New Zealand Bank Vulnerabilities in International Perspective

October 1, 2009

Preview Citation

Format: Chicago

Rodrigo Cubero, and R. Brooks New Zealand Bank Vulnerabilities in International Perspective, (USA: International Monetary Fund, 2009) accessed November 23, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The global financial crisis is creating stress on banking systems across the world through funding and asset quality shocks. This paper combines different stress scenarios, as well as cross-country analysis, to assess New Zealand bank vulnerabilities to the global crisis and the domestic recession. It finds that a sharp worsening of asset quality would be required to reduce bank capital below the regulatory minimum. On the funding side, a disruption to banks' offshore funding may put pressure on the exchange rate, but would not trigger a systemic liquidity problem.

Subject: Banking, Capital adequacy requirements, Financial institutions, Financial regulation and supervision, Financial sector policy and analysis, Housing prices, Loans, Mortgages, Prices, Stress testing

Keywords: Asset quality, Bank, Bank asset quality, Bank assets, Bank capital, Bank funding, Capital adequacy requirements, Disclosure statement, Financing, Global, Housing prices, Loans, Mortgage, Mortgages, New Zealand, New Zealand bank, New Zealand dollar, Stress testing, Stress tests, WP

Publication Details

Pages:

26
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2009/224
Stock No:

WPIEA2009224
ISBN:

9781451873719
ISSN:

1018-5941

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