01831cas a2200277 a 4500 AALejournalIMF006502 230101c9999 xx r poo 0 0eng d 5.00 USD 9781455201143 1018-5941 BD-DhAAL BD-DhAAL Hakura, Dalia. U.S. Bank Behavior in the Wake of the 2007-2009 Financial Crisis / Dalia Hakura, Ralph Chami, Thomas Cosimano, Adolfo Barajas. Washington, D.C. : International Monetary Fund, 2010. 1 online resource (30 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The paper examines the slowdown of lending by large U.S. banks over the period 2007Q3 - 2009Q2, focusing on: (i) whether capital or liquidity was the binding constraint; (ii) factors influencing banks' decision to hold capital; and (iii) their pricing behavior. Using quarterly data for the largest U.S. banks, the paper finds that capital, rather than liquidity, constrained lending. Banks took actions to increase capital by slowing lending and raising profit margins, not fully passing through the Federal Reserve's interest rate cuts. Banks optimally choose capital based on the expected future demand for loans and the marginal cost of capital. Mode of access: Internet Barajas, Adolfo. Chami, Ralph. Cosimano, Thomas. IMF Working Papers; Working Paper ; No. 2010/131 Full text available on IMF http://elibrary.imf.org/view/journals/001/2010/131/001.2010.issue-131-en.xml IMF e-Library