{
  "title": "Uncertainty and Cross-Border Banking Flows",
  "publication": "IMF Working Papers, January 5, 2018",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2018/01/05/uncertainty-and-cross-border-banking-flows-45539",
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  "summary": "While global uncertainty—measured by the VIX—has proven to be a robust global “push” factor of international capital flows, there has been no systematic study assessing the role of country-specific uncertainty as a key (pull and push) factor of international capital flows.",
  "sections": [
    {
      "heading": "Overview and research objective",
      "content": "- Paper examines the effects of country-specific uncertainty shocks on cross-border banking flows.\n- Uses confidential Bank for International Settlements Locational Banking Statistics data with a dyadic structure to disentangle supply and demand factors.\n- Authors: Sangyup Choi, Davide Furceri\n- Date: January 5, 2018\n- Format: IMF Working Papers"
    },
    {
      "heading": "Key findings",
      "content": "- Uncertainty is both a push and pull factor that robustly predicts a decrease in both outflows (retrenchment) and inflows (stops).\n- Global banks rebalance their lending towards safer foreign borrowers from local borrowers when facing higher uncertainty.\n- This rebalancing occurs only towards advanced economies (flight to quality), but not emerging market economies."
    },
    {
      "heading": "Methodology and data notes",
      "content": "- Empirical analysis based on the dyadic structure of BIS Locational Banking Statistics to better identify effects on cross-border banking flows.\n- Country-specific uncertainty shocks are the focus, distinguishing from global measures such as the VIX."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subjects: Balance of payments, Bank credit, Banking, Capital flows, Cross-border banking, Emerging and frontier financial markets, Financial markets, Financial services, Money, Stock markets\n- Keywords: Bank credit, banking flow, banking office, Capital flows, Cross-border banking, cross-border banking flows, cross-border claim, cross-border lending, Emerging and frontier financial markets, flight-to-quality, Global, global bank, lending activity, portfolio rebalancing, retrenchment, Stock markets, sudden stops, uncertainty, WP\n\n---\n\n Content in this bundle\n\n- Uncertainty and Cross-Border Banking Flows, WP/18/4, January 2018\n  - Uncertainty and Cross-Border Banking Flows, WP/18/4, January 2018 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Uncertainty and Cross-Border Banking Flows, WP/18/4, January 2018 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2018/01/05/uncertainty-and-cross-border-banking-flows-45539"
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    "Authors: Sangyup Choi, Davide Furceri",
    "Published: January 5, 2018",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781484336793.001",
    "Paper examines the effects of country-specific uncertainty shocks on cross-border banking flows.",
    "Uses confidential Bank for International Settlements Locational Banking Statistics data with a dyadic structure to disentangle supply and demand factors.",
    "Authors: Sangyup Choi, Davide Furceri",
    "Date: January 5, 2018",
    "Format: IMF Working Papers",
    "Uncertainty is both a push and pull factor that robustly predicts a decrease in both outflows (retrenchment) and inflows (stops).",
    "Global banks rebalance their lending towards safer foreign borrowers from local borrowers when facing higher uncertainty.",
    "This rebalancing occurs only towards advanced economies (flight to quality), but not emerging market economies.",
    "Empirical analysis based on the dyadic structure of BIS Locational Banking Statistics to better identify effects on cross-border banking flows.",
    "Country-specific uncertainty shocks are the focus, distinguishing from global measures such as the VIX.",
    "Subjects: Balance of payments, Bank credit, Banking, Capital flows, Cross-border banking, Emerging and frontier financial markets, Financial markets, Financial services, Money, Stock markets",
    "Keywords: Bank credit, banking flow, banking office, Capital flows, Cross-border banking, cross-border banking flows, cross-border claim, cross-border lending, Emerging and frontier financial markets, flight-to-quality, Global, global bank, lending activity, portfolio rebalancing, retrenchment, Stock markets, sudden stops, uncertainty, WP",
    "**Uncertainty and Cross-Border Banking Flows, WP/18/4, January 2018**"
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