Monetary policy leverage and bank risk-taking
Web1 jul. 2010 · Monetary Policy, Leverage, and Bank Risk-Taking L. Laeven, Giovanni Dell'Ariccia, Robert Marquez Economics 2010 The recent global financial crisis has ignited a debate on whether easy monetary conditions can lead to greater bank risk-taking. We study this issue in a model of leveraged financial intermediaries… 165 PDF WebKeywords: Monetary policy, leverage, risk taking, banking crises JEL Classification Numbers:E44, E58, G21 ∗The views expressed in this paper are those of the authors and do not necessarily represent those of theIMF.We thank Olivier Blanchard, Stijn Claessens, Gianni De Nicolo’, Hans Degryse, Giovanni Favara, Charlie Kahn, Marcus
Monetary policy leverage and bank risk-taking
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Web31 jan. 2011 · We study this issue in a model of leveraged financial intermediaries that endogenously choose the riskiness of their portfolios. When banks can adjust their capital structures, monetary easing unequivocally leads to greater leverage and higher risk. Web1 jan. 2014 · We assess the effects of monetary policy on bank risk to verify the existence of a risk-taking channel – monetary expansions inducing banks to assume more risk. ... Monetary policy, bank leverage, and financial stability. Journal of Economic Dynamics and Control, Volume 47, 2014, pp. 20-38.
WebBank leverage and monetary policy’s risk-taking channel: evidence from the United States . Giovanni Dell’Ariccia, Luc Laeven . and Gustavo A. Suarez No 1903 / May … Web8 aug. 2010 · This paper contributes to the debate by showing that the relationship between the monetary policy stance and bank risk taking is more complex than generally believed. Most of the debate so far has focused on how monetary policy easing can induce greater risk taking through a search for yield or its effects on leverage and asset prices, a view …
Web31 jan. 2011 · We study this issue in a model of leveraged financial intermediaries that endogenously choose the riskiness of their portfolios. When banks can adjust their … Webthe relationship between the monetary policy stance and bank risk taking is more complex than generally believed. Most of the debate so far has focused on how …
Web1 okt. 2014 · Consistent with the above empirical evidence, this paper rationalizes a link between monetary policy and banks׳ risk-taking incentives in a dynamic bank model, and studies the conditions under which risk-taking can be excessive. It exploits a well-established result in the banking literature, which is that limited liability induces banks to ...
WebSpain).2 The international analysis of the risk-taking channel is use-ful, as it accounts for country-related factors—other than monetary policy—that could affect bank risk contemporaneously. Second, it analyzes the impact of monetary policy on a broad concept of bank risk that is captured by the expected default frequency (EDF). It how gallon dose a 30\\u0027x30\\u0027 round pool holdWeb31 dec. 2016 · We present evidence of a risk-taking channel of monetary policy for the U.S. banking system. We use confidential data on the internal ratings of U.S. banks on loans to businesses over the period 1997 to 2011 from the Federal Reserve’s survey of terms of business lending. We find that ex-ante risk taking by banks (as measured by … how gallons are in a quartWebThe net effect of a monetary policy change on bank monitoring (an inverse measure of risk taking) depends on the balance of three forces: interest rate pass-through, risk shifting, and leverage. When banks can adjust their capital structures, a monetary easing leads to greater leverage and lower monitoring. However, if a bank's capital ... how gallon dose a 30\u0027x30\u0027 round pool hold