The International Bank Lending Channel of Monetary Policy Rates and QE: Credit Supply, Reach-for-Yield, and Real Effects

Claudia Ruiz-Ortega, Jessica Roldán-Peña, Bernardo Morais and José-Luis Peydró
Authors registered in the RePEc Author Service: Claudia Ruiz Ortega and Jose-Luis Peydro

No 1102, Working Papers from Barcelona School of Economics

Abstract: We identify the international credit channel by exploiting Mexican supervisory data sets and foreign monetary policy shocks in a country with a large presence of European and U.S. banks. A softening of foreign monetary policy expands credit supply of foreign banks (e.g., U.K. policy affects credit supply in Mexico via U.K. banks), inducing strong firm†level real effects. Results support an international risk†taking channel and spill overs of core countries' monetary policies to emerging markets, both in the foreign monetary softening part (with higher credit and liquidity risk†taking by foreign banks) and in the tightening part (with negative local firm†level real effects).

Keywords: monetary policy; financial globalization; credit supply; risk-taking; quantitative easing (QE); foreign banks (search for similar items in EconPapers)
JEL-codes: E52 E58 G01 G21 G28 (search for similar items in EconPapers)
Date: 2019-07
New Economics Papers: this item is included in nep-cba, nep-ifn, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Journal Article: The International Bank Lending Channel of Monetary Policy Rates and QE: Credit Supply, Reach‐for‐Yield, and Real Effects (2019)
Journal Article: The International Bank Lending Channel of Monetary Policy Rates and QE: Credit Supply, Reach-for-Yield, and Real Effects (2019)
Working Paper: The international bank lending channel of monetary policy rates and QE: Credit supply, reach-for-yield, and real effects (2019)
Working Paper: The International Bank Lending Channel of Monetary Policy Rates and QE: Credit Supply, Reach-for-Yield, and Real Effects (2017)
Working Paper: The International Bank Lending Channel of Monetary Policy Rates and QE: Credit Supply, Reach-for-Yield, and Real Effects (2015)
Working Paper: The international bank lending channel of monetary policy rates and QE: Credit supply, reach-for-yield, and real effects (2015)
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