Unconventional monetary policy may have reduced overall bank resilience in the eurozone, a Bank of International Settlements paper finds.
Fernando Avalos and Emmanuel C Mamatzakis use bank-level data of the size of loss-absorbing buffers to estimate bank resilience. They cross-reference the buffer’s relationship with unconventional monetary policy data.
The authors find that quantitative easing enhances bank-level resilience in “core” eurozone countries, such as France, Germany, Luxembourg
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