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Board of Governors of the Federal Reserve System (US)
Finance and Economics Discussion Series
The Non-Bank Credit Cycle
We investigate the cyclical properties of non-bank credit and its relevance for financial stability. We construct a measure of non-bank credit for a large sample of countries and find that its cyclical properties differ from those of bank credit. Non-bank credit cycles are highly correlated with bank credit cycles in some countries but not in others. Moreover, non-bank credit cycles are less synchronised than bank credit cycles across countries. Finally, non-bank credit cycles could act as a leading indicator for currency, but not for systemic banking, crises. The opposite is true for bank credit cycles. These findings highlight the value added of monitoring non-bank credit.
Cite this item
Esti Kemp & Rene van Stralen & Alexandros Vardoulakis & Peter J. Wierts, The Non-Bank Credit Cycle, Board of Governors of the Federal Reserve System (US), Finance and Economics Discussion Series 2018-076, 14 Nov 2018.
- G01 - Financial Economics - - General - - - Financial Crises
- G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
- F34 - International Economics - - International Finance - - - International Lending and Debt Problems
Keywords: Credit cycle ; Financial crisis ; Leading indicator ; Non-bank credit
This item with handle RePEc:fip:fedgfe:2018-76
is also listed on EconPapers
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