Customer data access and fintech entry: Early evidence from open banking

Journal of Financial Economics · 2025-04-07 · 32 citations

The Secular Decline of Bank Balance Sheet Lending

SSRN Electronic Journal · 2024-01-01 · 1 citations

NAR Settlement, House Prices, and Consumer Welfare

SSRN Electronic Journal · 2024-01-01

The Secular Decline of Bank Balance Sheet Lending

SSRN Electronic Journal · 2024-01-01 · 2 citations

Customer Data Access and Fintech Entry: Early Evidence From Open Banking

SSRN Electronic Journal · 2024-01-01 · 6 citations

Revolving Credit to SMEs: The Role of Business Credit Cards

SSRN Electronic Journal · 2024-01-01 · 1 citations

The Secular Decline of Bank Balance Sheet Lending

National Bureau of Economic Research · 2024-02-01 · 31 citations

The traditional model of bank-led financial intermediation, where banks issue demandable deposits to savers and make informationally sensitive loans to borrowers, has seen a dramatic decline since 1970s.Instead, private credit is increasingly intermediated through arms-length transactions, such as securitization.This paper documents these trends, explores their causes, and discusses their implications for the financial system and regulation.We document that the balance sheet share of overall private lending has declined from 60% in 1970 to 35% in 2023, while the deposit share of savings has declined from 22% to 13%.Additionally, the share of loans as a percentage of bank assets has fallen from 70%to 55%.We develop a structural model to explore whether technological improvements in securitization, shifts in saver preferences away from deposits, and changes in implicit subsidies and costs of bank activities can explain these shifts.Declines in securitization cost account for changes in aggregate lending quantities.Savers, rather than borrowers, are the main drivers of bank balance sheet size.Implicit banks' costs and subsidies explain shifting bank balance sheet composition.Together, these forces explain the fall in the overall share of informationally sensitive bank lending in credit intermediation.We conclude by examining how these shifts impact the financial sector's sensitivity to macroprudential regulation.While raising capital requirements or liquidity requirements decreases lending in both early (1960s) and recent (2020's) scenarios, the effect is less pronounced in the later period due to the reduced role of bank balance sheets in credit intermediation.The substitution of bank balance sheet loans with debt securities in response to these policies explains why we observe only a fairly modest decline in aggregate lending despite a large contraction of bank balance sheet lending.Overall, we find that the intermediation sector has undergone significant transformation, with implications for macroprudential policy and financial regulation.

NAR Settlement, House Prices, and Consumer Welfare

National Bureau of Economic Research · 2024-08-01 · 4 citations

Motivated by the recent National Association of Realtors (NAR) settlement, we examine how reduced real estate agent commissions affect home prices, housing turnover, and consumer welfare.Using a calibrated dynamic structural search model, we show that by reducing future transaction costs, lower commissions raise the value of housing as a durable asset and tend to increase house prices.While reduced fees generally improve consumer welfare, most gains accrue to current homeowners, with limited benefits for prospective buyers.Higher prices may also crowd out financially constrained households, suggesting that lower agent fees are unlikely to significantly improve housing affordability and access.Our findings underscore the importance of accounting for market dynamics, consumer heterogeneity, and general equilibrium effects.They also shed light on the redistributive implications of technological innovations-such as those leveraging AI-that reduce transaction costs.Finally, our analysis suggests that static IO-style models may be ill-suited to studying transaction costs in durable goods markets, where dynamic considerations and repeated resale are central, as this can lead to misestimated magnitudes and even incorrect signs of key effects.

Customer Data Access and Fintech Entry: Early Evidence from Open Banking

SSRN Electronic Journal · 2024-01-01 · 1 citations

Nar Settlement, House Prices, and Consumer Welfare

SSRN Electronic Journal · 2024-01-01