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World Economic and Financial Surveys

Global Financial Stability Report

A Quarterly Report on Market Developments and Issues
June 2002

©2002 International Monetary Fund
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The Global Financial Stability Report provides quarterly assessments of global financial markets and addresses emerging market financing in a global context.

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 Contents   
 
Preface
 
Chapter I. Overview (140KB pdf file)
Corporate Profitability Impacts on Financial Markets
Corporate Profitability and the Banking Sector
Financial Market Activities of Insurance Companies
Developments in Emerging Markets
Local Equity Markets
Chapter II. Recent Developments (269KB pdf file)
Mature Markets
Mature Market Vulnerabilities--The Weakness in Japan's
Banking Sector
Emerging Market Developments and Financing
References
Chapter III. The Financial Market Activities of Insurance and Reinsurance Companies (140KB pdf file)
Insurance and Reinsurance Financial Activities
Financial Efficiency and Stability Questions Raised by
Insurers' Financial Activities
Some Concluding Thoughts
References
Chapter IV. Emerging Equity Markets (155k pdf file)
Emerging Market Equities as an Asset Class for Foreign Investors
Domestic Equity as an Alternative Source of Funding
Conclusions
References
 
Boxes
2.1 Enron: Lessons Learned and the Response
2.2 Mature Equity Market Valuations
2.3 Are Forward Short Rates Useful Indicators of Market Expectations?
2.4 The Shrinking U.S. Commercial Paper Market
2.5 The Balance of Risks for Emerging Equity Markets
 
Tables
2.1 Performance of Mature Equity Market Sectors, 2002: Q1
2.2 Emerging Market Financing Overview
2.3 Index Performance
2.4 Performance of Emerging Bond Markets
2.5 Sovereign Spreads and Ratings
2.6 Currency of Issuance
2.7 Performance of Emerging Equity Markets
3.1 Life Insurance: Premium Growth Rates
3.2 Profitability Decomposition of Major Non-Life Markets
4.1 Equity and Bond Returns
 
Figures  
2.1 Evolution of Consensus 2002 GDP Growth Forecasts
2.2 Liquidity and Credit Premia Index
2.3 Mature Equity Market Dollar-Denominated Indices
2.4 International Yield Curve Differentials
2.5 Expected Policy Rates: Federal Funds Futures, 2002
2.6 Credit Market Spreads
2.7 European Credit Market Spreads
2.8 Japan Credit Curves
2.9 Major Currencies Against the U.S. Dollar
2.10 Emerging Markets Financing
2.11 Emerging Market Spreads
2.12 Bond Issues
2.13 Average Correlations of the Returns on Emerging Equity Markets Indices
2.14 Net Inflows into U.S. Equity Mutual Funds
2.15 Emerging Market Earnings Forecasts
2.16 Equity Placements
2.17 Syndicated Loan Commitments
2.18 Loan-Weighted Interest Margin
2.19 Latin American Currencies Against the U.S. Dollar
2.20 Asian Currencies: Cross Rates Against the Yen
2.21 Asian Currencies: Non-Deliverable Forward Implied Yields
3.1 Total Financial Assets of Institutional Investors and Banks: United States and Japan
3.2 Financial Assets of Institutional Investors and Banks: Selected Euro Area Countries and United Kingdom
3.3 Holdings of Financial Securities by Insurance Companies and Banks
3.4 Holdings of Securities Relative to Domestic Market Size
3.5 United States: Corporate and Foreign Bonds
3.6 Balance Sheet Assets of Insurance Companies: United States and Japan
3.7 Balance Sheet Assets of Insurance Companies: Selected Euro Area Countries and United Kingdom
3.8 Global Insurance Industry Results
3.9 Non-Life Insurance: Combined Ratios in the Industrial Countries
4.1 Equity and Bond Performances
4.2 Risk-Return Trade-Off for Emerging Market and U.S. Stock Portfolios
4.3 Valuation Indicators in Emerging Equity Markets
4.4 Correlations Between Returns in Emerging and U.S. Equity Markets
4.5 Stock Market Capitalization and Bank Credit
4.6 Domestic and International Equity Issuance