Monetary policy and the resilience of the German banking system: From Deutsche Bundesbank to ECB

Tim Florian Sepp, Karl-Friedrich Israel, Benjamin Treitz and Tom Hartl

No 180, Working Papers from University of Leipzig, Faculty of Economics and Management Science

Abstract: The resilience of the German banking system is studied on the semiaggregated level from 1968 to 2022. We distinguish between Large Banks, Regional Banks, Landesbanken, Sparkassen and Credit Unions and study their z-scores as a measure of resilience in response to the monetary policy stances of the Bundesbank and the ECB, respectively. We estimate two-way fixed effects panel regression models for both periods separately. The results suggest that monetary policy was more effective in enhancing resilience during the period of a national currency controlled by the Deutsche Bundesbank. The effect across bank types is much more heterogeneous after the inception of the ECB. In particular, decreasing resilience of Large Banks is associated with expansionary (un)conventional monetary policy in recent years.

Keywords: Resilience; Monetary Policy; Banking; Financial Stability; Germany; Deutsche Bundesbank; ECB; Credit Union; Sparkasse (search for similar items in EconPapers)
JEL-codes: E42 E52 G21 (search for similar items in EconPapers)
Date: 2024
New Economics Papers: this item is included in nep-ban, nep-cba, nep-eec, nep-his, nep-mon and nep-pay
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/283608/1/1881093743.pdf (application/pdf)

Related works:
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:zbw:leiwps:283608

Access Statistics for this paper

More papers in Working Papers from University of Leipzig, Faculty of Economics and Management Science Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().