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Macroeconomic and Financial Soundness Indicators :, An Empirical Investigation, Rita Babihuga

This paper analyzes the relationship between selected macroeconomic and financial soundness indicators (FSIs) using a newly assembled panel dataset of FSIs for 96 countries covering the period 1998-2005. The analysis covers key macroeconomic indicators and FSIs of capital adequacy, asset quality and profitability. The paper finds that FSIs fluctuate strongly with both the business cycle and the inflation rate. Short term interest rates and the real exchange rate also emerge as important determinants. There is also a considerable degree of heterogeneity in the relationship between macroeconomic indicators and FSIs across the sample of countries. Several country and industry specific characteristics including country income levels, financial depth, market concentration, and the quality of regulatory supervision are found to be significant in explaining this cross country heterogeneity
Table Of Contents
CONTENTS; I. Introduction; Figures; 1. Studies of Macro-Financial Sector Linkages; II. Data: Financial Soundness Indicators; 2. FSIs and the Business Cycle, 1998-2005; 3. Variation Across Regions: Cyclicality of FSIs, 1998-2005; III. Empirical Methodology; A. Capital Adequacy; B. Asset Quality; C. Profitability; Tables; 1. Capital Adequacy; 2. Capital Adequacy; 3. Asset Quality; 4. Profitability; IV. Conclusion; Appendices; I. Contemporaneous Correlations (FSIs and Real GDP Growth); II. Data Description; III. Econometric Models; IV. Model for Capital Adequacy; References
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (32 p.)
Specific Material Designation
Form Of Item

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