Central Banks as Bankers to Each Other: Overview, Trends, and Future Directions in Global Official Sector Service Provision

Simon Potter, Matthew Nemeth () and Mark Choi
Additional contact information
Matthew Nemeth: Federal Reserve Bank of New York
Mark Choi: Federal Reserve Bank of New York

Chapter Chapter 22 in Asset Management at Central Banks and Monetary Authorities, 2020, pp 365-381 from Springer

Abstract: Abstract The choice of custodial and banking relationships is an underappreciated but important consideration for reserve managers in managing their overall risk profile. The major reserve currency central banks have long served as correspondent banks, transactional agents, and custodians for the safekeeping of foreign reserves for each other and the global central banking community. The ability of central banks to provide each other with safe, confidential, and reliable banking and custody services (BCS) has provided important public benefits, aiding in central banks’ execution of foreign reserve management, monetary policy implementation, financial stability operations, and other mission-critical central bank activities. In the decade since the global financial crisis, and demonstrating the continued strong policy rationale for the inter-central bank provision of BCS, official BCS volumes have continued to grow, reflecting broader global reserve accumulation patterns, the impact of regulatory reforms, counterparty risk perceptions, correspondent bank de-risking, official cross-border financial stability initiatives, and other trends. More recently, the increasingly dangerous cyber threat to wholesale payments security has led central bank providers of BCS and their central bank clients to adapt in order to better protect foreign reserve assets from criminal actors.

Date: 2020
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
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:spr:sprchp:978-3-030-43457-1_22

Ordering information: This item can be ordered from
http://www.springer.com/9783030434571

DOI: 10.1007/978-3-030-43457-1_22

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().