1. Alejandro Izquierdo Andrew Powell Research Department, IADB

4. Credit Depth in Latin America In Latin America, credit is scarce ... Note: Simple average within regions. Mean Value for the 1990s. Source : World Bank data.

5. Credit Depth in Latin America ... especially in continental Latin America, even controlling for the level of development

6. Interest Rate Margin Credit in Latin America is costly. Note: Simple average within regions. Mean Value for the 1990s. Source : IMF data.

7. Interest Rate Margin Low financial development is associated with high spreads.

8. Credit Volatility And credit is also highly volatile

9. Credit Volatility ...credit volatility is related with an underdeveloped financial sector.

10. Recurring Banking Crises LAC is the region of the world with the highest banking crisis recurrence

15. Crisis and Volatility ... as well as public sector debt holdings.

20. Twin Crises This is highly relevant considering that sudden stops and banking crises are another set of twins (75% in dollarized countries)

21. Balance Sheets Abrupt changes in relative prices lead to government’s and non tradable firm’s bankruptcies.

26. Low Compliance with Basel Core Principles

27. Source: IMF-World Bank Financial Sector Assessment Program, Presentation A. de la Torre, WB Selected Countries: Improvements in BCP Compliance

31. Market Discipline Basel II: Do the Pillars Balance?

35. The Role of Institutions: Weak Creditor Rights in LAC

37. The Role of Institutions: Creditor Rights

38. The Role of Institutions: Creditor Rights

39. The Role of Institutions: Creditor Rights

51. Alejandro Izquierdo Andrew Powell Research Department, IADB