Banks and capital requirements: Channels of adjustment

Benjamin Cohen and Michela Scatigna ()

Journal of Banking & Finance, 2016, vol. 69, issue S1, S56-S69

Abstract: Bank capital ratios have increased steadily since the financial crisis. For a sample of 101 large banks from advanced and emerging economies, retained earnings account for the bulk of their higher risk-weighted capital ratios, with reductions in risk weights playing a lesser role. On average, banks continued to expand their lending in real terms, though lending contracted among European banks. Lower dividend payouts and (for advanced economy banks) wider lending spreads have contributed to banks’ ability to use retained earnings to build capital. Banks that came out of the crisis with higher capital ratios and stronger profitability were able to expand lending more.

Keywords: Banks; Bank capital; Regulation; Capital ratios; Basel III (search for similar items in EconPapers)
JEL-codes: G21 G28 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (77)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0378426615002952
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Banks and capital requirements: channels of adjustment (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:69:y:2016:i:s1:p:s56-s69

DOI: 10.1016/j.jbankfin.2015.09.022

Access Statistics for this article

Journal of Banking & Finance is currently edited by Ike Mathur

More articles in Journal of Banking & Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().