International Monetary Policy Spillovers Through the Bank Funding Channel

30 Pages Posted: 20 Aug 2018 Last revised: 21 Feb 2019

See all articles by Peter Lindner

Peter Lindner

Oesterreichische Nationalbank (OeNB)

Axel Loeffler

Deutsche Bundesbank

Esther Segalla

Oesterreichische Nationalbank (OeNB)

Guzel Valitova

Independent

Ursula Vogel

Deutsche Bundesbank; Frankfurt School of Finance & Management gemeinnützige GmbH

Date Written: 2018

Abstract

In this paper, we examine the international transmission of monetary policies of major advanced economies (US, UK, euro area) through banks in Austria and Germany. In particular, we compare the role of banks' funding structure, broken down by country of origin as well as by currency denomination, in the international transmission of monetary policy changes to bank lending. We find weak evidence for inward spillovers. The more a bank is funded in US dollars, the more its domestic real sector lending is affected by monetary policy changes in the US. This effect is more pronounced in Germany than in Austria. We do not find evidence for outward spillovers of euro area monetary policy through a bank funding channel.

Keywords: monetary policy spillover, global banks, bank funding channel

JEL Classification: E52, F33, G21

Suggested Citation

Lindner, Peter and Loeffler, Axel and Segalla, Esther and Valitova, Guzel and Vogel, Ursula, International Monetary Policy Spillovers Through the Bank Funding Channel (2018). Deutsche Bundesbank Discussion Paper No. 13/2018. Available at SSRN: https://ssrn.com/abstract=3234177

Peter Lindner (Contact Author)

Oesterreichische Nationalbank (OeNB) ( email )

Otto-Wagner-Platz 3, PO Box 61
Vienna,
1010 Vienna, A-1011
Austria

Axel Loeffler

Deutsche Bundesbank ( email )

Wilhelm-Epstein-Straße 14
Frankfurt am Main, 60431
Germany
+49 69 9566 2966 (Phone)

HOME PAGE: http://www.bundesbank.de

Esther Segalla

Oesterreichische Nationalbank (OeNB) ( email )

Otto-Wagner-Platz 3, PO Box 61
Vienna,
1010 Vienna, A-1011
Austria

Guzel Valitova

Independent

No Address Available

Ursula Vogel

Deutsche Bundesbank ( email )

Wilhelm-Epstein-Str. 14
Frankfurt/Main, 60431
Germany

Frankfurt School of Finance & Management gemeinnützige GmbH ( email )

Sonnemannstraße 9-11
Frankfurt am Main, 60314
Germany

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