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Business Owner Wealth and the Credit Channel of Monetary Policy

Author

Listed:
  • Manthos D. Delis

    (Audencia Business School)

  • Annalisa Ferrando

    (European Central Bank (ECB))

  • Klaas Mulier

    (KU Leuven - Faculty of Business and Economics (FEB))

  • Steven Ongena

    (University of Zurich - Department Finance; Swiss Finance Institute; KU Leuven; NTNU Business School; Centre for Economic Policy Research (CEPR))

Abstract

Using data on small business owners' private wealth, firm loan applications, and credit scores, we show that monetary policy's impact on credit access depends heavily on owner wealth. Controlling for firm quality, expansionary policy significantly boosts loan approvals for low-wealth owners, but not their high-wealth counterparts. Because securing a loan enables owners to build future wealth, this credit channel carries clear distributional consequences. Survey data from 19 euro area countries corroborate these findings, revealing that the effect transmits primarily through weakly capitalized and less liquid banks.

Suggested Citation

  • Manthos D. Delis & Annalisa Ferrando & Klaas Mulier & Steven Ongena, 2026. "Business Owner Wealth and the Credit Channel of Monetary Policy," Swiss Finance Institute Research Paper Series 26-32, Swiss Finance Institute.
    • Handle: RePEc:chf:rpseri:rp2632
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    File URL: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6506280
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    More about this item

    Keywords

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    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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