scholarly journals Sovereign Risk and Cross-Country Heterogeneity in the Transmission of Monetary Policy to Bank Lending in the Euro Area

2018 ◽  
Author(s):  
Pietro Grandi
Keyword(s):  
Monetary Policy ◽  
Euro Area ◽  
Bank Lending ◽  
Sovereign Risk ◽  
Cross Country ◽  
Transmission Of Monetary Policy

Excess euro-area liquidity raises bank lending risks

2019 ◽  
Keyword(s):  
Monetary Policy ◽  
Euro Area ◽  
Commercial Banks ◽  
Bank Lending ◽  
Domestic Demand ◽  
Basel Iii ◽  
Content Type ◽  
Reserve Requirements ◽  
Regulatory Standards ◽  
Excess Liquidity

Significance The ECB stopped purchasing bonds this month after running its asset purchase programme (APP) since March 2015. The APP flooded commercial banks with liquidity in excess of their minimum reserve requirements, which they could use to grant new loans. The ECB achieved its goal of increasing credit to the private sector, raising domestic demand and warding off price deflation, but commercial banks have kept large amounts of excess liquidity. Impacts Euro-area banks' average profitability has improved during the APP scheme, but less accommodating monetary policy may reverse this trend. The high prudential ratios the Basel III regulatory standards require should make euro-area banks more resilient to monetary tightening. The ECB's mopping up may pose difficulties to banks relying on excess liquidity to meet the Basel III coverage liquidity ratio.

What Do a Million Observations on Banks Say About the Transmission of Monetary Policy?

2000 ◽  
Vol 90 (3) ◽  
pp. 407-428 ◽  
Author(s):  
Anil K Kashyap ◽  
Jeremy C Stein
Keyword(s):  
Monetary Policy ◽  
Bank Lending ◽  
Monetary Transmission ◽  
Bank Lending Channel ◽  
Data Set ◽  
Balance Sheets ◽  
Lending Channel ◽  
The Impact ◽  
Transmission Of Monetary Policy ◽  
Quantitative Importance

We study the monetary-transmission mechanism with a data set that includes quarterly observations of every insured U.S. commercial bank from 1976 to 1993. We find that the impact of monetary policy on lending is stronger for banks with less liquid balance sheets—i.e., banks with lower ratios of securities to assets. Moreover, this pattern is largely attributable to the smaller banks, those in the bottom 95 percent of the size distribution. Our results support the existence of a “bank lending channel” of monetary transmission, though they do not allow us to make precise statements about its quantitative importance. (JEL E44, E52, G32)

scholarly journals State-Dependent Transmission of Monetary Policy in the Euro Area

2018 ◽  
Author(s):  
Jan Pablo Burgard ◽  
Matthias Neuenkirch ◽  
Matthias Nöckel
Keyword(s):  
Monetary Policy ◽  
Euro Area ◽  
State Dependent ◽  
Transmission Of Monetary Policy

scholarly journals Monetary Policy, Credit Institutions and the Bank Lending Channel in the Euro Area

2019 ◽  
Author(s):  
Carlo Altavilla ◽  
Desislava Andreeva ◽  
Miguel Boucinha ◽  
Sarah Holton
Keyword(s):  
Monetary Policy ◽  
Euro Area ◽  
Bank Lending ◽  
Bank Lending Channel ◽  
Lending Channel ◽  
Credit Institutions
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