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The impact of the corporate sector purchase programme on corporate bond markets and the financing of euro area non-financial corporations

Author

Listed:
  • De Santis, Roberto A.
  • Geis, André
  • Juskaite, Aiste
  • Cruz, Lia Vaz

Abstract

This article reviews the impact of the ECB’s corporate sector purchase programme (CSPP) on corporate bond markets and the financing of euro area non-financial corporations (NFCs). It finds that the CSPP has led to a significant easing in financing conditions for euro area NFCs, including declines in corporate bond spreads, improved supply conditions in the corporate bond primary market and increased bank lending to NFCs that do not have access to bond-based financing. The operational set-up of the CSPP, in particular its flexibility and adaptability, minimises any impact that could be detrimental to the functioning of the corporate bond market. JEL Classification: E52, E58, G01, G12, G21

Suggested Citation

  • De Santis, Roberto A. & Geis, André & Juskaite, Aiste & Cruz, Lia Vaz, 2018. "The impact of the corporate sector purchase programme on corporate bond markets and the financing of euro area non-financial corporations," Economic Bulletin Articles, European Central Bank, vol. 3.
  • Handle: RePEc:ecb:ecbart:2018:0003:2
    Note: 185689
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    File URL: https://www.ecb.europa.eu//pub/pdf/other/ecb.ebart201803_02.en.pdf
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    Citations

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    Cited by:

    1. Chi Hyun Kim & Lars Other, 2019. "The Short-Run Effect of Monetary Policy Shocks on Credit Risk: An Analysis of the Euro Area," Discussion Papers of DIW Berlin 1781, DIW Berlin, German Institute for Economic Research.
    2. Bank for International Settlements, 2019. "Unconventional monetary policy tools: a cross-country analysis," CGFS Papers, Bank for International Settlements, number 63, Autumn.
    3. Betz, Frank & De Santis, Roberto A., 2019. "ECB corporate QE and the loan supply to bank-dependent firms," Working Paper Series 2314, European Central Bank.
    4. Pablos Nuevo, Irene, 2019. "Has the new bail-in framework increased the yield spread between subordinated and senior bonds?," Working Paper Series 2317, European Central Bank.
    5. Zaghini, Andrea, 2020. "How ECB purchases of corporate bonds helped reduce firms’ borrowing costs," Research Bulletin, European Central Bank, vol. 66.
    6. Coudert, Virginie & Salakhova, Dilyara, 2020. "Do mutual fund flows affect the French corporate bond market?," Economic Modelling, Elsevier, vol. 87(C), pages 496-510.
    7. Virginie Coudert & Dilyara Salakhova, 2019. "Price effect of mutual fund flows on the corporate bond market. The French case," Working papers 706, Banque de France.

    More about this item

    Keywords

    APP; bond markets; CSPP;
    All these keywords.

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G01 - Financial Economics - - General - - - Financial Crises
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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