Does Monetary Policy Affect Bank Risk-Taking?
Research output: Working paper
Electronic versions
DOI
This paper investigates the relationship between short-term interest rates and bank risk. Using a unique database that includes quarterly balance sheet information for listed banks operating in the European Union and the United States in the last decade, we find evidence that unusually low interest rates over an extended period of time contributed to an increase in banks' risk. This result holds for a wide range of measures of risk, as well as macroeconomic and institutional controls.
| Original language | English |
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| Publisher | Bank for International Settlements (BIS) |
| DOIs | |
| Publication status | Published - 1 Mar 2010 |
Publication series
| Name | BIS Working Paper |
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| No. | n.298 |