 Assessment of the banking sector's exposure to hydrometeorological events in Costa RicaIrene Alvarado-Quesada, Jose Pablo Barquero-Romero and Cristian Sancho-Brenes Latin American Journal of Central Banking (previously Monetaria), 2025, vol. 6, issue 3 Abstract: This study examines, for the first time, the exposure of the credit portfolio of the banking system in Costa Rica to hydrometeorological events, specifically excess rainfall events, with a focus on firm credit at the canton level. We propose a credit risk indicator to identify cantons with credit portfolios that are more affected by rainfall events. Moreover, we introduce a novel approach with respect to firm level data to assign a single productive location to firms with two or more establishments. We find that cantons with the highest number of excess rainfall events represent a small share of the average credit balance of the country. Furthermore, we observe that the top three cantons with the highest credit risk score are driven by economic activities that are not expected to be notably vulnerable to extreme rainfall. Keywords: Hydrometeorological events; Physical risks; Banking sector; Credit risk (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:lajcba:v:6:y:2025:i:3:s2666143824000371 DOI: 10.1016/j.latcb.2024.100155 Access Statistics for this article Latin American Journal of Central Banking (previously Monetaria) is currently edited by Manuel Ramos-Francia More articles in Latin American Journal of Central Banking (previously Monetaria) from Elsevier |
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