Currency mismatch in the banking sector in Latin America and the Caribbean

Arbeitspapier

Existing literature uses data based on the residence principle to proxy for currency mismatch. This paper collects data on assets and liabilities broken by currency of denomination in the banking sector in Latin America and the Caribbean. I show that the information used in the literature cannot substitute for data broken down by currency and present new facts. I observe a reduction in long foreign currency positions, with several banking sectors taking short positions after 2006. Employing a methodology that accounts for time-varying unobservable characteristics, this reduction is shown to be partially explained by the implementation of prudential policies.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Papers ; No. 2017-05

Classification and Topics

• Classification: Wirtschaft ; General Financial Markets: Government Policy and Regulation ; Banks; Depository Institutions; Micro Finance Institutions; Mortgages ; International Finance: General
• Subject: currency mismatch ; prudential regulation ; foreign currency risk ; dollarization ; synthetic control method

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Tobal, Martín
• Event: Veröffentlichung
• (who): Banco de México
• (where): Ciudad de México
• (when): 2017

Further information

• Handle: http://hdl.handle.net/10419/174458
• Last update: 10.03.2025, 11:44 AM CET