The Impact of IFRS 9 on the Link Between Lending and the Capital Ratio in Publicly Traded Banks in Poland

Paweł Bojar and Małgorzata Olszak

Journal of Banking and Financial Economics, 2022, vol. 1, issue 17, 60–73

Abstract: This paper aims to determine the role of the expected credit loss approach as defi ned in IFRS 9 in the eff ects of capital ratio on loans growth in publicly traded banks in Poland. To resolve this problem, we apply semi-annual data of individual banks in 2012–2018. Using several estimation techniques, we fi nd that in the period of implementation of the expected credit loss approach, the links between loans growth and the capital ratio were enhanced. In particular, lending growth is more sensitive to levels of the capital ratio. These results are important with respect to the goal of bank fi nancial stability and have implications for the conduct of macroprudential policy.

Keywords: loans growth rate; capital ratio; expected credit loss; IRFS 9 (search for similar items in EconPapers)
JEL-codes: E32 G2 G28 G32 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:sgm:jbfeuw:v:1:y:2022:i:17:p:60-73

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