Lev Ratnovski
Lev Ratnovski is the IMF's Resident Representative for Serbia. Previously, he was the IMF's Senior Desk for the Euro Area, Lead Economist at the European Central Bank, and Senior Economist at the IMF Research Department. Mr. Ratnovski has published in the Journal of Monetary Economics and the Review of Financial Studies. Mr. Ratnovski, a Portuguese national, started his career at the Bank of England after receiving Ph.D. from the University of Amsterdam.
Country experience: Canada, China, Euro Area/EU, Ireland, Korea, Mongolia, Portugal, Spain, Ukraine, UK, and USA.
CV
IMF, Representative for Serbia, 2024-
IMF, Euro Area Desk, 2021-2024
ECB, Lead Economist, 2018-2021;
IMF, Sr. Economist, Research, 2010-2018;
IMF, USA and Canada Desk, 2008-2010;
Bank of England, 2006-2008;
PhD, University of Amsterdam, 2008.
Recent work
New Bank Profits and Bank Taxes in the EU with Maneely
We document the heterogeneity across countries of recent taxes on banks in the EU in terms of tax base, rate, duration, and fiscal revenue.
New 100 Inflation Shocks: Seven Stylized Facts with Ari, Mulas, Mylonas, Zhao
We analyze 100 inflation shocks since the 1970s. Key lessons: inflation is persistent; premature celebrations are very common; consistently tight macroeconomic policy is key; inflation fighting pays off.
Coverage: FT Alphaville, Central Banking, IMF Blog, The Times, The Telegraph, Financial Post, WSJ
Columns: VOXEU, Finance and Development, SUERF Policy Brief.
Cited by Isabel Schnabel (ECB) in "The Last Mile" and Joachim Nagel (Deutsche Bundesbank) in "Geldpolitik in einer herausfordernden Zeit"
New The ECB’s Future Monetary Policy Operational Framework: Corridor or Floor? with Brandao-Marques
A review of the trade-offs involved in the choice of the ECB’s monetary policy operational framework.
Publications
Monetary Policy and Intangible Investment with Döttling Journal of Monetary Economics 2023
Intangible investment responds less to monetary shocks compared to tangible investment.
Bank Capital Requirements and Lending in Emerging Markets with Martinez Peria and Presbitero Journal of Banking and Finance 2022
Capital requirements have little effect on lending in a buoyant EM environment.
Credit and Fiscal Multipliers in China with Chen and Tsai Journal of International Money and Finance 2021
China's fiscal multipliers are high, while the effect of credit on output is low.
The Dynamics of NPLs in Banking Crises with Ari and Chen DATA Journal of Banking and Finance 2021
Data on 100+ banking crises since 1990 point to major challenges in NPL resolution.
Fintech: What's Old, What's New? with Boot, Laeven, and Hoffmann Journal of Financial Stability 2021
Digital innovation in finance may lead to a disintegration of the universal bank business model.
Bank Lending in the Knowledge Economy with Dell'Ariccia, Kadyrzhanova, and Minoiu Review of Financial Studies 2021
As corporate assets become more intangible, banks lend less to firms and more to real estate.
Bank Profitability, Leverage Constraints, and Risk-Taking with Martynova and Vlahu Journal of Financial Intermediation 2020
Profitable banks can borrow more and take risk at a higher scale.
Bank Capital: A Seawall Approach with Dagher, Dell'Ariccia, Laeven, and Tong International Journal of Central Banking 2020
Risk-weighted bank capital of 15-23% would have prevented a majority of banking crises.
Bailouts and Systemic Insurance with Dell'Ariccia Journal of Banking and Finance 2019
A government's commitment to shield banks from contagion may increase their incentives to invest prudently, despite moral hazard.
Global Liquidity and Cross-Border Bank Flows with Cerutti and Claessens Economic Policy 2017
Global liquidity is driven by US monetary policy but European bank conditions.
Banking and Trading with Boot Review of Finance 2016
Banks may allocate too much capital to market-based activities, compromising their ability to lend.
Coverage: Huffington Post, Reuters (Felix Salmon), Economist (Letters).
Bank Size, Capital, and Systemic Risk: Some International Evidence with Laeven and Tong Journal of Banking and Finance 2015
Systemic risk is driven primarily by insufficient capital in large banks.
Liquidity and Transparency in Bank Risk Management Journal of Financial Intermediation 2013
Better disclosure complements liquidity buffers by ensuring banks' market access during crises.
Capital Regulation and Tail Risk with Perotti and Vlahu International Journal of Central Banking 2011
Better capitalized banks are less likely to accidentally breach capital requirements, and so may take more risk.
The Dark Side of Bank Wholesale Funding with Huang Journal of Financial Intermediation 2011
The providers of wholesale funding can remain uninformed of bank fundamentals, and trigger inefficient liquidations based on imprecise public information.
The first paper (2008) to identify short-term wholesale funding as a source of bank vulnerability
Top citation for "wholesale funding" on Google Scholar.
Bank Liquidity Regulation and the Lender of Last Resort Journal of Financial Intermediation 2009
Bank may stay illiquid and gamble for LOLR support, especially when other banks do the same.
Policy papers
Shorter Euro Area-related pieces
Macroeconomic policy challenges and priorities for Europe EuroFi magazine (with Kammer and Toscani)
Macroprudential policy challenges in the current macroeconomic environment Speech prepared for the ESRB Annual Conference.
Financial Innovation and Technology: What's Old, What's New? (with Arnoud Boot, Luc Laeven, and Peter Hoffmann) ECB Discussion Paper 2438 VOXEU IMF Blog
We contrast old trends and recent developments in financial innovation, focusing on information processing and customer communication.
COVID-19 and Non-Performing Loans: Lessons from Past Crises (with Anil Ari and Sophia Chen) ECB Research Bulletin 71 VOXEU
NPL resolution post-COVID-19 will be challenged by high public debt, low bank profitability, and weak corporate balance sheets.
Benefits and Costs of Bank Capital (with Jihad Dagher, Giovanni Dell'Ariccia, Luc Laeven, Hui Tong) IMF Staff Discussion Note 16/04
The marginal benefits of bank capital peak at 15-23% risk-weighted bank capital ratio.
Finance and Development: Capital Buffers
Corporate Governance of Banks and Financial Stability (with Luc Laeven)
Bank corporate governance reforms may be useful, but cannot substitute for strong supervision.
Bank Size and Systemic Risk (with Luc Laeven and Hui Tong) IMF Staff Discussion Note 14/01
Large banks' market-based activities increase systemic but not standalone bank risk; offering a clear rationale for macroprudential policy.
What Is Shadow Banking? (with Stijn Claessens) IMF WP 14/25
Defines shadow banking as "all financial activities, except traditional banking, which require a public or private backstop to operate."
How Much Capital Should Banks Have?
Banks may need 18% risk-weighted capital, 9% leverage to fully absorb asset shocks of the size seen in past crises in OECD countries.
Competition Policy for Modern Banks IMF WP 13/126 VOXEU Covered by Bloomberg
Competition policy can support financial stability by dealing with "too-big-to fail" and facilitating crisis management.
Shadow Banking: Economics and Policy (with Stijn Claessens, Zoltan Poszar, and Manmohan Singh) IMF Staff Discussion Note 12/12 VOXEU
Two key shadow banking functions -- securitization and collateral intermediation -- are economically valuable but pose systemic risk.
New Risks in Financial Intermediation, in IMF Global Financial Stability Report Oct 2012
Significant changes in the structure of the financial sector over the last decade have led to new systemic risks.
Externalities and Macroprudential Policy (with Gianni De Nicolo and Giovanni Favara) IMF Staff Discussion Note 12/05 VOXEU
The economic rationale of macroprudential policy is to correct risk externalities: across financial institutions and from finance to the real economy.
Why Are Canadian Banks More Resilient? (with Rocco Huang, 2009), IMF WP 09/152 VOXEU
Depository funding was a key determinant of banks stability during the 2008 crisis.
Other policy work
At the ECB
Fintech analysis co-lead in DG-Research
DG-Research work on post-COVID economic policy issues
Support to the Capital Market Union workstreams
Monetary policy strategy review (with a focus on the nonbanks aspect)
IMF country experience
Desk for the Euro Area, 2021-present
Desk for United States (monetary policy) and Canada (monetary policy and financial sector) during 2008-2010.
Missions to Korea (2016: corporate restructuring, financial sector, macroprudential policies)
Reviewer for Ireland and Spain (2011-14), Portugal (2014-2017), Ukraine (2014-2018), Mongolia (2016), and China (2017-2018).
Ad hoc work on EU issues, including A Banking Union for the Euro Area IMF Staff Discussion Note 13/01
IMF work on financial sector issues
Credit and Fiscal Multipliers in China (with Sophia Chen and Pi Han Tsai) 2017 IMF WP 17/273 IMF blog VOX China
Benefits and Costs of Corporate Debt Restructuring: An Estimation for Korea (with Jae Chung) 2016 IMF WP 16/204
Wide news coverage, top ranked business news on Naver (the main Korean news aggregator), Economist, Yohnap TV among others
Global Liquidity: Issues for Surveillance, IMF Board Paper, April 2014
Bank Funding and Financial Stability, Chapter 3 of IMF Global Financial Stability Report, October 2013
Key Aspects of Macroprudential Policy, IMF Policy Paper, September 2013 See also a Background Paper
Progress toward a Safer Financial System, Chapter 3 of IMF Global Financial Stability Report, October 2012
Inflation Expectations and Commodity Prices, U.S. Article IV 2011 (with Oya Celasun and Roxana Mihet) IMF WP 12/89 A short version
A Fair and Substantial Contribution, an IMF Report to G20 on Financial Sector Taxation, 2010
Government-Sponsored Financial Institutions in Advanced Economies (with Aditya Narain, 2006) IMF WP 07/227
At the Bank of England:
Work on UK liquidity regime
Support to the Basel WG on Liquidity
Member of the ECB/CEBS taskforce on Liquidity
Conferences and seminars; honors
Lev Ratnovski Lev Ratnovskiy
Lev Ratnovskiy