[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/2017-252.html
   My bibliography  Save this paper

Bank Capital and Lending: An Extended Framework and Evidence of Nonlinearity

Author

Listed:
  • Mr. Mario Catalan
  • Alexander W. Hoffmaister
  • Cicilia Anggadewi Harun
Abstract
This paper studies the transmission of bank capital shocks to loan supply in Indonesia. A series of theoretically founded dynamic panel data models are estimated and find nonlinear effects of capital on loan growth: the response of weaker banks to changes in their capital positions is larger than that of stronger banks. This non-linearity implies that not only the level of capital but also its distribution across banks in the financial system affects the transmission of shocks to aggregate lending. Likewise, the effects of bank recapitalization on loan growth depend on banks’ starting capital positions and the size of capital injections.

Suggested Citation

  • Mr. Mario Catalan & Alexander W. Hoffmaister & Cicilia Anggadewi Harun, 2017. "Bank Capital and Lending: An Extended Framework and Evidence of Nonlinearity," IMF Working Papers 2017/252, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2017/252
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=45376
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Quang Thi Thieu Nguyen & Christopher Gan & Zhaohua Li, 2020. "Capital regulation and bank balance sheet adjustments: a simultaneous approach," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 60(2), pages 1563-1599, June.
    2. Catalán, Mario & Hoffmaister, Alexander W. & Harun, Cicilia Anggadewi, 2020. "Bank capital and lending: Evidence of nonlinearity from Indonesia," Journal of Asian Economics, Elsevier, vol. 68(C).
    3. Verma, Radheshyam & Herwadkar, Snehal, 2019. "Bank Recapitalisation and Credit Growth: The Indian Case," MPRA Paper 97394, University Library of Munich, Germany.
    4. Marcin Czaplicki, 2022. "Measuring the restrictiveness of (macro)prudential policy: the case of bank capital regulation in Poland," Journal of Banking Regulation, Palgrave Macmillan, vol. 23(3), pages 322-338, September.
    5. Cristina Badarau & Corentin Roussel, 2021. "A Theoretical Foundation for Prudential Authorities Decision Making," Working Papers 2021.11, International Network for Economic Research - INFER.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:2017/252. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.