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Powerpoint Presentation
Powerpoint Presentation

... at fire sale losses and scramble for more capital (or for bailouts) even though the bank doesn’t have any actual liquidity problem. ...
à la russe
à la russe

Asian Banks in Trouble* C.P. Chandrasekhar
Asian Banks in Trouble* C.P. Chandrasekhar

... governing their financial sectors and easing monetary policy, both of which have increased the flexibility of the banking sector when making lending decisions. This provided the basis for an important commonality across the region: expansion-contraction or even boom-bust cycles in credit provision, ...
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... Claims on Central Bank consist of all deposits, required reserves and redeposits placed with the Central Bank and the holding of negotiable certificates of deposit issued by the Central Bank. In the absence of individual data, the shares and debt securities issued by financial corporations are all r ...
Asia-Pacific Outreach Meeting on Sustainable Development Financing Session 6: Financial inclusion
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Regulatory Reluctance to Fail Banks if Other Banks are also Weak
Regulatory Reluctance to Fail Banks if Other Banks are also Weak

... z-i: A measure of health for other banks in the same country. (Typically, the weighted average across all other banks for a bank specific variable included in xi) Null hypothesis  g=0 (a failing bank is closed regardless of other banks) Regulatory reluctance  g>0 (the healthier other banks are, th ...
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Naked Economics: Undressing the Dismal Science



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AP Economics - Arundel High School

... Reserve requirements are a percentage of commercial banks', and other depository institutions', demand deposit liabilities (i.e. chequing accounts) that must be kept on deposit at the Central Bank as a requirement of Banking Regulations. Though seldom used, this percentage may be changed by the Cen ...
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... These observations lead to the larger point that agents will still have a demand for liquidity, defined as demand for an asset that is subject to zero nominal price fluctuation and is perfectly acceptable. How this demand might be met is discussed later in connection with the possible emergence of 1 ...
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TAKS Remediation Lesson #1
TAKS Remediation Lesson #1

... U.S. promised to redeem dollars in gold to other central banks. Trade imbalances were corrected by gold reserve exchanges or by loans from the International Monetary Fund. This system collapsed when the United States government ended the convertibility of the US dollar for gold in 1971, in what beca ...
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continued from cover - Association Reserves

... The expectation of this laddering strategy is that the assets shall benefit from longerterm rates, which are commonly higher than short-term rates, while maintaining readily available funds and cash flow. In structuring maturities, review the Association's Reserve Study to ensure that maturing funds ...
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Fractional-reserve banking

Fractional-reserve banking is the practice whereby a bank accepts deposits, and holds reserves that are a fraction of the amount of its deposit liabilities. Reserves are held at the bank as currency, or as deposits in the bank's accounts at the central bank. Fractional-reserve banking is the current form of banking practiced in most countries worldwide.Fractional-reserve banking allows banks to act as financial intermediaries between borrowers and savers, and to provide longer-term loans to borrowers while providing immediate liquidity to depositors (providing the function of maturity transformation). However, a bank can experience a bank run if depositors wish to withdraw more funds than the reserves held by the bank. To mitigate the risks of bank runs and systemic crises (when problems are extreme and widespread), governments of most countries regulate and oversee commercial banks, provide deposit insurance and act as lender of last resort to commercial banks.Because bank deposits are usually considered money in their own right, and because banks hold reserves that are less than their deposit liabilities, fractional-reserve banking permits the money supply to grow beyond the amount of the underlying reserves of base money originally created by the central bank. In most countries, the central bank (or other monetary authority) regulates bank credit creation, imposing reserve requirements and capital adequacy ratios. This can limit the amount of money creation that occurs in the commercial banking system, and helps to ensure that banks are solvent and have enough funds to meet demand for withdrawals. However, rather than directly controlling the money supply, central banks usually pursue an interest rate target to control inflation and bank issuance of credit.
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