F34 - International Lending and Debt Problems

• The BoC-BoE Sovereign Default Database: What’s New in 2019?

  Staff Working Paper 2019-39 David Beers, Patrisha de Leon-Manlagnit

  Until recently, few efforts have been made to systematically measure and aggregate the nominal value of the different types of sovereign government debt in default. To help fill this gap, the Bank of Canada (BoC) developed a comprehensive database of sovereign defaults that is posted on its website and updated in partnership with the Bank of England (BoE).

  Content Type(s): Staff research, Staff working papers Topic(s): Debt management, Development economics, Financial stability, International financial markets JEL Code(s): F, F3, F34, G, G1, G10, G14, G15

• Macroprudential FX Regulations: Shifting the Snowbanks of FX Vulnerability?

  Staff Working Paper 2018-55 Toni Ahnert, Kristin Forbes, Christian Friedrich, Dennis Reinhardt

  Can macroprudential foreign exchange (FX) regulations on banks reduce the financial and macroeconomic vulnerabilities created by borrowing in foreign currency? To evaluate the effectiveness and unintended consequences of macroprudential FX regulations, we develop a parsimonious model of bank and market lending in domestic and foreign currency and derive four predictions.

  Content Type(s): Staff research, Staff working papers Topic(s): Exchange rates, Financial institutions, Financial system regulation and policies, International financial markets JEL Code(s): F, F3, F32, F34, G, G1, G15, G2, G21, G28

• Assessing Vulnerabilities in Emerging-Market Economies

  Staff Discussion Paper 2018-13 Tatjana Dahlhaus, Alexander Lam

  This paper introduces a new tool to monitor economic and financial vulnerabilities in emerging-market economies. We obtain vulnerability indexes for several early warning indicators covering 26 emerging markets from 1990 to 2017 and use them to monitor the evolution of vulnerabilities before, during and after an economic or financial crisis.

  Content Type(s): Staff research, Staff discussion papers Topic(s): International topics, Monetary and financial indicators, Recent economic and financial developments JEL Code(s): C, C8, C82, F, F3, F34, G, G0, G01, G1, G15

• The BoC-BoE Sovereign Default Database Revisited: What’s New in 2018?

  Staff Working Paper 2018-30 David Beers, Jamshid Mavalwalla

  Until recently, there have been few efforts to systematically measure and aggregate the nominal value of the different types of sovereign government debt in default. To help fill this gap, the Bank of Canada’s Credit Rating Assessment Group (CRAG) has developed a comprehensive database of sovereign defaults posted on the Bank of Canada’s website that now is updated in partnership with the Bank of England.

  Content Type(s): Staff research, Staff working papers Topic(s): Debt management, Development economics, Financial stability, International financial markets JEL Code(s): F, F3, F34, G, G1, G10, G14, G15

• Cross-Border Bank Flows and Monetary Policy: Implications for Canada

  Staff Working Paper 2017-34 Ricardo Correa, Teodora Paligorova, Horacio Sapriza, Andrei Zlate

  Using the Bank for International Settlements (BIS) Locational Banking Statistics data on bilateral bank claims from 1995 to 2014, we analyze the impact of monetary policy on cross-border bank flows. We find that monetary policy in a source country is an important determinant of cross-border bank flows.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial institutions, Monetary policy JEL Code(s): F, F3, F34, F36, G, G0, G01
• June 8, 2017

  Canada’s International Investment Position: Benefits and Potential Vulnerabilities

  Financial System Review - June 2017 Gabriel Bruneau, Maxime Leboeuf, Guillaume Nolin

  While greater global financial integration is beneficial, the authors discuss how foreign capital inflows can also facilitate the buildup of domestic vulnerabilities and potentially lead to destabilizing reversals. Canada’s current international investment position is typical of advanced economies and will likely continue to act as an economic stabilizer. However, the growth and composition of Canada’s international investment position warrant continued monitoring.

  Content Type(s): Publications, Financial System Review articles Topic(s): Balance of payments and components, Financial stability, International financial markets JEL Code(s): F, F2, F21, F3, F32, F34, F36, F4, F6

• International Banking and Cross-Border Effects of Regulation: Lessons from Canada

  Staff Working Paper 2016-34 H. Evren Damar, Adi Mordel

  We study how changes in prudential requirements affect cross-border lending of Canadian banks by utilizing an index that aggregates adjustments in key regulatory instruments across jurisdictions.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial institutions, Financial stability, Financial system regulation and policies JEL Code(s): F, F3, F34, G, G0, G01, G2, G21

• Government Corruption and Foreign Direct Investment Under the Threat of Expropriation

  Staff Working Paper 2016-13 Christopher Hajzler, Jonathan Rosborough

  Foreign investment is often constrained by two forms of political risk: expropriation and corruption. We examine the role of government corruption in foreign direct investment (FDI) when contracts are not fully transparent and investors face the threat of expropriation.

  Content Type(s): Staff research, Staff working papers Topic(s): Development economics, Economic models, International topics JEL Code(s): F, F2, F21, F23, F3, F34

• Database of Sovereign Defaults, 2017

  Technical Report No. 101 David Beers, Jamshid Mavalwalla

  Until recently, there have been few efforts to systematically measure and aggregate the nominal value of the different types of sovereign government debt in default. To help fill this gap, the Bank of Canada’s Credit Rating Assessment Group (CRAG) has developed a comprehensive database of sovereign defaults posted on the Bank of Canada’s website.

  Content Type(s): Staff research, Technical reports Topic(s): Debt management, Development economics, Financial stability, International financial markets JEL Code(s): F, F3, F34, G, G1, G10, G14, G15

• Sovereign Default and State-Contingent Debt

  Staff Discussion Paper 2013-3 Martin Brooke, Rhys R. Mendes, Alex Pienkowski, Eric Santor

  The Latin American debt crises in the 1980s and the Asian crisis in the late 1990s both provided impetus for reforming the framework for restructuring sovereign debt. In the late 1980s, the Brady plan established the importance of substantive debt relief in addressing some crises.

  Content Type(s): Staff research, Staff discussion papers Topic(s): International financial markets, International topics JEL Code(s): F, F3, F34