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Contribution Details

Type Journal Article
Scope Discipline-based scholarship
Title Bank capital buffer releases, public guarantee programs, and dividend bans in Covid-19 Europe: An appraisal
Organization Unit
  • Alexandra Matyunina
  • Steven Ongena
Item Subtype Original Work
Refereed Yes
Status Published in final form
  • English
Journal Title European Journal of Law and Economics
Publisher Springer
Geographical Reach international
ISSN 0929-1261
Volume 54
Page Range 127 - 152
Date 2022
Abstract Text We analyse the recent policy decisions made by the European Central Bank and the national authorities related to capital and shareholders’ remuneration aimed at promoting banking credit supply in COVID-19-afflicted economies. We forecast the impact of the regulatory decisions based on the empirical literature and discuss the factors that reduce the banks’ incentives to expand their loan portfolios. We argue that the introduction of the dividend ban caused a surge in regulatory uncertainty and undermined banks’ market valuation raising the expected funding costs and contributing to the banks’ reluctance to make use of the capital buffers. We develop policy suggestions intended to mitigate this effect.
Free access at DOI
Digital Object Identifier 10.1007/s10657-022-09734-9
Other Identification Number merlin-id:22359
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