ABSTRACT
Our paper outlines and evaluates a model of transfer risk analysis which has been used by an international commercial bank for managing the country risk of and allocating country limits to emerging markets over the last three years. The model is highly eclectic and pragmatic; despite this fact (or maybe even because of it) it proved to be a very useful instrument in the sense that it gave correct signals in advance for upcoming economic crises in several emerging market economies during the period from July 1997 (depreciation of the Thai baht) to January 1999 (devaluation of the Brazilian real).
