Changing Forces of Gravity: How the Crisis Affected International Banking

Arbeitspapier

The global financial crisis has brought to an end a rather unprecedented period of banks' international expansion. We analyze the effects of the crisis on international banking. Using a detailed dataset on the international assets of all German banks with foreign affiliates for the years 2002-2011, we study bank internationalization before and during the crisis. Our data allow analyzing not only the international assets of the banks' headquarters but also of their foreign affiliates. We show that banks have lowered their international assets, both along the extensive and the intensive margin. This withdrawal from foreign markets is the result of changing market conditions, of policy interventions, and of a weakly increasing sensitivity of banks to financial frictions.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IWH Discussion Papers ; No. 15/2013

Classification and Topics

• Classification: Wirtschaft ; Financial Crises ; International Lending and Debt Problems ; Banks; Depository Institutions; Micro Finance Institutions; Mortgages
• Subject: international banking ; gravity model ; financial frictions

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Buch, Claudia M. ; Neugebauer, Katja ; Schröder, Christoph
• Event: Veröffentlichung
• (who): Leibniz-Institut für Wirtschaftsforschung Halle (IWH)
• (where): Halle (Saale)
• (when): 2013

Further information

• Handle: http://hdl.handle.net/10419/88585
• URN: urn:nbn:de:gbv:3:2-25148
• Last update: 10.03.2025, 11:43 AM CET