The Study on the Effect of Housing Price Change on Lending Strategy Behavior : Evidence from Crowding-Out Behavior in Korean Banks

Seo, Jiyong

doi:10.15793/kspr.2017.92..005

Current study focused on the recent studies reporting that upward of housing price may result in reduction of corporate loan. Furthermore, as the research motivation, current study needed to examine on shrinking lending behavior shown in the Korean banks because economic condition in domestic market is depressed even though low interest rate and upward housing price are been showing over recent years. Considering recent studies, Chakraborty, Goldstein and MacKinlay(2016) and Tai(2016), this study examined whether the so-called crowding-out behavior exists in the Korean banks. As the research theme, this study analyzed the relationship between the change of loan portfolio and that of housing price in Korea by using Arellano-Bond dynamic panel data model. Main findings from the empirical test are as follows. First, upward of housing prices in nation and Seoul lead to decreasing SME(small and medium sized enterprise) loan weight within loan portfolio of Korean banks. Second, macro-economic and financial market factors related with making Korean banks cut SME loan are low interest rate and low market liquidity. Third, it is confirmed that bank characteristics affecting SME loan’s reduction are mostly high risk level and low profitability. As a conclusion, it needs to be recognized that smoothing SME financing may be constrained under the stance of low interest rate with rising housing price.

Citation status

KCI Citation Counts (3)
열림/닫힘 버튼
REFERENCES (26)
열림/닫힘 버튼
* 2021년 이후 발행 논문의 참고문헌은 현재 구축 중입니다.

[journal] 고광수 / 2009 / The Effects of Financing and Profit Structure on Bank Profitability / Journal of The Korean Data Analysis Society / 한국자료분석학회 11(3) : 1567~1579

[journal] 이건희 / 2013 / A Study on the Determinants of Loan Portfolio in Korean Banks / Journal of The Korean Data Analysis Society / 한국자료분석학회 15(4) : 2189~2202

[journal] Altunbas, Y. / 2012 / Do bank characteristics influence the effect of monetary policy on bank risk? / Economics Letters 117(1) : 220~222

[journal] Ayuso, J. / 2004 / Are capital buffers pro-cyclical? Evidence from Spanish panel data / Journal of Financial Intermediation 13(2) : 249~264

[journal] Arellano, M. / 1991 / Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations / Review of Economic Studies 58(2) : 277~297

[journal] Biase, P. / 2012 / The determinants of systematic risk in the Italian banking system: A cross-sectional time series analysis / International Journal of Economics and Finance 4(11) : 152~164

[web] Chakraborty, I. / 2016 / Housing price booms and crowding-out effects in bank lending / https://ssrn.com/abstract=2246214

[journal] Chaney, T. / 2012 / The collateral channel: How real estate shocks affect corporate investment / The American Economic Review 102(6) : 2381~2409

[journal] Delis, M. D. / 2011 / Interest rates and bank risk-taking / Journal of Banking and Finance 35(4) : 840~855

[journal] Dell'Ariccia, G. / 2006 / Lending booms and lending standards / The Journal of Finance 61(5) : 2511~2546

[journal] Den, H. W. / 2007 / Bank loan portfolios and the monetary transmission mechanism / Journal of Monetary Economics 54(3) : 904~924

[journal] Gan, J. / 2007 / The real effects of asset market bubbles:Loan-and firm-level evidence of a lending channel / The Review of Financial Studies 20(6) : 1941~1973

[journal] Garcia-Marco, T. / 2008 / Risktaking behaviour and ownership in the banking industry:The Spanish evidence / Journal of Economics and Business 60(4) : 332~354

[journal] Ghosh, A. / 2016 / Do real estate loans reflect regional banking and economic conditions? / Journal of Financial Economic Policy 8(1) : 37~63

[journal] Gupta, E. / 2008 / Oil vulnerability index of oil-importing countries / Energy Policy 36(3) : 1195~1211

[journal] Huang, H. / 2016 / From housing bust to credit crunch: Evidence from small business loans / Canadian Journal of Economics 48(3) : 853~880

[journal] Kapinos, P. / 2016 / (Un)expected housing price changes: Identifying the drivers of small business finance / Journal of Economics and Business 84 : 79~94

[journal] Lorenzoni, G. / 2008 / Inefficient credit booms / The Review of Economic Studies 75(3) : 809~833

[journal] Loutskina, E. / 2015 / Financial integration, housing, and economic volatility / Journal of Financial Economics 115(1) : 25~41

[journal] Minetti, R. / 2007 / Bank capital, firm liquidity, and project quality / Journal of Monetary Economics 54(8) : 2584~2594

[journal] Nijskens, R. / 2011 / Credit risk transfer activities and systemic risk: How banks became less risky individually but posed greater risks to the financial system at the same time / Journal of Banking and Finance 35(6) : 1391~1398

[journal] Sargan, J. D. / 1958 / The estimation of economic relationship using instrumental variables / Econometrica 26 : 393~415

[journal] Stiroh, K. J. / 2004 / Diversification in banking: Is noninterest income the answer? / Journal of Money, Credit, and Banking 36(5) : 853~882

[report] Tai, M. / 2016 / House prices and the allocation of consumer credit / Harvard University

[journal] Zhang, Z. / 2008 / Impacts of capital adequacy regulation on risk-taking behaviors of banking / System Engineering-Theory and Practice 28(8) : 183~189

[web] 금융감독원 / 금융정보통계시스템 / http://fisis.fss.or.kr

KJC Korea
Journal Central

Statistics

Tools

Sharing

Issue List

Citation status