Capitalizing central banks : a net worth approach /

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Bibliographic Details
Author / Creator:	Ize, Alain.
Imprint:	[Washington, D.C.] : International Monetary Fund, Monetary and Financial Systems Dept., 2005.
Description:	1 online resource (25 pages)
Language:	English
Series:	IMF working paper ; WP/05/15
Subject:	Bank capital. Banks and banking, Central. Bank capital. Banks and banking, Central.
Format:	E-Resource Book
URL for this record:	http://pi.lib.uchicago.edu/1001/cat/bib/12498445

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Other authors / contributors:	International Monetary Fund. Monetary and Financial Systems Department. IMF Institute.
ISBN:	1282042750 9781282042759 9781451905700 145190570X
Notes:	Includes bibliographical references (page 25). Print version record.
Summary:	This paper provides a simple, quantitative, net worth-based, approach to assessing the need for central bank capital. It derives a concept of "core capital" (a function of the central bank's operating expenditures and the carrying cost of its international reserves) as the minimum capital needed by a central bank to ensure the credibility of its inflation target. The approach is illustrated with the published accounts of three loss-making central banks and selected accounting entries for a broader sample of central banks. Policy implications are explored. In particular, the paper argues that central bank capitalizations cannot be automatic and require instead a broad policy debate.

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