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Purchases of sovereign debt securities by Italian banks during the crisis: the role of balance-sheet conditions

Author

Listed:
  • Massimiliano Affinito

    (Bank of Italy)

  • Giorgio Albareto

    (Bank of Italy)

  • Raffaele Santioni

    (Bank of Italy)

Abstract

This paper analyses the main microeconomic determinants of Italian banks� purchases of sovereign debt securities from 2007 to 2013, with special reference to their balance-sheet conditions. The analysis distinguishes two phases of the crisis � the period following the Lehman Brothers collapse and the sovereign debt crisis � and different types of banks (large and small). Results show that banks� specific characteristics and balance-sheet features do matter and that banks use government securities purchases to support their financial and economic conditions. The influence of the balance-sheet conditions differs according to the phase of the crisis and the type of bank.

Suggested Citation

  • Massimiliano Affinito & Giorgio Albareto & Raffaele Santioni, 2016. "Purchases of sovereign debt securities by Italian banks during the crisis: the role of balance-sheet conditions," Questioni di Economia e Finanza (Occasional Papers) 330, Bank of Italy, Economic Research and International Relations Area.
  • Handle: RePEc:bdi:opques:qef_330_16
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    References listed on IDEAS

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    Cited by:

    1. Daniel Gros, 2017. "Banks as Buyers of Last Resort for Government Bonds?," EconPol Policy Brief 4, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    2. Massimiliano Affinito, 2019. "What do almost 20 years of micro data and two crises say about the relationship between central bank and interbank market liquidity? Evidence from Italy," Temi di discussione (Economic working papers) 1238, Bank of Italy, Economic Research and International Relations Area.
    3. Giovanni Dosi & Marcello Minenna & Andrea Roventini & Roberto Violi, 2021. "Making the Eurozone work: a risk-sharing reform of the European Stability Mechanism," Annals of Operations Research, Springer, vol. 299(1), pages 617-657, April.
    4. Silvana Bartoletto & Bruno Chiarini & Elisabetta Marzano & Paolo Piselli, 2019. "Banking crises and business cycle: evidence for Italy(1861-2016)," Journal of Financial Economic Policy, Emerald Group Publishing, vol. 11(1), pages 34-61, April.
    5. Gros, Daniel, 2017. "Banks as buyers of last resort for government bonds?," CEPS Papers 13226, Centre for European Policy Studies.
    6. Silvana Bartoletto & Bruno Chiarini & Elisabetta Marzano & Paolo Piselli, 2018. "Banking Crises and Boom-Bust Dynamics: Evidence for Italy (1861-2016)," CESifo Working Paper Series 6972, CESifo.
    7. Francesco Cusano & Giuseppe Marinelli & Stefano Piermattei, 2021. "Learning from revisions: a tool for detecting potential errors in banks' balance sheet statistical reporting," Questioni di Economia e Finanza (Occasional Papers) 611, Bank of Italy, Economic Research and International Relations Area.

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    More about this item

    Keywords

    financial crisis; securities portfolio; banks� balance sheets; sovereign risk;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

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