This paper examines the relationship between the structure of the interbank lending market and systemic risk. We consider a model in which banks finance investment opportunities through household deposits and borrowing from other banks. Using simulation techniques a range of interbank markets structures are considered. It is shown that greater levels of interbank connectivity reduce the risk of...

because of important role of development banks in optimal allocation of limited financial resources, their investment efforts must have an objective direction to the achievement of government's strategic goals. in order to get appropriate approaches in its investment, bank of industry and mine (bim) as the only development bank in industry and mine sector, aims to take a general survey amo...

In the recent recession and current economic recovery, policymakers have supported asset prices in the U.S. treasury and mortgage markets, expecting that improvement in the balance sheet of banks will lead to more commercial lending. In general, we document that increases in housing prices in a bank’s deposit base lead banks to decrease commercial lending. Further, we find that a one-standard d...

The theory of the optimal allocation of risk and the Townsend Thai panel data on financial transactions are used to assess the impact of the major formal and informal financial institutions of an emerging market economy. We link financial institution assessment to the actual impact on clients, rather than ratios and non-performing loans. We derive both consumption and investment equations from ...