## Figure 2.9. Higher Riskiness of Credit Allocation Signals Greater Risk of a Systemic Banking Crisis (Proportional increase in the odds of a banking crisis)

## Source details

**Canonical URL:** [Figure 2.9. Higher Riskiness of Credit Allocation Signals Greater Risk of a Systemic Banking Crisis (Proportional increase in the odds of a banking crisis)](https://www.imf.org/-/media/files/publications/gfsr/2018/april/chapter-2/pdf/figure2-9.pdf)

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### Key finding
- The figure shows the multiplicative effect of a one standard deviation increase in the riskiness of credit allocation on the odds of a systemic banking crisis, as defined in Laeven and Valencia (forthcoming).
- Proportional increase in the odds of a banking crisis is illustrated across different risk dimensions.

### Risk dimensions displayed
- LeverageInterest
- coverage ratio
- Debt overhangExpected default
- frequency

### Quantitative indicators (values shown on the figure)
- 3.5
- 4.0
- 4.5
- 5.0

### Methodology note
- See Annex 2.3 for methodology.
- Source: IMF staff estimates.

*Source: IMF staff estimates.*

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_Source: https://www.imf.org/-/media/files/publications/gfsr/2018/april/chapter-2/pdf/figure2-9.pdf_