Risks in US bank international exposures

Arbeitspapier

U.S. banks have substantial exposure to foreign markets such as Europe and Latin America. In this paper, we show how the amounts and forms of these exposures have evolved over time and note the changes in embodied risks taken through banks’ crossborder activity, local claims, and derivative positions. Our findings vary with the type of U.S. bank. Compared with other banks, money-center banks tend to have a greater share of their assets in foreign exposures. Some of money-center banks’ exposure to riskier countries, particularly Latin American countries, is achieved through the activities of local branches and subsidiaries that take on liabilities as well as assets, a strategy that reduces their bank transfer risk accordingly. As a share of total international exposures, the transfer risk assumed by money-center banks tends to be significantly lower than that of other banks.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Staff Report ; No. 240

Classification and Topics

• Classification: Wirtschaft
• Subject: bank, foreign exposure, cross border, lending, capital, claims, derivatives, business cycle, interest rates ; Internationale Bank ; Bankrisiko ; Internationale Finanzierung ; USA ; Welt

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Cetorelli, Nicola ; Goldberg, Linda
• Event: Veröffentlichung
• (who): Federal Reserve Bank of New York
• (where): New York, NY
• (when): 2006

Further information

• Handle: http://hdl.handle.net/10419/60646
• Last update: 10.03.2025, 11:42 AM CET