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Exploring bank-level data from a small open economy, we present evidence that global funding conditions limit the effectiveness of domestic monetary policy in terms of shaping both the volume and the riskiness of bank lending. We show that more favorable global funding conditions associated with a local currency appreciation encourage banks to increase lending, leverage up, take more risks, and thus insulate themselves from lean-against-the-wind domestic monetary policy. These results support the existence of a risk-taking channel of currency appreciation at the bank level. [ABSTRACT FROM AUTHOR]

We empirically document that the effectiveness of the German rent control introduced in 2015 in achieving rental housing affordability is limited. Exploring the reasons for this limited effectiveness, we focus on the impact of the rent control on the yield on rental housing investments proxied by rent‐price ratios, which we derive by predicting sale prices to rental objects based on a hedonic model using micro‐level quotes on rental and sale listing. Exploiting the temporal, regional, and object‐specific variation generated by the design of the rent control, we identify a causal negative effect of the rent control on the yield of rental objects subject to the regulation. Furthermore, we zoom into the spillovers across regulated objects and objects in the affected markets that were exempt from the regulation and find rising yields for the exempted objects, suggesting that the regulation contributed to gentrification via a shift of rental housing supply away from the regulated segment. [ABSTRACT FROM AUTHOR]

In this paper, we examine how a trade conflict's impact on the real economy can be amplified by financial intermediaries. After the Norwegian Nobel Peace Prize Committee awarded the 2010 Nobel Peace Prize to Chinese dissident Liu Xiaobo, China in practice banned imports of Norwegian salmon. The ban was an unexpected trade shock to the Norwegian salmon industry. Using bank balance sheet and credit register data, we trace how this trade shock affected the lending behavior of banks highly exposed to the salmon industry when the shock occurred. We find that, in the years following the trade shock, highly exposed banks cut back lending to non-salmon firms and households by 3-6 percent more than other banks. Furthermore, we find that the reduction in lending was not driven by the erosion of bank capital, but rather by the shift in expectations about the performance of loans to salmon producers, which drove highly exposed banks to increase their loan loss provisions and reduce risk-taking. [ABSTRACT FROM AUTHOR]

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This paper investigates how government-led banking liberalization affects credit allocation by banks using as a quasi-natural experiment the establishment of city commercial banks (CCBs) in China. Based on more than three million corporate financial statements spanning over 16 years, we find that the establishment of CCBs led to a 6-14 % drop in debt funding for private firms, as well as a 1-2 % rise in their funding costs. At the same time, private infrastructure firms enjoyed a nearly 6 % increase in debt funding and more than 100-basis-point drop in interest costs despite their inferior credit quality. The debt financing of private firm appears most severely affected in municipalities where officials face high promotional pressures or fiscal constraints. [ABSTRACT FROM AUTHOR]

To shed light on the interaction between macroprudential and monetary policies, we study the inward transmission of foreign monetary policy in conjunction with domestic macroprudential and monetary policies in Norway and Sweden. Using detailed bank‐level data, we show how Norwegian and Swedish banks' lending reacts to monetary policy surprises arising abroad, controlling for the domestic macroprudential stance and the interaction between monetary and macroprudential policies. In both countries, domestic macroprudential policy helps mitigate the effects arising from foreign monetary surprises. [ABSTRACT FROM AUTHOR]

Copyright of Zeitschrift für Bankrecht und Bankwirtschaft is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

We examine the rigidity of retail deposit and loan rates by applying duration analysis on uniquely rich data. We find that the retail rate dynamics are state-dependent. An important determinant of the duration of retail interest rates are the dynamics of the wholesale (market and monetary policy) interest rates. We also show that the reaction to positive and negative wholesale interest rate changes is strongly asymmetric. Moreover, retail rate durations are significantly modified by bank and market characteristics, such as the size of the bank, its market share in a given local market, and its geographical scope. [ABSTRACT FROM PUBLISHER]