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Clearinghouse loan certificates as a lender of last resort

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  • Hoag, Christopher

Abstract

Looking across multiple panics of the nineteenth and twentieth centuries, this paper treats borrowing of clearinghouse loan certificates as borrowing from a lender of last resort. We evaluate individual bank use of clearinghouse loan certificates in New York City using bank balance sheet data. Bank capital ratios do not predict positive net borrowing. Lower pre-panic reserve ratios increased the probability of positive net borrowing of loan certificates. Bank borrowing behavior from a lender of last resort remained relatively constant across all three crises considered.

Suggested Citation

  • Hoag, Christopher, 2018. "Clearinghouse loan certificates as a lender of last resort," The North American Journal of Economics and Finance, Elsevier, vol. 45(C), pages 215-229.
    • Handle: RePEc:eee:ecofin:v:45:y:2018:i:c:p:215-229
    DOI: 10.1016/j.najef.2018.03.001
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    Cited by:

    1. Christopher Hoag, 2019. "Liquidity and Borrowing from a Lender of Last Resort during the Crisis of 1884," Working Papers 1901, Trinity College, Department of Economics, revised Jul 2019.
    2. Christopher Hoag, 2019. "Bank Executive Experience with Clearinghouse Loan Certificates," Working Papers 1903, Trinity College, Department of Economics.

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    More about this item

    Keywords

    Bank; Lender of last resort; Clearinghouse; Loan certificates;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • N21 - Economic History - - Financial Markets and Institutions - - - U.S.; Canada: Pre-1913

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