## _wp07272

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---

### Introduction
- Research question: Does the bank lending channel of monetary transmission work in Turkey?
- Definition: The bank lending (or “narrow credit”) channel refers to the adverse effect of higher interest rates on bank loan supply, which may suppress economic activity if firms and consumers cannot replace completely the “missing” loans with other sources of credit.
- Context:
  - Structural changes in Turkey since the 2001 crisis: introduction of a flexible exchange rate regime, recapitalization of the banking sector, and shift towards an inflation-targeting framework.
  - Post-crisis period is short; pre-crisis data may not reflect current monetary transmission.
  - The Central Bank of Turkey (CBT) suggests the bank lending channel may have become more important (Inflation Report I, 2006; Inflation Report III, 2006).
- Identification strategy: use the May–June 2006 financial turbulence as an exogenous shock that prompted a significant tightening of monetary policy to examine bank loan supply responses across banks with different balance sheet characteristics.

### Previous literature
- Two necessary theoretical conditions for the bank lending channel:
  1. Banks cannot fully shield their loan portfolios from changes in monetary policy (i.e., cannot replace lost liquidity without additional costs).
  2. A substantial group of borrowers cannot fully substitute other sources of finance for reduced bank credit.
- Bank characteristics expected to influence responsiveness to monetary shocks:
  - Size: Small banks expected to reduce lending more than large banks (Kashyap and Stein, 1995, 2000).
  - Liquidity: More liquid banks can draw down liquid assets and are less likely to cut lending (Kashyap and Stein, 2000; Ashcraft, 2001).
  - Capitalization: Highly-leveraged banks expected to be more responsive; raising equity can be costly (Kishan and Opiela, 2000; Van den Heuvel, 2001).
- Empirical strategies:
  - Aggregate VAR-based approaches (suggestive; do not separate supply and demand effects).
  - Bank-level panel regressions exploiting cross-bank variation in responses, assuming homogeneous demand shocks across banks.
- Empirical findings across countries:
  - United States: evidence that small and illiquid banks are more responsive (Kashyap and Stein, 2000; Kishan and Opiela, 2000); disputed importance of channel for U.S. (Ashcraft, 2006).
  - Euro area: mixed; liquidity often matters, size and capitalization vary by country and period (Favero et al., 1999; Erhmann et al., 2001; Brissimis et al., 2001; Pizzaro-Barcelo, 2004).
  - Emerging markets: stronger support for bank lending channel; liquidity and sometimes capitalization and size matter (Juks, 2004; Kohler et al., 2005; Havrylchyk and Jurzyk, 2003; Chmielewski, 2005; Golodniuk, 2006; Pruteanu, 2004; Horvath et al., 2005; Alfaro et al., 2003).
  - Turkey: scarce evidence and covering pre-2001-crisis periods only (Cavusoglu, 2002; Sengonul and Thorbecke, 2005).

### Methodology and data
- Identification: treat May–June 2006 turmoil as exogenous; the CBT increased the policy interest rate by 425 basis points and withdrew liquidity via deposit auctions.
- Empirical approach: difference-in-difference using bank-level quarterly balance sheet data for all 33 deposit-taking banks in Turkey from the Banks Association of Turkey.
  - Loan growth computed as percentage change from June (before shock) to September (after shock).
  - To eliminate bank-specific effects, subtract March-to-June loan growth from June-to-September loan growth.
  - Key assumption: decline in loan demand is uniform across banks; variation in responses interpreted as shifts in loan supply.
- Three regression specifications estimated:
  1. Regress differenced loan growth rates on bank-specific variables as of end-June: size (log of total assets), liquidity (ratio of liquid holdings to total assets), capitalization (shareholders’ equity to total assets).
  2. Regress differenced loan growth rates on changes in bank-specific characteristics between end-March and end-June.
  3. Regress differenced loan growth rates on changes in liquidity and capitalization between end-March and end-June.
- Bank-level controls: loan splits by short- and medium-term, domestic and foreign currency; ownership dummies (state, foreign, private); stock market participation (listed, unlisted).
- Notation:
  - ),(js i lΔ = percentage change in loans for bank i from June to September.
  - ),(mj i lΔ = percentage change in loans for bank i from March to June.
  - ),(),,(mjjs i lΔΔ = difference between the two above.

### Main findings
- Sample and estimation:
  - Sample covers all 33 deposit-taking banks in Turkey.
  - Dependent variable: difference between the June-September and the March-June growth rates in total bank loans.
  - Estimation method: least absolute deviations.
  - Number of observations reported: 31.
- Key empirical results (coefficients and reported significance preserved):
  - Liquidity:
    - Specification (1): Liquidity = 0.325 (0.158)** — positive and significant at 5 percent level.
    - Interpretation: less liquid banks reduced lending more; more liquid banks were better able to maintain loan supply.
  - Capitalization:
    - Specification (1): Capitalization = 0.554 (0.326) — not statistically significant at conventional levels in most specifications; statistically significant only at the 10 percent level in one specification.
    - Interpretation: capitalization does not have a robust effect on loan supply in these estimates; possible measurement issues since capitalization is not risk-adjusted.
  - Size:
    - Coefficient estimates are not robust: insignificant in one specification and significant with the unexpected sign in another.
  - Changes in bank characteristics (March-to-June):
    - Change in liquidity: -1.772 (0.571)*** in one specification and 1.224 (0.636)* in another.
    - Change in capitalization: -0.286 (0.702) in one specification and 1.556 (0.849)* in another.
    - Change in size: -0.656 (0.162)*** in the specification where included.
  - Ownership and stock participation variables: coefficients are not statistically significant across specifications.
- Interpretation and implications:
  - Evidence indicates liquidity significantly affects loan supply in Turkey: more liquid banks are less likely to cut lending in response to monetary tightening.
  - Results provide partial support for the existence of a bank lending channel in Turkey (first theoretical condition satisfied).
  - Whether reduced bank lending translates into effects on real activity depends on borrowers’ ability to substitute other finance—this remains an open question for Turkey.
- Caveats and limitations:
  - Overall levels of liquidity and capitalization in Turkey’s banking system are still very high in most banks; estimated effects may not be constant over time and could increase if aggregate liquidity and capitalization trend downward.
  - The identifying assumption that all banks faced the same loan demand shock could bias results if violated, but authors argue it is unlikely that banks with lower liquidity have customers whose loan demand is more interest-sensitive.
  - Sharp exchange rate movements during May–June turbulence could have affected loan supply; note that June and September balance sheet data are valued at similar exchange rates ($/TRY=1.57 in June and 1.50 in September).
- Illustrative policy note from the paper:
  - “For example, the overall impact of a 100 basis point increase in the policy rate on the real economy may be smaller if banks had very strong liquidity positions. (This is because banks would be less likely to cut back on their loan supply in this case.)”

### Conclusion and policy recommendations
- Conclusion:
  - Banks play a role in Turkey’s monetary transmission mechanism through their liquidity positions: the effect of monetary policy can be propagated by the banking sector depending on liquidity.
  - Incorporating an explicit bank lending channel in the CBT model is premature, but banking sector information should be used as an input to form judgment about the likely impact of future interest rate changes on the economy.
- Policy implications and recommendations:
  - Monitor closely the overall level and distribution of liquidity across banks, since liquidity heterogeneity affects loan supply responses to monetary tightening.
  - Recognize that the bank lending channel’s relevance may increase if aggregate liquidity and capitalization decline over time.
  - Further research is required to determine whether borrowers in Turkey can substitute other sources of finance for lost bank credit (i.e., to establish the second theoretical condition for the bank lending channel to affect real activity).

### References
- Ashcraft, Adam, 2006, “New Evidence on the Lending Channel,” Journal of Money, Credit and Banking, Vol. 38, pp. 751–76.
- Aydin, Halil, Cafer Kaplan, Mehtap Kesriyeli, Erdal Ozmen, Cihan Yalcin, and Serkan Yigit, 2006, “Corporate Sector Financial Structure in Turkey: A Descriptive Analysis,” CBT Working Paper 06/07, Ankara: Central Bank of Turkey.
- Bernanke, Ben, and Alan Blinder, 1988, “Money, Credit and Aggregate Demand,“ American Economic Review, Vol. 78, pp. 901–21.
- Bernanke, Ben, and Mark Gertler, 1995, “Inside the Black Box: The Credit Channel of Monetary Policy Transmission,“ The Journal of Economic Perspectives, Vol. 9, pp. 27–48.
- Brissimis, Sophocles, Nicos Kamberoglou, and George Simigiannis, 2001, “Is There A Bank Lending Channel of Monetary Policy in Greece: Evidence from Bank Level Data,” ECB Working Paper 104, Frankfurt: European Central Bank.
- Cavusoglu, Tarkan, 2002, “Credit Transmission Mechanism in Turkey: An Empirical Investigation,” ERC Working Papers in Economic 02/03, Ankara: Middle East Technical University.
- Chmielewski, Tomasz, 2005, “Bank Risks, Risk Preferences and Lending,” unpublished paper presented at the BIS Workshop on Banking Stability: Applied Banking Research, available at  http://www.bis.org/bcbs/events/rtf05bankingfinstab.htm
- Erhmann, Michael, Leonardo Gambacorta, Jorge Martines-Pages, Patrick Sevestre and Andreas Worms, 2001, “Financial Systems and the Role of Banks in Monetary Transmission in the Euro Area,” ECB Working Paper 105, Frankfurt: European Central Bank.
- Farinha, Luisa, and Carlos Robalo Marques, 2001, “The Bank Lending Channel of Monetary Policy: Identification and Estimation Using Portugese Micro Bank Data,” ECB Working Paper 102, Frankfurt: European Central Bank.
- Favero, Carlo, Francesco Gavazzi, and Luca Flabbi, 1999, “The Transmission Mechanism of Monetary Policy in Europe: Evidence from Banks’ Balance Sheets,” NBER Working Paper 7231, Cambridge: National Bureau of Economic Research.
- Golodniuk, Inna, 2006, “Evidence on the Bank-Lending Channel in Ukraine,” Research in International Business and Finance, Vol. 20, pp. 180–99.
- Havrylchyk, Olena, and Emilia Jurzyk, 2003, “Does the Bank Lending Channel Work in a Transition Economy? A Case of Poland,” unpublished manuscript, European University Viadrina.
- Horvath, Csilla, Judit Kreko, and Anna Naszodi, 2006, “Is There a Bank Lending Channel in Hungary? Evidence from Bank Panel Data,” MNB Working Papers 2006/07, Budapest: Central Bank of Hungary.
- Juks, Reico, 2004, “The Importance of the Bank-Lending Channel in Estonia: Evidence from Micro-Economic Data,” Bank of Estonia Working Papers 6, Tallinn: Bank of Estonia.
- Kaplan, Cafer, Erdal Ozmen, and Cihan Yalcin, 2006, “The Determinants and Implications of Financial Asset Holdings of Non-Financial Firms in Turkey: An Empirical Investigation,” CBT Working Paper 06/06, Ankara: Central Bank of Turkey.
- Kashyap, Anil, and Jeremy Stein, 1995, “The Impact of Monetary Policy on Bank Balance Sheets,” Carnegie-Rochester Conference Series on Public Policy, Vol. 42, pp. 151–95.
- Kashyap, Anil and Jeremy Stein, 2000, “What Do One Million Observations on Banks Have to Say About the Transmission of Monetary Policy,” American Economic Review, Vol. 80, pp. 1183–200.
- Kishan, Ruby and Timothy Opiela, 2000, “Bank Size, Bank Capital, and the Bank Lending Channel,” Journal of Money, Credit, and Banking, Vol. 32, pp. 121–41.
- Kohler, Matthias, Judith Hommel, and Matthias Grote, 2006, “The Role of Banks in the Transmission of Monetary Policy in the Baltics,” CEER Discussion Paper 06–005, Mannheim: Center for European Economic Research.
- Kuttner, Kenneth, and Patricia Mosser, 2002, “The Monetary Transmission Mechanism: Some Answers and Further Questions,” FRBNY Economic Policy Review, Vol. 8, pp. 15–26.
- Matousek, Roman, and Nicholas Sarantis, 2006, “The Bank Lending Channel and Monetary Transmission in Central and Eastern Europe,” unpublished paper, presented at 61st International Atlantic Economic Conference, Berlin.
- Pizzaro-Barcelo, Rafaela, 2004, “A Bank Lending Channel of Monetary Transmission in Spain: Evidence from Bank Balance Sheets,” unpublished manuscript, available at http://www.ecomod.net/conferences/ecomod2004/ecomod2004_papers/281.pdf
- Pruteanu, Anca, 2004, “The Role of Banks in the Czech Monetary Policy,” CNB Working Paper 3, Prague: Czech National Bank.
- Sengonul, Ahmed, and Willem Thorbecke, 2005, “The Effect of Monetary Policy on Bank Lending in Turkey,” Applied Financial Economics, Vol. 15, pp. 931–34.
- Van den Heuvel, Skander, 2002, “Does Bank Capital Matter for Monetary Transmission?” Economic Policy Review, Vol. 8, pp. 161–72.
- Worms, Andreas, 2001, “The Reaction of Bank Lending to Monetary Policy Measures in Germany,” ECB Working Paper 98, Frankfurt: European Central Bank.

*Source: _wp07272 - References..............................................................................................................*

### References..............................................................................................................

### _wp07272 - References..............................................................................................................

### Introduction
- Research question: Does the bank lending channel of monetary transmission work in Turkey?
- Definition: The bank lending (or “narrow credit”) channel refers to the adverse effect of higher interest rates on bank loan supply, which may suppress economic activity if firms and consumers cannot replace completely the “missing” loans with other sources of credit.
- Context:
  - Structural changes in Turkey since the 2001 crisis: introduction of a flexible exchange rate regime, recapitalization of the banking sector, and shift towards an inflation-targeting framework.
  - Post-crisis period is short; pre-crisis data may not reflect current monetary transmission.
  - The Central Bank of Turkey (CBT) suggests the bank lending channel may have become more important (Inflation Report I, 2006; Inflation Report III, 2006).
- Identification strategy: use the May–June 2006 financial turbulence as an exogenous shock that prompted a significant tightening of monetary policy to examine bank loan supply responses across banks with different balance sheet characteristics.

### Previous literature
- Two necessary theoretical conditions for the bank lending channel:
  1. Banks cannot fully shield their loan portfolios from changes in monetary policy (i.e., cannot replace lost liquidity without additional costs).
  2. A substantial group of borrowers cannot fully substitute other sources of finance for reduced bank credit.
- Bank characteristics expected to influence responsiveness to monetary shocks:
  - Size: Small banks expected to reduce lending more than large banks (Kashyap and Stein, 1995, 2000).
  - Liquidity: More liquid banks can draw down liquid assets and are less likely to cut lending (Kashyap and Stein, 2000; Ashcraft, 2001).
  - Capitalization: Highly-leveraged banks expected to be more responsive; raising equity can be costly (Kishan and Opiela, 2000; Van den Heuvel, 2001).
- Empirical strategies:
  - Aggregate VAR-based approaches (suggestive; do not separate supply and demand effects).
  - Bank-level panel regressions exploiting cross-bank variation in responses, assuming homogeneous demand shocks across banks.
- Empirical findings across countries:
  - United States: evidence that small and illiquid banks are more responsive (Kashyap and Stein, 2000; Kishan and Opiela, 2000); disputed importance of channel for U.S. (Ashcraft, 2006).
  - Euro area: mixed; liquidity often matters, size and capitalization vary by country and period (Favero et al., 1999; Erhmann et al., 2001; Brissimis et al., 2001; Pizzaro-Barcelo, 2004).
  - Emerging markets: stronger support for bank lending channel; liquidity and sometimes capitalization and size matter (Juks, 2004; Kohler et al., 2005; Havrylchyk and Jurzyk, 2003; Chmielewski, 2005; Golodniuk, 2006; Pruteanu, 2004; Horvath et al., 2005; Alfaro et al., 2003).
  - Turkey: scarce evidence and covering pre-2001-crisis periods only (Cavusoglu, 2002; Sengonul and Thorbecke, 2005).

### Methodology and data
- Identification: treat May–June 2006 turmoil as exogenous; the CBT increased the policy interest rate by 425 basis points and withdrew liquidity via deposit auctions.
- Empirical approach: difference-in-difference using bank-level quarterly balance sheet data for all 33 deposit-taking banks in Turkey from the Banks Association of Turkey.
  - Loan growth computed as percentage change from June (before shock) to September (after shock).
  - To eliminate bank-specific effects, subtract March-to-June loan growth from June-to-September loan growth.
  - Key assumption: decline in loan demand is uniform across banks; variation in responses interpreted as shifts in loan supply.
- Three regression specifications estimated:
  1. Regress differenced loan growth rates on bank-specific variables as of end-June: size (log of total assets), liquidity (ratio of liquid holdings to total assets), capitalization (shareholders’ equity to total assets).
  2. Regress differenced loan growth rates on changes in bank-specific characteristics between end-March and end-June.
  3. Regress differenced loan growth rates on changes in liquidity and capitalization between end-March and end-June.
- Bank-level controls: loan splits by short- and medium-term, domestic and foreign currency; ownership dummies (state, foreign, private); stock market participation (listed, unlisted).
- Notation:
  - ),(js i lΔ = percentage change in loans for bank i from June to September.
  - ),(mj i lΔ = percentage change in loans for bank i from March to June.
  - ),(),,(mjjs i lΔΔ = difference between the two above.

### Main findings
- Sample and estimation:
  - Sample covers all 33 deposit-taking banks in Turkey.
  - Dependent variable: difference between the June-September and the March-June growth rates in total bank loans.
  - Estimation method: least absolute deviations.
  - Number of observations reported: 31.
- Key empirical results (preserve reported coefficients and significance):
  - Liquidity:
    - Specification (1): Liquidity = 0.325 (0.158)** — positive and significant at 5 percent level.
    - Interpretation: less liquid banks reduced lending more; more liquid banks were better able to maintain loan supply.
  - Capitalization:
    - Specification (1): Capitalization = 0.554 (0.326) — not statistically significant at conventional levels in most specifications; statistically significant only at the 10 percent level in one specification.
    - Interpretation: capitalization does not have a robust effect on loan supply in these estimates; possible measurement issues since capitalization is not risk-adjusted.
  - Size:
    - Coefficient estimates are not robust: insignificant in one specification and significant with the unexpected sign in another.
  - Changes in bank characteristics (March-to-June):
    - Change in liquidity: -1.772 (0.571)*** in one specification and 1.224 (0.636)* in another.
    - Change in capitalization: -0.286 (0.702) in one specification and 1.556 (0.849)* in another.
    - Change in size: -0.656 (0.162)*** in the specification where included.
  - Ownership and stock participation variables: coefficients are not statistically significant across specifications.
- Interpretation and implications:
  - Evidence indicates liquidity significantly affects loan supply in Turkey: more liquid banks are less likely to cut lending in response to monetary tightening.
  - Results provide partial support for the existence of a bank lending channel in Turkey (first theoretical condition satisfied).
  - Whether reduced bank lending translates into effects on real activity depends on borrowers’ ability to substitute other finance—this remains an open question for Turkey.
- Caveats and limitations:
  - Overall levels of liquidity and capitalization in Turkey’s banking system are still very high in most banks; estimated effects may not be constant over time and could increase if aggregate liquidity and capitalization trend downward.
  - The identifying assumption that all banks faced the same loan demand shock could bias results if violated, but authors argue it is unlikely that banks with lower liquidity have customers whose loan demand is more interest-sensitive.
  - Sharp exchange rate movements during May–June turbulence could have affected loan supply; note that June and September balance sheet data are valued at similar exchange rates ($/TRY=1.57 in June and 1.50 in September).
- Illustrative policy note from the paper:
  - “For example, the overall impact of a 100 basis point increase in the policy rate on the real economy may be smaller if banks had very strong liquidity positions. (This is because banks would be less likely to cut back on their loan supply in this case.)”

### Conclusion and policy recommendations
- Conclusion:
  - Banks play a role in Turkey’s monetary transmission mechanism through their liquidity positions: the effect of monetary policy can be propagated by the banking sector depending on liquidity.
  - Incorporating an explicit bank lending channel in the CBT model is premature, but banking sector information should be used as an input to form judgment about the likely impact of future interest rate changes on the economy.
- Policy implications and recommendations:
  - Monitor closely the overall level and distribution of liquidity across banks, since liquidity heterogeneity affects loan supply responses to monetary tightening.
  - Recognize that the bank lending channel’s relevance may increase if aggregate liquidity and capitalization decline over time.
  - Further research is required to determine whether borrowers in Turkey can substitute other sources of finance for lost bank credit (i.e., to establish the second theoretical condition for the bank lending channel to affect real activity).

*Source: _wp07272 - References..............................................................................................................*

### REFERENCES

### _wp07272 - REFERENCES

### References list
- Ashcraft, Adam, 2006, “New Evidence on the Lending Channel,” Journal of Money, Credit and Banking, Vol. 38, pp. 751–76.  
- Aydin, Halil, Cafer Kaplan, Mehtap Kesriyeli, Erdal Ozmen, Cihan Yalcin, and Serkan Yigit, 2006, “Corporate Sector Financial Structure in Turkey: A Descriptive Analysis,” CBT Working Paper 06/07, Ankara: Central Bank of Turkey.  
- Bernanke, Ben, and Alan Blinder, 1988, “Money, Credit and Aggregate Demand,“ American Economic Review, Vol. 78, pp. 901–21.  
- Bernanke, Ben, and Mark Gertler, 1995, “Inside the Black Box: The Credit Channel of Monetary Policy Transmission,“ The Journal of Economic Perspectives, Vol. 9, pp. 27–48.  
- Brissimis, Sophocles, Nicos Kamberoglou, and George Simigiannis, 2001, “Is There A Bank Lending Channel of Monetary Policy in Greece: Evidence from Bank Level Data,” ECB Working Paper 104, Frankfurt: European Central Bank.  
- Cavusoglu, Tarkan, 2002, “Credit Transmission Mechanism in Turkey: An Empirical Investigation,” ERC Working Papers in Economic 02/03, Ankara: Middle East Technical University.  
- Chmielewski, Tomasz, 2005, “Bank Risks, Risk Preferences and Lending,” unpublished paper presented at the BIS Workshop on Banking Stability: Applied Banking Research, available at  http://www.bis.org/bcbs/events/rtf05bankingfinstab.htm  
- Erhmann, Michael, Leonardo Gambacorta, Jorge Martines-Pages, Patrick Sevestre and Andreas Worms, 2001, “Financial Systems and the Role of Banks in Monetary Transmission in the Euro Area,” ECB Working Paper 105, Frankfurt: European Central Bank.  
- Farinha, Luisa, and Carlos Robalo Marques, 2001, “The Bank Lending Channel of Monetary Policy: Identification and Estimation Using Portugese Micro Bank Data,” ECB Working Paper 102, Frankfurt: European Central Bank.  
- Favero, Carlo, Francesco Gavazzi, and Luca Flabbi, 1999, “The Transmission Mechanism of Monetary Policy in Europe: Evidence from Banks’ Balance Sheets,” NBER Working Paper 7231, Cambridge: National Bureau of Economic Research.  
- Golodniuk, Inna, 2006, “Evidence on the Bank-Lending Channel in Ukraine,” Research in International Business and Finance, Vol. 20, pp. 180–99.  
- Havrylchyk, Olena, and Emilia Jurzyk, 2003, “Does the Bank Lending Channel Work in a Transition Economy? A Case of Poland,” unpublished manuscript, European University Viadrina.  
- Horvath, Csilla, Judit Kreko, and Anna Naszodi, 2006, “Is There a Bank Lending Channel in Hungary? Evidence from Bank Panel Data,” MNB Working Papers 2006/07, Budapest: Central Bank of Hungary.  
- Juks, Reico, 2004, “The Importance of the Bank-Lending Channel in Estonia: Evidence from Micro-Economic Data,” Bank of Estonia Working Papers 6, Tallinn: Bank of Estonia.  
- Kaplan, Cafer, Erdal Ozmen, and Cihan Yalcin, 2006, “The Determinants and Implications of Financial Asset Holdings of Non-Financial Firms in Turkey: An Empirical Investigation,” CBT Working Paper 06/06, Ankara: Central Bank of Turkey.  
- Kashyap, Anil, and Jeremy Stein, 1995, “The Impact of Monetary Policy on Bank Balance Sheets,” Carnegie-Rochester Conference Series on Public Policy, Vol. 42, pp. 151–95.  
- Kashyap, Anil and Jeremy Stein, 2000, “What Do One Million Observations on Banks Have to Say About the Transmission of Monetary Policy,” American Economic Review, Vol. 80, pp. 1183–200.  
- Kishan, Ruby and Timothy Opiela, 2000, “Bank Size, Bank Capital, and the Bank Lending Channel,” Journal of Money, Credit, and Banking, Vol. 32, pp. 121–41.  
- Kohler, Matthias, Judith Hommel, and Matthias Grote, 2006, “The Role of Banks in the Transmission of Monetary Policy in the Baltics,” CEER Discussion Paper 06–005, Mannheim: Center for European Economic Research.  
- Kuttner, Kenneth, and Patricia Mosser, 2002, “The Monetary Transmission Mechanism: Some Answers and Further Questions,” FRBNY Economic Policy Review, Vol. 8, pp. 15–26.  
- Matousek, Roman, and Nicholas Sarantis, 2006, “The Bank Lending Channel and Monetary Transmission in Central and Eastern Europe,” unpublished paper, presented at 61st International Atlantic Economic Conference, Berlin.  
- Pizzaro-Barcelo, Rafaela, 2004, “A Bank Lending Channel of Monetary Transmission in Spain: Evidence from Bank Balance Sheets,” unpublished manuscript, available at http://www.ecomod.net/conferences/ecomod2004/ecomod2004_papers/281.pdf  
- Pruteanu, Anca, 2004, “The Role of Banks in the Czech Monetary Policy,” CNB Working Paper 3, Prague: Czech National Bank.  
- Sengonul, Ahmed, and Willem Thorbecke, 2005, “The Effect of Monetary Policy on Bank Lending in Turkey,” Applied Financial Economics, Vol. 15, pp. 931–34.  
- Van den Heuvel, Skander, 2002, “Does Bank Capital Matter for Monetary Transmission?” Economic Policy Review, Vol. 8, pp. 161–72.  
- Worms, Andreas, 2001, “The Reaction of Bank Lending to Monetary Policy Measures in Germany,” ECB Working Paper 98, Frankfurt: European Central Bank.

*Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2007/_wp07272.pdf*

---


_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2007/_wp07272.pdf_