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Bank risk-taking and impaired monetarypolicy transmission

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Bibliographic Details
Authors and Corporations: Koenig, Philipp J. (Author), Schliephake, Eva (Author)
Other Authors: Schliephake, Eva 1983- [Author]
Type of Resource: E-Book
Language: English
published:
Frankfurt am Main Deutsche Bundesbank [2021]
Series: Deutsche Bundesbank: Discussion paper ; no 2021, 42
Subjects:
Monetary policy
Bank lending
Risk-taking channel
Reversal rate
Monetary policy
Bank lending
Risk-taking channel
Reversal rate
Source: Verbunddaten SWB
Lizenzfreie Online-Ressourcen
ISBN: 9783957298508
3957298504
Description
Summary: We consider a standard banking model with agency frictions to simultaneously studythe weakening and reversal of monetary transmission and banks’ risk-taking in alow-interest environment. Both, weaker monetary transmission and higher risk-taking arise because lower policy rates impair banks’ net worth. The pass-throughto deposit rates, the level of excess reserves and the extent of the agency problembetween banks and depositors are crucial determinants of monetary transmission.If the deposit pass-through is sufficiently impaired, a reversal rate exists. For policyrates below the reversal rate further interest rate reductions lead to a disproportionalincrease in risk-taking and a contraction in loan supply.
Physical Description: 1 Online-Ressource (circa 30 Seiten)
ISBN: 9783957298508
3957298504