The Effect of Bank Size and Bank Capital on the Bank Lending Channel for Turkish Banks
Keywords:
Monetary Transmission Mechanism, Credit Channel, Bank Lending Channel, Capital Leverage Ratio, Contractionary Monetary PolicyAbstract
This study investigates the existence of a bank lending channel in Turkey over the estimation period 2002Q4-2008Q4. Consistent with the bank lending channel, I search for evidence that small, undercapitalized banks are more sensitive to changes in monetary policy than large, well-capitalized banks. Results suggest that small, undercapitalized banks find it harder to raise time deposits than large, well-capitalized banks which support the existence of a bank lending channel however the insignificant relationship between the change in the monetary policy indicator (Central Bank overnight rates) and the growth rate of bank loans does not support the existence of a bank lending channel.
References
[1] Frederic S. Mishkin. The Economics of Money, Banking, and Financial Markets. Columbia University, Seventh Edition, 2006, pp. 616-623.
[2] Ruby P. Kishan, Timothy Opiela. “Bank Size, Bank Capital and the Bank Lending Channel.” Journal of Money, Credit and Banking, vol. 32, No. 1, pp. 121-141, Feb. 2000.
[3] A. Tarkan Çavu?o?lu. “Credit Transmission Mechanism in Turkey: An Empirical Investigation.” ERC Working Papers in Economics, 02/03, Nov. 2002.
[4] Ben S. Bernanke, Alan S. Blinder. “Credit, Money, and Aggregate Demand.” The American Economic Review, Vol. 78, No. 2, pp. 435-439, Papers and Proceedings of the One-Hundredth Annual Meeting of the American Economic Association, May. 1988.
[5] Ben S. Bernanke, Alan S. Blinder. “The Federal Funds Rate and the Channels of Monetary Transmission.” The American Economic Review, Vol. 82, No. 4, pp. 901-22, Sep. 1992.
[6] Christina D. Romer, David H. Romer, Stephen M. Goldfeld, Benjamin M. Friedman. “New Evidence on the Monetary Transmission Mechanism.” Brookings Papers on Economic Activity, Vol. 1990, No. 1, pp. 149-213, 1990.
[7] Ben S. Bernanke, Mark Gertler. “Inside the Black Box: The Credit Channel of Monetary Policy Transmission.” The Journal of Economic Perspectives, Vol. 9, No. 4, pp. 27-48, Fall 1995.
[8] Anil K. Kashyap, Jeremy C. Stein, David W. Wilcox. “Monetary Policy and Credit Conditions: Evidence from the Composition of External Finance.” The American Economic Review, Vol. 83, No. 1, pp. 78-98, 1993.
[9] Donald P. Morgan. “The Credit Effects of Monetary Policy: Evidence Using Loan Commitments.” Journal of Money, Credit and Banking, Vol. 30, No. 1, pp. 102-118, Feb 1998.
[10] Anil K Kashyap, Jeremy C. Stein. “What Do a Million Observations on Banks Say about the Transmission of Monetary Policy?” The American Economic Review, Vol. 90, No. 3, pp. 407-428, Jun 2000.
[11] Joe Peek, Eric Rosengren. “The Capital Crunch: Neither a Borrower nor a Lender Be” Journal of Money, Credit and Banking, Vol. 27, No. 3, pp. 625-638, Aug 1995.
[12] Joe Peek, Eric Rosengren. “Derivatives Activity at Troubled Banks” Journal of Financial Services Research, Vol. 12, No. 2/3, pp. 287-302, Oct 1997.
[13] Allen N. Berger, Gregory F. Udell. “Did Risk-Based Capital Allocate Bank Credit and Cause a "Credit Crunch" in the United States?” Journal of Money, Credit and Banking, Vol. 26, No. 3, Part 2: Federal Credit Allocation: Theory, Evidence, and History, pp. 585-628, Aug 1994.
[14] Ruby P. Kishan, Timothy Opiela. “Bank Capital and Loan Asymmetry in the Transmission of Monetary Policy” Journal of Banking & Finance, Vol. 30, No. 1, pp. 259-285, Jan 2006.
[15] Seyfettin Erdo?an, Sinem Gözde Be?ball?. “Türkiye’de Banka Kredileri Kanal?n?n ??leyi?i Üzerine Ampirik Bir Analiz” Do?u? Üniversitesi Dergisi, Vol. 11, No. 1, pp. 28-41, 2009.
[16] Zuhal I??k. “Does a Credit Channel Exist in Turkey?” Koç University Economics Department, 2008.
[2] Ruby P. Kishan, Timothy Opiela. “Bank Size, Bank Capital and the Bank Lending Channel.” Journal of Money, Credit and Banking, vol. 32, No. 1, pp. 121-141, Feb. 2000.
[3] A. Tarkan Çavu?o?lu. “Credit Transmission Mechanism in Turkey: An Empirical Investigation.” ERC Working Papers in Economics, 02/03, Nov. 2002.
[4] Ben S. Bernanke, Alan S. Blinder. “Credit, Money, and Aggregate Demand.” The American Economic Review, Vol. 78, No. 2, pp. 435-439, Papers and Proceedings of the One-Hundredth Annual Meeting of the American Economic Association, May. 1988.
[5] Ben S. Bernanke, Alan S. Blinder. “The Federal Funds Rate and the Channels of Monetary Transmission.” The American Economic Review, Vol. 82, No. 4, pp. 901-22, Sep. 1992.
[6] Christina D. Romer, David H. Romer, Stephen M. Goldfeld, Benjamin M. Friedman. “New Evidence on the Monetary Transmission Mechanism.” Brookings Papers on Economic Activity, Vol. 1990, No. 1, pp. 149-213, 1990.
[7] Ben S. Bernanke, Mark Gertler. “Inside the Black Box: The Credit Channel of Monetary Policy Transmission.” The Journal of Economic Perspectives, Vol. 9, No. 4, pp. 27-48, Fall 1995.
[8] Anil K. Kashyap, Jeremy C. Stein, David W. Wilcox. “Monetary Policy and Credit Conditions: Evidence from the Composition of External Finance.” The American Economic Review, Vol. 83, No. 1, pp. 78-98, 1993.
[9] Donald P. Morgan. “The Credit Effects of Monetary Policy: Evidence Using Loan Commitments.” Journal of Money, Credit and Banking, Vol. 30, No. 1, pp. 102-118, Feb 1998.
[10] Anil K Kashyap, Jeremy C. Stein. “What Do a Million Observations on Banks Say about the Transmission of Monetary Policy?” The American Economic Review, Vol. 90, No. 3, pp. 407-428, Jun 2000.
[11] Joe Peek, Eric Rosengren. “The Capital Crunch: Neither a Borrower nor a Lender Be” Journal of Money, Credit and Banking, Vol. 27, No. 3, pp. 625-638, Aug 1995.
[12] Joe Peek, Eric Rosengren. “Derivatives Activity at Troubled Banks” Journal of Financial Services Research, Vol. 12, No. 2/3, pp. 287-302, Oct 1997.
[13] Allen N. Berger, Gregory F. Udell. “Did Risk-Based Capital Allocate Bank Credit and Cause a "Credit Crunch" in the United States?” Journal of Money, Credit and Banking, Vol. 26, No. 3, Part 2: Federal Credit Allocation: Theory, Evidence, and History, pp. 585-628, Aug 1994.
[14] Ruby P. Kishan, Timothy Opiela. “Bank Capital and Loan Asymmetry in the Transmission of Monetary Policy” Journal of Banking & Finance, Vol. 30, No. 1, pp. 259-285, Jan 2006.
[15] Seyfettin Erdo?an, Sinem Gözde Be?ball?. “Türkiye’de Banka Kredileri Kanal?n?n ??leyi?i Üzerine Ampirik Bir Analiz” Do?u? Üniversitesi Dergisi, Vol. 11, No. 1, pp. 28-41, 2009.
[16] Zuhal I??k. “Does a Credit Channel Exist in Turkey?” Koç University Economics Department, 2008.
Downloads
Published
2015-03-10
How to Cite
Meral, G. (2015). The Effect of Bank Size and Bank Capital on the Bank Lending Channel for Turkish Banks. American Scientific Research Journal for Engineering, Technology, and Sciences, 12(1), 1–28. Retrieved from https://asrjetsjournal.org/index.php/American_Scientific_Journal/article/view/596
Issue
Section
Articles
License
Authors who submit papers with this journal agree to the following terms.
