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Negative Interest Rates, Excess Liquidity and Retail Deposits : Banks’ Reaction to Unconventional Monetary Policy in the Euro Area

Demiralp, Selva; Eisenschmidt, Jens; Vlassopoulos, Thomas - 2021

reliance on retail deposit funding and the level of excess liquidity holdings may increase banks’ responsiveness to NIRP. We … segments. We are the first to document the importance of banks’ excess liquidity holdings for the effectiveness of NIRP …, pointing to a strong complementarity of NIRP with central bank liquidity injections, e.g. via asset purchases …

Persistent link: https://www.econbiz.de/10013221074

Negative Interest Rates, Excess Liquidity and Retail Deposits : Banks’ Reaction to Unconventional Monetary Policy in the Euro Area

Demiralp, Selva - 2019

' funding structures jointly with that in their excess liquidity holdings. We find evidence that banks highly exposed to the …, importantly, the explicit consideration of the role of excess liquidity in our analysis …

Persistent link: https://www.econbiz.de/10012869955

Life Below Zero : Bank Lending Under Negative Policy Rates

Heider, Florian - 2018

We show that negative policy rates aﬀect the supply of bank credit in a novel way. Banks are reluctant to pass on negative rates to depositors, which increases the funding cost of high-deposit banks, and reduces their net worth, relative to low-deposit banks. As a consequence, the introduction...

Persistent link: https://www.econbiz.de/10012913551

Monetary Policy Transmission to Mortgages in a Negative Interest Rate Environment

Amzallag, Adrien - 2019

Do negative policy rates hinder banks' transmission of monetary policy? To answer this question, we examine the behaviour of Italian mortgage lenders using a novel loan-level dataset. When policy rates turn negative, banks with higher ratios of retail overnight deposits to total assets charge...

Persistent link: https://www.econbiz.de/10012892476

Banks, Low Interest Rates, and Monetary Policy Transmission

Wang, Olivier - 2021

This paper studies how low interest rates weaken the short-run transmission of monetary policy and contract the long-run supply of bank credit. As U.S. bond rates have fallen, the pass-through of monetary shocks to loan and deposit rates has weakened while the spread on U.S. bank loans has...

Persistent link: https://www.econbiz.de/10013314913

Jagged Cliffs and Stumbling Blocks : Interest Rate Pass-Through Fragmentation During the Euro Area Crisis

Holton, Sarah - 2015

The financial crisis has been characterised by fragmentation in the transmission of monetary policy, reflected in high dispersion in the cost of bank finance for euro area firms. Using micro-level bank data across a number of euro area countries, we identify individual bank balance sheet...

Persistent link: https://www.econbiz.de/10013014957

Mending the Broken Link : Heterogeneous Bank Lending and Monetary Policy Pass-Through

Altavilla, Carlo - 2017

We analyse the pass-through of monetary policy measures to lending rates to firms and households in the euro area using a unique bank-level dataset. Bank balance sheet characteristics such as the capital ratio and the exposure to sovereign debt are responsible for the heterogeneity of...

Persistent link: https://www.econbiz.de/10012963918

Monetary Policy and the Flow of Funds in the Euro Area

Bonci, Riccardo - 2011

, partially replacing them with inter-company loans, and draw on their liquidity to try to offset the fall of revenues associated …

Persistent link: https://www.econbiz.de/10013118686

A Non-Standard Monetary Policy Shock : The ECB’s 3-year LTROs and the Shift in Credit Supply

Darracq Pariès, Matthieu - 2013

The identification of non-standard monetary policy shocks is a key challenge for econometricians, not least as these measures are somewhat unprecedented in modern central banking history and as the instruments vary widely across the various non-standard measures. This paper focuses on the 3-year...

Persistent link: https://www.econbiz.de/10013088278

Bank Lending and Monetary Transmission in the Euro Area

De Santis, Roberto A. - 2013

monetary policy exerts larger effects on cooperative and savings banks with lower liquidity and less capital in Germany and …

Persistent link: https://www.econbiz.de/10013078975