Modelling the corporate deposits of Irish financial institutions: 2009 - 2010
AbstractThis paper examines the corporate funding flows of Irish credit institutions over the period 2009 to end-2010. The analysis examines the daily net movement across the consolidated corporate and retail deposit books of the domestic Irish banking sector and models these flows as a function of bank specific measures of risk, sovereign influences and general macro-financial conditions. The international financial crisis resulted in Irish banking institutions experiencing more acute funding difficulties than institutions elsewhere. Over the period 1995 to 2007, Irish credit institutions had engaged in a remarkable surge in concentrated lending to the commercial and residential property sector. The collapse in prices and activity in both markets post-2007 coupled with the downturn in general economic activity are the main reasons why Irish banks now rely substantially on liquidity support from the ECB and the Irish Central Bank. This situation is clearly unsustainable in the longer term and, in returning these institutions to a more viable longer-term path of market based funding, a greater understanding of the deposit flows of financial institutions is required.
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Bibliographic InfoPaper provided by Central Bank of Ireland in its series Research Technical Papers with number 02/RT/12.
Date of creation: Mar 2012
Date of revision:
Banks; Deposit; Financial Crisis;
Find related papers by JEL classification:
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
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