Who is to blame for the credit crunch: foreign ownership or foreign funding?

Erik Feyen, Raquel Letelier, Inessa Love, Samuel Munzele Maimbo, Roberto Rocha, 15 March 2014

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From boom to crunch

Although most developing countries around the world experienced a severe contraction of bank credit during the recent global financial crisis, the Eastern Europe and Central Asia (ECA) region was disproportionately hit after it had experienced very high credit growth (Figure 1).

Figure 1. Banking system trends in ECA

Topics: Financial markets, Global crisis, International finance
Tags: banking, Central Asia, Credit crunch, credit growth, cross-border banking, Eastern Europe, global financial crisis

Job losses from the credit crunch during the Great Recession

Samuel Bentolila, Marcel Jansen, 1 February 2014

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Policymakers in both Europe and the US are concerned about the economic implications of the current shortage of credit. As the International Monetary Fund put it recently, “policymakers want to support markets because the decline in lending is seen to be a primary factor in the slow recovery” (IMF 2013).

Topics: Global crisis
Tags: Credit crunch, Great Recession, job losses, Spain

Is lending by state banks more stable over the business cycle?

Ata Can Bertay, Asli Demirgüç-Kunt, Harry Huizinga, 2 August 2012

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During the banking crisis of 2008-2009, government bailouts of banks in Europe and elsewhere frequently resulted in state ownership of the bank. The rescue of Fortis Bank in 2008, for instance, involved the nationalisation of ABN Amro by the Dutch state.

Topics: Global crisis, International finance
Tags: Bailouts, bank ownership, Credit crunch, state banks

Credit demand, supply, and conditions: A tale of three crises

Sarah Holton, Martina Lawless, Fergal McCann, 4 March 2012

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The post-2007 Eurozone economic crisis has taken on a number of forms. Real economic activity has declined, in certain cases significantly. Turmoil in sovereign and financial sectors has seen yields on government bonds and spreads on bank credit-default swaps (CDSs) increase dramatically. The vast credit expansion of the previous decade has led to large private sector debt overhang.

Topics: Europe's nations and regions, International finance
Tags: credit, Credit crunch, Eurozone crisis, Small and medium enterprises

Home bias and the credit crunch: Evidence from Italy

Andrea F Presbitero, Gregory F Udell, Alberto Zazzaro, 12 February 2012

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The management of the Eurozone sovereign debt crisis will have significant effects on the stability of national banking systems, as argued in some recent Vox columns (Acharya et al 2011, Wyplosz 2011).

Topics: Financial markets
Tags: banks, Credit crunch, cross-border banking, Italy

European Banking Authority and the capital of European banks: Don’t shoot the messenger

Marco Onado, Andrea Resti, 7 December 2011

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The newborn European Banking Authority (EBA) has been fiercely criticised in the first few months of its life. According to many observers:

Topics: EU policies, Financial markets
Tags: Credit crunch, European Banking Authority, stress tests

The credit crunch of 1294: Causes, consequences and the aftermath

Adrian R. Bell, Chris Brooks, Tony Moore, 13 May 2009

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The Ricciardi and Edward I

Topics: Economic history, Financial markets
Tags: Credit crunch, economic history, Edward I

Fiscal policy and the credit crunch: What will work?

Daniel Gros, 21 December 2008

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As the real economy sinks quickly into a deep recession, governments are groping for measures to limit the downturn.

Topics: Macroeconomic policy
Tags: Credit crunch, fiscal stimulus

India’s credit crunch conundrum

Arvind Subramanian, 10 November 2008

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How can India be facing credit crunch if credit continues to grow at a torrid 30%? Yet, it is undeniable that call rates have risen sharply to double-digit levels. What is going on? And how should monetary policy respond?

Topics: Financial markets
Tags: Credit crunch, India, interest rates

Escaping from a Combined Liquidity Trap and Credit Crunch

Frank Heinemann, 26 October 2008

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Between the collapse of Lehman Brothers on 15 September and the announcements of European and US bank recapitalizations on 13 and 14 October, stock prices fell daily, producing double-digit percentage-point losses in most major markets. The muscular interventions agreed on 13 and 14 October seem to have quelled the worst of the panic, but stock prices have not rebounded.

Topics: Financial markets
Tags: Credit crunch, financial crises, liquidity trap, monetary policy, subprime crisis

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