THE BANKING SPREAD AND THE RESOURCE COST OF CAPITAL

Javier Gómez-Pineda

No 3566, Borradores de Economia from Banco de la Republica

Abstract: The paper provides a model of the banking firm in the macroeconomy intended to explain what determines the interest rate spread. A key factor explaining the spread in our model is the resource cost of capital. A statistical result confirms the prediction of the model, that is, the bank's spread is higher in low income economies.

Keywords: Bank spread (search for similar items in EconPapers)
Pages: 16
Date: 1998-05-30
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http://www.banrep.gov.co/docum/ftp/borra092.pdf

Related works:
Working Paper: The Banking Spread and the Resource Cost of Capital (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:col:000094:003566

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