IMF Working Papers

Bank Debt in Europe: “Are Funding Models Broken”

By Vanessa Le Lesle

December 20, 2012

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Vanessa Le Lesle. Bank Debt in Europe: “Are Funding Models Broken”, (USA: International Monetary Fund, 2012) accessed September 20, 2024
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 crisis in Europe has underscored the vulnerability of European bank funding models compared to international peers. This paper studies the drivers behind this fragility and examines the future of bank funding, primarily wholesale, in Europe. We argue that cyclical and structural factors have altered the structure, cost, and composition of funding for European banks. The paper discusses the consequences of shifting funding patterns and investor preferences and presents possible policy options and bank actions to enhance European bank funding models’ robustness.

Subject: Asset and liability management, Bank deposits, Banking, Deposit insurance, Financial regulation and supervision, Financial statements, Liquidity, Liquidity requirements, Liquidity risk, Public financial management (PFM)

Keywords: Asia and Pacific, Bail-in, Bank capital, Bank creditor, Bank debt, Bank funding, Bank lending, Bank liability structure, Banks, Basel, Deposits, Europe, Financial statements, Funding, Funding challenge, Funding model, Liabilities, Liability structure, Liquidity, Liquidity requirements, Liquidity risk, Profitability prospects, Self-financing effort, Senior debt, Unsecured debt, WP

Publication Details

  • Pages:

    40

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2012/299

  • Stock No:

    WPIEA2012299

  • ISBN:

    9781475522037

  • ISSN:

    1018-5941

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