The interbank market during a crisis |
| |
| Institution: | 1. Católica-Lisbon School of Business and Economics, Palma de Cima, 1649-023 Lisbon, Portugal;2. Department of Banking and Finance, University of Zürich (UZH), Plattenstrasse 32, CH-8032 Zürich, Switzerland;3. Swiss Finance Institute, Switzerland;4. KU Leuven, Belgium;5. CEPR, United Kingdom;6. Research Department, Norges Bank, P.O. Box 1179 Sentrum, N-0107 Oslo, Norway;7. University of Groningen, Netherlands;8. Sveriges Riksbank, 10337 Stockholm;1. Moore School of Business, University of South Carolina, 1014 Greene Street, Columbia, SC 29208, United States\n;2. Wharton Financial Institutions Center, United States\n;3. European Banking Center, Netherlands\n;4. Villanova University, 800 Lancaster Avenue, 2065 Bartley Hall, Villanova, PA 19085, United States;1. Cotsakos College of Business, William Paterson University, 1600 Valley Road, Wayne, NJ 07470, USA;2. Fox School of Business, Temple University, 1801 Liacouras Walk, Philadelphia, PA 19122, USA |
| |
| Abstract: | The autumn of 1998 provides a setting in which to test the performance of the interbank market during a potential financial crisis. This period witnessed Russia's effective default on its sovereign bonds and the near collapse of the hedge fund Long-Term Capital Management. Despite these negative shocks to bank capital and increased uncertainty in financial markets, the federal funds market still effectively channeled liquidity to those institutions in need at rates consistent with Federal Reserve intentions. Further, risk premiums on overnight lending were largely unaffected and lending volumes increased, suggesting that the federal funds market performed well during this period. |
| |
| Keywords: | |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
