Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/43884
Authors: 
Craig, Ben R.
von Peter, Goetz
Year of Publication: 
2010
Series/Report no.: 
Discussion Paper Series 2: Banking and Financial Studies 2010,12
Abstract: 
This paper provides evidence that interbank markets are tiered rather than flat, in the sense that most banks do not lend to each other directly but through money center banks acting as intermediaries. We capture the concept of tiering by developing a core-periphery model, and devise a procedure for fitting the model to real-world networks. Using Bundesbank data on bilateral interbank exposures among 1800 banks, we find strong evidence of tiering in the German banking system. Moreover, bankspecific features, such as balance sheet size, predict how banks position themselves in the interbank market. This link provides a promising avenue for understanding the formation of financial networks.
Subjects: 
interbank markets
intermediation
networks
tiering
core and periphery
market structure
JEL: 
G21
L14
D85
C63
ISBN: 
978-3-86558-661-2
Document Type: 
Working Paper

Files in This Item:
File
Size
558.71 kB





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