Arbeitspapier

Competition for internal funds within multinational banks: Foreign affiliate lending in the crisis

We investigate how the lending activities of a multinational bank's affiliates located abroad are affected by funding difficulties in view of the financial crisis. For this, we consider transaction-induced changes in long-term lending to the private sector of 40 countries by the affiliates of the 68 largest German banks. We find that affiliates' local deposits and profitability have been stabilizing loan supply. By contrast, relying on short-term wholesale funding has increasingly proven to be a disadvantage in the crisis, as inter-bank and capital markets froze. Besides, the more an affiliate abroad takes recourse to intra-bank funding in the crisis, the more it becomes dependent on a stable deposit and long-term wholesale funding position of its parent bank. We furthermore detect competition for intra-bank funding across the affiliates abroad as well as an increasing focus on the parent bank's home market activities.

ISBN
978-3-86558-832-6
Sprache
Englisch

Erschienen in
Series: Bundesbank Discussion Paper ; No. 19/2012

Klassifikation
Wirtschaft
Banks; Depository Institutions; Micro Finance Institutions; Mortgages
Multinational Firms; International Business
International Lending and Debt Problems
Financial Markets and the Macroeconomy
Thema
funding structure
multinational banks
internal capital market
intra-bank lending
wholesale funding
financial crisis

Ereignis
Geistige Schöpfung
(wer)
Düwel, Cornelia
Frey, Rainer
Ereignis
Veröffentlichung
(wer)
Deutsche Bundesbank
(wo)
Frankfurt a. M.
(wann)
2012

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Düwel, Cornelia
  • Frey, Rainer
  • Deutsche Bundesbank

Entstanden

  • 2012

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