Liquidity Shocks, Banking System Failures, and Supranational Lending of Last Resort Facilities

Germana Corrado

Annals of Economics and Finance, 2005, vol. 6, issue 1, 1-24

Abstract: In a small open economy with a high share of short term foreign currency denominated debt the arrival of some negative information on banks' investment returns may lead to severe bank runs. We analyse how a supranational institution which acts as an international lender of last resort can cope with banking crises by guaranteeing run-proof bank deposit contracts.

Keywords: Fundamental-based bank runs; Run-proof deposit contracts; International lender of last resort (search for similar items in EconPapers)
JEL-codes: D8 E50 E58 F33 F42 G21 G28 (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:cuf:journl:y:2005:v:6:i:1:p:1-24

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