WORKING PAPERS
Albuquerque, B., Cerutti, E., Chen, N. and Firat, M. (2025), IMF Working Paper WP/25/96, Washington, D.C, International Monetary Fund. R&R at the American Economic Journal: Macroeconomics.
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The growing role of nonbanks in corporate credit intermediation raises important yet underexplored questions about the transmission of monetary policy (MP) and macroprudential policy (MaPP) to the real economy. Using syndicated loan data, we examine the impact of both MP and MaPP shocks on credit supply to nonfinancial firms. We show that nonbanks act as shock absorbers, cushioning firms—particularly those with preexisting nonbank relationships—from policy tightening. These shocks drive credit away from weaker banks toward nonbanks, raising concerns about credit quality. We also provide evidence that MaPPs on banks can lead them, especially weaker ones, to shift lending to nonbanks and away from nonfinancial corporations. This allows nonbanks to expand their footprint in corporate credit markets. Our findings highlight that the side effects of tighter MP and MaPP are non-trivial as credit intermediation migrates to a sector largely outside the regulatory perimeter, posing new financial stability risks.
Albuquerque, B., Cerutti, E., Firat, M. and Kagerer, B. (2026), IMF Working Paper WP/26/23, Washington, D.C, International Monetary Fund.
We study how banking groups adjust corporate credit supply in response to tighter macroprudential policies. Using granular data on syndicated corporate loans, we show that banking groups reallocate lending from bank subsidiaries toward affiliated nonbank financial institutions (NBFIs) following regulatory tightening. Relative to bank subsidiaries within the same group, NBFI subsidiaries expand lending, and their credit supply also increases in absolute terms. We estimate that by `banking on' their nonbanks, banking groups offset, on average, more than half of the contraction in bank lending induced by macroprudential tightening. Our findings highlight an important intra-group reallocation channel through which banking groups can partially offset regulatory constraints and result in greater bank–nonbank interconnectedness.
WORK IN PROGRESS
Bonding through crisis: the role of nonbanks