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Competition in Lending and Credit Ratings
Ahmed, Javed - 2016
This article relates corporate credit rating quality to competition in lending between the public bond market and banks. In the model, the monopolistic rating agency's choice of price and quality leads to an endogenous threshold separating low-quality bank-dependent issuers from higher-quality...
Persistent link: https://www.econbiz.de/10013006572
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Aggregate Consequences of Dynamic Credit Relationships
Verani, Stephane - 2015
Which financial frictions matter in the aggregate? This paper presents a general equilibrium model in which entrepreneurs finance a firm with a long-term contract. The contract is constrained efficient because firm revenue is costly to monitor and entrepreneurs may default. The cost of...
Persistent link: https://www.econbiz.de/10013029376
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The impact of credit risk mispricing on mortgage lending during the subprime boom
Kahn, James A.; Kay, Benjamin S. - 2019
We provide new evidence that credit supply shifts contributed to the U.S. subprime mortgage boom and bust. We collect original data on both government and private mortgage insurance premiums from 1999-2016, and document that prior to 2008, premiums did not vary across loans with widely different...
Persistent link: https://www.econbiz.de/10012181334
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Risky Mortgages, Bank Leverage and Credit Policy
Ferrante, Francesco - 2016
Two key channels that allowed the 2007-2009 mortgage crisis to severely impact the real economy were: a housing net worth channel, as defined by Mian and Sufi (2014), which affected the wealth of leveraged households; and a bank net worth channel, which reduced the ability of financial...
Persistent link: https://www.econbiz.de/10014130918
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The Transmission of Monetary Policy Through Bank Lending : The Floating Rate Channel
Ippolito, Filippo; Ozdagli, Ali K.; Perez-Orive, Ander - 2017
We describe and test a mechanism through which outstanding bank loans affect the firm balance sheet channel of monetary policy transmission. Unlike other debt, most bank loans have floating rates mechanically tied to monetary policy rates. Hence, monetary policy-induced changes to floating rates...
Persistent link: https://www.econbiz.de/10014352397
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Supervisor Ratings and the Contraction of Bank Lending to Small Businesses
Kiser, Elizabeth K. - 2017
Bank lending to small firms in the U.S. fell substantially during the recent financial crisis and the ensuing recession. Because small firms account for a disproportionate share of new job creation, lending to these firms could have important implications for the pace of economic recovery. A...
Persistent link: https://www.econbiz.de/10012974736
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Un-Used Bank Capital Buffers and Credit Supply Shocks at SMEs During the Pandemic
Berrospide, Jose M.; Gupta, Arun; Seay, Matthew P. - 2021
Did banks curb lending to creditworthy small and mid-sized enterprises (SME) during the COVID-19 pandemic? Sitting on …. Using a novel set of confidential loan level data that includes private SME firms, we show that "buffer-constrained" banks … (those entering the pandemic with capital ratios close to this regulatory buffer region) reduced loan commitments to SME …
Persistent link: https://www.econbiz.de/10013219081
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Business to Business Credit to Small Firms
Mach, Traci - 2014
Following the financial crisis, total outstanding loans to businesses by commercial banks dropped off substantially. Large loans outstanding began to rebound by the third quarter of 2010 and essentially returned to their previous growth trajectory while small loans outstanding continued to...
Persistent link: https://www.econbiz.de/10013049258
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Banking Consolidation and Small Firm Financing for Research and Development
Chang, Andrew C. - 2016
This paper examines the effect of increased market concentration of the banking industry caused by the Riegle-Neal Interstate Banking and Branching Efficiency Act (IBBEA) on the availability of finance for small firms engaged in research and development (R&D). I measure the financing decisions...
Persistent link: https://www.econbiz.de/10013210386
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The Impact of the Small Business Lending Fund on Community Bank Lending to Small Businesses
Amel, Dean F. - 2015
Following the financial crisis, total outstanding loans to businesses by commercial banks dropped off substantially. Large loans outstanding began to rebound by the third quarter of 2010 and essentially returned to their previous growth trajectory while small loans outstanding continued to...
Persistent link: https://www.econbiz.de/10013031122