Private bank deposits and macro/fiscal risk in the euro-area

Arbeitspapier

We examine the relationship between private bank deposits and macro/fiscal risk in the euro area. We test three hypotheses: First, private bank deposits relative to Germany are determined by macro/fiscal risk factors. Second, this relationship is time-varying. Third, time-variation is driven by the level of macro/fiscal risk. Our findings validate all three tested hypotheses. They also reveal persistent fragmentation between EMU core and periphery banking systems caused by a deficit of trust in periphery banking systems, unmitigated by the introduction of OMT and European Banking Union. Our findings have implications for the introduction of the European Deposits Insurance Scheme (EDIS), for which they offer tentative support.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Cardiff Economics Working Papers ; No. E2019/6

Classification and Topics

• Classification: Wirtschaft ; International Finance: General ; Financial Aspects of Economic Integration ; Macroeconomic Issues of Monetary Unions ; Portfolio Choice; Investment Decisions ; International Financial Markets
• Subject: Private bank deposits ; macro/fiscal risk ; eurozone ; TVP panel ; fragmentation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Arghyrou, Michael Georgiou ; Gadea, María Dolores
• Event: Veröffentlichung
• (who): Cardiff University, Cardiff Business School
• (where): Cardiff
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/230439
• Last update: 10.03.2025, 11:42 AM CET