Akademik Veri Yönetim Sistemi
ESKISEHIR OSMANGAZI UNIVERSITESI IIBF DERGISI-ESKISEHIR OSMANGAZI UNIVERSITY JOURNAL OF ECONOMICS AND ADMINISTRATIVE SCIENCES, cilt.15, sa.3, ss.1081-1094, 2020 (ESCI)
This study investigates the impacts of bank capital regulations on credit cycles. In the study, the investigation of the effects of banks' capital ratios on the loan supply of the Turkish banking sector with bank-level data and panel VAR econometric methods is important as it is the first attempt to address the issue within this framework for Turkey. The findings obtained from the analysis with data covering the period from 2002Q4 to 2019Q2 and 26 domestic and foreign-owned banks operated in Turkey show that tightening capital requirements have a significant negative effect on the loan supply of the banking sector. The results of the study imply that regulations on capital requirements may be important in planning policy practices to control banks' loan supply. Overall, it can be concluded that macro-prudential policy tools such as countercyclical capital requirements and countercyclical capital buffers may be used to smooth the credit cycle and, thus, financial cycles in Turkey.