EconPapers    
Economics at your fingertips  
 

Risk-Based Capital Requirements for Banks and International Trade

Banu Demir (), Tomasz Michalski () and Evren Ors

Review of Financial Studies, 2017, vol. 30, issue 11, 3970-4002

Abstract: We test the trade finance channel of exports by controlling for the bank credit channel. Using Turkey’s July 2012 adoption of Basel II as a quasi-natural experiment, we examine whether shocks to trade financing costs affect exports. With data for 16,662 Turkish exporters shipping 2,888 different products to 158 countries, we find that the share of letters-of-credit-based exports decreases (increases) when the associated risk weights for counterparty exposure increase (decrease) after the adoption of Basel II. However, growth of firm-product-country-level exports remains unaffected. Trade financing might have a lesser role in exports than previously suggested by the previous literature. Received October 26, 2014; editorial decision March 15, 2017 by Editor Philip Strahan.

JEL-codes: F14 G21 G28 (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations: View citations in EconPapers (12) Track citations by RSS feed

Downloads: (external link)
http://hdl.handle.net/10.1093/rfs/hhx062 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Risk-Based Capital Requirements for Banks and International Trade (2016) Downloads
Working Paper: Risk-Based Capital Requirements for Banks and International Trade (2014) Downloads
Working Paper: Risk-Based Capital Requirements for Banks and International Trade (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:oup:rfinst:v:30:y:2017:i:11:p:3970-4002.

Ordering information: This journal article can be ordered from
http://www4.oup.co.uk/revfin/subinfo/

Access Statistics for this article

Review of Financial Studies is currently edited by Itay Goldstein

More articles in Review of Financial Studies from Society for Financial Studies Oxford University Press, Journals Department, 2001 Evans Road, Cary, NC 27513 USA.. Contact information at EDIRC.
Bibliographic data for series maintained by Oxford University Press ().

 
Page updated 2022-06-29
Handle: RePEc:oup:rfinst:v:30:y:2017:i:11:p:3970-4002.