BIS Quarterly Review, December 2012
The BIS Quarterly Review for December 2012 says policy measures and reduced short-term risks buoyed markets.
Statistical tables:
- Summary tables (PDF, 23 pages, 553 kb)
- Detailed tables (PDF, 165 pages, 1,200 kb)
International banking and financial market developments
Special features
Natural disasters resulting in significant losses have become more frequent in recent decades, with 2011 being the costliest year in history. Sebastian von Dahlen (International Association of Insurance Supervisors) and Goetz von Peter (BIS) explore how risk is transferred within and beyond the global insurance sector and assess the financial linkages that arise in this process. While most of the risk is retained within the global insurance market, part is transferred through retrocession and securitisation to other financial institutions and the broader financial market. These links appear small, but little is known about who exactly ultimately bears the corresponding risks, as no comprehensive international statistics exist.
More...Cross-border bank lending to emerging markets dropped sharply in the second half of 2011 as the euro area crisis intensified. Stefan Avdjiev (BIS), Zsolt Kuti (Magyar Nemzeti Bank) and Előd Takáts (BIS) use the BIS international banking statistics to identify the key drivers of this decline. Their results suggest that the latest contraction in cross-border bank lending was largely linked to the deteriorating health of euro area banks.
More...Basel III introduces the first global framework for bank liquidity regulation. As monetary policy typically involves targeting the interest rate on interbank loans of the most liquid asset - central bank reserves - it is important to understand how this new requirement will impact the efficacy of current operational frameworks. Morten Bech (BIS) and Todd Keister (Rutgers University) extend a standard model of monetary policy implementation to include the new liquidity regulation. Based on this model, they find that the regulation does not impair central banks' ability to implement monetary policy, but operational frameworks may need to adjust.
More...The BIS has revised its debt securities statistics to enhance their comparability across different markets. This feature by Branimir Gruić and Philip Wooldridge (BIS) sketches the main changes and the reasoning behind them. International issues have been redefined as debt securities issued outside the market where the borrower resides, and statistics combining international and domestic issues are being released for the first time. The revised statistics highlight the growing size and internationalisation of bond markets.
More...