Foreign banks and international transmission of monetary policy: Evidence from the syndicated loan market

Asli Demirguc-Kunt, Balint Horvath and Harry Huizinga

European Economic Review, 2020, vol. 129, issue C

Abstract: This paper examines how the sensitivity of cross-border syndicated loan supply varies with the internationalization of borrower country banking sectors, banks and loan syndicates. A higher foreign bank presence in borrower countries mitigates the transmission of monetary policy. Prior lending experience of international banks in borrower countries also attenuates monetary transmission. In contrast, to the extent they become more international, the credit supply of banks and loan syndicates becomes more sensitive to lender-country monetary policy.

Keywords: Cross-border lending; Monetary transmission; Foreign ownership of banks (search for similar items in EconPapers)
JEL-codes: E44 E52 F34 F38 F42 G15 G20 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Related works:
Working Paper: Foreign Banks and International Transmission of Monetary Policy: Evidence from the Syndicated Loan Market (2017)
Working Paper: Foreign banks and international transmission of monetary policy: evidence from the syndicated loan market (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:129:y:2020:i:c:s0014292120301732

DOI: 10.1016/j.euroecorev.2020.103542

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