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Business cycles imply liquidity risks for banks. This paper explores how these risks influence bank lending over the … cycle. With forward-looking banks, lending cycles, credit booms and busts, or suppressed and highly fragile bank systems can … unpleasant effects on bank lending. Imposing countercyclical capital adequacy ratio may amplify procyclicality or result in …
Persistent link: https://www.econbiz.de/10010341626
From a broad macro-financial structure perspective, overly easy credit conditions gave rise to house price booms and busts in several advanced economies (e.g., Ireland, Spain, and the U.S.), and, more specifically in the U.S., an underpricing of risk made possible by regulatory arbitrage and...
Persistent link: https://www.econbiz.de/10011509124
focuses on bank incentives to manage bad loans. We show that interventions involving bank recapitalizations provide banks with … undercapitalization of the banking sector, other interventions, such as guarantees on bank liabilities and liquidity support, lead banks … crisis, and find that bank recapitalizations substantially reduce recession duration …
Persistent link: https://www.econbiz.de/10014160201
Most explanations of the crisis of 2007-2009 emphasize the role of the preceding boom in real estate and asset markets in a variety of advanced countries. As a result, an idea that is gaining support among various groups is how to make Basel II or any regulatory regime less procyclical.This...
Persistent link: https://www.econbiz.de/10013140026
Most explanations of the crisis of 2007-2009 emphasize the role of the preceding boom in real estate and asset markets in a variety of advanced countries. As a result, an idea that is gaining support among various groups is how to make Basel II or any regulatory regime less procyclical. This...
Persistent link: https://www.econbiz.de/10013148271
While the finance literature often equates government banks with political capture and capital misallocation, these banks can help mitigate financial shocks. This paper examines the role of Brazil's government banks in preventing a recession during the 2008-2010 financial crisis. Government...
Persistent link: https://www.econbiz.de/10013055701
We assess the procyclical effects of bank capital regulation in a dynamic equilibrium model of relationship lending in …
Persistent link: https://www.econbiz.de/10013146586
Despite the extensive debate on the effects of bank competition on risk-taking and procyclicality, there is no evidence … cycle. We contribute to the literature by investigating the impact of bank competition on the effects of individual … macroprudential tools in a sample covering over 70,000 bank-level observations in 109 countries from 2004 to 2015. Our results are in …
Persistent link: https://www.econbiz.de/10012861004
analysis also provides a new rationale for the countercyclical elements of capital requirements.This version updates the Bank …
Persistent link: https://www.econbiz.de/10013130532
CCyB, especially relative to countries where a bank regulator or the central bank has the authority to set the CCyB. While …
Persistent link: https://www.econbiz.de/10012170614