Foreign funding shocks and the lending channel: Do foreign banks adjust differently?

Felix Noth and Matias Ossandon Busch

Finance Research Letters, 2016, vol. 19, issue C, 222-227

Abstract: We document for a set of Latin American emerging countries that the different nature of foreign funding accessed by foreign and local banks affected their lending performance after September 2008. We show that lending growth was weaker for shock-affected foreign banks compared to shock-affected local banks. This evidence represents valuable policy information for regulators concerned with the stability and well-functioning of banking sectors.

Keywords: Foreign funding shocks; Crisis transmission; Financial stability; Multinational banks (search for similar items in EconPapers)
JEL-codes: E44 F23 F36 G01 G21 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:19:y:2016:i:c:p:222-227

DOI: 10.1016/j.frl.2016.08.003

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