A financial stress index for a highly dollarized developing country: The case of Lebanon

Layal MansourIshrakieh, Leila Dagher () and Sadika El Hariri
Authors registered in the RePEc Author Service: Layal Mansour Ichrakieh

Central Bank Review, 2020, vol. 20, issue 2, 43-52

Abstract: The aim of this paper is to construct the first comprehensive Financial Stress Index for Lebanon, dubbed the IFEFSI (Institute of Financial Economics Financial Stress Index). This is a broad coincident composite index that includes three different market segments; the banking sector, the equities market, and the foreign exchange and other markets. It is constructed as a continuous real-time measure that quantifies the level of systemic stress by measuring latent conditions. As a metric for financial conditions, the IFEFSI should provide valuable information to macroprudential regulators whose aim is to maintain a smooth and resilient financial system. By using it as a tool to help monitor, identify, and address any potential crisis, they are better equipped to maintain financial and economic stability in Lebanon.

Keywords: Financial stress index; Financial crisis; Lebanon; Economic policy (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (13)

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Working Paper: A Financial Stress Index for a Highly Dollarized Developing Country: The Case of Lebanon (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:tcb:cebare:v:20:y:2020:i:2:p:43-52

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