No. 97. BASEL II AND THE MONEY SUPPLY PROCESS: SOME EMPIRICAL EVIDENCE FROM THE GREEK BANKING SYSTEM (1995-2006)

Published in DISCUSSION PAPERS

Y. Panagopoulos. 2007.

 

The main purpose of this paper is to examine the Basel II influence on the debate concerning the money endogeneity process in the Greek banking system. The emergence of the importance of equity, through Basel II directives, is initially discussed by creating and applying a “new credit (equity) multiplier”. Then a new multivariate loan model, which contains banks’ equity and interbank debt as explanatory variables, is briefly presented and next tested. From the econometric part of this paper, it is obvious that although the equity multiplier is not operative, the loan model favours a new type of Structuralism regarding the Greek monetary system and its money supply process.

 

(pdf)