The pro-cyclicality of capital ratios and credit supply, a tale of two sizes
BankUnderground
APRIL 28, 2023
First, analysing years up to 2009 can be used to measure the cyclical patterns in a less regulated environment, providing evidence on whether Basel III needed cyclical components. Second, expanding the analysis beyond 2009 provides evidence on whether Basel III addressed the pro-cyclicality of bank capital and lending.
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