Macroprudential policy and intra-group dynamics : the effects of reserve requirements in Brazil / Chris Becker, Matias Ossandon Busch, Lena Tonzer
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Macroprudential policy and intra-group dynamics
Discovery
1002560357
URN
urn:nbn:de:gbv:3:2-80741
DOI
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Publication history
Halle (Saale), Germany : Halle Institute for Economic Research (IWH), 02. November 2017
Content
1 Online-Ressource (III, 53 Seiten, 1,22 MB) : Illustration, Diagramme
Edition
Language
eng
Comment
Datei gelöscht auf Wunsch der herausgebenden Institution
Abstract
This paper examines whether intra-group dynamics matter for the transmission of macroprudential policy. Using novel bank-level data on the Brazilian banking system, we investigate the effect of reserve requirements targeting headquarter banks’ deposit share on credit supply by their municipal bank branches. For identification purposes, we exploit that reserve requirements are adjusted following global economic cycles. Our results reveal a lending channel of reserve requirements for branches whose parent banks are more exposed to targeted deposits. Branch ownership and exposure to internal liquidity are central in explaining the results. Our findings reveal limitations in current macroprudential policy frameworks.
Series
IWH-Diskussionspapiere ; 2017, no. 21 (November 2017) ppn:837399270