SYMBOL MODEL DATABASE and ANALYSES for PUBLIC FINANCE SUSTAINABILITY
In the present report, we describe the main steps we have taken in order to create a sound database for the European Union Member States banking system. The final goal is to use this database as source for input variables of SYMBOL (SYstemic Model of Banking Originated Losses) model, developed by the Join Research Centre of Ispra in cooperation with the European Commission Direcotrate General for Internal Market and Services and experts from academia, for monitoring financial crises.
SYMBOL simulates potential crises in the banking sector under various assumptions, and it allows assessing the cumulative effects of different regulatory measures (e.g. higher capital requirements, strengthened deposit insurance and introduction of resolution funds) and their most effective combinations. It uses items in bank's balance sheet to estimate the potential losses for a given banking system via a Monte Carlo analysis. The model is flexible and can be deployed either on a single country or on a set of financial institutions sharing common features.
The report also shows an application of SYMBOL for assessing the impact on public finance of a crisis in the baning sector and compares the current regulatory framework with a future scenario where the new capital requirements set in Basel III and an effective framework for bank resolution are in place.
PAGANO Andrea;
CARIBONI Jessica;
PETRACCO GIUDICI Marco;
2013-03-07
Publications Office of the European Union
JRC77215
978-92-79-27996-6 (print),
978-92-79-27995-9,
1018-5593 (print),
1831-9424 (online),
EUR 25665 EN,
OP LB-NA-25665-EN-C (print),
OP LB-NA-25665-EN-N (online),
https://publications.jrc.ec.europa.eu/repository/handle/JRC77215,
10.2788/7525 (print),
10.2788/75033 (online),
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