Why Are Canadian Banks More Resilient?
Electronic Access:
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Summary:
This paper explores factors behind Canadian banks' relative resilience in the ongoing credit turmoil. We identify two main causes: a higher share of depository funding (vs. wholesale funding) in liabilities, and a number of regulatory and structural factors in the Canadian market that reduced banks' incentives to take excessive risks. The robust predictive power of the depository funding ratio is confirmed in a multivariate analysis of the performance of 72 largest commercial banks in OECD countries during the turmoil.
Series:
Working Paper No. 2009/152
Subject:
Asset and liability management Banking Business enterprises Capital adequacy requirements Economic sectors Financial institutions Financial regulation and supervision Financial statements Liquidity Public financial management (PFM) Stocks
English
Publication Date:
July 1, 2009
ISBN/ISSN:
9781451872996/1018-5941
Stock No:
WPIEA2009152
Pages:
19
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