Banks' funding stress, lending supply and consumption expenditure

Evren Damar, Reint Gropp and Adi Mordel

No 11/2019, IWH Discussion Papers from Halle Institute for Economic Research (IWH)

Abstract: We employ a unique identification strategy linking survey data on household consumption expenditure to bank-level data to estimate the effects of bank funding stress on consumer credit and consumption expenditures. We show that households whose banks were more exposed to funding shocks report lower levels of nonmortgage liabilities. This, however, only translates into lower levels of consumption for low income households. Hence, adverse credit supply shocks are associated with significant heterogeneous effects.

Keywords: credit supply; banking; financial crisis; consumption expenditure; liquid assets; consumption smoothing (search for similar items in EconPapers)
JEL-codes: E21 E44 G01 G21 (search for similar items in EconPapers)
Date: 2019
New Economics Papers: this item is included in nep-ban and nep-mac
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Banks' Funding Stress, Lending Supply, and Consumption Expenditure (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:iwhdps:112019

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