IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Evaluating the impact of shock in the supply of overnight unsecured money market funds on the TARGET2-Banca d'Italia functioning: a simulation approach

Listed author(s):
  • Luca Arciero


    (Banca d'Italia)

This paper presents a simulation exercise assessing the ability of Italian banks to fulfil their payment commitments in TARGET2, the Euro area Real Time Gross Settlement System, in the event of a contraction in the supply of funds on the overnight unsecured money market. The results of the exercise - which was carried out with reference to two reserve maintenance periods: from 12 November to 9 December 2008, during the acute phase of the crisis, and from 11 November to 7 December 2009 - show that even a drastic fall in trading on the interbank market would have caused limited effects on the functioning of the system. These broadly positive results depend basically on two factors. First, both simulations refer to periods in which the ratio of unsecured overnight loans to the total quantity of settled payments was significantly lower than in the period preceding the crisis; furthermore, in both periods the average level of liquidity on participants’ settlement accounts was relatively high due to the reliance of banks to the Eurosystem credit facilities.

If 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.

File URL:
Download Restriction: Full text for Rivista Bancaria subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Istituto di Cultura Bancaria Francesco Parrillo in its journal Rivista Bancaria - Minerva Bancaria.

Volume (Year): (2012)
Issue (Month): 2-3 (June)

in new window

Handle: RePEc:rvs:bancar:12_2-3_2
Contact details of provider: Web page:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:rvs:bancar:12_2-3_2. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Stefano Marzioni)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.