#2311. Overcoming the loan-to-deposit ratio by a financial intermediation measure — A perspective instrument of financial stability policy

September 2026publication date
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Journal’s subject area:
Economics and Econometrics;
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Abstract:
The paper proposes extending the metric of liquidity and funding towards measuring attainment in financial intermediation. The proposed metric, financial intermediation measure (FIM), is a normative indicator and amends the descriptive nature of the LTD ratio, and is thus more suited to the needs of macroprudential regulation of financial systems. The FIM focuses upon the banking part of financial intermediation and measures whether a financial system is successful in transforming (bank) deposits into loans subject to feasibility restrictions applied to both the banking and securities markets.
Keywords:
Financial Development and Structure Dataset; Financial intermediation; Financial intermediation measure; Financial system; Loan-to-deposit ratio

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