Dominika Kolcunová, Simona Malovaná
This paper studies the impact of higher additional capital requirements on growth in loans to the private sector for banks in the Czech Republic. The empirical results indicate that higher additional capital requirements have a negative effect on loan growth for banks with relatively low capital surpluses. In addition, the results confirm that the relationship between the capital surplus and loan growth is also important at times of stable capital requirements, i.e. it does not serve only as an intermediate channel of higher additional capital requirements.
JEL codes: C22, E32, G21, G28
Keywords: Bank lending, banks’ capital surplus, regulatory capital requirements
Issued: April 2019
Download: CNB WP No. 2/2019 (pdf, 580 kB)