Banking Globalization and Monetary Transmission
Year: 2012
Type: article
Abstract: ABSTRACT Globalization of banking raises questions about banks’ liquidity management, their response to liquidity shocks, and the potential for international shock propagation. We conjecture that global banks manage liquidity on a global scale, actively using cross‐border internal funding in response to local shocks. Having global operations insulates banks from changes in monetary policy, while banks without global operations are more affected by monetary policy than previously found. We provide direct evidence that internal capital markets are active in global banks and contribute to the international propagation of shocks. This feature was at play during the financial crisis of 2007–2009.
Source: The Journal of Finance
Authors: NICOLA CETORELLI, LINDA S. GOLDBERG
Institution: Federal Reserve Bank of New York
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W3122515577