Credit channel has bigger effect on big banks
Rate hikes have a greater impact on the lending behaviour of bigger banks than smaller institutions, research published by the Chicago Federal Reserve finds.
The research investigates the impact of the credit channel of monetary policy transmission on overall bank lending and the allocation of loans.
The data shows that both large and small banks adjust their stock of loans by reducing the maturity of loan originators and reallocating their short-term loan supply from small to large firms.
To
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