Journal of Financial Stability Vol. 13 2014
Has the global banking system become more fragile over time?
open access
Abstract
We examine the evolution of credit risk co-dependence in the banking sectors of over 65 countries. We find that there has been a significant increase in default risk co-dependence over the 3-year period leading up to the financial crisis. We also find that countries that are more integrated with liberalized financial systems have seen a greater rise in co-dependence in their banking sectors. This negative effect of financial openness is mitigated by a strong institutional environment that allows for efficient public and private monitoring of financial institutions.
- DOI
- 10.1016/j.jfs.2014.02.003
- Volume
- 13
- Pages
- 202-213
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref