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The Impact Of Domestic Investors’ Participation In Government Debt On Bank Loans To The Private Sector: A Cross-Country Study

Author

Listed:
  • Justina Adamanti

    (Universitas Indonesia, Indonesia; Bank Indonesia, Jakarta, Indonesia)

  • Sugiharso Safuan

    (Universitas Indonesia, Indonesia)

  • Zaäfri Ananto Husodo

    (Universitas Indonesia, Indonesia)

Abstract

This study analyzes the impact of domestic investors’ participation in government debt on bank loans to the private sector in advanced and emerging countries. We find that domestic bank participation in government debt has a more profound negative impact on bank loans to the private sector in advanced than in emerging countries. Meanwhile, domestic non-bank participation in government debt only negatively impacts bank loans to the private sector in emerging countries. While both domestic bank and non-bank participation in government debt have a negative impact on bank loans to the private sector in emerging countries, the latter has a weaker impact.

Suggested Citation

  • Justina Adamanti & Sugiharso Safuan & Zaäfri Ananto Husodo, 2022. "The Impact Of Domestic Investors’ Participation In Government Debt On Bank Loans To The Private Sector: A Cross-Country Study," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 25(3), pages 275-290, November.
    • Handle: RePEc:idn:journl:v:25:y:2022:i:3a:p:275-290
    DOI: https://doi.org/10.21098/bemp.v25i3.2121
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    More about this item

    Keywords

    Government debt; Domestic bank investors; Domestic non-bank investors; Bank loans to the private sector; Cross-country;
    All these keywords.

    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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