Footnote:
In: Review of Financial Studies, 32, 3728-3761 (2019)
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments September 19, 2018 erstellt
Description:
We show that negative policy rates affect the supply of bank credit in a novel way. Banks are reluctant to pass on negative rates to depositors, which increases the funding cost of high-deposit banks, and reduces their net worth, relative to low-deposit banks. As a consequence, the introduction of negative policy rates by the European Central Bank in mid-2014 leads to more risk taking and less lending by euro-area banks with greater reliance on deposit funding. Our results suggest that negative rates are less accommodative, and could pose a risk to financial stability, if lending is done by high-deposit banks