Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/336487 
Year of Publication: 
2025
Series/Report no.: 
CBM Working Papers No. WP/07/2025
Publisher: 
Central Bank of Malta, Valletta
Abstract: 
In this paper we construct a bipartite network model for the Maltese banking sector and identify communities of banks based on overlapping credit exposures. By leveraging confidential supervisory bank-level data on total exposures, we identify four distinct bank clusters and compute relevant network metrics. This approach enables the assessment of exposure concentration, network nestedness, and the centrality of individual institutions within the system. Finally, we use this information to identify banks' business models based on their credit risk profiles. In particular, we distinguish between generalist and specialist banks, based on their position within identified communities and the geographical composition of their exposures. This analysis complements the existing classification framework employed by the Central Bank of Malta from a credit risk perspective, and lays the groundwork for future research on the transmission of credit risk shocks within the banking system.
Subjects: 
Bipartite network model
Overlapping portfolios
Banking networks
Bank communities
JEL: 
C63
C88
E44
G21
Document Type: 
Working Paper

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