How do bank-specific characteristics affect lending? New evidence based on credit registry data from Latin America

Abstract

This paper investigates how bank-specific characteristics have affected credit growth in five Latin American countries (Brazil, Chile, Colombia, Mexico and Peru). We use detailed credit registry data and apply a common empirical strategy to analyse the pre- and post-crisis periods. We find that large and well-capitalised banks with low risk indicators, stable sources of funding and a commercial business model generally supply more credit. Such banks are also more sheltered from monetary and global shocks, with the role of specific characteristics varying by the type of shock.