Author: Robert M. AdamsPublisher:
ISBN:
Category :
Languages : en
Pages : 34
Book Description
The Effects of Local Banking Market Structure on the Bank-lending Channel of Monetary Policy
Author: Robert M. AdamsThe Effects of Local Banking Market Structure on the Bank-lending Channel of Monetary Policy
Author: Robert M. AdamsThe Effects of Local Banking Market Structure on the Banking-lending Channel of Monetary Policy
Author: Robert M. AdamsPublisher:
ISBN:
Category : Banks and banking
Languages : en
Pages : 58
Book Description
"We study the relationship between banking competition and the transmission of monetary policy through the bank lending channel. Using business small loan origination data provided from the Community Reinvestment Act from 1996-2002 in our analysis, we are able to reaffirm the existence of the bank lending channel of monetary transmission. Moreover, we find that the impact of monetary policy on loan originations is weaker in more concentrated markets"--Abstract.
Bank Leverage and Monetary Policy's Risk-Taking Channel
Author: Mr.Giovanni Dell'AricciaPublisher: International Monetary Fund
ISBN: 1484381130
Category : Business & Economics
Languages : en
Pages : 41
Book Description
We present evidence of a risk-taking channel of monetary policy for the U.S. banking system. We use confidential data on the internal ratings of U.S. banks on loans to businesses over the period 1997 to 2011 from the Federal Reserve’s survey of terms of business lending. We find that ex-ante risk taking by banks (as measured by the risk rating of the bank’s loan portfolio) is negatively associated with increases in short-term policy interest rates. This relationship is less pronounced for banks with relatively low capital or during periods when banks’ capital erodes, such as episodes of financial and economic distress. These results contribute to the ongoing debate on the role of monetary policy in financial stability and suggest that monetary policy has a bearing on the riskiness of banks and financial stability more generally.
Market Structure in Banking and the Bank Lending Channel
Author: Yuan LiPublisher:
ISBN:
Category : Banks and banking
Languages : en
Pages : 286
Book Description
Banking Structure and The Effect of Monetary Policy on Bank Lending
Author: Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
This dissertation examines the role of bank structure on the effectiveness of monetary policy. Using time series data for U.S. banks, I examine the varying effect of monetary policy on bank lending for the period 1976-2003. It is found that as the banking industry gets more concentrated (through mergers and acquisitions), the effect of monetary policy transmission (through open market operations) is being mitigated. That was the result of the deregulation of the banking sector that took place in the first half of the 1990s which led to an unprecedented wave of consolidation in the banking sector. Then I investigate the lending channel evidence at the bank level. That is, how important is the cross-sectional differences in the way that banks with varying characteristics respond to policy shocks. Three bank characteristics are highlighted: bank size, liquidity and capitalization. It is found that large, more liquid, and well capitalized banks are more impervious to changes in monetary policy than other banks. Real estate loans, agriculture, commercial and industrial (C & I), and consumer loans are analyzed. The size of the bank is found to be most crucial for real estate lending, where small banks are much more sensitive to changes in the federal funds rate compared to large banks. The effect is comparatively less pronounced for C & I and consumer lending and largely disappears when it comes to agriculture lending. Finally, the question of monetary policy asymmetry is examined. As expected, monetary policy has more effect on bank lending when it tightens than when it eases interest rates. This is found to be the case for all types of loans except for real estate loans, where a decline of FFR entices more real estate lending than a rise.
Heterogeneous Bank Lending Responses to Monetary Policy
Author: Mr.John C BluedornPublisher: International Monetary Fund
ISBN: 1484356764
Category : Business & Economics
Languages : en
Pages : 39
Book Description
We present new evidence on how heterogeneity in banks interacts with monetary policy changes to impact bank lending. Using an exogenous policy measure identified from narratives on FOMC intentions and real-time economic forecasts, we find much greater heterogeneity in U.S. bank lending responses than that found in previous research based on realized federal funds rate changes. Our findings suggest that studies using realized monetary policy changes confound the monetary policy’s effects with those of changes in expected macrofundamentals. We also extend Romer and Romer (2004)’s identification scheme, and expand the time and balance sheet coverage of the U.S. banking sample.
Global Banks and International Shock Transmission
Author: Nicola CetorelliPublisher: DIANE Publishing
ISBN: 1437933874
Category : Business & Economics
Languages : en
Pages : 41
Book Description
Global banks played a significant role in transmitting the 2007-09 financial crisis to emerging-market (EM) economies. The authors examine adverse liquidity shocks on main developed-country banking systems and their relationships to EM across Europe, Asia, and Latin Amer., isolating loan supply from loan demand effects. Loan supply in EM across Europe, Asia, and Latin Amer. was affected significantly through three separate channels: (1) a contraction in direct, cross-border lending by foreign banks; (2) a contraction in local lending by foreign banks¿ affiliates in EM; and (3) a contraction in loan supply by domestic banks, resulting from the funding shock to their balance sheets induced by the decline in interbank, cross-border lending. Charts and tables.
Negative Monetary Policy Rates and Portfolio Rebalancing: Evidence from Credit Register Data
Author: Margherita BotteroPublisher: International Monetary Fund
ISBN: 1498300855
Category : Business & Economics
Languages : en
Pages : 59
Book Description
We study negative interest rate policy (NIRP) exploiting ECB's NIRP introduction and administrative data from Italy, severely hit by the Eurozone crisis. NIRP has expansionary effects on credit supply-- -and hence the real economy---through a portfolio rebalancing channel. NIRP affects banks with higher ex-ante net short-term interbank positions or, more broadly, more liquid balance-sheets, not with higher retail deposits. NIRP-affected banks rebalance their portfolios from liquid assets to credit—especially to riskier and smaller firms—and cut loan rates, inducing sizable real effects. By shifting the entire yield curve downwards, NIRP differs from rate cuts just above the ZLB.
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