The Impact of IFRS 9 on the Link Between Lending and the Capital Ratio in Publicly Traded Banks in Poland
The Impact of IFRS 9 on the Link Between Lending and the Capital Ratio in Publicly Traded Banks in Poland

Summary/Abstract: This paper aims to determine the role of the expected credit loss approach as defined in IFRS 9in the effects of capital ratio on loans growth in publicly traded banks in Poland. To resolve thisproblem, we apply semi-annual data of individual banks in 2012–2018. Using several estimationtechniques, we find that in the period of implementation of the expected credit loss approach, thelinks between loans growth and the capital ratio were enhanced. In particular, lending growth ismore sensitive to levels of the capital ratio. These results are important with respect to the goal ofbank financial stability and have implications for the conduct of macroprudential policy.

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