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Bank risks, risk preferences and lending


  • Chmielewski, Tomasz


The recent debate on the impact of capital regulation on bank behaviour shows that risk exposures of banks might influence the amount of loans newly granted to the non-financial sector. The paper extends the traditional set of bank-specific variables used in testing for the bank lending channel and points to the role of financial stability analysis in the conduct of monetary policy. This role stems from the fact that the financial instability can influence the monetary transmission mechanism. The implications of the presented reasoning are tested using the data for the Polish banking sector during the period 1997-2004. The variables proxying bank risk preferences and the level of risk undertaken (also when interacted with a monetary policy measure) are significant in regressions explaining changes in the amount of bank loan supply.

Suggested Citation

  • Chmielewski, Tomasz, 2005. "Bank risks, risk preferences and lending," MPRA Paper 5131, University Library of Munich, Germany, revised 15 Jan 2006.
  • Handle: RePEc:pra:mprapa:5131

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    References listed on IDEAS

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    Cited by:

    1. Balázs Égert & Ronald MacDonald, 2006. "Monetary Transmission Mechanism in Transition Economies: Surveying the Surveyable," MNB Working Papers 2006/5, Magyar Nemzeti Bank (Central Bank of Hungary).
    2. Ramos-Tallada, Julio, 2015. "Bank risks, monetary shocks and the credit channel in Brazil: Identification and evidence from panel data," Journal of International Money and Finance, Elsevier, vol. 55(C), pages 135-161.
    3. Srdjan Kujundzic & Dragiša Otaševic, 2012. "The bank lending channel in an euroised economy: the case of Serbia," Working papers 24, National Bank of Serbia.
    4. Jerzy Pruski & Piotr Szpunar, 2008. "The monetary transmission mechanism in Poland," BIS Papers chapters,in: Bank for International Settlements (ed.), Transmission mechanisms for monetary policy in emerging market economies, volume 35, pages 427-437 Bank for International Settlements.
    5. Coricelli, Fabrizio & Égert, Balázs & MacDonald, Ronald, 2006. "Monetary transmission mechanism in Central and Eastern Europe : gliding on a wind of change," BOFIT Discussion Papers 8/2006, Bank of Finland, Institute for Economies in Transition.
    6. Fabrizio Coricelli & Balázs Égert & Ronald MacDonald, 2006. "Monetary Transmission in Central and Eastern Europe: Gliding on a Wind of Change," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue 1, pages 44-87.
    7. Senderski, Marcin, 2011. "Justifiable thrift or feverish animal spirits: What stirred the corporate credit crunch in Poland?," MPRA Paper 56613, University Library of Munich, Germany.
    8. Petya Koeva Brooks, 2007. "Does the Bank Lending Channel of Monetary Transmission Work in Turkey?," IMF Working Papers 07/272, International Monetary Fund.
    9. Fabrizio Coricelli & Bal??zs ??gert & Ronald MacDonald, 2006. "Monetary Transmission Mechanism in Central & Eastern Europe: Gliding on a Wind of Change," William Davidson Institute Working Papers Series wp850, William Davidson Institute at the University of Michigan.
    10. Fernando da Silva Vinhado & José Angelo Divino, 2015. "Monetary and Macroprudential Policies: Empirical Evidences from Panel-VAR," Brazilian Review of Finance, Brazilian Society of Finance, vol. 13(4), pages 691-731.

    More about this item


    monetary policy; monetary transmission mechanism; bank lending channel; bank risk taking;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy


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