Narrow Your Choices

Refine By Countries

Refine By Series

Refine By Language

Refine By Date

—

Refine By IMF Taxonomy

Refine By JEL Taxonomy

Refine by LOC Taxonomy

Refine By THEMA Taxonomy

  • Print
  • Save

Business and Economics > Finance: General

You are looking at 1 - 9 of 9 items for :

  • Type: Journal Issue x
  • Financial Economics: General x
Clear All Modify Search
Cover IMF Working Papers
The Internationalization of China’s Equity Markets
Juan J. Cortina
,
Mr. Maria Soledad Martinez Peria
,
Mr. Sergio L. Schmukler
, and
Jasmine Xiao
China’s equity markets internationalization process started in the early 2000s but accelerated after 2012, when Chinese firms’ shares listed in Shanghai and Shenzhen gradually became available to international investors. This paper studies the effects of the post-2012 internationalization events by comparing the evolution of equity financing and investment activities for: (i) domestic listed firms relative to firms that already had access to international investors and (ii) domestic listed firms that were directly connected to international markets relative to those that were not. The paper finds large increases in financial and investment activities for domestic listed and for connected firms, with significant aggregate effects. The evidence also suggests the rise in firms’ equity issuances was primarily and initially financed by domestic investors. International investors’ portfolio holdings in Chinese equity markets and ownership in firms increased markedly only once Chinese firms’ locally issued shares became part of the MSCI Emerging Markets Index.
Keywords:
equity financing; equity market liberalization; firm investment; foreign investors; international investors; issuance activity; Stock Connect; portfolio holding; internationalization process; unconnected firm; China's equity markets; Stock markets; Stocks; Foreign corporations; Emerging and frontier financial markets; Market capitalization; Global
Cover IMF Working Papers
Understanding the Use of Long-term Finance in Developing Economies
Mr. Maria Soledad Martinez Peria
and
Mr. Sergio L. Schmukler
This short paper reviews recent literature on the use of long-term finance in developing economies (relative to advanced ones) to identify where long-term financing occurs, and what role different financial intermediaries and markets play in extending this type of financing. Although banks are the most important providers of credit, they do not seem to offer long-term financing. Capital markets have grown since the 1990s and can provide financing at fairly long terms. But few firms use these markets. Only some institutional investors provide funding at long-term maturities. Governments might help to expand long-term financing, although with limited policy tools.
Keywords:
WP; finance; institutional investor; capital market; market; maturity; banks; bond markets; firm financing; financial crises; financial intermediaries; institutional investors; issuance maturity; long-term debt; short-term debt; investment finance program; long-term finance; capital market capitalization; economies stock market capitalization; saving needs; finance shift; stock market capitalization; market failure; income economy; investment horizons; Mutual funds; Capital markets; Loans; Pension spending; Insurance companies; Europe; Global; Central America
Cover IMF Working Papers
Bank Solvency and Funding Cost
Christoph Aymanns
,
Carlos Caceres
,
Christina Daniel
, and
Miss Liliana B Schumacher
Understanding the interaction between bank solvency and funding cost is a crucial pre-requisite for stress-testing. In this paper we study the sensitivity of bank funding cost to solvency measures while controlling for various other measures of bank fundamentals. The analysis includes two measures of bank funding cost: (a) average funding cost and (b) interbank funding cost as a proxy of wholesale funding cost. The main findings are: (1) Solvency is negatively and significantly related to measures of funding cost, but the effect is small in magnitude. (2) On average, the relationship is stronger for interbank funding cost than for average funding cost. (3) During periods of stress interbank funding cost is more sensitive to solvency than in normal times. Finally, (4) the relationship between funding cost and solvency appears to be non-linear, with higher sensitivity of funding cost at lower levels of solvency.
Keywords:
WP; funding cost; bank fundamentals; default probability; federal funds; return on assets; solvency shock; Solvency; stress testing; solvency measure; FDIC bank default dataset; Bank solvency; Estimation techniques; Capital adequacy requirements; Financial statements; Global
Cover IMF Working Papers
Assessing Countries’ Financial Inclusion Standing - A New Composite Index
Mr. Alexander Massara
and
André Mialou
This paper leverages the IMF’s Financial Access Survey (FAS) database to construct a new composite index of financial inclusion. The topic of financial inclusion has gathered significant attention in recent years. Various initiatives have been undertaken by central banks both in advanced and developing countries to promote financial inclusion. The issue has also attracted increasing interest from the international community with the G-20, IMF, and World Bank Group assuming an active role in developing and collecting financial inclusion data and promoting best practices to improve financial inclusion. There is general recognition among policy makers that financial inclusion plays a significant role in sustaining employment, economic growth, and financial stability. Nonetheless, the issue of its robust measurement is still outstanding. The new composite index uses factor analysis to derive a weighting methodology whose absence has been the most persistent of the criticisms of previous indices. Countries are then ranked based on the new composite index, providing an additional analytical tool which could be used for surveillance and policy purposes on a regular basis.
Keywords:
WP; income group; factor analysis; Financial inclusion; access and usage of financial services; index; borrowers variable; a number of variable; outreach variable; cross-dimension composite index; scale invariance; household depositor; composite index value; usage variable; normalized variable; geometric mean; Public expenditure review; Personal income; Commercial banks; Global
Cover IMF Working Papers
Financial Integration and Rebalancing in Asia
Mr. Olaf Unteroberdoerster
and
Ms. Runchana Pongsaparn
The paper shows that Asia's degree of financial integration, both with the world and within the region remains low by various measures. The paper also provides empirical evidence that greater financial integration can support economic rebalancing in statistically meaningful ways. The implication is that in the debate on managing capital inflows the longer-term benefits of financial openness for broader-based growth should not be forgotten.
Keywords:
WP; GDP; Asia; Financial Integration; Financial Development; Rebalancing; Portfolio investment; savings-investment norm; FDI inflow; FDI flow; FDI outflow; Foreign direct investment; Financial sector development; Exchange rates; Asia and Pacific; Global; Eastern Europe
Cover IMF Working Papers
Financial Deepening, Property Rights and Poverty: Evidence From Sub-Saharan Africa
Mr. Yifei Huang
and
Mr. Raju J Singh
Recent studies on the relationship between financial development and poverty have been inconclusive. Some claim that, by allowing more entrepreneurs to obtain financing, financial development improves the allocation of capital, which has a particularly large impact on the poor. Others argue that it is primarily the rich and politically connected who benefit from improvements in the financial system. This paper looks at a sample of 37 countries in sub-Saharan Africa from 1992 through 2006. Its results suggest that financial deepening could narrow income inequality and reduce poverty, and that stronger property rights reinforce these effects. Interest rate and lending liberalization alone could, however, be detrimental to the poor if not accompanied by institutional reforms, in particular stronger property rights and wider access to creditor information.
Keywords:
WP; Gini coefficient; GDP; financial development; poverty alleviation; income distribution; Africa; poverty gap; poverty indicator; dependent variable; allocation mechanism; decrease poverty; absolute value; positive correlation; Financial sector development; Credit; Income inequality; Sub-Saharan Africa
Cover IMF Working Papers
Defining Financial Stability
Mr. Garry J. Schinasi
The main objective of this paper is to propose a definition of financial stability that has some practical and operational relevance. Financial stability is defined in terms of its ability to facilitate and enhance economic processes, manage risks, and absorb shocks. Moreover, financial stability is considered a continuum: changeable over time and consistent with multiple combinations of the constituent elements of finance. The paper also discusses several practical implications of the definition that should be considered when using it for policy analysis or developing an analytical framework.
Keywords:
WP; financial system; market; finance; economy; economic process
Cover IMF Working Papers
Toward a Framework for Safeguarding Financial Stability
International Monetary Fund
This paper examines the emergence of financial stability as a key policy objective. It discusses the underlying trends in the financial system, as well as the role of finance in relation to money, the real economy, and public policy. Financial stability is defined in terms of its ability to help the economic system allocate resources, manage risks, and absorb shocks. Moreover, financial stability is considered a continuum, changeable over time and consistent with multiple combinations of its constituent elements. On the basis of these concepts, a framework is presented that comprises an encompassing analysis and assessment of financial stability, and maps out broad policy implications.
Keywords:
WP; payments system; economic system; market imperfection; unit of account; financial-system policy; Financial stability; Policy framework; foregone exchange opportunity; financial system performance; market uncertainty; market failure; public goods; market discipline; market confidence; Financial sector stability; Financial stability assessment; Systemic risk; Asset prices
Cover IMF Working Papers
The Statistical Measurement of Financial Derivatives
Mr. Robert M Heath
The System of National Accounts 1993 (1993 SNA) provided new standards for the statistical treatment of financial derivatives. Subsequently, financial derivative markets have evolved, and there have been requests from national statisticians for clarification and amplification of the recommendations in the 1993 SNA and the fifth edition of the IMF’s Balance of Payments Manual (BPM5). Meeting this need is the main purpose of this working paper. Its recommendations have been widely discussed in international meetings and have been approved by bodies that effect changes in the 1993 SNA and BPM5.
Keywords:
WP; financial derivative; derivative contract; market price; options contract; cash settlement; economic value; unit of account; Financial derivatives; Options; Currencies