Risk of Contagious Failures and Interbank Cooperative Arrangements
Olivier De Bandt
The paper studies a possibility of creation of structure interbank cooperative arrangements with the goal to cut down a risk of failure. An attention concentrates on mutually ex � post help among banks which applies for deposit but faced the risk of portfolio that is not ex-ante diversified. An effort of banks to cut down the risk them motivates to a sharing risk. In a tests to explain a role of clearing bank and willingness of banks to tie up themselves behaviour by strength rules for intervention are use numerous features of accessible models but the main focus is on moral hazard.
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