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Bank business models at negative interest rates

Author

Listed:
  • Schwaab, Bernd

Abstract

Not all banks are the same. They differ in terms of size, complexity, organisation, activities, funding choices and geographical reach. This article shows how changes in the yield curve and reductions in the ECB’s deposit facility rate (DFR) to negative values have affected different types of banks in different ways, thus giving rise to different market perceptions of banks’ risks. JEL Classification: C33, G20, G21

Suggested Citation

  • Schwaab, Bernd, 2017. "Bank business models at negative interest rates," Research Bulletin, European Central Bank, vol. 40.
    • Handle: RePEc:ecb:ecbrbu:2017:0040:
    Note: 955417
    as

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    References listed on IDEAS

    as
    1. André Lucas & Julia Schaumburg & Bernd Schwaab, 2019. "Bank Business Models at Zero Interest Rates," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 37(3), pages 542-555, July.
    2. Christian Brownlees & Robert F. Engle, 2017. "SRISK: A Conditional Capital Shortfall Measure of Systemic Risk," Review of Financial Studies, Society for Financial Studies, vol. 30(1), pages 48-79.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Boungou, Whelsy, 2021. "Empirical evidence of the lending channel of monetary policy under negative interest rates," The Quarterly Review of Economics and Finance, Elsevier, vol. 81(C), pages 309-318.
    2. López-Penabad, Maria Celia & Iglesias-Casal, Ana & Silva Neto, José Fernando, 2022. "Effects of a negative interest rate policy in bank profitability and risk taking: Evidence from European banks," Research in International Business and Finance, Elsevier, vol. 60(C).
    3. Giovanni Angelini & Paolo Gorgi, 2018. "DSGE Models with Observation-Driven Time-Varying parameters," Tinbergen Institute Discussion Papers 18-030/III, Tinbergen Institute.

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    More about this item

    Keywords

    Bank business model; Clustering; Negative interest rates; Systemic risk; Unconventional monetary policy measures;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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