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While a more integrated central counterparty (CCP) network via interoperability will provide users more cost efficient clearing and settlement services, it also increases the default transmission through the system. Using epidemic spreading model, it is found that a vertically interoperated CCP network is more robust compared with a horizontally interoperated one when certain condition is satisfied. Variation of the different transmission rates from both internal and external sources leads to different equilibrium. The safe range which is free from the crisis explosion state is identified and can be reached with certain policy coordination among nations. [ABSTRACT FROM AUTHOR]

The negative externalities from an individual bank failure to the whole system can be huge. One of the key purposes of bank regulation is to internalize the social costs of potential bank failures via capital charges. This study proposes a method to evaluate and allocate the systemic risk to different countries/regions using a Susceptible-Infected-Removable (SIR) type of epidemic spreading model and the Shapley value (SV) in game theory. The paper also explores features of a constructed bank network using real globe-wide banking data. [ABSTRACT FROM AUTHOR]

Although recently there are extensive research on currency network using minimum spanning trees approach, the knowledge about the actual evolution of a currency web in Asia is still limited. In the paper, we study the structural evolution of an Asian network using daily exchange rate data. It was found that the correlation between Asian currencies and US Dollar, the previous regional key currency has become weaker and the intra-Asia interactions have increased. This becomes more salient after the exchange rate reform of China. Different from the previous studies, we further reveal that it is the trade volume, national wealth gap and countries growth cycle that has contributed to the evolutionary topology of the minimum spanning tree. These findings provide a valuable platform for theoretical modeling and further analysis. [ABSTRACT FROM AUTHOR]