New Zealand Bank Vulnerabilities in International Perspective

Author/Editor:

Rodrigo Cubero ; R. Brooks

Publication Date:

October 1, 2009

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

The global financial crisis is creating stress on banking systems across the world through funding and asset quality shocks. This paper combines different stress scenarios, as well as cross-country analysis, to assess New Zealand bank vulnerabilities to the global crisis and the domestic recession. It finds that a sharp worsening of asset quality would be required to reduce bank capital below the regulatory minimum. On the funding side, a disruption to banks' offshore funding may put pressure on the exchange rate, but would not trigger a systemic liquidity problem.

Series:

Working Paper No. 2009/224

Subject:

Banking Capital adequacy requirements Financial institutions Financial regulation and supervision Financial sector policy and analysis Housing prices Loans Mortgages Prices Stress testing

English

Publication Date:

October 1, 2009

ISBN/ISSN:

9781451873719/1018-5941

Stock No:

WPIEA2009224

Pages:

26

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