@techreport{39dfc800a79644619c9e4d93e9463485,
title = "Credit Supply versus Demand: Bank and Firm Balance-Sheet Channels in Good and Crisis Times",
abstract = "Abstract: Banking crises involve periods of persistently low credit and economic growth. Banks{\textquoteright} balance sheets are then weak but so are those of non-financial corporate borrowers. Hence, a crucial question is whether credit growth is low due to supply or to demand factors. However convincing identification has been elusive due to a lack of detailed loan application-, bank-, and firm-level data. Access to a dataset of loan applications in Spain that is matched with complete bank and firm balance-sheet data covering the period from 2002 to 2010 allows us to identify bank and firm balancesheet channels. We find robust evidence showing that bank balance-sheet strength determines the success of loan applications and the granting of loans in crisis times. The heterogeneity in firm balance-sheet strength determines loan granting in both good and crisis times, although the potency of this firm balance-sheet channel is the largest in the latter period. Our findings therefore hold important implications for both theory and policy.",
keywords = "bank lending channel, credit supply, business cycle, credit crunch, capital, liquidity",
author = "{Jimenez Porras}, G. and S. Ongena and J.L. Peydro and J. Saurina",
note = "This is also CentER Discussion Paper 2012-005 Pagination: 34",
year = "2012",
language = "English",
volume = "2012-003",
series = "EBC Discussion Paper",
publisher = "EBC",
type = "WorkingPaper",
institution = "EBC",
}