## 11. Complementary Role of Macroprudential Policies and Reserve Requirements

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---

### I. Introduction
- Scope: examines the role of reserve requirements (RRs) as a macroprudential tool in Latin America, assessing effectiveness in containing bank credit to the private sector and interactions with other policies over the period 2003–11.
- Regional macroprudential measures: loan-loss dynamic provisioning; reserve requirements; targeted measures such as capital requirement tightening for specific market segments and RRs on banks’ short spot dollar positions.
- Methodologies used:
  - Event analysis tracking effects around policy changes.
  - Dynamic panel vector autoregressions (panel VAR) accounting for simultaneous and feedback effects between credit growth, RRs and policy rates.
- Practical motivation: RRs are flexible countercyclical tools with widespread use and broad scope; focus is on RRs given active use over the cycle.

### II. Reserve Requirements — Mechanics, Benefits, Drawbacks
- Design and scope:
  - RRs require banks to hold a fraction of deposits/liabilities as liquid reserves at the central bank (cash or highly liquid sovereign paper).
  - Regulation can vary by deposit type, currency denomination, holding period, and remuneration; marginal RRs apply to new deposits from a reference period only.
  - RRs have most commonly been applied to liabilities rather than assets.
- Potential macroprudential roles:
  - Countercyclical management of credit cycle: hikes can increase lending rates, slow credit, and act as a speed limit; lowers in downturns can ease liquidity constraints.
  - Improve funding structure: RRs on foreign or domestic borrowing can reduce reliance on short-term external financing, akin to Basel III liquidity objectives.
  - Credit allocation: asymmetric RRs across instruments/sectors/institutions can direct liquidity to systemically important areas or constrain funding for risky segments.
  - Complement to capital requirements where asset valuation is uncertain.
  - Bank capitalization: increasing remuneration on RRs can help capitalize banks in stress episodes.
  - Substitute for monetary policy where large capital inflows push credit beyond monetary goals (example cited: Peru).
- Costs, distortions, calibration complexity:
  - If remunerated below market rates, RRs act as a tax on intermediation; banks may widen spreads, causing disintermediation and growth of less-regulated funding channels.
  - Incentives for regulatory arbitrage and proliferation of bank-like institutions (e.g., off-shore branches).
  - Calibration complexity: choice of targeted liabilities, holding period, remunerated vs unremunerated, base calculation (lagged vs contemporaneous), marginal vs average RRs — changes in marginal rates may signal, while changes in reference period or average RRs may have larger liquidity effects.
  - Trade-off between monetary and financial stability; RRs should not substitute for sound fiscal/monetary policy and exchange rate flexibility.

### III. Theory and Latin American Experience — Key Points from Literature
- Theoretical drivers of RR effectiveness:
  - Effects depend on banking market structure, degree of financial development, and RR design.
  - Two illustrative scenarios:
    - Competitive loan market + market power in deposit market: RRs act like a tax passed to depositors (lower deposit rates), reducing intermediation.
    - Competitive deposit market + market power in loan market: RRs increase lending rates and reduce credit; costs borne by borrowers.
  - Monetary regime matters: in inflation-targeting regimes central banks may supply liquidity (muting RR effects on lending rates) if central bank credit is close substitute for deposits; otherwise RRs can raise lending rates and reduce credit.
  - Financial frictions and imperfect substitutability across funding sources are necessary conditions for RRs to be effective.
- Empirical and regional evidence:
  - Brazil, Colombia, Peru actively used RRs countercyclically before, during, and after the 2008–09 crisis.
  - Examples of extreme credit expansions: annual real credit growth rates exceeded 20 percent and in some instances 30 percent; Brazil saw private bank credit expansion reaching annual growth rates of 35 percent.
  - Crisis policy responses after Lehman: policy rate cuts—Colombia (600 bps), Peru (525 bps) and Brazil (500 bps)—and reductions or eliminations of RRs to provide liquidity.
  - Post-crisis (2010–2011): tightening of policy rates and increases in RRs in Brazil and Peru; Colombia relied less on RRs.
  - Case innovations:
    - Brazil used RRs to channel liquidity from large to smaller banks, introduced RRs on banks’ dollar positions in FX spot market (January 2011; exemption threshold reduced in July 2011), and adjusted capital requirements for consumer loans.
    - Peru applied RRs on short-term foreign liabilities (raised from zero to 75 percent in 2010, reduced to 60 percent in 2011) and extended RRs to off-shore branches.
- Existing empirical studies:
  - Lim and others (2011) (49 countries, 2000 to 2010) find RRs effective in reducing credit procyclicality in the short run and that periodic recalibration is necessary.
  - Country studies (e.g., Vargas and others (2011) for Colombia) suggest RRs affect business loan interest rates and strengthen policy pass-through.
  - Other studies find RRs can contract household credit (Evandro and Takeda (2011)) and conclude RRs complement monetary policy but can induce exchange rate depreciation and inflationary effects (Glocker and Towbin (2012b)).
  - Criticisms: asymmetric application and circumvention can induce funding fragilities (Robitaille (2011)).

### IV. Empirical Analysis — Data, Methods, Results
- Data and sample:
  - Monthly data for five countries: Brazil, Chile, Colombia, Mexico, and Peru over January 2003 to April 2011.
  - Macroprudential information constructed by authors from central banks and IMF desk discussions; cumulative dummy variables capture changes in RRs and other macroprudential measures.
- Methodologies:
  - Event analysis: tracks bank credit growth, lending rates, policy rates and exchange rates four months before and after policy implementation for average RRs, marginal RRs and other macroprudential policies (sample limited to Brazil, Colombia, Peru).
  - Dynamic panel vector autoregression (panel VAR): system GMM estimation of a second-order VAR with variables including macroprudential policy dummy(s), policy interest rate, level of economic activity, and private bank credit growth; identification via Choleski decomposition assuming macroprudential measures most exogenous; impulse responses normalized to a unitary discrete change in the cumulative dummy; panel VAR sample covers 2004:M6—2011:M4 for Brazil, Chile, Colombia, Mexico, Peru.
- Key empirical findings (numeric specifics preserved):
  - Overall effect: RRs and other macroprudential policies produce a moderate and transitory slowdown in bank credit growth to the private sector.
  - Event analysis:
    - Policies are introduced when credit growth is booming (growing at rates exceeding 20 percent on annual terms).
    - Introduction associated with an immediate but moderate decline in bank credit growth in the month following the shock.
    - Effects on credit growth are short-lived; growth rates return after four months to pre-shock levels.
    - Marginal RRs appear associated with a sharp credit decline in event plots, but this likely reflects synchronization with policy rate hikes.
    - Macroprudential instruments exert a non-negligible weakening effect on the nominal exchange rate.
  - Panel VAR results:
    - Confirm modest and temporary reduction in private bank credit growth following a macroprudential shock.
    - Strongest impact observed for average RRs and other macroprudential policies (e.g., dynamic provisioning, countercyclical capital requirements).
    - Marginal RRs show negligible short-run effects in the panel VAR (the event-analysis “sharp decline” for marginal RRs mainly reflects concurrent policy rate hikes).
    - Long-run impulse responses may show opposite signs, indicating dynamics vary with horizon.
    - There is mutually reinforcing behavior between policy rates and macroprudential measures: policy rates tend to increase following a tightening in macroprudential policies and macroprudential measures tend to respond to monetary policy shocks (simulations referenced assume a 25-basis-point shock on policy interest rates; impulse responses normalized so macroprudential shock equals one).
  - Practical implication: to maintain effectiveness RRs may need periodic recalibration, consistent with Lim and others (2011).

### V. Conclusions and Policy Implications
- Summary conclusions:
  - Brazil, Colombia, Peru used RRs countercyclically: raising RRs during upswing to contain excessive credit growth and lowering them during downturns to ease liquidity pressures.
  - RRs can address credit procyclicality, help build liquidity buffers, improve funding structure (when targeted at non-deposit liabilities), and serve as a complement to monetary policy even under inflation-targeting regimes.
  - Empirical evidence points to modest, short-lived effects of RRs on aggregate private bank credit growth; average RRs and other macroprudential tools have stronger short-run impacts than marginal RRs.
  - RRs are not costless: difficult to calibrate, may induce disintermediation, promote regulatory arbitrage, and shift risks to less-regulated sectors.
  - Little evidence of substitution between monetary policy and macroprudential measures—rather a reinforcing relationship.
- Recommendations and research priorities:
  - Periodic recalibration of RRs is likely necessary to preserve effectiveness.
  - Future research needed to:
    - Evaluate RRs’ impact on funding structure of banks and sectoral (market-segment) effects, not only aggregate credit.
    - Better understand interactions between monetary policy and macroprudential policies in general equilibrium settings.
    - Construct more detailed, tax-equivalent measures of RRs to guide design and calibration and to identify potential nonlinear effects arising from levels and changes in RRs and other instruments.
- Cautions:
  - Modest aggregate effects on credit do not imply ineffectiveness—RRs may reduce systemic risk by slowing credit in specific market segments with limited aggregate impact.

*Source: IMF staff chapter “11. Complementary Role of Macroprudential Policies and Reserve Requirements” (content unit _wp12142).*

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

### _wp12142 - References

### Table
- 1.  Recent Macroprudential Measures .................................................................................... 4

### Figures
- 1.   Reserve Requirements on Banks Liabilities ....................................................................... 6
- 2.   Effects of Reserve Requirements when Financial Intermediation Involves a Competitive Loan Market and Market Power in the Deposit Market ...........................   9
- 3.   Effects of Reserve Requirements when Financial Intermediation Involves a Competitive Deposit Market and Market Power in the Loan Market ........................... 10
- 4.   Credit Dynamics and Interest Rates  ................................................................................. 12
- 5.   Reserve Requirements in Brazil  ....................................................................................... 13
- 6.   Reserve Requirements in Colombia  ................................................................................. 14
- 7.   Reserve Requirements in Peru  ......................................................................................... 15
- 8    Latin America: Average and Marginal Reserve Requirements ........................................ 18
- 9.   Impact of RRs and other Macroprudential Measures on Private Credit Growth  ............. 19
- 10. Impulse Response of Private Credit Growth to Macroprudential Policy Shocks  ............ 22

*Source: _wp12142 - References*

### 11. Complementary Role of Macroprudential Policies and Reserve Requirements  .............. 23

### 11. Complementary Role of Macroprudential Policies and Reserve Requirements

### I. Introduction
- Scope: examines the role of reserve requirements (RRs) as a macroprudential tool in Latin America, assessing effectiveness in containing bank credit to the private sector and interactions with other policies over the period 2003–11.
- Macroprudential measures in the region include loan-loss dynamic provisioning and reserve requirements; targeted measures include capital requirement tightening for specific market segments and RRs on banks’ short spot dollar positions.
- Methodologies used: (i) event analysis tracking effects around policy changes; (ii) dynamic panel vector autoregressions (panel VAR) accounting for simultaneous and feedback effects between credit growth, RRs and policy rates.
- Key practical motivation: RRs are flexible countercyclical tools with widespread use and broad scope; this study focuses on RRs given their active use over the cycle.

### II. Reserve Requirements as a Macroprudential Tool — Mechanics, Benefits, Drawbacks
- Design and scope of RRs:
  - RRs require banks to hold a fraction of deposits/liabilities as liquid reserves at the central bank (cash or highly liquid sovereign paper).
  - Regulation can vary by deposit type, currency denomination, holding period, and remuneration; marginal RRs apply to new deposits from a reference period only.
  - RRs have most commonly been applied to liabilities rather than assets.
- Potential macroprudential roles (enumerated):
  - Countercyclical management of credit cycle: hikes can increase lending rates, slow credit, and act as a speed limit; lowers in downturns can ease liquidity constraints.
  - Improve funding structure: RRs on foreign or domestic borrowing can reduce reliance on short-term external financing, akin to Basel III liquidity objectives.
  - Credit allocation: asymmetric RRs across instruments/sectors/institutions can direct liquidity to systemically important areas or constrain funding for risky segments.
  - Complement to capital requirements where asset valuation is uncertain.
  - Bank capitalization: increasing remuneration on RRs can help capitalize banks in stress episodes.
  - Substitute for monetary policy where large capital inflows push credit beyond monetary goals (example cited: Peru).
- Costs, distortions, calibration complexity:
  - If remunerated below market rates, RRs act as a tax on intermediation; banks may widen spreads, causing disintermediation and growth of less-regulated funding channels.
  - Incentives for regulatory arbitrage and proliferation of bank-like institutions (e.g., off-shore branches).
  - Calibration complexity: choice of targeted liabilities, holding period, remunerated vs unremunerated, base calculation (lagged vs contemporaneous), marginal vs average RRs — changes in marginal rates may signal, while changes in reference period or average RRs may have larger liquidity effects.
  - Trade-off between monetary and financial stability remains; RRs should not substitute for sound fiscal/monetary policy and exchange rate flexibility.

### III. Literature Review — Theory and Latin American Experience
- Theoretical considerations:
  - RR effects depend critically on banking market structure, degree of financial development, and RR design.
  - Two extreme illustrative scenarios:
    - Competitive loan market + market power in deposit market: RRs act like a tax passed to depositors (lower deposit rates), reducing intermediation.
    - Competitive deposit market + market power in loan market: RRs increase lending rates and reduce credit; costs borne by borrowers.
  - Monetary regime matters: in inflation-targeting regimes central banks may supply liquidity (muting RR effects on lending rates) if central bank credit is close substitute for deposits; otherwise RRs can raise lending rates and reduce credit.
  - Presence of financial frictions and imperfect substitutability across funding sources are necessary conditions for RRs to be effective.
- Empirical and regional evidence:
  - Latin American central banks (Brazil, Colombia, Peru) actively used RRs countercyclically before, during, and after 2008–09 crisis.
  - Examples of extreme credit expansions: annual real credit growth rates exceeded 20 percent and in some instances 30 percent; Brazil saw private bank credit expansion reaching annual growth rates of 35 percent.
  - Crisis policy responses: policy rate cuts following Lehman—Colombia (600 bps), Peru (525 bps) and Brazil (500 bps)—and reductions or eliminations of RRs to provide liquidity.
  - Post-crisis (2010–2011) responses: tightening of policy rates and increases in RRs in Brazil and Peru; Colombia relied less on RRs in that episode.
  - Case-specific innovations: Brazil used RRs to channel liquidity from large to smaller banks, introduced RRs on banks’ dollar positions in FX spot market (January 2011; exemption threshold reduced in July 2011), and adjusted capital requirements for consumer loans; Peru applied RRs on short-term foreign liabilities (raised from zero to 75 percent in 2010, reduced to 60 percent in 2011) and extended RRs to off-shore branches.
- Existing empirical studies:
  - Limited cross-country evidence; Lim and others (2011) use 49 countries (2000 to 2010) finding RRs effective in reducing credit procyclicality in the short run and that periodic recalibration is necessary.
  - Country studies (e.g., Vargas and others (2011) for Colombia) suggest RRs affect business loan interest rates and strengthen policy pass-through.
  - Other studies find RRs can contract household credit (Evandro and Takeda (2011)) and conclude RRs complement monetary policy but can induce exchange rate depreciation and inflationary effects (Glocker and Towbin (2012b)).
  - Criticisms: asymmetric application and circumvention can induce funding fragilities (Robitaille (2011)).

### IV. Empirical Analysis — Data, Methods, Results
- Data and sample:
  - Monthly data for five countries: Brazil, Chile, Colombia, Mexico, and Peru over January 2003 to April 2011 (sample periods used in panel VAR and event analysis described).
  - Macroprudential information constructed by authors from central banks and IMF desk discussions; cumulative dummy variables capture changes in RRs and other macroprudential measures.
- Methodologies:
  - Event analysis: tracks bank credit growth, lending rates, policy rates and exchange rates four months before and after policy implementation for average RRs, marginal RRs and other macroprudential policies (sample limited to countries that used RRs: Brazil, Colombia, Peru).
  - Dynamic panel vector autoregression (panel VAR): system GMM estimation of a second-order VAR with variables including macroprudential policy dummy(s), policy interest rate, level of economic activity, and private bank credit growth; identification via Choleski decomposition assuming macroprudential measures most exogenous; impulse responses normalized to a unitary discrete change in the cumulative dummy; sample includes Brazil, Chile, Colombia, Mexico, Peru over 2004:M6—2011:M4 for panel VAR.
- Key empirical findings (preserve numeric specifics):
  - Overall effect: RRs and other macroprudential policies produce a moderate and transitory slowdown in bank credit growth to the private sector.
  - Event analysis:
    - Policies are introduced when credit growth is booming (growing at rates exceeding 20 percent on annual terms).
    - Introduction associated with an immediate but moderate decline in bank credit growth in the month following the shock.
    - Effects on credit growth are short-lived; growth rates return after four months to pre-shock levels.
    - Marginal RRs appear associated with a sharp credit decline in event plots, but this likely reflects synchronization with policy rate hikes.
    - Macroprudential instruments exert a non-negligible weakening effect on the nominal exchange rate.
  - Panel VAR results:
    - Confirm modest and temporary reduction in private bank credit growth following a macroprudential shock.
    - Strongest impact observed for average RRs and other macroprudential policies (e.g., dynamic provisioning, countercyclical capital requirements).
    - Marginal RRs show negligible short-run effects in the panel VAR (the event-analysis “sharp decline” for marginal RRs mainly reflects concurrent policy rate hikes).
    - Long-run impulse responses may show opposite signs (noted), indicating dynamics vary with horizon.
    - There is mutually reinforcing behavior between policy rates and macroprudential measures: policy rates tend to increase following a tightening in macroprudential policies and macroprudential measures tend to respond to monetary policy shocks (simulations referenced assume a 25-basis-point shock on policy interest rates; impulse responses normalized so macroprudential shock equals one).
  - Practical implication: to maintain effectiveness RRs may need periodic recalibration, consistent with Lim and others (2011).

### V. Conclusions and Policy Implications
- Summary conclusions:
  - Latin American authorities (Brazil, Colombia, Peru) used RRs countercyclically: raising RRs during upswing to contain excessive credit growth and lowering them during downturns to ease liquidity pressures.
  - RRs can address credit procyclicality, help build liquidity buffers, improve funding structure (when targeted at non-deposit liabilities), and serve as a complement to monetary policy even under inflation-targeting regimes.
  - Empirical evidence points to modest, short-lived effects of RRs on aggregate private bank credit growth; average RRs and other macroprudential tools have stronger short-run impacts than marginal RRs.
  - RRs are not costless: they are difficult to calibrate, may induce disintermediation, promote regulatory arbitrage, and shift risks to less-regulated sectors.
  - There is little evidence of substitution between monetary policy and macroprudential measures—rather a reinforcing relationship.
- Recommendations and research priorities:
  - Periodic recalibration of RRs is likely necessary to preserve effectiveness.
  - Future research needed to:
    - Evaluate RRs’ impact on funding structure of banks and sectoral (market-segment) effects, not only aggregate credit.
    - Better understand interactions between monetary policy and macroprudential policies in general equilibrium settings.
    - Construct more detailed, tax-equivalent measures of RRs to guide design and calibration and to identify potential nonlinear effects arising from levels and changes in RRs and other instruments.
- Cautions:
  - Modest aggregate effects on credit do not imply ineffectiveness—RRs may reduce systemic risk by slowing credit in specific market segments with limited aggregate impact.

*Source: IMF staff chapter “11. Complementary Role of Macroprudential Policies and Reserve Requirements” (content unit _wp12142).*

### REFERENCES

### REFERENCES

### Reference list
- Agénor, P.-R.; K. Alper and L. Pereira da Silva, 2012, “Sudden Floods, Macroprudention Regulation and Stability in an Open Economy,” Working Paper 267, Banco Central do Brazil.  
- Betancourt, Yanneth and Hernando Vargas, 2008, “Encajes Bancarios y la Estrategia de Inflación Objetivo,” Borradores de Economía, No. 533. Banco de la República. Bogotá-Colombia.  
- Bustamante, Christina, 2011, “Politica Monetaria Contraciclica y Encaje Bancario,” Borradores de Economía, No. 646. Banco de la República. Bogotá-Colombia.  
- Carvalho, Fabia and Cynthia Azevedo, 2008, “The Incidence of Reserve Requirements in Brazil: Do stockholders Share the Burden?” Working Paper 160, Banco Central do Brazil.  
- Chan-Lau, J.A. (2012), “Do Dynamic Provisions Enhance Bank Solvency and Reduce Credit Procyclicality? A Study of the Chilean Banking System,” IMF Working Paper (forthcoming).  
- Drehmann, M., C. Borio, L. Gambacorta, G. Jiménez and C. Trucharte, 2010, “Countercyclical Capital Buffers: Exploring Options," BIS Working Paper No. 317.  
- Edwards, Sebastian and Carlos Vegh, 1997, “Banks and Macroeconomic Disturbances Under Predetermined Exchange Rates,” Journal of Monetary Economics, Vol. 40, pp. 239–278.  
- Evandro, Paulo and Tony Takeda, 2011, “Recolhimentos Compulsorios e o Crédito Bancário Brasileiro,” Discussion Paper 250, Banco Central do Brazil.  
- Eyzaguirre, Nicolas, Martin Kaufman, Steven Phillips and Rodrigo Valdes, 2011, “Managing Abundance to Avoid a Bust in Latin America,” IMF Staff Discussion Note, 11/07 (Washington: International Monetary Fund).  
- Feinman, Joshua, 1993, “Reserve Requirements: History, Current Practice, and Potential Reform,” Federal Reserve Bulletin, Board of Governors of the Federal Reserve System. June. Washington D.C.  
- Gelos, Gaston, 2009, “Banking Spreads in Latin America,” Economic Enquiry, Vol. 47, No. 4, October.  
- Glocker, Christian and Pascal Towbin, 2012, "Reserve Requirements for Price and Financial Stability: When Are They Effective?," International Journal of Central Banking, International Journal of Central Banking, Vol. 8, No. 1, pp. 65–114.  
- Glocker, Christian and Pascal Towbin, 2012b, "The macroeconomic effects of reserve requirements," WIFO Working Paper No. 420.  
- Goodfriend, Marvin and Monica Hargraves, 1983, “A Historical Assessment of the Rationale and Functions of Reserve Requirements,” Economic Review, Federal Reserve Bank of Richmond, March/April.  
- Gray, Simon, 2011, “Central Bank Balances and Reserve Requirements,” IMF Working Paper 11/36 (Washington: International Monetary Fund).  
- Holtz-Eakin, Douglas, Whitney Newey, and Harvey S. Rosen, 1988, “Estimating Vector Autoregressions with Panel Data,” Econometrica, Vol. 56, No. 6, pp. 1371–95.  
- International Monetary Fund, 2011, Recent Experiences in Managing Capital Inflows—Cross-cutting Themes and Possible Policy Framework, (Washington), available at: http://www.imf.org/external/np/pp/eng/2011/021411a.pdf  
- ___________, 2010, Regional Economic Outlook: Western Hemisphere − Heating up in the south, cooler in the north, (Washington, October).  
- ___________, 2010b, “Macroprudential Tools in Latin America: A Primer,” Chapter 4, Regional Economic Outlook: Western Hemisphere, Heating Up in the South , Cooler in the North, October (Washington: International Monetary Fund).  
- ___________, 2011b, “Key Risks and Challenges for Sustaining Financial Stability,” Global Financial Stability report, (Washington, April)  
- ___________, 2011c, Regional Economic Outlook: Western Hemisphere—Wachting out for overheating, (Washington, April)  
- ___________, 2011d, “Macroprudential Policy—an Organizing Framework,” paper prepared by the Monetary and Capital Markets Department (Washington). Available via internet at http://www.imf.org/external/np/pp/eng/2011/031411.pdf  
- Jara, Alejandro, Ramón Moreno, and Camilo E. Tovar, 2009, “The Global Crisis and Latin America: Financial Impact and Policy Response,” BIS Quarterly Review, June, pp. 53–68.  
- León, Davin and Zenon Quispe, 2010, “El Encaje como Instrumento No Convencional de Política Monetaria,” Revista Moneda 143, Banco Central de Reserva del Perú.  
- Lim, C, F Columba, A Costa, P Kongsamut, A Otani, M Saiyid, T Wezel, and X Wu (2011), “Macroprudential Policy: What Instruments and How to Use Them? Lessons from Country Experiences,” IMF Working Paper 11/238 (Washington: International Monetary Fund).  
- McKinnon, Ronald, 1973, Money and capital in economic development, The Brookings Institution, Washington, DC.  
- Montoro, Carlos and Ramón Moreno, 2011, “The Use of Reserve Requirements as a Policy Instrument in Latin America,” BIS Quarterly Review, March.  
- Ostry, Jonathan D, Atish R. Ghosh, Karl Habermeier, Luc Laeven, Marcos Chamon, Mahvash S. Qureshi, and Annamaria Kokenyne; “Managing Capital Inflows: What Tools to Use?,” IMF Staff Discussion Note 11/06 (2011), available at: http://www.imf.org/external/pubs/ft/sdn/2011/sdn1106.pdf  
- Palley, Thomas,2004, “Asset-based Reserve Requirements: Reassessing Domestic Monetary Ccontrol in an Era of Financial Innovation and Stability,” Review of Political Economy, Vol. 16, No. 1, January.  
- Peydró-Alcalde, J.-L., G. Jiménez, S. Ongena and J. Saurina (2011), “Macroprudential Policy, Countercyclical Bank Capital Buffers and Credit Supply: Evidence from the Spanish Dynamic Provisioning Experiments,” Working Paper CEPR/Banca d’Italia  
- Reinhart, Vincent and Carmen Reinhart, 1999, “On the Use of Reserve Requirements in Dealing with Capital Flow Problems,” International Journal of Finance and Economics, No. 4.  
- Robitaille, Patrice, 2011, “Liquidity and Reserve Requirements in Brazil,” International Finance Discussion Papers, No. 1021, June.  
- Terrier, Gilbert, Rodrigo Valdes, Camilo Tovar, Jorge Chan-Lau, Carlos Fernández-Valdovinos, Mercedes García-Escribano, Carlos Medeiros, Man-Keung Tang, Mercedes Vera Martin, and Chris Walker, 2011, “Policy Instruments to Lean Against the Wind in Latin America,” IMF Working Paper 159, July. Available at: http://www.imf.org/external/pubs/ft/wp/2011/wp11159.pdf  
- Vargas, Hernando, Carlos Varela, Yanneth Betancourt and Norberto Rodriguez, 2010, “Effects of Reserve Requirements in an Inflation Targeting Regime: the Case of Colombia,” Borradores de Economía, No. 587. Banco de la República (Colombia).  
- Walsh, Carl, 2012, “Discussion of Reserve Requirements for Price and Financial Stability: When are they Effective?," International Journal of Central Banking, International Journal of Central Banking, Vol. 8, No. 1, pp. 65–114.

*Source: _wp12142 - REFERENCES*

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