Global Financial Stability Report
Market Developments and Issues
April 2005
On this site, the term "country" does not in all cases refer to a territorial entity that is a state as understood by international law and practice. As used here, the term also covers some territorial entities that are not states. Dependent territories of member countries are listed alphabetically followed by a description of the constitutional relationships with their member countries.
©2005 International Monetary Fund
Ordering Information
The Global Financial Stability Report provides semiannual assessments of global financial markets and addresses emerging market financing in a global context.* |
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| Contents | ||
| Preface | ||
| Chapter I. | Overview (86KB pdf file) | |
| Assessment of Global Financial Stability | ||
| Risks in the Period Ahead | ||
| Policy Measures to Mitigate Risks | ||
| Risk Transfer to the Household Sector | ||
| Financing Prospects and Risks Facing Emerging Market Countries | ||
| Chapter II. | Global Financial Market Developments (928KB pdf file) | |
| Market Developments | ||
| Developments and Risks in Mature Financial Markets | ||
| Developments and Vulnerabilities in Emerging Markets | ||
| Emerging Market Financing | ||
| Banking Sector Developments in Emerging Markets | ||
| Structural Issues in Mature Markets | ||
| References | ||
| Chapter III. | Household Balance Sheets (184KB pdf file) | |
| Household Balance Sheets | ||
| Household Investment and Risk Management Behavior | ||
| Need to Communicate, Educate, and Facilitate Advice | ||
| Concluding Observations | ||
| References | ||
| Chapter IV. | Corporate Finance in Emerging Markets (238KB pdf file) | |
| Recent Trends in Corporate Finance | ||
| Structural Determinants and Obstacles | ||
| Vulnerabilities Associated with the Level and Composition of Corporate Finance | ||
| Policy Issues | ||
| Appendix | ||
| References | ||
| Glossary (59KB pdf file) | ||
| Annex: Summing Up by the Chairman (56KB pdf file) | ||
| Statistical Appendix (1,066KB pdf file) | ||
| Boxes | ||
| 2.1 | Gauging Global Liquidity Conditions | |
| 2.2 | Pension Fund Update | |
| 2.3 | Insurance Industry Update | |
| 2.4 | Credit Derivatives Market Came of Age in 2004 | |
| 2.5 | Collective Action Clauses | |
| 2.6 | Issuing Global Bonds in Local Currencies: Toward the Absolution of Original Sin? | |
| 2.7 | Distance-to-Default Measure of Bank Soundness | |
| 3.1 | Longevity Bonds | |
| 4.1 | Finance and Economic Growth: A Brief Review of the Evidence | |
| 4.2 | New Firm-Level Evidence on Hedging Activities in the Nonfinancial Sector in Latin America | |
| Tables | ||
| 2.1 | Emerging Market Financing | |
| 2.2 | Emerging Market Countries: Selected Bank Financial Soundness Indicators | |
| 2.3 | Recent Inflows, Performance, and Leverage of Hedge Funds | |
| 3.1 | Household Balance Sheet Volatility Measures | |
| 3.2 | Mortgage Markets in Selected Industrialized Countries: General Characteristics | |
| 4.1 | Structural Determinants of Corporate Leverage, 1993–2003 | |
| 4.2 | Cost of Equity Capital Estimates by Country | |
| 4.3 | Bankruptcy Costs and Legal Rights, 2004 | |
| 4.4 | Investor Protection by Country | |
| 4.5 | Use of IFRS for Domestically Listed Firms, by 2005 | |
| 4.6 | Countries with a Code of Good Corporate Governance | |
| 4.7 | Estimates of Average Firm-Level Private Benefits of Control Across Countries | |
| 4.8 | Corporate Debt Structures | |
| 4.9 | Nonfinancial Private Sector Firms: Sample Size for 2002 | |
| Figures | ||
| 2.1 | Global Real Interest Rates and Excess Liquidity | |
| 2.2 | Policy Rates | |
| 2.3 | U.S. Tightening Cycles: Movement in 10-Year Treasury Yields | |
| 2.4 | Real Yields on Inflation-Indexed Bonds | |
| 2.5 | U.S. Economic Growth and Treasury Yields | |
| 2.6 | Foreign Ownership of U.S. Securities | |
| 2.7 | High-Grade Corporate Bond Spreads | |
| 2.8 | High-Yield Corporate Bond Spreads | |
| 2.9 | Speculative Grade Corporate Default Rates | |
| 2.10 | Credit Derivatives Market | |
| 2.11 | Price-Earnings Ratios | |
| 2.12 | U.S. Equity and Benchmark Government Yields | |
| 2.13 | German Equity and Benchmark Government Yields | |
| 2.14 | Implied Volatilities | |
| 2.15 | Equity Volatility | |
| 2.16 | Equity Volatility and Corporate Spreads | |
| 2.17 | Implied Versus Actual Volatility | |
| 2.18 | United States: External Balance | |
| 2.19 | Emerging Asia Reserve Accumulation | |
| 2.20 | Asia (Excluding Japan) Currency Index | |
| 2.21 | Chinese Yuan 12-Month Forward Rates | |
| 2.22 | United States: 10-Year Rate Spread and Current Account Balance | |
| 2.23 | Currency Volatilities | |
| 2.24 | EMBIG Sovereign Spreads | |
| 2.25 | Risk-Return Trade-off | |
| 2.26 | Emerging Market Credit Bucket Spread Difference | |
| 2.27 | EMBI Global Performance, 2004 | |
| 2.28 | Forecast and Actual EMBIG Spread | |
| 2.29 | Differentials Between Corporate and Emerging Market Spreads | |
| 2.30 | Foreign Participation Rates in Local Markets | |
| 2.31 | Trading Volumes in Local Emerging Market Instruments | |
| 2.32 | Correlations Between Local and External Debt | |
| 2.33 | Emerging Market Financing | |
| 2.34 | Quarterly Emerging Market Net Issuance | |
| 2.35 | Emerging Market Bond Issuance | |
| 2.36 | Share of Emerging Market Bond Issuance | |
| 2.37 | Emerging Market Bond Issuance by Currency | |
| 2.38 | Emerging Market Equity Issuance | |
| 2.39 | Emerging Market Syndicated Loan Commitments | |
| 2.40 | Foreign Direct Investment | |
| 2.41 | Asian Emerging Markets: Market Indicators | |
| 2.42 | Emerging Europe: Market Indicators | |
| 2.43 | Latin America: Market Indicators | |
| 2.44 | Arab Light/Heavy, Brent, and West Texas Intermediate Crude Oil Pricing | |
| 2.45 | West Texas Intermediate Crude Oil Futures Price Volatility | |
| 2.46 |
Implied Volatility of Oil Futures Prices and Crude Oil Positions of Noncommercial Traders |
|
| 2.47 |
Value at Risk (VaR) for Complete Portfolio of Banks: Total VaR and VaR Without World Market and Local Market Effects (VaR-Beta) |
|
| 2.48 |
Bank and LCFI Portfolios: Value at Risk Without World Market and Local Market Effects (VaR-Beta) |
|
| 2.49 |
Japanese Banks: Value at Risk (VaR) Without World Market and Local Market Effects (VaR-Beta) |
|
| 2.50 |
Total Diversification Effect and Diversification Without Market Effects (Diversification-Beta) for LCFIs and Commercial Banks |
|
| 2.51 | Probability of Observing a Default Over a Two-Year Period | |
| 2.52 | Insurance Portfolio Value at Risk (VaR) | |
| 3.1 | Household Sector: Net Worth and Net Financial Assets in Domestic Currencies | |
| 3.2 | Household Sector: Total Asset Composition | |
| 3.3 | Japan: Total Asset Composition by Household Groups | |
| 3.4 | United States: Total Asset Composition by Household Groups | |
| 3.5 | Netherlands: Distribution of Net Worth by Income Quintiles | |
| 3.6 | Household Sector: Real Estate Values and Mortgage Debt | |
| 4.1 | Corporate Debt Outstanding by Instrument in Emerging Markets | |
| 4.2 | Corporate Leverage and External Debt in Emerging Markets | |
| 4.3 | Bank Credit Outstanding | |
| 4.4 | Banking Sector in Emerging Markets | |
| 4.5 | Corporate Bonds Outstanding | |
| 4.6 | Composition of Outstanding Corporate Domestic Debt | |
| 4.7 | Equity Issuance | |
| 4.8 | Internal Financing of Capital Expenditure | |
| 4.9 | Outstanding Bank Loans and Securities | |
| 4.10 | Dollarization of Assets and Liabilities in the Nontradable Sector in Latin America | |
| 4.11 | Bankruptcy Risk Indicators: Probability of Default and Altman's Z-Scores | |
| 4.12 | Foreign Currency Mismatch in the Nontradable Sector in Latin America | |
|
On this site, the term "country" does not in all cases refer to a territorial entity that is a state as understood by international law and practice. As used here, the term also covers some territorial entities that are not states. Dependent territories of member countries are listed alphabetically followed by a description of the constitutional relationships with their member countries. |