How do EU banks' funding costs respond to the CRD IV? : an assessment based on the Banking Union directives database / Thomas Krause, Eleonora Sfrappini, Lena Tonzer, Cristina Zgherea ; editor: Halle Institute for Economic Research (IWH) - Member of the Leibniz Association
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How do EU banks` funding costs respond to the CRD IV?
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1886249393
URN
urn:nbn:de:gbv:3:2-1059134
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Publication history
Halle (Saale), Germany : Halle Institute for Economic Research (IWH) - Member of the Leibniz Association, April 2024
Content
1 Online-Ressource (III, 59 Seiten, 1,8 MB)
Edition
Language
eng
Comment
Literaturverzeichnis: Seite 22-24
Abstract
The establishment of the European Banking Union constitutes a major change in the regulatory framework of the banking system. Main parts are implemented via directives that show staggered transposition timing across EU member states. Based on the newly compiled Banking Union Directives Database, we assess how banks’ funding costs responded to the Capital Requirements Directive IV (CRD IV). Our findings show an upward trend in funding costs which is driven by an increase in cost of equity and partially offset by a decline in cost of debt. The diverging trends are most present in countries with an ex-ante lower regulatory capital stringency, which is in line with banks’ short-run adjustment needs but longer-run benefits from increased financial stability.
Series
IWH-Diskussionspapiere ; 2024, no. 12 (April 2024) ppn:837399270