We develop a macroeconomic model in which commercial banks can offload risky loans to a ‘shadow’ banking sector, and … financial intermediaries trade in securitised assets. We analyse the responses of aggregate activity, credit supply and credit … institutions affect credit dynamics; high leverage in the shadow banking system makes the economy excessively vulnerable to …

We estimate the effect of changes in microprudential regulatory capital requirements on bank capital ratios and bank … lending. We do so by running panel regressions using a rich new data set, exploiting variation in individual bank capital … mostly recovers within three years. While estimated over a different policy regime and at the individual bank level, these …

the aggregate bank capital requirement during an economic upswing is associated with a reduction of lending, with the …

bank lending is surprisingly underexamined, given the central importance ascribed to this channel of contagion by … quarterly to the Bank of England. I find that the shock to foreign funding caused a substantial pullback in domestic lending …

UK bank panel data set from a period that pre-dates the recent financial crisis. Focusing on the behaviour of bank loans … lending to UK residents. Specifically, we use write-offs on loans to non-residents to instrument bank capital’s impact on UK …This paper assesses how shocks to bank capital may influence a bank’s portfolio behaviour using novel evidence from a …

The regulation of bank capital to improve the resilience of the financial system and, related to this aim, as a means … of smoothing the credit cycle are central elements of forthcoming macroprudential regimes internationally. For such … regulation to be effective in controlling the aggregate supply of credit: (i) changes in capital requirements need to affect loan …

We examine how the Bank of England’s quantitative easing (QE) policy during the global financial crisis affected the …

quantitative restrictions on lending. As well as affecting investment, such a credit contraction is likely to have had a large … components of working capital (net cash, inventories, and trade credit). We find that this model produces the standard responses … reinforced by reductions in trade credit. Our model also documents a crucial role for monetary policy to offset such shocks. …