Presentation by Hyun Song Shin, Economic Adviser and Head of Research, on the occasion of the Bank's Annual General Meeting, Basel, 29 June 2014.
Shift from banking sector flows to portfolio flows
- Cross-border bank activity is subdued in spite of compressed measures of risk
- Banking sector capital flows have given way to portfolio flows through purchase of debt securities
- Average maturity of debt securities has increased
- Mitigates rollover risk for borrowers
- But only at expense of increased duration risk for investors
- Longer duration may exacerbate potential for non-linear
market disruptions due to behaviour of global asset managers
The views expressed here are my own and not necessarily those of the BIS or its member institutions.
