The countercyclical capital buffer and the composition of bank lending

Auer, Raphael; Ongena, Steven

doi:10.1016/j.jfi.2022.100965

Cited by 26 publications

(12 citation statements)

References 42 publications

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“…Maatoug et al (2019) argue that capital buffers of both Islamic and conventional banks are counter-cyclical in MENA countries. Auer et al (2022) find that additional capital requirements resulting from the activation of the CCyB are associated with higher growth in banks' commercial lending. Therefore, in addition to the minimum common equity requirement and the Capital Conservation Buffer (CCB), banks are also required to satisfy sufficient countercyclical capital buffers to sustain lending during a crisis and to maintain financial system resilience (Benetton et al, 2021;Bui et al, 2017;Bennani et al, 2014).…”

Section: Introductionmentioning

confidence: 86%

Bank credit risk and macro-prudential policies: Role of counter-cyclical capital buffer

Benbouzid

Kumar

Mallick

et al. 2022

Journal of Financial Stability

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Section: Introductionmentioning

confidence: 86%

Bank credit risk and macro-prudential policies: Role of counter-cyclical capital buffer

Benbouzid

Kumar

Mallick

et al. 2022

Journal of Financial Stability

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“…Wan (2018) [32] showed that imposing the limit on the purchase of housing may result in the increase in vacancy, the decrease in the housing investment, and the decrease in the number of housing-related companies. Recently, Auer and Ongena (2022) [33] found that lending regulations in one location caused an unintended spillover, which generated an increase in lending in another place in Switzerland.…”

Section: Literature Reviewmentioning

confidence: 99%

Unintended Consequences of Housing Policies: Evidence from South Korea

Kim

2023

Sustainability

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South Korea has crafted a series of policy measures to regulate or stimulate housing markets. One interesting feature is that policy makers and market observers have paid enormous attention to one particular housing market, the Greater Gangnam Area in Seoul. The area is an upscale and self-sufficient urban neighborhood with high-priced residential properties; the nation’s housing policies have been directed toward tempering housing price appreciation there. This leads to the following research question: whether the housing policy tools achieved the intended goals or not. This study examined the differential impacts of government-initiated policy measures on housing submarkets in the primary real estate market. Quasi-experimental econometric evaluations, which are AITS-DID methods, revealed that recent policy measures did not achieve the intended goal of housing price stabilization. Rather, those policy instruments brought about unintended consequences. The Housing Welfare Roadmap measure was intended to cool down the Gangnam housing market, but it in fact increased the Gangnam housing prices by 5.69 percent points in comparison to the non-Gangnam area. In order to tackle housing market imbalances, the government should devise long-term urban and regional planning strategies to create self-sustaining communities suitable for various population groups so that they can compete with existing strong real estate markets.

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“…Another kind of studies examines the impact of external factors on bank loans. For instance, capital requirements and monetary policy (Chakraborty et al 2020 ; Benetton and Fantino 2021 ; Imbierowicz et al 2021 ; Yun and Cho 2022 ; Auer et al 2022 ), quantitative easing (Chen et al 2022 ), economic policy uncertainty (Shabir et al 2022 ), COVID-19 pandemic (Ҫolak and Öztekin 2021 ; Dursun-de Neef and Schandlbauer 2022 ), interest rate risk (Beutler et al 2020 ), foreign exchange risk (Kim et al 2021 ), trade and financial openness (Ashraf et al 2021 ), economic uncertainty and geopolitical risk (Alessandri and Bottero 2020 ; Demir and Danisman 2021 ), environmental regulation (Fard et al 2020 ), social trust (Álvarez-Botas and González 2021 ), etc.…”

Section: Introductionmentioning

confidence: 99%

How does climate risk affect bank loan supply? Empirical evidence from China

2023

Econ Change Restruct

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The impact of the climate change on the real economy and financial system has aroused great concern from the Chinese government and financial regulator. The objective of this paper is to examine the impact of climate risk on bank loan supply by using the sample of 403 commercial banks from China over the period 2008–2018 and fixed effects panel regression models. Our empirical studies obtain four findings. First, climate risk has a significant negative impact on the bank loan supply. Second, this adverse effect of climate risk can be mitigated by government’s climate protection performance and monetary expansion. Third, climate risk can inhibit loan supply through reducing banks’ risk appetites and decreasing their deposits. Finally, the negative influence of climate risk on loan supply is more pronounced for banks with less deposits and banks located in coastal areas. One policy implication is that commercial banks should adjust the structure of credit business and innovate loan products.

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The countercyclical capital buffer and the composition of bank lending

Cited by 26 publications

References 42 publications

Bank credit risk and macro-prudential policies: Role of counter-cyclical capital buffer

Bank credit risk and macro-prudential policies: Role of counter-cyclical capital buffer

Unintended Consequences of Housing Policies: Evidence from South Korea

How does climate risk affect bank loan supply? Empirical evidence from China

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