Macroprudential policy effect on the link between lending and capital ratio – the role of economic development and capital account openness
Journal Title: "Finanse" Czasopismo Komitetu Nauk o Finansach PAN - Year 2017, Vol 10, Issue 1
Abstract
In this paper we ask about the role of macroprudential policies to affect the link between lending and capital ratio in countries differing in economic development and capital account openness. To resolve this problem we apply the GMM 2-step Blundell and Bond approach to a sample covering over 60 countries. Our results show that the effect of macroprudential policies on the association between lending and the capital ratio in non-crisis periods is stronger in advanced countries than in emerging countries. Differentiating by the level of capital account openness, we find that macroprudential policies are more effective in increasing the resilience of banks and thus weakening the association between loan supply and capital ratio for relatively closed economies but less effective for relatively open economies. Generally, with our study we are able to support the view that macroprudential policy has the potential to curb the procyclical impact of bank capital on lending.
Authors and Affiliations
Małgorzata Olszak, Sylwia Roszkowska, Iwona Kowalska
Keywords
Related Articles
- EP ID EP308950
- DOI -
- Views 47
- Downloads 0
Stock recommendations – an analysis of usefulness
This article presents the results of an assessment of the reliability and thus usefulness of the recommendations concerning stocks listed on the Warsaw Stock Exchange. In order to meet this goal, the authors analysed tho...
Resolution tools in the opinion of EU resolution authorities
After the banking crisis, the European Union (EU) introduced a framework for the restructuring and orderly liquidation of credit institutions. The overarching goal of the new rules is to manage severe banking crisis more...
Finansjalizacja a zmiana matrycy instytucjonalnej
The article focuses on the problem of so called “financialization”. The applied method of analysis of this issue is rarely used in finance – the mechanism of the institutional changes that has been used is the one elabor...
Negative interest rates and Islamic finance
Negative interest rates are a phenomenon, which attracts the attention of many economists. Several world currencies are affected, for different reasons. Currencies such as Swiss franc or Danish krone have an appreciation...
Comparison of the results of long and short straddle option strategies on the WIG20 during 2005–2015
There is a huge variety of derivatives on the Polish financial market (i.a. options and futures on stocks or indices). Options offer a lot of possibilities in the creation of advanced strategies. They can be used during...