Research on the International Monetary Fund (IMF) shows how the Fund, through its lending practices, conditionality, and recommendations, has influenced countries’ policies and economic outcomes. Yet, how the IMF may unintentionally generate incentives for domestic institutional reforms has received less attention. In this paper, we analyze the consequences of the relative decrease of the IMF’s lending capabilities on member states’ decision to entrust their central banks with (stronger) powers as lenders of last resort (LOLR). While the IMF's absolute lending capacity is near historic highs, the growth of its lending capacity has not kept pace with financial globalization and potential liabilities of developing countries. We develop a formal model based on the beer-quiche game that shows that states with a reduced access to IMF lending capabilities should be associated with member states’ expansion of their central banks’ powers as to act as a LOLR – independently from the soundness of the countries’ financial systems, or their repayment reputations. We test our theory on a sample of developing countries between 1974 and 2014, using an original database of central banks LOLR capabilities. A battery of quantitative tests provides strong support for the empirical implications our theory. These findings suggest a substitution between domestic and global financial safety nets when access to IMF lending is reduced. Our results contribute to studies on the international factors behind of central banks designs, and to the broader institutionalist agenda in international relations, showing under what circumstances and to what extent international institutions affect state behaviour.