Reserve Requirements, the Maturity Structure of Debt, and Bank Runs [electronic resource] / Eza Ghassan Al-Zein.
Material type:
TextSeries: IMF Working Papers; Working Paper ; No. 08/108Publication details: Washington, D.C. : International Monetary Fund, 2008Description: 1 online resource (26 p.)ISBN: 1451869681 :ISSN: 1018-5941Subject(s): Bank Run | Bank Runs | Bond | Bonds | Crises | International Lending | ChileAdditional physical formats: Print Version:: Reserve Requirements, the Maturity Structure of Debt, and Bank RunsOnline resources: IMF e-Library | IMF Book Store Abstract: The paper looks at the relationship between reserve requirements and the choice of the maturity structure of external debt in a general equilibrium setup, by incorporating the role of international lenders. A date- and maturity-specific reserve requirement is a fraction of the debt to be deposited in a non-interest bearing account at the central bank. At maturity, the central bank returns the reserves. There exist some specific combinations of date- and maturity-specific reserve requirements that reduce the vulnerability to bank runs. In such setup, lenders may still want to provide new short-term lending to the bank after a bank run.
The paper looks at the relationship between reserve requirements and the choice of the maturity structure of external debt in a general equilibrium setup, by incorporating the role of international lenders. A date- and maturity-specific reserve requirement is a fraction of the debt to be deposited in a non-interest bearing account at the central bank. At maturity, the central bank returns the reserves. There exist some specific combinations of date- and maturity-specific reserve requirements that reduce the vulnerability to bank runs. In such setup, lenders may still want to provide new short-term lending to the bank after a bank run.
Description based on print version record.
There are no comments on this title.