Bank capital requirements and lending in emerging markets: The role of bank characteristics and economic conditions

Impact of ESG practices on European Bank Lending for Sustainability: The Role of Culture and Institutions

“…This indicates that the banks with a more liquid portfolio and better asset quality are more likely to expand their supply of loans. This outcome is consistent with theory and empirical data from the literature that suggests that greater liquidity and better asset quality create a greater capacity for banks to provide credit to the private sector ( Furthermore, the negative link between capitalization and bank lending indicates that banks might decrease their assets to meet capital levels, which reduces bank credit availability (Fang et al, 2022). The credit portfolio's riskiness adversely impacts the banks' capacity to enhance credit growth.…”

Does Regulation Only Bite the Less Profitable? Evidence from the Too-Big-to-Fail Reforms

“…Complementing this line of research, our paper shows that even after controlling for capitalisation levels, pre-treatment profitability proves to be a key driver of banks' responses to the G-SIB framework. 2 Our finding relates to that of Cohen and Scatigna (2016), who report that the more profitable banks expanded lending by more amid rising regulatory requirements after the 2007-08 crisis, and to Fang et al (2020), who document that weak banks react more to changes in capital requirements.…”

ESG activity and bank lending during financial crises

“…Higher capitalization is negatively associated with bank lending. Specifically, banks might shrink their assets to meet higher capital levels, which would decrease the availability of bank lending (Hanson et al, 2011;Fang et al, 2020). We find that larger banks tend to have lower loan growth.…”