Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/229118 
Year of Publication: 
2020
Series/Report no.: 
ECB Working Paper No. 2504
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
We document that there are strong complementarities between monetary policy and macroprudential policy in shaping the evolution of bank credit. We use a unique loanlevel dataset comprising multiple credit registers from several European countries and different types of loans, including corporate loans, mortgages and consumer credit. We merge this rich information with borrower and bank-level characteristics and with indicators summarising macroprudential and monetary policy actions. We find that monetary policy easing increases both bank lending and lending to riskier borrowers, especially when there is a more accommodative macroprudential environment. These effects are stronger for less capitalised banks. Results apply to both household and firm lending, but they are stronger for consumer and corporate loans than for mortgages. Finally, for firms, the overall increase in bank lending induced by an accommodative policy mix is stronger for more (ex ante) productive firms than firms with high ex ante credit risk, except for banks with low capital.
Subjects: 
monetary policy
macroprudential policy
corporate and household credit
euro area
JEL: 
E51
E52
E58
G21
G28
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-4450-2
Document Type: 
Working Paper

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