Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/299506 
Year of Publication: 
2018
Series/Report no.: 
EBA Staff Paper Series No. 1
Publisher: 
European Banking Authority (EBA), London
Abstract: 
We analyze the credit supply and real sector effects of bank bail-ins by exploiting the unexpected failure of a major Portuguese bank and subsequent resolution. Using a matched firm-bank dataset on credit exposures and interest rates, we show that while banks more exposed to the bail-in significantly reduced credit supply at the intensive margin, affected firms compensated the tightening of overall credit with other sources of funding. Nevertheless, SMEs were subject to a binding contraction of funds available through credit lines and reduced investment and employment. These dampening effects are explained by the pre-shock internal liquidity position of smaller firms.
Subjects: 
banking crisis
debt assumption
corporate banking
credit rationing
SMEs
Investment
employment effect
Portugal
JEL: 
E22
E24
E58
G01
G21
G28
G32
Persistent Identifier of the first edition: 
ISBN: 
978-92-9245-389-3
Document Type: 
Working Paper

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