Template-type: ReDIF-Paper 1.0
Author-Name: Dr. Toni Beutler
Author-Name-First: Toni
Author-Name-Last: Beutler
Author-Person: pbe491
Author-Name: Dr. Matthias Gubler
Author-Name-First: Matthias
Author-Name-Last: Gubler
Author-Person: pgu469
Author-Name: Simona Hauri
Author-Name-First: Simona
Author-Name-Last: Hauri
Author-Person: pha1344
Author-Name: Sylvia Kaufmann
Author-Name-First: Sylvia
Author-Name-Last: Kaufmann
Author-Person: pka122
Title: Bank lending in Switzerland: Capturing cross-sectional heterogeneity and asymmetry over time
Abstract: We study the bank lending channel in Switzerland over three decades using unbalanced quarterly bank-individual data spanning 1987 to 2016. In contrast to the usual empirical approach, we take an agnostic stance on which bank characteristic drives the heterogenous lending response to interest rate changes. In addition, our empirical model allows for a changing lending reaction occurring over time in a state-dependent manner. Our results are consistent with the existence of a bank lending channel, which is however muted in specific periods. Such episodes are characterized by increased economic uncertainty, which negatively impacts loan growth.
Length: 44 pages
Creation-Date: 2020
Contact-Email: forschung@snb.ch
File-URL: https://www.snb.ch/en/publications/research/working-papers/2020/working_paper_2020_12
File-Format: text/html
Number: 2020-12
Classification-JEL: C11, C34, E44, E52, G21
Keywords: Bank lending channel, economic uncertainty, Markov switching model, Bayesian econometrics, unbalanced panels
Handle: RePEc:snb:snbwpa:2020-12