Trade Uncertainty and U.S. Bank Lending

Ricardo Correa, Julian di Giovanni, Linda Goldberg and Camelia Minoiu

No 2024-16, FRB Atlanta Working Paper from Federal Reserve Bank of Atlanta

Abstract: This paper uses U.S. credit register data and the 2018–19 Trade War to study the effects of uncertainty on domestic credit supply. Exploiting differences in banks' ex-ante exposure to trade uncertainty, we find that increased uncertainty is associated with a broad lending contraction across their customer firms. This result is consistent with banks responding to uncertainty with wait-and-see behaviors, where more exposed banks curtail risky exposures, reduce loan maturities, and adjust loan supply along both intensive and extensive margins. The lending contraction is larger for more capital-constrained banks and has significant real effects, especially for bank-dependent firms.

Keywords: uncertainty; bank loans; trade finance; credit supply; trade war (search for similar items in EconPapers)
JEL-codes: F34 F42 G21 (search for similar items in EconPapers)
Pages: 66
Date: 2024-10-18
New Economics Papers: this item is included in nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in 2024

Downloads: (external link)
https://www.atlantafed.org/-/media/documents/resea ... -us-bank-lending.pdf Full text (application/pdf)

Related works:
Working Paper: Trade Uncertainty and U.S. Bank Lending (2023)
Working Paper: Trade Uncertainty and U.S. Bank Lending (2023)
Working Paper: Trade Uncertainty and U.S. Bank Lending (2023)
Working Paper: Trade Uncertainty and U.S. Bank Lending (2023)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fip:fedawp:99199

Ordering information: This working paper can be ordered from

DOI: 10.29338/wp2024-16

Access Statistics for this paper

More papers in FRB Atlanta Working Paper from Federal Reserve Bank of Atlanta Contact information at EDIRC.
Bibliographic data for series maintained by Rob Sarwark ().