Toward An Effective Supervision of Partially Dollarized Banking Systems
AbstractThe paper presents a supervisory framework that addresses the vulnerabilities of partially dollarized banking systems. The tendency to underprice systemic liquidity risk and currency-induced credit risk creates vulnerabilities that need supervisory responses. The framework seeks to induce agents to better internalize risks by implementing a risk based approach to supervision, following the risk management guidelines of the Basel Committee, and by establishing buffers to cover higher liquidity and solvency risks. The paper also shows that most dollarized countries have addressed their liquidity vulnerabilities, but few have addressed those arising from currency-induced credit risks.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by International Monetary Fund in its series IMF Working Papers with number 06/32.
Date of creation: 01 Jan 2006
Date of revision:
Contact details of provider:
Postal: International Monetary Fund, Washington, DC USA
Phone: (202) 623-7000
Fax: (202) 623-4661
Web page: http://www.imf.org/external/pubind.htm
More information through EDIRC
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-03-05 (All new papers)
- NEP-FMK-2006-03-05 (Financial Markets)
- NEP-IFN-2006-03-05 (International Finance)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Guillermo A. Calvo & Carmen M. Reinhart, 2002.
"Fear Of Floating,"
The Quarterly Journal of Economics,
MIT Press, vol. 117(2), pages 379-408, May.
- Alain Ize & Andrew Powell, 2003.
"Prudential Responses to De Facto Dollarization,"
Business School Working Papers
defactodollarization, Universidad Torcuato Di Tella.
- repec:rus:hseeco:123906 is not listed on IDEAS
- Carmen M. Reinhart & Kenneth S. Rogoff & Miguel A. Savastano, 2014.
"Addicted to Dollars,"
Annals of Economics and Finance,
Society for AEF, vol. 15(1), pages 1-50, May.
- Carmen M. Reinhart & Kenneth S. Rogoff & Miguel A. Savastano, 2003. "Addicted to Dollars," NBER Working Papers 10015, National Bureau of Economic Research, Inc.
- Carmen M. Reinhart & Kenneth S. Rogoff & Miguel A. Savastano, 2003. "Addicted to Dollars," CEMA Working Papers 594, China Economics and Management Academy, Central University of Finance and Economics.
- Anne Marie Gulde & David S. Hoelscher & Alain Ize & David Marston & Gianni De NicolÃ³, 2004. "Financial Stability in Dollarized Economies," IMF Occasional Papers 230, International Monetary Fund.
- Gianni De NicolÃ³ & Patrick Honohan & Alain Ize, 2003. "Dollarization of the Banking System," IMF Working Papers 03/146, International Monetary Fund.
- Morris Goldstein & Philip Turner, 2004. "Controlling Currency Mismatches in Emerging Markets," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 373.
- Alain Ize & Miguel Kiguel & Eduardo Levy Yeyati, 2005. "Managing Systemic Liquidity Risk in Financially Dollarized Economy," Business School Working Papers managsystrisk, Universidad Torcuato Di Tella.
- Aaron Tornell & Frank Westermann, 2005.
"Boom-Bust Cycles and Financial Liberalization,"
MIT Press Books,
The MIT Press,
edition 1, volume 1, number 0262201593, December.
- Cem Karacadag & Paul J. Heytens, 2001. "An Attempt to Profile the Finances of China's Enterprise Sector," IMF Working Papers 01/182, International Monetary Fund.
- Carlos E. León Rincón & Alejandro Revéiz Herault, 2008.
"La dolarización financiera: experiencia internacional y perspectivas para Colombia,"
Revista de Economía Institucional,
Universidad Externado de Colombia - Facultad de Economía, vol. 10(18), pages 313-341, January-J.
- Carlos Eduardo León Rincón & Alejandro Reveiz, . "La dolarización financiera: Experiencia internacional y perspectivas para Colombia," Borradores de Economia 482, Banco de la Republica de Colombia.
- Carlos Eduardo León Rincón & Alejandro Reveiz Herault, 2008. "La dolarización financiera:Experiencia internacional y perspectivas para Colombia," BORRADORES DE ECONOMIA 004510, BANCO DE LA REPÚBLICA.
- Yilmaz Akyüz, 2009. "Mananging Financial Instability: Why Prudence is not Enough?," Working Papers 86, United Nations, Department of Economics and Social Affairs.
- García-Escribano, Mercedes, 2011. "Factores que impulsan la desdolarización en el Perú," Revista Estudios Económicos, Banco Central de Reserva del Perú, issue 21, pages 23-40.
- Torsten Wezel & Mario Mansilla & Gustavo Adler, 2009. "Modernizing Bank Regulation in Support of Financial Deepening," IMF Working Papers 09/199, International Monetary Fund.
- Winkelried, Diego & Castillo, Paul, 2010.
"Dollarization persistence and individual heterogeneity,"
Journal of International Money and Finance,
Elsevier, vol. 29(8), pages 1596-1618, December.
- Paul Castillo & Diego Winkelried, 2005. "Dollarization Persistence and Individual Heterogeneity," Macroeconomics 0512014, EconWPA, revised 31 Dec 2005.
- Paul Castillo & Diego Winkelried, 2007. "Dollarization Persistence and Individual Heterogeneity," Working Papers 2007-004, Banco Central de Reserva del Perú.
- International Monetary Fund, 2011. "Policy Instruments to Lean Against the Wind in Latin America," IMF Working Papers 11/159, International Monetary Fund.
- Yilmaz Akyuz, 2008. "Managing Financial Instability in Emerging Markets: A Keynesian Perspective," Working Papers 2008/4, Turkish Economic Association.
- Felix Fischer & Charlotte J. Lundgren & Samir Jahjah, 2013. "Making Monetary Policy More Effective: The Case of the Democratic Republic of the Congo," IMF Working Papers 13/226, International Monetary Fund.
- Luca, Alina & Petrova, Iva, 2008. "What drives credit dollarization in transition economies?," Journal of Banking & Finance, Elsevier, vol. 32(5), pages 858-869, May.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jim Beardow) or (Hassan Zaidi).
If references are entirely missing, you can add them using this form.