$500 billion reserve drain made crisis worse: IMF’s Ferhani

Central banks' reserve managers exacerbated the global liquidity crunch as they drew down half a trillion dollars on deposit at banks after the crisis struck, a senior IMF official said on Friday.

Speaking at Central Banking's National Asset Liability Management conference in London on Friday, Hervé Ferhani, the deputy director of the monetary and capital markets department, said: "By and large, reserve managers reduced their exposure to risk assets in a way that was similar to the behaviour of