Cosimano, Thomas F.; Hakura, Dalia - International Monetary Fund (IMF) - 2011
lending rates and loan growth. Higher capital requirements, by raising banks’ marginal cost of funding, lead to higher … lending rates. The data presented in the paper suggest that large banks would on average need to increase their equity … increase their lending rates by 16 basis points, causing loan growth to decline by 1.3 percent in the long run. The results …