Macroeconomic Determinants of Bank Spread in Brazil: An Empirical Evaluation
AbstractDespite a decline in interest rates since mid-1999, bank spread in Brazil continues extremely high in international terms and in recent years has stood at around 40%. This paper analyses the determinants of bank spread in Brazil, seeking particularly to analyse the macroeconomic determinants of spread in recent times. It uses a VAR model to identify the macroeconomic variables that may directly or indirectly have been influencing spread in Brazil over the period 1994-2005. It presents evidence that interest rate levels and, to a lesser degree, the inflation rate are the main macroeconomic determinants of high bank spread in Brazil.
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Bibliographic InfoPaper provided by Universidade Federal do Paraná, Department of Economics in its series Working Papers with number 0066.
Length: 29 pages
Date of creation: 2007
Date of revision:
Note: Creation Date corresponds to the year in which the paper was published on the Department of Economics website. The paper may have been written a small number of months before its publication date.
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More information through EDIRC
Bank Spread; VAR models; Brazilian banking sector;
Find related papers by JEL classification:
- E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
- E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
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