Austria's IBSG Guarantee Program (Austria GFC)

Claire Simon ()
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Claire Simon: YPFS, Yale School of Management, https://elischolar.library.yale.edu/journal-of-financial-crises/

Journal of Financial Crises, 2020, vol. 2, issue 3, 593-606

Abstract: Following the adoption of a joint framework by euro-area countries in response to the intensifying financial crisis in October 2008, Austria enacted a package of measures including the Interbank Market Support Act (Interbankmarktstarkungsgesetz, "IBSG"). In addition to calling for the establishment of a new clearing bank to facilitate interbank lending, IBSG permitted the Austrian government to guarantee debt securities issued by other eligible institutions. Securities issued by eligible institutions with a maturity of three years or less (five years in exceptional circumstances) were eligible for guarantee. According to IBSG, the amount outstanding for all measures taken under the act could not exceed EUR75 billion. Of this, EUR4 billion was specifically allocated for guarantees of the clearing bank, Oesterreichische Clearingbank AG (OeCAG). This was subsequently reduced to EUR50 billion. The guarantee scheme established by IBSG was used by six institutions in addition to OeCAG, for a total of approximately EUR25 billion (EUR24.05 billion, CHF 325 million, and JPY20 billion). After being extended by one year the issuance window for guarantees closed on December 31, 2010. None of the participating institutions defaulted on the guaranteed debt. The amount of guaranteed debt outstanding declined steadily, and all had matured by June 2014.

Keywords: credit guarantee; interbank lending; Austria (search for similar items in EconPapers)
JEL-codes: G01 G28 (search for similar items in EconPapers)
Date: 2020
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