The sensitivity of loan growth and the existence of bank lending channel during the new regulatory environment in Turkey
Author
Kuşakcıoğlu, Zeynep Gözde
Advisor
Özyıldırım, Süheyla
Date
2010Publisher
Bilkent University
Language
English
Type
ThesisItem Usage Stats
88
views
views
27
downloads
downloads
Abstract
Theoretical framework for monetary transmission mechanism and hence for
bank lending channel provides straightforward impacts of monetary policy
on aggregate output, however there is a problem of identification for these
impacts with aggregate data. Using a two-staged approach, the thesis studies
the loan growth sensitivities of banks in the new regulatory system in Turkey
and tries to identify a relationship between loan growth sensitivity and monetary
tightening. There are six alternative sensitivities tested in the thesis: (1)
Liquidity sensitivity of bank loan growth, (2) Income sensitivity of bank loan
growth, (3) Liquidity sensitivity of bank loan growth with ownership type
of banks controlled, (4) Liquidity sensitivity of large banks loan growth, (5)
Liquidity sensitivity of small banks loan growth. (6) Liquidity sensitivity of
bank loan growth with foreign affiliation of banks controlled. Results confirm
that there exists a positive relationship between liquidity sensitivity of loan growth of Turkish banks and monetary policy shocks. Results also show that
small banks are more liquidity dependent during contradictionary monetary
policy periods than large banks. Besides the results parallel to empirical findings
in the literature, characteristics of Turkish banking sector are included in
the discussion such as the influence of BRSA on banks and the impacts of its
regulations. Robustness of the tests are checked with additional econometric
models. Hence, the findings suggest that there are evidences on bank lending
channel in Turkey for the period 1998-2009.