Trust key to interbank lending, study finds

'Social collateral' collapsed during 2008 crisis, finds Swiss National Bank paper

Investment and trust
A close fit: the unsecured lending market relies on established relationships

A new study of the Swiss interbank market before and during the financial crisis highlights the reliance of unsecured lending on established relationships – and how quickly these networks of trust collapsed as the crisis hit.

In the paper, published last week in the Journal of Network Theory in Finance, Silvio Schumacher of the Swiss National Bank studied daily transaction-level data on the unsecured and secured Swiss interbank markets. The two sub-markets were organised very differently in

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: