Stressing to Breaking Point : Interpreting Stress Test Results /

This paper illustrates how stress tests of banking systems may be designed to evaluate banks' reaction to shocks of increasing intensity, up to the point where regulatory norms are breached, or banks become insolvent. This approach offers useful insight and guidance for regulatory policy and in...

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Bibliographic Details
Main Author: Worrell, Rupert
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2008.
Series:IMF Working Papers; Working Paper ; No. 2008/148
Online Access:Full text available on IMF
Description
Summary:This paper illustrates how stress tests of banking systems may be designed to evaluate banks' reaction to shocks of increasing intensity, up to the point where regulatory norms are breached, or banks become insolvent. This approach offers useful insight and guidance for regulatory policy and intervention, using existing methodology and data. The illustrations presented in this paper are a small sample of the wide variety of shocks, scenarios, and assumptions to which this approach may be applied.
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Physical Description:1 online resource (18 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students