A Global Lending Channel Unplugged? Does U.S. Monetary Policy Affect Cross-border and Affiliate Lending by Global U.S. Banks?
Judit Temesvary (),
Steven Ongena () and
Ann Owen ()
No 2018-008, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (US)
We examine how U.S. monetary policy affects the international activities of U.S. Banks. We access a rarely studied U.S. bank-level regulatory dataset to assess at a quarterly frequency how changes in the U.S. Federal funds rate (before the crisis) and quantitative easing (after the onset of the crisis) affects changes in cross-border claims by U.S. banks across countries, maturities and sectors, and also affects changes in claims by their foreign affiliates. We find robust evidence consistent with the existence of a potent global bank lending channel. In response to changes in U.S. monetary conditions, U.S. banks strongly adjust their cross-border claims in both the pre and post-crisis period. However, we also find that U.S. bank affiliate claims respond mainly to host country monetary conditions.
Keywords: Bank lending channel; Cross-country analysis; Global banking; Monetary transmission (search for similar items in EconPapers)
JEL-codes: E44 E52 F42 G15 G21 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ban, nep-cba, nep-mac and nep-mon
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Journal Article: A global lending channel unplugged? Does U.S. monetary policy affect cross-border and affiliate lending by global U.S. banks? (2018)
Working Paper: A Global Lending Channel Unplugged? Does U.S. Monetary Policy Affect Cross-border and Affiliate Lending by Global U.S. Banks? (2015)
Working Paper: A global lending channel unplugged? Does U.S. monetary policy affect cross-border and affiliate lending by global U.S. banks? (2015)
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