UNGARO Stefano

Despite France's importance in the interwar world economy, the scale of the French banking crises of 1930–1 and their consequences have never been fully assessed quantitatively. The lack of banking regulation severely limited the availability of balance sheet data. Using a new dataset of individual balance sheets from more than 300 banks, this article shows that the crises were much more severe than previously thought, although they did not affect the main commercial banks. By reconstructing financial flows, this study shows that the fall in bank credit was mostly driven by a flight‐to‐safety by deposits, from banks to savings institutions and the central bank. The decrease in bank deposits due to bank runs was offset by an increase in deposits with savings institutions, with the central bank, and in cash hoarding, whereas the decrease in bank credit was not offset by an increase in loans from non‐bank financial institutions. In line with the gold standard mentality, cash deposited with savings institutions and the central bank was used to decrease marketable public debt and increase gold reserves, rather than pursuing countercyclical policies. Despite massive capital inflows and rising aggregate money supply, France suffered from a severe, persistent credit crunch.

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This thesis focuses on the relationship between the money and financial markets in France over the period 1880-1914. In particular, it examines the market for short-term loans. The thesis studies in detail two segments of this market: the advances on securities (secured short-term loans), and the deferment market (sale and repurchase agreements). The key intermediaries are the Banque de France, four major depository banks, regional banks, and the two stock market players: the Compagnie des agents de change and the Coulisse. The thesis is structured in three chapters. The first chapter deals with the introduction of a clearing house in the French deferral market, and studies the consequences of this introduction on counterparty risk. The second chapter deals with the monetary policy of the Banque de France between 1890 and 1913 and the role of the banking sector in the transmission of monetary policy itself. The third and final chapter deals with the financial crisis of 1914 in France.

This thesis deals with the relationship between the money market and the financial market from 1880 to 1914. It focuses in particular on the market for short-term loans. This dissertation studies in detail two segments of this market: the advances on securities (collateralized short-term loans), and the repo market (repurchase agreements). The key financial intermediaries are the Banque de France, four main commercial banks, regional banks, the « coulisse » operating over-the-counter and the « Compagnie des agents de changes ». The dissertation is structured in three chapters. The first deals with the introduction of a clearing house in the French historical repo market, and studies its consequences on counterparty risk. The second chapter deals with Bank of France monetary policy between 1890 and 1913 and the role of the banking sector in the transmission of policy shocks. The third chapter deals with the Great Financial Crisis of 1914.

No summary available.