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Business and Economics > Banks and Banking

You are looking at 1 - 10 of 33 items for :

  • Type: Journal Issue x
  • IMF Policy Discussion Papers x
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Cover IMF Policy Discussion Papers
Modernizing China's Growth Paradigm
Mr. Eswar S Prasad
and
Raghuram Rajan
China has achieved tremendous economic progress in the last three decades, but there is much work to be done to make the economy resilient to large shocks, ensure the sustainability of its growth, and translate this growth into corresponding improvements in the economic welfare of its citizens. We discuss the complex challenges that Chinese policymakers face in striking the right balance in terms of speed and coordination of reforms. We argue that China's current stage of development, along with its rising market orientation and increasing integration with the world economy, may make the incremental and piecemeal approaches to reforms increasingly untenable and, in some cases, could even generate risks of their own. The present favorable domestic and external circumstances provide an excellent window of opportunity for bolder reforms and for tackling some deep-rooted problems without causing much economic disruption.
Keywords:
PDP; exchange rate; reform; economy; banking system; state enterprise; Policy reforms; market-oriented economy; trade and financial integration; policy complementarities; reform strategy; banking system's reform effort; state-owned enterprise reform; reform process; reform agenda; a number of reform; market economy; reform of the state enterprises; transition economy; export-led growth; policy reform; Exchange rate flexibility; Commercial banks; Capital account liberalization; Capital controls; Financial sector reform; Global; Eastern Europe
Cover IMF Policy Discussion Papers
Considerations in the Choice of the Appropriate Discount Rate for Evaluating Sovereign Debt Restructurings
Ms. Julie A Kozack
Assessments regarding the effectiveness of sovereign debt restructurings are often summarized by comparisons of the net present value of debt service before and after the restructuring. These calculations are inherently sensitive to the choice of discount rate. This paper explores issues that arise in selecting discount rates when evaluating sovereign debt restructurings. It suggests using a range of discount rates and centering the analysis around the internal rate of return to assess whether the debt restructuring has generated net present value savings or costs to the debtor.
Keywords:
PDP; NPV calculation; NPV saving; debt-service payment; Discount rate; sovereign debt restructuring; financial crisis; net present value; discount rate range; uniform discount rate; NPV cost; default premium; NPV estimate; stock concept; calculations to the choice; savings from the perspective; associated NPV calculation; NPV neutral; Discount rates; Debt restructuring; Debt service; Debt sustainability; Yield curve; Global
Cover IMF Policy Discussion Papers
Does Excess Liquidity Pose a Threat in Japan?
Mr. Gauti B. Eggertsson
and
Mr. Jonathan David Ostry
This paper examines the effects of quantitative easing implemented by the Bank of Japan (BoJ) since early 2001, looking specifically at the impact on inflation expectations and real asset prices. It suggests a number of possible channels through which quantitative easing may have exerted influence, and reviews some of the empirical evidence linking open market operations and long-term bond purchases to real yields and other asset prices. It argues that quantitative easing has had smaller effects on nominal and real variables than desired, mainly because the BoJ has not succeeded in credibly communicating its policy intentions once the zero bound on short-term rates ceases to be binding. It argues that setting clear goals for inflation and a return to interest rate targeting are not only key elements of a successful strategy to avoid deflation, but are also essential to pin down expectations and avoid instability once deflation wanes.
Keywords:
PDP; interest rate; quantitative easing; price level; BoJ policy announcement; Monetary policy; expectations; BoJ communications; nominal interest rate; price level goal; BoJ's intention; BoJ's policy; BoJ's announcement; BoJ's purchase; Unconventional monetary policies; Monetary base; Short term interest rates; Sovereign bonds; Open market operations; Asia and Pacific
Cover IMF Policy Discussion Papers
Banking Reform in the Lower Mekong Countries
Mr. Olaf Unteroberdoerster
This paper reviews recent banking reform efforts in the lower Mekong countries (LMCs), comprising Cambodia, the Lao People's Democratic Republic, and Vietnam. Linked by close economic and cultural ties, the three LMCs face the dual challenge of economic development and transition to market-based economies. Two-tier banking systems were formally introduced in the late 1980s. However, state-owned banks with weak balance sheets continue to dominate the banking systems of Vietnam and Lao P.D.R. Cambodia's main challenge is to reconstruct a banking system after decades of civil strife. Based on progress made and brief cross-country comparisons, the paper identifies key challenges and options for further reform.
Keywords:
PDP; bank; Vietnam; banking system; loan; state-owned commercial bank; Banking reform; transition economics; Cambodia; Lao P.D.R.; bank intermediation; intermediation level; asset quality; reform target; bank management; Commercial banks; Nonperforming loans; Foreign banks; Credit; Loan classification; Mekong; Central and Eastern Europe
Cover IMF Policy Discussion Papers
Issues in the Establishment of Asset Management Companies
Mr. Stefan N Ingves
,
Mr. Steven A. Seelig
, and
Mr. Dong He
This paper discusses the role of asset management companies (AMCs) in facilitating bank restructuring and specifies some policy lessons learned from international experience. The paper concludes that there is no single optimal solution but a combination of strategies that will vary from bank to bank and country to country. There are, however, common factors that contribute to the success of an AMC and these include the legal environment, leadership, independence, incentives, and commercial orientation.
Keywords:
PDP; asset; In Private AMCs; bank; company; loan; bank restructuring; asset management; corporate restructuring; loan restructuring; AMC face; AMC management; AMC's assets; asset recovery; functioning bank; asset portfolio; transactions of the AMC; asset disposition strategy; AMC monopoly; Asset management companies; Distressed assets; Bank resolution; Asset valuation; Asia and Pacific
Cover IMF Policy Discussion Papers
Issuing Government Bonds to Finance Bank Recapitalization and Restructuring: Design Factors that Affect Banks' Financial Performance
Mr. Michael Andrews
Bonds issued by the government or government agencies are often used to finance bank restructuring following a systemic crisis. Many conflicting considerations affect the design of the bonds used to pay for public sector investment in bank equity or the purchase of distressed assets from banks. Some bond features can leave restructured banks facing significant risks, laying the foundation for future banking sector problems. Sovereign default makes publicly financed bank restructuring more difficult, but it is still possible to carry out if banks receive sufficient interest income to provide a margin over their cost of funds.
Keywords:
PDP; bank; interest rate; recapitalization; bond market; zero coupon bond; bank restructuring; systemic crisis; banking crisis; bank recapitalization; bank privatization; government bonds; government debt management; recapitalization bond; public funds; bond issue; bond market interest rates; interest rate fluctuation; bank recapitalization program; Bonds; Bank resolution; Sovereign bonds; Bond ratings
Cover IMF Policy Discussion Papers
Financial Integration in Central America: Prospects and Adjustment Needs
Mr. Jorge I Canales Kriljenko
,
Padamja Khandelwal
, and
Mr. Alexander Lehmann
We assess the current barriers to trade in financial services in the six Central American countries seeking a free trade agreement with the United States (the CAFTA) and examine the relative merits of regional and multilateral liberalization. Even though there are few formal barriers, deficiencies in regulatory and competition standards and in the judicial systems still restrict the participation of foreign institutions in the financial systems in the region. A greater presence of such institutions could support other objectives of trade and investment liberalization, though it would require several adjustments in prudential supervision at national levels and greater cooperation between members of the CAFTA.
Keywords:
PDP; financial market; capital account; foreign exchange; insurance fund; central bank; CAFTA; Trade in Financial Services; country authorities; market participant; contract enforcement; banking market access restriction; supervisory authority; financial services agreement; market access restriction; gats market access commitment; a number of bank; exit policy; exchange regulation; market entry; Foreign banks; Deposit insurance; Financial sector; Trade in services; Central America
Cover IMF Policy Discussion Papers
Large and Complex Financial Institutions: Challenges and Policy Responses: Lessons from Sweden
Mr. R. B. Johnston
,
Mr. Balázs Horváth
,
Mr. Luca Errico
, and
Ms. Jingqing Chai
This paper examines the regulatory and supervisory implications stemming from the dominance of large and complex financial institutions, drawing on the recent Financial Sector Assessment Program (FSAP) mission work on Sweden. The analysis highlights the importance of consolidated supervision, of a greater emphasis on effective management and corporate governance structures, and of measures strengthening the disciplinary role of the private sector. It calls for developing credible liquidity and crisis management arrangements through appropriate attention to the cross-product and cross-border nature of large and complex financial institution (LCFI) operations. Strengthened supervisory and regulatory responses will enable financial markets to better assess the nature and sources of residual risks they have to face and, on this basis, to develop more effective risk-mitigating measures.
Keywords:
PDP; Swedish LCFIs; financial institution; solvency support; financial institution solvency; market discipline; Large and complex financial institutions; moral hazard; policy lessons; LCFI operations; systemic importance; business name; market confidence; LCFIs active; LCFI's banking; Stress testing; Financial sector; Baltics
Cover IMF Policy Discussion Papers
The Role of Monthly Economic Statistical Bulletins
Ms. Claudia H Dziobek
and
Mr. Mei Jin
Monthly economic statistical bulletins issued by central banks and national statistical offices, the focus of this study, are well established in countries with advanced statistical systems. Such bulletins present a synopsis of current economic trends and cater to a broad group of users involved in policy, markets, media, and research. Compendium bulletins serve as a reference point, contribute to public economic knowledge and transparency, and can add to international visibility. The authors find that only about half of developing countries produce monthly bulletins. Based on experience in industrial countries and a survey of 22 successful bulletins from developing countries, this paper highlights the role of such bulletins and discusses selected aspects of their content, production, and dissemination.
Keywords:
PDP; bulletin project; central bank bulletin; publication program; country; transition country; Economic information; statistical capacity building; technical assistance; monthly bulletin; IMF-world Bank Joint Library; Data dissemination
Cover IMF Policy Discussion Papers
Issues in Electronic Banking: An Overview
Ms. Andrea Schaechter
Using electronic delivery channels for banking services and products has become increasingly popular in recent years. Electronic banking makes it possible to offer banking services around the world 24 hours a day. The dependence on technology for providing the services with the necessary security, and the cross-border nature of transactions, involve additional risks for banks and new challenges for banking regulators and supervisors. This paper provides an overview of some of the issues resulting from the development of electronic banking and how they are currently being addressed by regulatory and supervisory authorities.
Keywords:
PDP; bank; electronic banking; customer; virtual bank; Internet banking; banking regulation; banking supervision; e-banking service; customer relationship; mortar bank; bank supervisor; Reputational risk; Securities; Operational risk; Money laundering; Exchange rate risk; Global