Macroprudential policy and intra-group dynamics: The effects of reserve requirements in Brazil

Chris Becker, Matias Ossandon Busch, Lena Tonzer*

*Corresponding author for this work

Research output: Contribution to JournalArticleAcademicpeer-review


We examine whether liquidity dynamics within banking groups matter for the transmission of macroprudential policy. Using matched bank headquarters-branch data for identification, we find a lending channel of reserve requirements for municipal branches whose headquarters are more exposed to the policy tool. The result is driven by the 2008–2009 crisis and is stronger for state-owned branches, especially when being less profitable and liquidity constrained. These findings suggest the presence of cross-regional distributional effects of macroprudential policies operating via internal capital markets.

Original languageEnglish
Article number102096
Pages (from-to)1-23
Number of pages23
JournalJournal of Corporate Finance
Early online date20 Sept 2021
Publication statusPublished - Dec 2021

Bibliographical note

Funding Information:
We would like to thank two anonymous referees, Ren?e Adams, S?hnke M. Bartram, Thorsten Beck, Manuel Buchholz, Vittoria Cerasi, Gamze Danisman, Martin G?tz, Iftekhar Hasan, Mathias Hofmann, Michael Koetter, Elena Mazza, Felix Noth, Martin Oehmke, Steven Ongena, Orkun Saka, Sascha Steffen, Iryna Stewen, and Radomir Todorov for helpful comments and suggestions. Furthermore, we thank conference and seminar participants at VU Amsterdam, Maastricht University, the Joint Research Centre of the European Commission in Ispra, the CESifo Workshop on Banking and Institutions, DIW Berlin, the annual meeting of the European Economic Association in Lisbon, the 2017 FINEST conference in Trani, the 2017 MBF conference in Palermo, the Central Bank of Ireland Workshop on ?Banking, Credit and Macroprudential Policy?, the Halle Institute for Economic Research, the TU Bergakademie Freiberg, the Friedrich-Schiller-University Jena, and the 6th Financial Economics Workshop in Bonn.

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© 2021 Elsevier B.V.

Copyright 2021 Elsevier B.V., All rights reserved.


  • Financial intermediation
  • Intra-group dynamics
  • Macroprudential regulation

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