EconPapers    
Economics at your fingertips  
 

Tasa Máxima Convencional y Oferta de Créditos

Rodrigo Alfaro (ralfaro@fen.uchile.cl), Andres Sagner (asagner@bu.edu) and Camilo Vio

Working Papers Central Bank of Chile from Central Bank of Chile

Abstract: The discussion about the Interest Rate Ceiling (TMC) has generated several proposals that involve changing the current way of calculating this interest rate, which applies to consumer loans of amounts smaller than 200 UF and maturities of less than 90 days. In this paper we analyze the effect of a change in the weighting factor of the current formula, focusing primarily in the reduction of the credit supply. For this purpose, we assume that interest rates can be characterized by a log-normal distribution. Our results show an important sensitivity of the credit supply to changes in the weighting factor. In fact, by reducing the weighting factor from its current value (1.5) to values below 1.3, the credit supply would be strongly reduced in case the distribution of risk has a high dispersion.

Date: 2012-07
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.bcentral.cl/documents/33528/133326/DTBC_673.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:chb:bcchwp:673

Access Statistics for this paper

More papers in Working Papers Central Bank of Chile from Central Bank of Chile Contact information at EDIRC.
Bibliographic data for series maintained by Alvaro Castillo (dtbc@bcentral.cl).

 
Page updated 2025-01-05
Handle: RePEc:chb:bcchwp:673