Template-type: ReDif-Paper 1.0
Author-Name: Kurz, Michael
Author-workplace-name: RS: GSBE other - not theme-related research, Finance
Author-Name: Kleimeier, Stefanie
Author-workplace-name: RS: GSBE Theme Sustainable Development, Finance
Title: Credit Supply: Are there negative spillovers from banks’ proprietary trading? (RM/19/005-revised-)
Abstract: Following the global financial crisis, policy makers considered regulations that restrict banks’ activities which were motivated by concerns that banks use central bank borrowing, government guarantees, or subsidies to fund securities trading instead of lending to the real economy. Using a global sample of 132 major banks from 2003 to 2016, we find that banks’ securities trading is indeed associated with decreased loan supply. Effects are stronger for domestic lending markets, during crisis periods, and in countries with deeper financial markets. However, corporate capital expenditures and employment growth are unaffected, suggesting that<br/>policy makers’ concerns are only partly justified.
Classification-JEL: g01,g21,g28
Series: GSBE Research Memoranda
Creation-Date: 20191024
Number: 026
File-URL: https://cris.maastrichtuniversity.nl/ws/files/37533581/RM19026.pdf
File-Format: application/pdf
File-Size: 788727
Handle: Repec:unm:umagsb:2019026
DOI: 10.26481/umagsb.2019026