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Monetary easing and the lending concentration channel of monetary policy transmission

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  • Antoniades, Adonis

Abstract

I use loan-level data on US mortgage loan applications to identify the effect of lending concentration on the pass-through of the 2008 monetary easing to the volume of lending. Lenders eased credit conditions but less so in counties with higher lending concentration. Furthermore, within a county, the pass-through was lower for lenders with higher local market power. The channel is active also during the 2005 monetary tightening episode. It is distinct from the deposits channel of monetary policy transmission, and its influence is ubiquitous: it affects both new loans and refinances, depository and non-depository lenders, and market leaders and laggards.

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  • Antoniades, Adonis, 2021. "Monetary easing and the lending concentration channel of monetary policy transmission," Journal of Banking & Finance, Elsevier, vol. 133(C).
    • Handle: RePEc:eee:jbfina:v:133:y:2021:i:c:s0378426621002533
    DOI: 10.1016/j.jbankfin.2021.106301
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    Cited by:

    1. Jiri Gregor & Jan Janku & Martin Melecky, 2022. "From Central Counter to Local Living: Pass-Through of Monetary Policy to Mortgage Lending Rates in Districts," Working Papers 2022/9, Czech National Bank.

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    More about this item

    Keywords

    Monetary policy; Lending channel; Market concentration; Market power; Mortgages;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • 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
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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