Bank specialization, mortgage lending and house prices

H. Özlem Dursun-de Neef

Journal of Banking & Finance, 2023, vol. 151, issue C

Abstract: This paper studies the link between banks’ geographic specialization and the growth in their mortgage lending. Specialized banks increase their lending relatively less during the boom (2004 - 2006) and they experience a lower reduction in their loans through the following bust (2007 - 2009). In the aggregate, bank specialization has an impact on the overall credit rather than a mere reallocation of lending: MSAs with a higher exposure to specialized banks experience less expansion and contraction in mortgages. As a result, higher bank specialization is associated with a less severe boom and bust cycle in house prices.

JEL-codes: G21 G28 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:151:y:2023:i:c:s0378426623000614

DOI: 10.1016/j.jbankfin.2023.106836

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