G2 - Financial Institutions and Services

• Imperfect Banking Competition and Macroeconomic Volatility: A DSGE Framework

  Staff Working Paper 2021-12 Jiaqi Li

  How do banks adjust their loan rate markup in response to macroeconomic shocks?

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Financial institutions, Interest rates JEL Code(s): E, E3, E32, E4, E44, G, G2, G21, L, L1, L13

• COVID-19 Crisis: Lessons Learned for Future Policy Research

  Staff Discussion Paper 2021-2 Jean-Sébastien Fontaine, Corey Garriott, Jesse Johal, Jessica Lee, Andreas Uthemann

  One year later, we review the events that took place in Canadian fixed-income markets at the beginning of the COVID-19 crisis and propose potential policy research questions for future work.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Coronavirus disease (COVID-19), Financial markets, Monetary policy JEL Code(s): D, D4, D47, E, E4, E41, E5, G, G0, G01, G1, G14, G2, G20, G21, G23

• Market Concentration and Uniform Pricing: Evidence from Bank Mergers

  Staff Working Paper 2021-9 João Granja, Nuno Paixão

  We show that US banks price deposits almost uniformly across their branches and that this pricing practice is more important than increases in local market concentration in explaining the deposit rate dynamics following bank mergers.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial institutions, Financial system regulation and policies, Market structure and pricing JEL Code(s): D, D4, G, G2, G20, G21, G28, G3, G34, L, L1, L11

• Distributional Effects of Payment Card Pricing and Merchant Cost Pass-through in Canada and the United States

  Staff Working Paper 2021-8 Marie-Hélène Felt, Fumiko Hayashi, Joanna Stavins, Angelika Welte

  Although credit cards are more expensive for merchants to accept than cash or debit cards, merchants typically pass through their costs evenly to all customers. Along with consumer card rewards and banking fees, this creates cross-subsidies between payment methods. Because higher-income individuals tend to use credit cards more than those with lower incomes, our results indicate that these cross-subsidies might lead to regressive distributional effects.

  Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Financial institutions, Financial services, Market structure and pricing, Payment clearing and settlement systems JEL Code(s): D, D1, D12, D2, D23, D3, D31, E, E4, E42, G, G2, G21, L, L8, L81