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The impact of central bank liquidity support on banks' balance sheets
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| Authors and Corporations: | , , |
|---|---|
| Title: | The impact of central bank liquidity support on banks' balance sheets/ Leo de Haan, Sarah Holton, Jan Willem van den End |
| Type of Resource: | E-Book |
| Language: | English |
| published: |
Frankfurt am Main, Germany
European Central Bank
[2019]
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| Series: |
Europäische Zentralbank: Working paper series ; no 2326 (November 2019)
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| Source: | Verbunddaten SWB Lizenzfreie Online-Ressourcen |
| Abstract: | We empirically analyse the relationship between longer term central bank liquidity support and banks' balance sheet ratios, using difference-in-differences panel regressions and propensity score matching on a large sample of banks in the euro area. The research question is whether the liquidity operations, which were introduced to prevent disorderly deleveraging, can also be linked to unintended changes in banks' funding policies and asset allocations. The results show that unconditional and conditional refinancing operations are associated with different developments on banks' balance sheets. Unconditional longer-term refinancing operations went together with higher maturity transformation by banks in stressed countries, and also more carry trades, i.e. banks borrowing more while increasing their holdings of government bonds. In contrast, refinancing operations that were conditional on banks' lending were not associated with such carry trades, highlighting the benefits of conditionality attached to long-term refinancing operations. |
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| Physical Description: | 1 Online-Ressource (circa 43 Seiten); Illustrationen |
| ISBN: |
9789289938952
9289938951 |
| DOI: | 10.2866/15373 |