Optimizing Banking Network Resilience to Exchange Rate Shocks

This paper explores the resilience optimization of Iran's banking sector in the face of exchange rate shocks---critical macroeconomic disturbances with extensive consequences‎. ‎We develop a multi-sector macro-dynamic stochastic general equilibrium model encompassing essential economic components‎, ‎including firms‎, ‎government‎, ‎central bank‎, ‎and the banking sector‎. ‎This framework facilitates the simulation of the macroeconomic environment and allows for a thorough analysis of the banking sector's adaptive responses to exchange rate fluctuations‎. ‎Our findings reveal optimization strategies that effectively mitigate the adverse effects of these shocks while maintaining equilibrium in the broader economy‎. ‎Specifically‎, ‎we discover that while an initial positive exchange rate shock can enhance banking sector performance‎, ‎it ultimately triggers inflationary pressures that threaten profitability and operational stability in the medium to long term‎.

کلیدواژه ها:

Exchange rate shocks ، Banking network performance ، Optimization ، Dynamic Stochastic General Equilibrium Model ، Efficiency