IMF paper models wholesale funding impact on credit supply
A working paper, published by the International Monetary Fund in June, considers the effect of short-term "wholesale" funding on banks' credit supply during the financial crisis.
The authors, Jihad Dagher and Kazim Kazimov, use US mortgage and bank balance sheet data from 2005 to 2008 to compare the impact of a bank's liability structure on its supply of credit following a worsening of liquidity conditions. The researchers find that banks that relied on short-term wholesale funding before the
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