Credit expansion, bank liberalization, and structural change in bank asset accounts
گسترش اعتبار، آزاد سازی بانک، و تغییر ساختاری در حسابهای دارایی بانک-2021
This paper studies the links among credit supply expansion, commercial bank asset ac- count structures, and the housing boom preceding the 20 07–20 09 ﬁnancial crisis. We propose a real business cycle model with a housing market and ﬁnancial intermediaries (banks) subject to leverage constraints. In our model, banks channel funds to ﬁrms for production and provide collateralized loans to mortgage borrowers; thus, banks determine their asset account structures endogenously. We show that a credit supply expansion to banks can account for four key facts that characterize the housing boom: (1) an increase in real house prices; (2) an increase in the mortgage-to-GDP ratio; (3) a decrease in the real mortgage interest rate; and (4) an increase in the ratio of mortgages to ﬁrm loans in commercial bank asset accounts. In our model, a credit supply expansion to banks can also generate a boom-bust cycle through the collateral value channel via mortgage borrowers. Asset-side bank regulations that reduce excessive mortgage issuance during a credit boom can help to dampen the subsequent economic downturn.
keywords: گسترش اعتبار | لیبرال سازی بانک | ورق بانکی | چرخه کسب و کار | Credit expansion | Bank liberalization | Bank balance sheet | Business cycle