Download This PaperLimits to Foreign Exchange Net Open Positions and Capital Requirements in Emerging Economies
33 Pages Posted: 3 Feb 2018
Date Written: January 30, 2018
Abstract
Many emerging economies have regulatory limits on foreign exchange rates net open positions of banks. We show that such limits leave the capital adequacy ratios of banks with investments in foreign subsidiaries more exposed to exchange rate fluctuations. We discuss alternative policies for overcoming this trade-off.
Keywords: Foreign Exchange Open Positions, Capital Requirements
JEL Classification: G21, F42, F23
Suggested Citation: Suggested Citation
Hofstetter, Marc and Lopez, Jose Ignacio and Urrutia, Miguel, Limits to Foreign Exchange Net Open Positions and Capital Requirements in Emerging Economies (January 30, 2018). Documento CEDE No. 2018-10, Available at SSRN: https://ssrn.com/abstract=3116943 or http://dx.doi.org/10.2139/ssrn.3116943
Jose Ignacio Lopez
Universidad de los Andes, Colombia - Department of Economics ( email )
Carrera 1a No. 18A-10
Santafe de Bogota, AA4976
Colombia
5713394949 (Phone)
HOME PAGE: http://joseignaciolopez..com
Miguel Urrutia
Universidad de los Andes, Colombia - Department of Economics ( email )
Carrera 1a No. 18A-10
Santafe de Bogota, AA4976
Colombia
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