The Financial Stability Implications of Capital Flows to Emerging Markets: Focus on Emerging Europe

30  September 2008    4:00 pm CEST

Dubravko Mihaljek, BIS


wiiw, Rahlgasse 3, 1060 Vienna, lecture hall (entrance from the ground floor)


Recent trends in private sector capital flows clearly point to the growing financial integration of emerging market economies. What merits attention from the financial stability viewpoint is especially the large increase in inflows to emerging market banks and the non-bank private sector, and the large increase in outflows to foreign debt securities. This presentation will examine the solvency, credit and contagion risks stemming from cross-border banking flows, as well as the policy responses to these risks, focusing on recent developments in Central and Eastern Europe.