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The Lender of Last Resort in the European Single Financial Market

In: Cross-Border Banking Regulatory Challenges

Author

Listed:
  • Garry J. Schinasi

    (International Monetary Fund, USA)

  • Pedro Gustavo Teixeira

    (European Central Bank, Germany)

Abstract

The following sections are included:IntroductionSystemic Risk in the Single Financial MarketIntegrated financial markets and market infrastructuresBanking concentration at the domestic levelThe emergence of pan-European banking groups with complex structuresCentralization of business functions in banking groupsThe emergence of large and complex financial institutionsIncreased foreign ownership of financial assetsThe Architecture for Financial Crisis ManagementCooperation between functions through committee-structuresCooperation agreementsConclusionThe Lender of Last Resort Function in PracticeDetection of a liquidity shockAssessment of systemic riskJurisdiction of the lender of last resortAssessing the solvency position of a pan-European banking groupInteraction with treasuriesConclusion: Pressure points of the lender of last resortChallengesInstitutional coordination issuesCoordination modelsWays Forward: Coordination versus Centralization of PolicymakingReferences

Suggested Citation

  • Garry J. Schinasi & Pedro Gustavo Teixeira, 2006. "The Lender of Last Resort in the European Single Financial Market," World Scientific Book Chapters, in: Gerard Caprio Jr & Douglas D Evanoff & George G Kaufman (ed.), Cross-Border Banking Regulatory Challenges, chapter 23, pages 349-372, World Scientific Publishing Co. Pte. Ltd..
    • Handle: RePEc:wsi:wschap:9789812773418_0023
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    1. Jean-Charles Rochet & Xavier Vives, 2004. "Coordination Failures and the Lender of Last Resort: Was Bagehot Right After All?," Journal of the European Economic Association, MIT Press, vol. 2(6), pages 1116-1147, December.
    2. Mr. Garry J. Schinasi, 2003. "Responsibility of Central Banks for Stability in Financial Markets," IMF Working Papers 2003/121, International Monetary Fund.
    3. Dirk Schoenmaker & Sander Oosterloo, 2005. "Financial Supervision in an Integrating Europe: Measuring Cross‐Border Externalities," International Finance, Wiley Blackwell, vol. 8(1), pages 1-27, March.
    4. Michel Aglietta, 1999. "A Lender of Last Resort for Europe," Working Papers 1999-12, CEPII research center.
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    Cited by:

    1. Friederike Niepmann & Tim Schmidt-Eisenlohr, 2013. "Bank Bailouts, International Linkages, and Cooperation," American Economic Journal: Economic Policy, American Economic Association, vol. 5(4), pages 270-305, November.
    2. Mr. Stijn Claessens & Mr. Luc Laeven & Ms. Deniz O Igan & Mr. Giovanni Dell'Ariccia, 2010. "Lessons and Policy Implications from the Global Financial Crisis," IMF Working Papers 2010/044, International Monetary Fund.
    3. Kenneth Sullivan, 2008. "Presentación proactiva del desempeño," Boletín, CEMLA, vol. 0(3), pages 130-135, Julio-sep.
    4. Mr. Martin Cihak & Mr. Jörg Decressin, 2007. "The Case for a European Banking Charter," IMF Working Papers 2007/173, International Monetary Fund.
    5. Barry Eichengreen, 2008. "Sui Generis EMU," NBER Working Papers 13740, National Bureau of Economic Research, Inc.
    6. Maria J. Nieto & Garry J. Schinasi, 2008. "Towards an EU Framework for Safeguarding Financial Stability," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 6(3), pages 27-36, October.
    7. Fritz Breuss, 2009. "Mangelnde "Europäisierung" der nationalen Konjunkturzyklen als Risiko für den Euro-Raum," WIFO Monatsberichte (monthly reports), WIFO, vol. 82(2), pages 125-138, February.
    8. Jorg Bibow, 2015. "The Euro's Savior? Assessing the ECB's Crisis Management Performance and Potential for Crisis Resolution," Economics Working Paper Archive wp_845, Levy Economics Institute.
    9. Jean Pisani-Ferry & André Sapir, 2009. "Banking Crisis Management in the EU- An Interim Assessment," Bruegel Working Papers 359, Bruegel.
    10. Dimitrios Dapontas, 2013. "Saving Euro by Dividing Europe in Multiple OCAs," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 9(2), pages 107-119, April.
    11. Fritz Breuss, 2009. "Lacking "Europeanisation" of National Business Cycles as a Risk for the Euro Area," Austrian Economic Quarterly, WIFO, vol. 14(2), pages 91-104, June.
    12. Banco Central Europeo, 2008. "La titulización en la zona del euro," Boletín, CEMLA, vol. 0(3), pages 136-149, Julio-sep.
    13. Milošević Andriana & Jemović Mirjana, 2017. "Non-Standard Measures of the Monetary Policy – Mechanism for Overcoming Problems in the Implementation of the Neoliberal Concept of Monetary Policy During a Financial Crisis," Economic Themes, Sciendo, vol. 55(4), pages 465-480, December.
    14. Dapontas Dimitrios, 2012. "Can Euro Zone Survive and Long Prosper?," Journal of Economics and Behavioral Studies, AMH International, vol. 4(2), pages 121-128.
    15. Hertig Gerard & Lee Ruben & McCahery Joseph A., 2010. "Empowering the ECB to Supervise Banks: A Choice-Based Approach," European Company and Financial Law Review, De Gruyter, vol. 7(2), pages 171-215, January.
    16. Helge Berger & Carsten Hefeker, 2008. "Does financial integration make banks more vulnerable? Regulation, foreign owned banks, and the lender-of-last resort," International Economics and Economic Policy, Springer, vol. 4(4), pages 371-393, February.
    17. Vítor Gaspar, 2010. "Financial Stability and Policy Cooperation," Working Papers o201001, Banco de Portugal, Economics and Research Department.

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    More about this item

    Keywords

    Cross-Border Banking; Home-Host Coordination; International Banking; International Bank Mergers; Regulation of Cross-Border Banking; Failure of Internationally Active Banks; Geographic Expansion in Banking;
    All these keywords.

    JEL classification:

    • F39 - International Economics - - International Finance - - - Other
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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