Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/336340 
Year of Publication: 
2022
Citation: 
[Journal:] Latin American Journal of Central Banking (LAJCB) [ISSN:] 2666-1438 [Volume:] 3 [Issue:] 1 [Article No.:] 100047 [Year:] 2022 [Pages:] 1-11
Publisher: 
Elsevier, Amsterdam
Abstract: 
In this paper, we investigate the growing prominence of credit in the systemic banking crisis prediction literature. Through the application of the signal extraction model and multivariate probit panel regression, we evaluate the performance of the absolute change in credit-to-GDP ratio as an early warning system indicator of systemic banking crises. The findings reveal that the accelerated financialisation of economies turns the excess supply of credit into generating conditions that increase the likelihood of a systemic banking crisis. The findings also indicate that even with persistently low and stable inflation, systemic risk could gradually accumulate through an excessive supply of credit.
Subjects: 
Credit-to-GDP ratio
Systemic banking crisis
Early warning system
Financialisation
JEL: 
E51
E58
F30
G01
O11
O16
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.