Inside the Crisis: An Empirical Analysis of Banking Systems in Distress
IMF Working Papers, August 1, 2000
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- Inside the Crisis: An Empirical Analysis of Banking Systems in Distress
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Bibliographic details
- Authors: . Poonam Gupta, Asli Demirgüç-Kunt, Enrica Detragiache
- Published: August 1, 2000
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451857399.001
Summary
- Using aggregate and bank level data for several countries, the paper studies what happens to the banking system in the aftermath of a banking crisis.
- Contemporary crises are not accompanied by declines in aggregate bank deposits, and credit does not fall relative to output, although the growth of both deposits and credit slows down substantially.
- Output recovery begins in the second year after the crisis and is not led by a resumption in credit growth.
- Banks, including the stronger ones, reallocate their asset portfolio away from loans.
Key empirical findings
- Aggregate bank deposits: no declines in contemporary crises (statement as reported).
- Credit relative to output: does not fall, though credit growth slows substantially.
- Deposit growth: slows substantially in the aftermath of crises.
- Output recovery timing: begins in the second year after the crisis.
- Bank behavior: reallocation of asset portfolios away from loans, including by stronger banks.
Subject areas and keywords
- Subject: Bank credit, Bank deposits, Banking, Banking crises, Commercial banks, Credit, Financial crises, Financial institutions, Money
- Keywords: asset, bank, bank assets, bank credit, Bank credit, bank credit-to-GDP, bank distress, bank performance, bank recapitalization plan, bank runs, Banking crises, Commercial banks, Credit, credit crunch, crisis year, deposit, deposit growth, deposit guarantee, depositor, East Asia, WP
Content in this bundle
- Inside the Crisis: An Empirical Analysis of Banking Systems in Distress - WP/00/156