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2015 | 3 | 1 | 167-180

Article title

Do Financial Sector Structure and Development Matter for the Effect of Bank Capital on Lending in Large EU Banks?

Content

Title variants

Languages of publication

PL

Abstracts

PL
The paper aims at finding out what is the impact of bank capital ratios on loansupply in the EU and what factors explain the potential diversity of this impact.Applying the Blundell and Bond (1998) two step GMM estimator, we find that in thefull sample of large banks the role of capital ratio on loan growth in contractionsis relatively weak. However, if we take into account the differences in financial sector structure and development between EU countries, we find that the effectof capital ratio on lending is positive and statistically significant. Therefore, ourresults suggest that capital ratios are an important determinant of lending in thelarge EU banks in those countries where financial sector is more dominated bystock markets of is better developed. Thus, our results provide support for theview that more financially developed economies are prone to greater procyclicalimpact of capital ratios on lending of banks.

Year

Volume

3

Issue

1

Pages

167-180

Physical description

Dates

published
2015-12-12

Contributors

References

Document Type

Publication order reference

YADDA identifier

bwmeta1.element.ojs-doi-10_33119_KKESSiP_2015_1_3_11
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