We are pleased to announce the latest post on the SUARA SEACEN Blog by Nur Ain Shahrier, Senior Economist in the Macroeconomic and Monetary Policy Management pillar at the Centre.
When Banks and Insurers Move Together: Why Systemic Risk Lives in the Tails?
Are banks still the epicenter of financial contagion? Not always.
Our latest research uncovers how insurance companies especially those with investment heavy portfolios emerge as powerful transmitters of systemic shocks, particularly during market stress or exuberance. By moving beyond average-based models and zooming into the tails of the distribution, we show how risk behaves very differently in extreme states and why traditional tools might miss the signals that matter most.
Want to know who transmits shocks, when, and how systemic risk changes shape? This post dives into quantile connectedness, regime shifts, and what it means for regulators in SEACEN economies and beyond.
Click here to read.
