An assessment of financial sector rescue programmes
AbstractWe analyse the wide array of rescue programmes adopted in several countries, following Lehman Brothers’ default in September 2008, in order to support banks and other financial institutions. We first provide an overview of the programmes, comparing their characteristics, magnitudes and participation rates across countries. We then consider the effects of the programmes on banks’ risk and valuation, looking at the behaviour of CDS premia and stock prices. We then proceed to analyse the issuance of government guaranteed bonds by banks, examining their impact on banks’ funding and highlighting undesired effects and distortions. Finally, we briefly review the recent evolution of bank lending to the private sector. We draw policy implications, in particular as regards the way of mitigating the distortions implied by such programmes and the need for an exit strategy.
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Bibliographic InfoThis book is provided by Bank for International Settlements in its series BIS Papers with number 48 and published in 2009.
Other versions of this item:
- Fabio Panetta & Thomas Faeh & Giuseppe Grande & Corrinne Ho & Michael King & Aviram Levy & Federico M. Signoretti & Marco Taboga & Andrea Zaghini, 2009. "An assessment of financial sector rescue programmes," Questioni di Economia e Finanza (Occasional Papers) 47, Bank of Italy, Economic Research and International Relations Area.
- E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
- E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
- G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
- G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
- G - Financial Economics
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- Silvio Contessi & Johanna Francis, 2009.
"U.S. Commercial Bank Lending through 2008:Q4: New Evidence from Gross Credit Flows,"
Fordham Economics Discussion Paper Series, Fordham University, Department of Economics
dp2009-04, Fordham University, Department of Economics.
- Silvio Contessi & Johanna L. Francis, 2013. "U.S. Commercial Bank Lending Through 2008:Q4: New Evidence From Gross Credit Flows," Economic Inquiry, Western Economic Association International, vol. 51(1), pages 428-444, 01.
- Silvio Contessi & Johanna Francis, 2009. "U.S. commercial bank lending through 2008:Q4: new evidence from gross credit flows," Working Papers, Federal Reserve Bank of St. Louis 2009-011, Federal Reserve Bank of St. Louis.
- Pierre Collin-Dufresne, 2001. "The Determinants of Credit Spread Changes," Journal of Finance, American Finance Association, American Finance Association, vol. 56(6), pages 2177-2207, December.
- Ethan Cohen-Cole & Burcu Duygan-Bump & JosÃ© Fillat & Judit Montoriol-Garriga, 2008. "Looking behind the aggregates: a reply to â€œFacts and Myths about the Financial Crisis of 2008â€," Risk and Policy Analysis Unit Working Paper, Federal Reserve Bank of Boston QAU08-5, Federal Reserve Bank of Boston.
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