Economics, Econometrics and Finance
4 years ago

Austrian banks face increased interest rate risk amid low interest rates.

Financial stability report
Quantifying interest rate risk and the effect of model assumptions behind sight deposits
Stefan Kerbl, Boris Simunovic, Andreas Wolf

Paper Summary

Austrian banks may be taking on more risk due to low interest rates. By looking at how banks handle changes in interest rates, we found that larger banks are taking on more risk than smaller ones. This means that the way banks manage their money in response to interest rate changes is important for understanding how safe they are.

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