International banking and cross-border effects of regulation: Lessons from Germany

Jana Ohls (), Marcus Pramor and Lena Tonzer

No 27/2016, Discussion Papers from Deutsche Bundesbank

Abstract: We analyze the inward and outward transmission of regulatory changes through German banks' (international) loan portfolio. Overall, our results provide evidence for international spillovers of prudential instruments, these spillovers are however quite heterogeneous between types of banks and can only be observed for some instruments. For instance, foreign banks located in Germany reduce their loan growth to the German economy in response to a tightening of sector-specific capital buffers, local reserve requirements and loan to value ratios in their home country. Furthermore, from the point of view of foreign countries, tightening reserve requirements was effective in reducing lending inflows from German banks. Finally, we find that business and financial cycles matter for lending decisions.

Keywords: cross-border spillovers; prudential regulation; loan supply; German banks (search for similar items in EconPapers)
JEL-codes: F30 G01 G21 G28 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-ban, nep-ifn, nep-opm and nep-reg
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Citations: View citations in EconPapers (11)

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Related works:
Journal Article: International Banking and Cross-Border Effects of Regulation: Lessons from Germany (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:bubdps:272016

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