Work detail

The Rise of Shadow Banking

Author: Mgr. Michaela Dovicová
Year: 2014 - winter
Leaders: prof. PhDr. Petr Teplý Ph.D.
Work type: Economic Theory
Language: English
Pages: 98
Awards and prizes:
Abstract: Recent nancial crisis resulting in global nancial instability pointed at the
importance of growing shadow banking. Shadow banking activities are gen-
erally de ned as banking-like activities outside of regulated banking. In this
thesis, we study theoretical background of shadow banking, its regulation and
supervision. Despite the data availability problem, a qualitative analysis is
performed to estimate the volume of the European and the U.S. shadow bank-
ing sectors from 2006 until 2013 Q2. European shadow banking system hit its
bottom of EUR 8.3 trillion (19% of total European bank assets) in 2008 Q4.
Nowadays, it equals to EUR 9.3 trillion (21% of total European bank assets).
U.S. shadow banking sector attained its maximum of USD 20.7 trillion (163%
of total U.S. bank assets) in 2008 Q1. Nowadays, it equals to USD 15.6 tril-
lion which also equals to total U.S. bank assets. Moreover, we concentrate on
Chinese money market funds and French and UK repo markets, since these
represent an important part of shadow banking. Quantitative analysis studies
relationships among traditional banking, shadow banking and economy itself in
France and UK. Results show that if repo transactions, GDP and government
debt increase, total bank assets increase. Furthermore, if money market fund
assets decrease and GDP increases, repo transactions increase. The impact of
total bank assets on repo transactions di ers in studied countri




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