The national segmentation of euro area bank balance sheets during the financial crisis

Colangelo, A, Giannone, D, Lenza, M, Pill, H and Reichlin, L (2017) The national segmentation of euro area bank balance sheets during the financial crisis. Empirical Economics, 53 (1). pp. 247-265. ISSN 0377-7332 OPEN ACCESS

Abstract

This paper analyses bank balance sheet data in conjunction with macroeconomic and other financial variables. Our aim is to understand the nature of the instability in financial intermediation in the euro area during the recent financial crises. We define “large changes” as significant departures in the actual evolution of balance sheet variables during the crisis from their historical association with the business and financial cycles. In the course of the global 2008–2009 financial crisis, such “large changes” were features of the behaviour of cross-border inter-bank flows, both within the euro area and between the euro area and the rest of the world. By contrast, retail assets and liabilities, as well as inter-bank flows among banks of the same country, did not significantly deviate from historical regularities. Since the euro area sovereign crisis of 2011–2012, “large changes” have been more pervasive. In particular, a significant home bias in the sovereign bond market has emerged.

More Details

Item Type: Article
Subject Areas: Economics
Additional Information: This is a post-peer-review, pre-copyedited version of an article published in: Empirical Economics. The final authenticated version is available online at: https://doi.org/10.1007/s00181-016-1221-2 © 2017 Springer International Publishing AG
Subjects: C > Crises
C > Commercial banks
B > Balance sheets
E > Euro
Date Deposited: 16 May 2017 11:48
Last Modified: 21 Jun 2019 11:36
URI: http://lbsresearch.london.edu/id/eprint/814
More

Export and Share


Download

Accepted Version - Text

Statistics

Altmetrics
View details on Dimensions' website

Downloads from LBS Research Online

View details

Actions (login required)

Edit Item Edit Item