Conference Agenda
Please note that all times are shown in the time zone of the conference. The current conference time is: 15th Sept 2026, 08:43:06am CEST
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Daily Overview |
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FI 09: Bank Risk, Losses ,and Failure Location: LR M0.2 (Floor 0) Session Chair: Steven Ongena, University of Zurich | |
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ID: 761
Securities Losses and the Bank Collateral Channel of Monetary Transmission 1: Stockholm School of Economics; 2: Barnard College, Columbia University, United States of America; 3: ECB; 4: Columbia Business School We show that losses on banks’ securities portfolios matter for the transmission mechanism of monetary policy even in the absence of financial stability concerns. When banks experience losses in their pledgeable securities, their ability to tap liquidity through the interbank market is impaired, and they subsequently reduce illiquid corporate lending, regardless of whether the securities were recorded at market or historical value. These effects are less pronounced for banks with abundant collateral and reserves and for banks that receive liquidity through their group’s internal capital market. Our results highlight a collateral channel in the bank-based transmission of monetary policy.
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