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The cross-border credit channel and lending standards surveys

Andrew J. Filardo and Pierre L. Siklos

Journal of International Financial Markets, Institutions and Money, 2020, vol. 67, issue C

Abstract: The greater availability of bank Senior Loan Officer (SLO) surveys in the past decade is enhancing our understanding of the international bank lending channel of monetary policy. Using a Global VAR (GVAR), we find evidence that expansionary monetary policies in general resulted in lower credit standards, which in turn reinforced the thrust of monetary policy. However, at the time of announcements about unconventional monetary policies, the expansionary impact was muted likely owing to a signaling effect, i.e., signaling a downgrading of underlying economic and financial prospects. Comparisons with the United States and Eurozone economies draw attention to the special role bank-lending standards play in the monetary policy transmission mechanism.

Keywords: Global VAR; Lending standards and credit conditions; Unconventional monetary policies; Spillovers (search for similar items in EconPapers)
JEL-codes: F44 F36 F15 E5 E32 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1016/j.intfin.2020.101206

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Journal of International Financial Markets, Institutions and Money is currently edited by I. Mathur and C. J. Neely

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