The Effect of Higher Capital Requirements on Bank Lending: The Capital Surplus Matters

Dominika Kolcunová and Simona Malovana

Working Papers from Czech National Bank, Research and Statistics Department

Abstract: This paper studies the impact of higher additional capital requirements on growth in loans to the private sector for banks in the Czech Republic. The empirical results indicate that higher additional capital requirements have a negative effect on loan growth for banks with relatively low capital surpluses. In addition, the results confirm that the relationship between the capital surplus and loan growth is also important at times of stable capital requirements, i.e. it does not serve only as an intermediate channel of higher additional capital requirements.

Keywords: Bank lending; banks' capital surplus; regulatory capital requirements (search for similar items in EconPapers)
JEL-codes: C22 E32 G21 G28 (search for similar items in EconPapers)
Date: 2019-04
New Economics Papers: this item is included in nep-ban, nep-cba, nep-mac, nep-rmg and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://www.cnb.cz/export/sites/cnb/en/economic-re ... wp/cnbwp_2019_02.pdf

Related works:
Journal Article: The effect of higher capital requirements on bank lending: the capital surplus matters (2022)
Working Paper: The Effect of Higher Capital Requirements on Bank Lending: The Capital Surplus Matters (2019)
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:cnb:wpaper:2019/2

Access Statistics for this paper

More papers in Working Papers from Czech National Bank, Research and Statistics Department Contact information at EDIRC.
Bibliographic data for series maintained by Tomas Karhanek ().