Alan Karaev

Financial University under the Government of the Russian Federation

Department of Public Finance

Moscow, Russian Federation

Email: akkaraev@fa.ru

Stability analysis of the banking system: a complex systems approach

Marina Melnichuk

Financial University under the Government of the Russian Federation

Department of Laguage Training

Moscow, Russian Federation

Email: mvmelnichuk@gmail.com

Timur Guev

Kaspersky Lab

Moscow, Russian Federation

Email: timyr-guev@yandex.ru

Grzegorz Mentel

Rzeszow University of Technology

Rzeszow, Poland

Email: gmentel@prz.edu.pl

Abstract. The present work deals with the stability analysis of a banking system with the structure in the form of Apollonian graph based on such characteristics of the banking system as the modularity and inhomogeneous distribution of banks by degree, on the basis of the extended mean-field Nier model (a static approach based on a simplified balance sheet of assets and liabilities of the bank) which was used to analyze the extent of the process of bankruptcy of banks after the default of one of the banks in the banking system. The obtained results of research of stability of banking systems based on the Apollonian graphs indicate that such characteristics as modularity (i.e. clustering), and the heterogeneity of banks in the structure of the model of banking systems allow them to conform «isomorphous structure» typical of the majority of real social and biological complex adaptive systems.

Received: May, 2017

1st Revision: August, 2017

Accepted: September, 2017

DOI: 10.14254/2071-8330.2017/10-3/20

JEL Classification: D85, D47, D53

Keywords: banking and finance, financial stability, complex systems, financial contagion, network approach