Leverage—A Broader View

March 19, 2018

Preview Citation

Format: Chicago

Manmohan Singh, and Zohair Alam. Leverage—A Broader View, (USA: International Monetary Fund, 2018) accessed November 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Traditional measures of leverage in the financial system tend to reflect bank balance sheet data. The paper argues that these traditional, bank-centric measures should be augmented by considering pledged collateral in the financial system since pledged collateral provides a measure of an important part of nonbank funding to banks. From a policy perspective, the paper suggests that a broader view on leverage will enhance our understanding of global systemic risk, and complement the theoretical work in this field by providing a link from micro-level leverage data to macro aggregates such as credit to the economy.

Subject: Accounting standards, Bank credit, Banking, Collateral, Commercial banks, Financial institutions, Financial statements, Money, Public financial management (PFM)

Keywords: Accounting standards, Bank credit, Bank leverage, Bank-nonbank nexus, Collateral, Commercial banks, Financial stability, Financial statements, Global, Leverage ratio, Nonbank funding, Nonbank leverage, Nonbank relationship, Nonbank-bank nexus, Off-balance sheet, Pledged collateral, Regulations, WP

Publication Details

Pages:

28
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2018/062
Stock No:

WPIEA2018062
ISBN:

9781484347034
ISSN:

1018-5941

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