 Economic policy uncertainty and bank credit growth: Evidence from European banksGamze Ozturk Danisman, Oguz Ersan and Ender Demir Journal of Multinational Financial Management, 2020, vol. 57-58 Abstract: Using a sample of 2977 private and listed banks in the EU-5 countries (the United Kingdom, Germany, Spain, Italy, France) for the years 2009–2018, this paper explores the impact of Economic Policy Uncertainty (EPU) on credit growth. Using panel data fixed effects methodology and controlling for endogeneity using two-step difference GMM estimators, our findings indicate that uncertainty in economic policies hampers the credit growth of European banks. Our bank type-based analyses indicate that the effect is mainly valid for cooperative banks. Additional analyses imply that the negative impact of EPU on credit growth is more pronounced in civil law countries, increases with debt maturity, and weakens for banks with a larger number of employees and branches. Furthermore, the unfavorable effects are stronger in well-capitalized banks, banks with foreign subsidiaries, and banks with a higher share of wholesale funding. We also provide several policy implications for different economic actors. Keywords: Credit growth; European banks; Economic policy uncertainty; Debt maturity (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:mulfin:v:57-58:y:2020:i::s1042444x20300426 DOI: 10.1016/j.mulfin.2020.100653 Access Statistics for this article Journal of Multinational Financial Management is currently edited by I. Mathur and G. G. Booth More articles in Journal of Multinational Financial Management from Elsevier |
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