Capital Adequacy Requirements and the Bank Lending Channel of Monetary Policy

Andreas Gontermann

No 391, University of Regensburg Working Papers in Business, Economics and Management Information Systems from University of Regensburg, Department of Economics

Abstract: In this paper a modified version of Bernanke and Blinder�s (1988) model of the bank lending channel of monetary policy under asymmetric information is presented. If, aside from reserve requirements, banks have to meet capital adequacy requirements as well, then the results suggested by Bernanke and Blinder have to be amended in several respects. Most noticeably, when the net worth constraint is binding, the efficacy of monetary policy is severely lessened. Further, we are able to show that a positive relationship between banks� capital base and the real economy exists. Das Modell von Bernanke und Blinder (1988), in welchem der bei Vorliegen von asymmetrischer Information bedeutsame Kreditkanal der Geldpolitik erläutert wird, lässt sich dahingehend erweitern, dass Banken neben Mindestreserve- auch Eigenkapitalvorschriften einhalten müssen. Die Ergebnisse von Bernanke und Blinder werden durch diese Modifikation mitunter stark beeinflusst. Wenn die Eigenkapitalvorschrift bindet, wird die Wirksamkeit von Geldpolitik erheblich beeinträchtigt. Zwischen der Eigenkapitalausstattung des Bankensektors und der realwirtschaftlichen Ökonomie besteht ein positiver Zusammenhang.

Keywords: Geldpolitik; Asymmetrische Information; Eigenkapitalgrundsätze; Basel II; Asymmetric Information; Monetary Policy; Bank Lending Channel; Basel II (search for similar items in EconPapers)
JEL-codes: D8 E5 G2 (search for similar items in EconPapers)
Date: 2003
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