to access Polp61.pdf



US dollar money market funds and non-US banks

Naohiko Baba Robert N McCauley Srichander Ramaswamy



Click to access r_qt0903g.pdf



Improving the Resilience of Core Funding Markets


Bank of Canada

Jean-Sébastien Fontaine, Jack Selody, and Carolyn Wilkins



How do Global Banks Scramble for Liquidity? Evidence from the Asset- Backed Commercial Paper Freeze of 2007*

by Viral V. Acharya Gara Afonso Anna Kovner

October 24, 2012



The Financial Crisis and Money Markets in Emerging Asia

Robert Rigg and Lotte Schou-Zibell

No. 38 | November 2009



Regulatory Reforms and the Dollar Funding of Global Banks:

Evidence from the Impact of Monetary Policy Divergence

Tomoyuki Iida

Takeshi Kimura

Nao Sudo



Click to access wp16e14.pdf



Monetary policy spillovers and currency networks in cross-border bank lending

by Stefan Avdjiev and Előd Takáts

March 2016


Click to access work549.pdf




Prepared by Cho-Hoi Hui, Hans Genberg and Tsz-Kin Chung



Click to access HKMAWP09_13_full.pdf



Deviations from Covered Interest Rate Parity

Wenxin Du  Alexander Tepper  Adrien Verdelhan

January 1, 2016




Limits to Arbitrage and Deviations from Covered Interest Rate Parity

James Pinnington1 and Maral Shamloo

Click to access sdp2016-4.pdf



Capital Constraints, Counterparty Risk, and Deviations from Covered Interest Rate Parity

Niall Coffey Warren B. Hrung Asani Sarkar

September 2009

Click to access sr393.pdf



Covered interest parity lost: understanding the cross-currency basis

Claudio Borio Robert McCauley Patrick McGuire Vladyslav Sushko


Click to access r_qt1609e.pdf



Bye-bye covered interest parity

Claudio Borio, Robert McCauley, Patrick McGuire, Vladyslav Sushko

28 September 2016