TY  - UNPD
A1  - Acharya, Viral V.
A1  - Imbierowicz, Björn
A1  - Steffen, Sascha
A1  - Teichmann, Daniel
T1  - Does the lack of financial stability impair the transmission of monetary policy?
T2  - Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 620
N2  - We investigate the transmission of central bank liquidity to bank deposits and loan spreads in Europe over the January 2006 to June 2010 period. We find evidence consistent with an impaired transmission channel due to bank risk. Central bank liquidity does not translate into lower loan spreads for high-risk banks, even as it lowers deposit rates for both high-risk and low-risk banks. This adversely affects the balance sheets of high-risk bank borrowers, leading to lower payouts, lower capital expenditures, and lower employment. Overall, our results suggest that banks’ capital constraints at the time of an easing of monetary policy pose a challenge to the effectiveness of the bank lending channel and the effectiveness of the central bank as a lender of last resort.
T3  - CFS working paper series - 620 
KW  - Central bank liquidity
KW  - Monetary policy transmission
KW  - Corporate deposits
KW  - Financial crisis
KW  - Lender of last resort
KW  - Banking crisis
KW  - Loans
KW  - Real effects
Y1  - 2019
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/48057
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-480571
UR  - https://ssrn.com/abstract=3367885
IS  - April 2017
PB  - Center for Financial Studies
CY  - Frankfurt, M.
ER  -