Managing the Sovereign-Bank Nexus

The financial health of banks and sovereigns is intertwined in a "sovereign-bank nexus" that may multiply and accelerate vulnerabilities in each sector.
Volume/Issue: Volume 2018 Issue 016
Publication date: September 2018
ISBN: 9781484359624
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Topics covered in this book

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Banks and Banking , Money and Monetary Policy , Public Finance , DPPP , DP , economic activity , resolution framework , bank distress , interest rate , sovereign exposure , bank CDS , banking crisis , bank Risk , sovereign-bank nexus , bank risk , bank capital losses , bank's CD , bank CD , banks assets , Sovereign bonds , Banking crises , Credit default swap , Global

Summary

This paper reviews empirical and theoretical work on the links between banks and their governments (the bank-sovereign nexus). How significant is this nexus? What do we know about it? To what extent is it a source of concern? What is the role of policy intervention? The paper concludes with a review of recent policy proposals.