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Impact of the Fund-Provisioning Measure to Stimulate Bank Lending in Japan

Author

Listed:
  • Atsuki Hirata

    (Bank of Japan)

  • Yuichiro Ito

    (Bank of Japan)

  • Yoshiyasu Kasai

    (Bank of Japan)

Abstract

This paper uses financial data from individual banks to quantitatively analyze how the Bank of Japan's "Fund-Provisioning Measure to Stimulate Bank Lending," decided for introduction in October 2012, affected banks' outstanding loans. We estimated the causal impact of the measure using propensity score matching to address the selection bias stemming from the voluntary basis of participation in this program. The results indicate a statistically significant difference in the outstanding loans between the participating and non-participating banks, suggesting that the Fund-Provisioning Measure to Stimulate Bank Lending helped increase lending.

Suggested Citation

  • Atsuki Hirata & Yuichiro Ito & Yoshiyasu Kasai, 2024. "Impact of the Fund-Provisioning Measure to Stimulate Bank Lending in Japan," Bank of Japan Working Paper Series 24-E-24, Bank of Japan.
    • Handle: RePEc:boj:bojwps:wp24e24
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    File URL: https://www.boj.or.jp/en/research/wps_rev/wps_2024/data/wp24e24.pdf
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    More about this item

    Keywords

    Unconventional monetary policy; Lending facility; Bank lending; Propensity score matching;
    All these keywords.

    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • 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
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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