DOES INTERNATIONAL MONETARY POLICY INFLUENCE THE BANK RISK? EVIDENCE FROM INDIA

Authors

Ameen Omar Shareef, Indian Institute of Technology Hyderabad, IndiaFollow
K.P. Prabheesh, Indian Institute of Technology Hyderabad, India

Document Type

Article

Abstract

This study empirically examines the impact of international monetary policy on bank risk in the Indian context. Using annual data from 64 banks and employing panel OLS and GMM techniques, this study finds that: (1) a contractionary international monetary policy increases bank risk; (2) an appreciation of the domestic exchange rate induces bank riskiness; (3) the domestic monetary policy affects bank risk through the “search for yield” channel; and (4) the international monetary policy is relatively significant in explaining the bank riskiness in the post-global financial crisis period.

Recommended Citation

Shareef, Ameen Omar and Prabheesh, K.P. (2022) "DOES INTERNATIONAL MONETARY POLICY INFLUENCE THE BANK RISK? EVIDENCE FROM INDIA," Bulletin of Monetary Economics and Banking: Vol. 25: No. 2, Article 1.
DOI: https://doi.org/10.21098/bemp.v25i2.1867
Available at: https://bulletin.bmeb-bi.org/bmeb/vol25/iss2/1

First Page

135

Last Page

154

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License

Country

India

Affiliation

Indian Institute of Technology Hyderabad