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Banking systems, central banks and international reserve accumulation in East Asian economies

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  • Shrestha, Prakash Kumar

Abstract

This paper examines changes in the balance sheets of the banking system in five East Asian economies which were affected by the 1997 Asian Crisis. These countries have persistently accumulated foreign currency reserves since the crisis. This paper estimates the impact of reserve accumulation on some important balance sheet variables such as liquid assets, credits and deposits of the banking system by applying panel data techniques. Estimates using data from Thailand, South Korea, Malaysia, Philippines and Indonesia show that reserve accumulation has a positive impact on the liquid assets and deposits of the banking system, but not on credit flows, after controlling for the effect of other potential variables.

Suggested Citation

  • Shrestha, Prakash Kumar, 2012. "Banking systems, central banks and international reserve accumulation in East Asian economies," Economics Discussion Papers 2012-48, Kiel Institute for the World Economy (IfW).
  • Handle: RePEc:zbw:ifwedp:201248
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    References listed on IDEAS

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    More about this item

    Keywords

    international reserves; central banks; banking systems and East Asian countries;

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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