A working paper published by the Banque de France analyses new findings on interbank funding.

In Secured and unsecured interbank markets: monetary policy, substitution and the cost of collateral, Thibaut Piquard and Dilyara Salakhova analyse transaction data from both types of market in the eurozone.

Banks that borrow are active on both the secured and unsecured markets, even when their collateral constraint is not binding, the authors find, because banks’ borrowing policies do not strictly