Bericht

Banks' wholesale funding share as an indicator of financial vulnerability

A review of theoretical links between the wholesale (or market) funding share of banks (WFS) and financial vulnerability is provided. The vulnerability may both be within the financial system, and in the non-financial sector. The historical development of the WFS in Norway is described. In light of theory and history, we provide an intuitive interpretation of why the WFS works well as an indicator of excessive credit growth in the non-financial sector and as a predictor of financial crises. We argue that other indicators, such as net aggregate household savings and households' net financial investments, may have more intuitive links to excessive gross credit growth. These indicators predict the WFS in Norway.

ISBN
978-82-8379-158-7
Language
Englisch

Bibliographic citation
Series: Staff Memo ; No. 7/2020

Classification
Wirtschaft
Subject
Cash-and-Carry-Markt
Kreditgeschäft
Finanzkrise
Norwegen

Event
Geistige Schöpfung
(who)
Alstadheim, Ragna
Event
Veröffentlichung
(who)
Norges Bank
(where)
Oslo
(when)
2020

Handle
Last update
10.03.2025, 11:44 AM CET

Data provider

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Object type

  • Bericht

Associated

  • Alstadheim, Ragna
  • Norges Bank

Time of origin

  • 2020

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