Cross-Border Financial Surveillance: A Network Perspective

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Author/Editor: Marco Espinosa-Vega, Juan Sole
Release Date: © April, 2010
ISBN : 978-1-45520-064-1
Stock #: WPIEA2010105
Stock Status: Available

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Effective cross-border financial surveillance requires the monitoring of direct and indirect systemic linkages. This paper illustrates how network analysis could make a significant contribution in this regard by simulating different credit and funding shocks to the banking systems of a number of selected countries. After that, we show that the inclusion of risk transfers could modify the risk profile of entire financial systems, and thus an enriched simulation algorithm able to account for risk transfers is proposed. Finally, we discuss how some of the limitations of our simulations are a reflection of existing information and data gaps, and thus view these shortcomings as a call to improve the collection and analysis of data on cross-border financial exposures.


Financial crisis , International financial system

More publications in this series: Working Papers

More publications by: Marco Espinosa-Vega ; Juan Sole