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Corsetti, G., Pesenti, P. and Roubini, N. (2001) Fundamental Determinants of the Asian Crisis: The Role of Financial Fragility and External Imbalances. In: Ito, T. and Krueger, A.O., Eds., Regional and Global Capital Flows: Macroeconomic Causes and Consequences, NBER-EASE 10, University of Chicago Press, Chicago, 11-46. http://dx.doi.org/10.7208/chicago/9780226387017.003.0002

has been cited by the following article:

• TITLE: Is US Bank Lending Sensitive to Exchange Rates? A Panel Data Investigation

  AUTHORS: Michael R. Jonas

  KEYWORDS: Cross-Border Banking, Exchange Rates, Monetary Policy, Bank Lending Channel

  JOURNAL NAME: Modern Economy, Vol.5 No.8, July 14, 2014

  ABSTRACT: The goal of this paper is to examine the sensitivity of US bank lending to movements in the exchange rate. Using a panel of quarterly bank-level balance sheet observations, I show that there exists significant and meaningful exchange rate sensitivity of cross-border lending activity and total domestic loans. This relationship operates through traditional net export channels, as well as mechanisms specific to banks engaged in international lending. Further, I show that exchange rate innovations represent a source of long run lending volatility equivalent to monetary policy shocks for small banks. Lastly, exchange rate movements are shown to be associated with a four-fold increase in growth of non-performing loans for small banks, providing direct evidence of transfer risk for cross-border banks.