Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/142212
Authors: 
Gropp, Reint E.
Saadi, Vahid
Year of Publication: 
2015
Series/Report no.: 
IWH Online 11/2015
Abstract: 
In this note we document political lending cycles for German savings banks. We find that savings banks on average increase supply of commercial loans by €7.6 million in the year of a local election in their respective county or municipality (Kommunalwahl). For all savings banks combined this amounts to €3.4 billion (0.4% of total credit supply in Germany in a complete electoral cycle) more credit in election years. Credit growth at savings banks increases by 0.7 percentage points, which corresponds to a 40% increase relative to non-election years. Consistent with this result, we also find that the performance of the savings banks follows the same electoral cycle. The loans that the savings banks generate during election years perform worse in the first three years of maturity and loan losses tend to be realized in the middle of the election cycle.
Subjects: 
German savings banks
municipality
Persistent Identifier of the first edition: 
Document Type: 
Research Paper

Files in This Item:
File
Size
694.22 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.