DP11957 Changing business models in international bank funding

Author(s): Leonardo Gambacorta, Stefano Schiaffi, Adrian van Rixtel
Publication Date: April 2017
Keyword(s): bank funding, International Banks, structural reform initiatives
JEL(s): C32, F65, G21
Programme Areas: Financial Economics
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=11957

This paper investigates the foreign funding mix of globally active banks. Using BIS international banking statistics for a panel of 12 advanced economies, we detect a structural break in international bank funding at the onset of the global financial crisis. In their post-break business model, banks rely less on cross-border liabilities and, instead, tap funds from outside their jurisdictions by making more active use of their subsidiaries and branches, as well as inter-office accounts within the same banking group.