Elena Seghezza

Credit Supply and the Rise in Sovereign Debt Risk in the Eurozone

Since the financial crisis of 2007–2008, much has been written about the consequences of the fragility of the banking systems of several countries, as that fragility affects these countries’ deficit and debt and the resulting crisis. The need to save the banking system from a severe insolvency crisis has prompted the governments of many countries to support their economies by implementing expansionary fiscal policies, with the state taking on the losses of banks in difficulty. In many cases this has resulted in a significant increase in public deficits and debts.

Indipendenza delle banche centrali e coordinamento tra politica monetaria e politica fiscale

In a mode1 a la Rogoff, with independent fiscal (AF) and monetary (AM) authority, the Nash equilibrium is characterized by an infiation rate and by a fiscal surplus lower than the ones desired by the two authorities. In the contract of performance approach, the coordination problem between monetary and fiscal policy is solved bringing back the AM preferences to those of the AF. In this way, monetary policy is not safeguarded by politica1 pressures. If one accepts the political business cycle approach, the relations between AF and AM are brought back to a multi-period context, rather than a one period context as in Rogoff and in the contract of performance approach. In this perspective, AM and AF, although both independent, can give rise to repeated games and to forms of coordination, spontaneous or «forced». The latter can be realized in institutional moments of negotiation between AM and AF or in normative constraints to the behaviour of AM and AF.

Gross Imbalances, Liquidity Shortage and the Role of the Federal Reserve

There has been much debate about the link between global imbalances and the financial crisis of 2007–2008. The most recent contributions show that the recent global financial crisis was preceded not so much by a widening of current account imbalances as by a pronounced increase in gross capital flows between countries. In particular, between 2002 and 2007 several banks from major European countries dramatically increased their long-term assets in dollars, in particular as asset-backed securities (ABS), by stocking up on short-term funding on the interbank market or the money market.

Diversification, Diversity and Systemic Risk in European Banking

The recent financial crisis has revealed the unexpected fragility of financial systems in the industrialized countries. The process of national deregulation that started in the 1980s led to an intense process of consolidation of financial institutions. Consequently, both in the United States and in Europe, the degree of concentration in banking systems increased significantly.

The Italian Popular Banks and Their Behaviour after the Recent Financial Crisis

In this work we intend to understand whether Italian Popular Banks’ particular corporate governance has implications for the profitability and efficiency of these banks and for the behaviour of these banks across economic cycles, like the recent financial crisis. Part of the literature comprises the peculiarity of Popular Banks in the wider panorama of local banks: being near to the customers allows banks which operate in a limited geographical area to enjoy advantages as regards information. Such advantages can be traced back to the fact that local bank managers can take account of a large range of factors, such as the loan-holder’s personal characteristics and those of the local markets, when evaluating the creditworthiness of small businesses.