Currency Crises and the Real Economy: The Role of Banks

May 1, 2001

Preview Citation

Format: Chicago

Piti Disyatat. Currency Crises and the Real Economy: The Role of Banks, (USA: International Monetary Fund, 2001) accessed June 25, 2025

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

This paper shows that the quality of banks within each country is one of the important factors that can account for the fact that developing economies tend to suffer more severe output contractions in the wake of a currency crisis than more mature economies. In particular, countries with a banking sector whose balance sheets are healthy, in terms of having high net worth and low foreign currency exposure, are much less likely to suffer a contraction in the wake of an unexpected depreciation.

Subject: Banking, Commercial banks, Currency crises, Depreciation, Employment, Financial crises, Financial institutions, Financial statements, Labor, National accounts, Public financial management (PFM)

Keywords: Asia and Pacific, Balance sheet, Bank lending channel, Bank scope database, Banking crisis, Banking sector, Banks fail, Commercial banks, Cost of funds, Currency crises, Currency crisis, Depreciation, Domestic bank, Employment, Financial statements, Foreign currency debt, Output, Representative bank, WP

Publication Details

Pages:

29
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2001/049
Stock No:

WPIEA0492001
ISBN:

9781451846843
ISSN:

1018-5941

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