Buba paper identifies positive spillover effects of financial aid

Evidence that recipients of domestic financial aid have increased their foreign activities following the financial crisis has been published in a Bundesbank paper on Friday.

Claudia Buch, Cathérine Tahmee Koch and Michael Koetter, the paper's authors, shed light on the existence of cross-border policy transmission by analysing the response of German banks' foreign affiliates to domestic and foreign government support measures. In particular, they look at how the lending and borrowing of German