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The spillover effects of prudential regulation on banking competition

Ferri, Giovanni; Pesic, Valerio - In: Vierteljahrshefte zur Wirtschaftsforschung 89 (2020) 1, pp. 59-99

European supervisors aggressively requested more capital at large banks. That may cut credit to the economy. We confirm that especially larger banks cut loans while less-significant banks partly offset that credit drop. Moreover, we identify nasty spillovers from that interaction. Specifically,...

Persistent link: https://www.econbiz.de/10012507218

How Does Macroprudential Regulation Change Bank Credit Supply?

Kashyap, Anil K. - 2017

We analyze a variant of the Diamond-Dybvig (1983) model of banking in which savers can use a bank to invest in a risky … project operated by an entrepreneur. The savers can buy equity in the bank and save via deposits. The bank chooses to invest … in a safe asset or to fund the entrepreneur. The bank and the entrepreneur face limited liability and there is a …

Persistent link: https://www.econbiz.de/10012973038

How do banking groups react to macroprudential policies? : cross-border spillover effects of higher capital buffers on lending, risk-taking and internal markets

Cappelletti, Giuseppe; Marques, Aurea Ponte; Salleo, Carmelo - 2020

We study the impact of macroprudential capital buffers on banking groups' lending and risk-taking decisions, also investigating implications for internal capital markets. For identification, we exploit heterogeneity in buffers applied to other systemically important institutions, using...

Persistent link: https://www.econbiz.de/10012318816

Multinational lending retrenchment after the global financial crisis: the impact of policy interventions

Müting, Miriam - 2020 - This version: June 29, 2020

. Under a binding equity constraint, our model predicts shocks to bank equity, regulatory standards and monetary policy, such …

Persistent link: https://www.econbiz.de/10012240769

Banking networks and economic growth: from idiosyncratic shocks to aggregate fluctuations

Kundu, Shohini; Vats, Nishant - 2021

negative shocks towards other unaffected economies. Our GIV estimates suggest that a 1% increase in bank loan supply is …

Persistent link: https://www.econbiz.de/10012694566

Monetary policy and global banking

Bräuning, Falk; Ivashina, Victoria - 2017 - This version: December 23, 2016

Global banks use their global balance sheets to respond to local monetary policy. However, sources and uses of funds are often denominated in different currencies. This leads to a foreign exchange (FX) exposure that banks need to hedge. If cross-currency flows are large, the hedging cost...

Persistent link: https://www.econbiz.de/10011687276

Fire sale bank recapitalizations

Bertsch, Christoph; Mariathasan, Mike - 2015

imperfectly elastic supply of bank equity stemming from financial market segmentation. In our model, equity is costly and serves … and the design of bank stress testing. …

Persistent link: https://www.econbiz.de/10011341895