Interbank payments are settled in Norges Bank’s settlement system (NBO), a real-time gross settlement (RTGS) system. Such payments are often time-critical and of high value. Operational disruptions that impair the ability of participants to execute payments may therefore pose a threat to financial stability.
Analyse the robustness of the settlement process in the Norges Bank settlement system (NBO) to operational problems in one of its participating banks using a large number of days with actual payments data.
Only four banks are of systemic importance and that the systemic effects can be significantly reduced if banks react quickly by postponing their outgoing payments to the stricken bank.
- Norges Bank Working Paper: “Operational problems in banks – Effects on the settlement of payments in Norges Bank“