{
  "title": "What is Shadow Banking?",
  "publication": "IMF Working Papers, February 11, 2014",
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  "summary": "There is much confusion about what shadow banking is. Some equate it with securitization, others with non-traditional bank activities, and yet others with non-bank lending. Regardless, most think of shadow banking as activities that can create systemic risk.",
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    {
      "heading": "Summary",
      "content": "- The paper addresses widespread confusion about what constitutes shadow banking.\n- Common associations include securitization, non-traditional bank activities, and non-bank lending.\n- Most view shadow banking as activities that can create systemic risk.\n- The paper proposes describing shadow banking as “all financial activities, except traditional banking, which require a private or public backstop to operate”.\n- Backstops can be:\n  - franchise value of a bank or insurance company, or\n  - a government guarantee.\n- The need for a backstop is presented as a crucial feature that distinguishes shadow banking from “usual” intermediated capital market activities (examples: custodians, hedge funds, leasing companies)."
    },
    {
      "heading": "Definition and key feature",
      "content": "- Proposed definition: “all financial activities, except traditional banking, which require a private or public backstop to operate”.\n- Crucial distinguishing feature: requirement of a private or public backstop to operate."
    },
    {
      "heading": "Backstops (forms and implications)",
      "content": "- Forms of backstops identified:\n  - franchise value of a bank or insurance company\n  - government guarantee\n- Implication highlighted: activities that require such backstops are those most associated with the creation of systemic risk."
    },
    {
      "heading": "Distinction from intermediated capital market activities",
      "content": "- Activities not classified as shadow banking under the proposed definition include:\n  - custodians\n  - hedge funds\n  - leasing companies\n- These are characterized as “usual” intermediated capital market activities that do not require a private or public backstop to operate.\n\n---\n\n Content in this bundle\n\n- PDP-Working Paper\n  - PDP-Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - PDP-Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/what-is-shadow-banking-41334"
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    "Authors: Stijn Claessens, Lev Ratnovski",
    "Published: February 11, 2014",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781475597349.001",
    "The paper addresses widespread confusion about what constitutes shadow banking.",
    "Common associations include securitization, non-traditional bank activities, and non-bank lending.",
    "Most view shadow banking as activities that can create systemic risk.",
    "The paper proposes describing shadow banking as “all financial activities, except traditional banking, which require a private or public backstop to operate”.",
    "Backstops can be:",
    "The need for a backstop is presented as a crucial feature that distinguishes shadow banking from “usual” intermediated capital market activities (examples: custodians, hedge funds, leasing companies).",
    "Proposed definition: “all financial activities, except traditional banking, which require a private or public backstop to operate”.",
    "Crucial distinguishing feature: requirement of a private or public backstop to operate.",
    "Forms of backstops identified:",
    "Implication highlighted: activities that require such backstops are those most associated with the creation of systemic risk.",
    "Activities not classified as shadow banking under the proposed definition include:",
    "These are characterized as “usual” intermediated capital market activities that do not require a private or public backstop to operate.",
    "**PDP-Working Paper**"
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