Emergency Liquidity Support Facilities

Dong He

No 2000/079, IMF Working Papers from International Monetary Fund

Abstract: This paper discusses operational aspects of official emergency liquidity support to individual institutions under stress. It argues that properly designed lending procedures, clearly laid-out authority and accountability, as well as disclosures rules, will promote financial stability, reduce moral hazard, and protect the lender of last resort from undue political pressure. Although there may well be good reasons to maintain ambiguity over the conditions for assistance, there are important advantages for developing, and for transition economies to follow a rule-based approach by setting out ex ante the necessary conditions for support, while maintaining that meeting such conditions is not sufficient for receiving support.

Keywords: WP; liquidity support; capital market; emergency loan; interest rate; borrowing bank; discount window; Lender of Last Resort; Emergency Liquidity Support; insurance fund; financial support; liquidity assistance; central bank support; central bank liquidity support; State money market; Loans; Liquidity; Credit; Collateral; Central Asia; lending procedure; LOLR support; emergency Liqnidity support facilities; post transparency (search for similar items in EconPapers)
Pages: 36
Date: 2000-04-01
References: Add references at CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=3542 (application/pdf)

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:imf:imfwpa:2000/079

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().