Bank Debt in Europe : “Are Funding Models Broken”

Author/Editor: Vanessa Le Lesle
Publication Date: December 20, 2012
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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 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.
Series: Working Paper No. 12/299
Subject(s): Banking sector | Europe | Banks | Debt | Liquidity | Risk management

Publication Date: December 20, 2012
ISBN/ISSN: 9781475522037/1018-5941 Format: Paper
Stock No: WPIEA2012299 Pages: 40
US$18.00 (Academic Rate:
US$18.00 )
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