How do banks perform under Basel III? Tracing lending rates and loan quantity

摘要: Abstract In late 2010, the Basel Committee on Banking Supervision issued III document enumerating measures focused improvements in definition of regulatory capital, introduction a leverage ratio as backstop for risk-based capital requirement, buffers, enhancement risk coverage through methodology to measure counterparty credit and liquidity measurement standards. This study investigates impact new requirements introduced under framework bank lending rates loan growth. Higher requirements, by raising banks’ marginal cost funding, lead higher rates. The data presented paper suggest that assuming 1.3 percentage point increase equity-to-asset meet regulations, country-by-country estimations imply reduction volume loans an average 4.97 percent long run banks countries experienced crisis 18.67 did not experience crisis. wide variance results reflects cross-country differences elasticity demand with respect interest rate bank's net equity.