Interconnectedness and network dynamics of global banking

Gian Paolo Clemente, Paola Bongini, Rosanna Grassi

Risultato della ricerca: Contributo in libroContributo a convegno

Abstract

In this paper, we study the network of global banking using data on cross-border banking claims for about 200 countries during 20052015. Our aim is to investigate how the global banking system reacted to the financial crises occurred in the last decade. Such crises highlighted the urgency of addressing the specific issue of systemic risk within the financial sector and in particular in banking. Indeed, the failure of an interconnected and complex financial institution, even though not necessarily large in terms of total assets, can threaten the stability of the entire financial system and have serious negative consequences for the real economy. In other words, the issue of intermediaries too systemic to fail (TSTF) has nowadays replaced the old problem of too big to fail. To this aim, we build several core-periphery networks and we compute several structural indicators suitable to capture various aspects related to the interconnection, such as average degree and density, clustering coefficient and assortativity coefficient. In general, the structural properties and dynamics of the network of cross-country financial links are crucial to understand the reaction of the system to the shocks. A greater stability is observed for core-core networks, while indicators computed on core-periphery structure are more affected over time.
Lingua originaleEnglish
Titolo della pubblicazione ospiteThe 5th International Workshop on Complex Networks & Their Applications
Pagine144-147
Numero di pagine4
Stato di pubblicazionePubblicato - 2016
EventoThe 5th International Workshop on Complex Networks & Their Applications - Milano
Durata: 30 nov 20162 dic 2016

Workshop

WorkshopThe 5th International Workshop on Complex Networks & Their Applications
CittàMilano
Periodo30/11/162/12/16

Keywords

  • Cross-border banking
  • Financial interconnectedness
  • Network analysis
  • Systemic banks

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