Updated estimates of the role of the bank lending channel in monetary policy transmission in Poland

Mariusz Kapuściński

No 359, NBP Working Papers from Narodowy Bank Polski

Abstract: In this research note I provide updated estimates of the role of the bank lending channel in monetary policy transmission in Poland. Previous estimates were described in Kapuściński (2017). The bank lending channel is defined following Disyatat (2011), as the amplification of the effect of monetary policy on bank lending, due to its impact on bank balance sheet strength. As before, the estimates are based on counterfactual impulse response functions from panel vector autoregressive models. Differences include not only the longer time series dimension of available data, but also enhancements in terms of the number of banks covered, data processing and coefficient uncertainty coverage. I find the bank lending channel to operate differently in cooperative and commercial banks. Nevertheless, estimates for the latter, significantly larger part of the banking sector are broadly in line with previous ones. 18 percent of a decline in bank lending after the tightening of monetary policy can be attributed to the bank lending channel.

Keywords: transmission mechanism of monetary policy; bank lending channel. (search for similar items in EconPapers)
JEL-codes: E52 G21 (search for similar items in EconPapers)
Pages: 23
Date: 2023
New Economics Papers: this item is included in nep-ban, nep-cba, nep-mon and nep-tra
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Persistent link: https://EconPapers.repec.org/RePEc:nbp:nbpmis:359

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