Since 1989, the Bank has given increasing support to Mexico's National Solidarity Program (PRONASOL) in projects for education, health, transportation, and regional development. Despite the Bank's growing association with PRONASOL, given its magnitude and complexity, it is easy to underestimate...

A second-generation model of currency crises is combined with a standard model ofbanks as providers of insurance against liquidity risk. In a pegged exchange rateregime, after funds have been committed to the banks, news arrives about the qualityof the banks’ assets and about the exchange rate...