Interbank tiering and money center banks

Ben Craig and Goetz von Peter (goetz.von.peter@bis.org)

No 1014, Working Papers (Old Series) from Federal Reserve Bank of Cleveland

Abstract: This paper provides evidence that interbank markets are tiered rather than flat, in the sense that most banks do not lend to each other directly but through money center banks acting as intermediaries. We capture the concept of tiering by developing a core-periphery model, and devise a procedure for tting the model to real-world networks. Using Bundesbank data on bilateral interbank exposures among 1800 banks, we find strong evidence of tiering in the German banking system. Econometrically, bank-specific features, such as balance sheet size, predict how banks position themselves in the interbank market. This link provides a promising avenue for understanding the formation of financial networks.

Keywords: Interbank market; Banks and banking, Central - Germany (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-cba and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (48)

Downloads: (external link)
https://doi.org/10.26509/frbc-wp-201014 Persistent Link (text/html)
https://www.clevelandfed.org/-/media/project/cleve ... center-banks-pdf.pdf Full Text (application/pdf)

Related works:
Journal Article: Interbank tiering and money center banks (2014)
Working Paper: Interbank tiering and money center banks (2010)
Working Paper: Interbank tiering and money center banks (2010)
Working Paper: Interbank tiering and money center banks (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fip:fedcwp:1014

Ordering information: This working paper can be ordered from
4d.library@clev.frb.org

DOI: 10.26509/frbc-wp-201014

Access Statistics for this paper

More papers in Working Papers (Old Series) from Federal Reserve Bank of Cleveland Contact information at EDIRC.
Bibliographic data for series maintained by 4D Library (4d.library@clev.frb.org).