Non-bank lending and the transmission of monetary policy

Dominic Cucic and Denis Gorea

No 1211, BIS Working Papers from Bank for International Settlements

Abstract: We analyze the role of nonbank lenders in the transmission of monetary policy using data on the universe of unsecured credit to firms and households in Denmark. Nonbanks increase their credit supply after a monetary contraction, both relative to banks and in absolute terms. The nonbank credit expansion is driven by long-term debt funding flowing to nonbanks. The attenuation of the traditional bank lending channel of monetary policy has real effects: nonbank credit insulates corporate investment and household consumption from adverse consequences of monetary contractions.

Keywords: monetary policy; nonbanks; shadow banks; banks; real effects (search for similar items in EconPapers)
JEL-codes: E51 E52 G23 (search for similar items in EconPapers)
Date: 2024-09
New Economics Papers: this item is included in nep-ban, nep-cba, nep-fdg, nep-ipr and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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