(AGENPARL) - Roma, 22 Settembre 2022 - (AGENPARL) – gio 22 settembre 2022 Today, the OFR updated a working paper examining whether banks’ counterparty choices in over-the-counter derivative markets contribute to network fragility. The authors found that banks have a greater propensity to choose densely connected nonbank counterparties, particularly riskier ones, suggesting the existence of “moral hazard behavior” in network formations. Finally, the working paper shows how these exposures are correlated with systemic risk measures despite greater regulatory oversight after the 2008 financial crisis.
Follow us@OFRgov