scholarly journals Sources of Inaction in Household Finance: Evidence from the Danish Mortgage Market

2020 ◽  
Vol 110 (10) ◽  
pp. 3184-3230 ◽  
Author(s):  
Steffen Andersen ◽  
John Y. Campbell ◽  
Kasper Meisner Nielsen ◽  
Tarun Ramadorai
Keyword(s):  
Monetary Policy ◽  
Panel Data ◽  
Household Finance ◽  
Information Gathering ◽  
Mortgage Market ◽  
Lower Probability ◽  
Policy Transmission ◽  
Mortgage Refinancing ◽  
Refinancing Costs ◽  
And Behavior

We build an empirical model to attribute delays in mortgage refinancing to psychological costs inhibiting refinancing until incentives are sufficiently strong; and behavior, potentially attributable to information-gathering costs, lowering the probability of household refinancing per unit time at any incentive. We estimate the model on administrative panel data from Denmark, where mortgage refinancing without cash-out is unconstrained. Middle-aged and wealthy households act as if they have high psychological refinancing costs; but older, poorer, and less-educated households refinance with lower probability irrespective of incentives, thereby achieving lower savings. We use the model to understand frictions in the mortgage channel of monetary policy transmission. (JEL E52, G21, G51, R31)

scholarly journals Refinancing, Monetary Policy, and the Credit Cycle

2020 ◽  
Vol 12 (1) ◽  
pp. 67-93 ◽  
Author(s):  
Gene Amromin ◽  
Neil Bhutta ◽  
Benjamin J. Keys
Keyword(s):  
Monetary Policy ◽  
Policy Implementation ◽  
Lessons Learned ◽  
Mortgage Market ◽  
Transmission Mechanism ◽  
Mortgage Markets ◽  
Policy Transmission ◽  
The Usa ◽  
Credit Cycle

We assess the complicated reality of monetary policy transmission through mortgage markets by synthesizing the existing literature on the role of refinancing in policy implementation. After briefly reviewing mortgage market institutions in the USA and documenting refinance activity over time, we summarize the links between refinancing and consumption and describe the frictions impeding the refinancing channel. The review draws heavily on research emerging from the experience of the financial crisis of 2008–2009, as it highlights a combination of market, institutional, and policy-making factors that dulled the transmission mechanism. We conclude with a discussion of potential mortgage market innovations and the applicability of lessons learned to the ongoing stresses induced by the COVID-19 pandemic.

Does Inter-Bank Investments Restraints Financing Performance of Islamic Banks?

2019 ◽  
pp. 46-60
Author(s):  
Mohammad Taqiuddin Mohamad ◽  
Munazza Saeed
Keyword(s):  
Monetary Policy ◽  
Panel Data ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Panel Data Estimation ◽  
Financing Behavior ◽  
Financing Performance ◽  
And Behavior ◽  
Data Estimation ◽  
Size And Structure

The purpose of this study is to investigate the effect of interbank investment and changes in monetary policy on financing behavior of Islamic banks in Malaysia. The change occurring in bank specifications and changes in monetary policy will lead financial authorities generally, banking management specifically, to make modifications on financing. In order to achieve the objective, this study employs a panel data estimation of 17 Malaysian banks for the period of 1994-2014. Findings revealed that the pattern and behavior of Islamic banking in offering financing is influenced by the investment in interbank investment and also by the factors such as level of past financing, the exposure to risk, size and structure of the capitalization level. While for monetary policy factor, financing behavior of Islamic banking is influenced by Malaysian government securities (MGS). Next to the economic environment, the study showed no significant relationship to the behavior of the Malaysian Islamic banking financing.

scholarly journals GLOBALISASI PERBANKAN DAN EFEKTIVITAS KEBIJAKAN MONETER DALAM PERSPEKTIF CREDIT CHANNEL

2020 ◽  
Vol 17 (1) ◽  
pp. 37-47
Author(s):  
Radius Radius
Keyword(s):  
Monetary Policy ◽  
Panel Data ◽  
Regression Model ◽  
Banking Sector ◽  
Foreign Bank ◽  
Credit Channel ◽  
Credit Growth ◽  
Policy Transmission ◽  
Outstanding Result ◽  
Transmission Of Monetary Policy

Abstrak: Penelitian berfokus pada analisis dampak kepemilikan modal asing pada pertumbuhan kredit bank serta kaitannya dengan efektivitas transmisi kebijakan moneter credit channel. Menggunakan data panel individu bank BUKU 3 dan BUKU 4 di Indonesia, analisis dilakukan terhadap tiga kelompok bank berdasarkan jenis kepemilikannya yaitu Bank Pemerintah, Bank Domestik dan Bank Asing. Hasil estimasi pada model regresi menunjukkan secara empiris bahwa globalisasi berdampak terhadap pertumbuhan kredit bank secara spesifik pada bank dengan modal asing sebagai saham pengendali utama. Temuan yang menarik adalah transmisi kebijakan moneter pada sektor perbankan di Indonesia menunjukkan hasil yang tidak efektif jika dilihat dari perspektif credit channel.Abstract: This paper focuses on the effect of foreign equity in the Indonesian banking sector towards credit growth while linked to credit channel monetary policy transmission. It was using panel data from individual banks categorized as BUKU 3 and BUKU 4 in Indonesia, the analysis performed towards three categories of a bank by its ownership, which are Government Bank, Domestic Bank, and Foreign Bank. Estimation of the regression model shows that globalization empirically affects credit growth specific on foreign-controlled banks with majority foreign equity. The outstanding result in this paper is that the transmission of monetary policy in the Indonesian banking sector turns out to be ineffective as viewed from a credit channel perspective.

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