Does the ECB act as a lender of last resort during the subprime lending crisis?: Evidence from monetary policy reaction models

Family Financial Stress, Parenting and Problem Behavior in Adolescents

“…The value of their stocks plummeted and infected the stock prices of other Belgian banks and companies. By the end of September 2008, both banks had been bailed out by the Belgian government (Eichler & Hielscher, 2012). Shortly after the relatively costly and unpopular bank rescues, the Belgian government had to address the economy.…”

Is bank resilience affected by unconventional monetary policy in the Euro area?

“…Boeckx et al (2017) suggests that, as a result of low capitalization, the banks most affected by the financial crisis would have not received the intended impact of the ECB UMPs, or would have seen a rather anemic impact. Eichler and Hielscher (2012) find that the ECB acted as a lender of last resort during the subprime crisis for the GIIPS countries (Greece, Ireland, Italy, Portugal, and Spain). Afterwards, the ECB has increased lending and lowered interest rates in response to a rise in the vulnerability of these countries.…”

“…In the next stage of analysis, we investigate whether the main results summarised in the previous section hold for different country sub-samples. As argued by Eichler and Hielscher (2012), the ECB implements monetary policy for the euro area as a whole, thus it could be hard to achieve the same impact across every Member State at all times. Even though we do include country fixed-effects in the previous estimations, those only control for level effects across countries.…”

“…14 The second sub-group corresponds to all countries in the euro area that are not in this so-defined periphery. Member States in the periphery of the euro-area were widely regarded as the most vulnerable countries and were the most affected by the 2011 sovereign debt crisis (Eichler and Hielscher, 2012). In this stage, Greece is excluded from both sub-samples as its liabilities were not eligible for any of the several QE programmes launched by the ECB during our sample period.…”