Gross Loan Flows


  • The authors wish to thank Guillaume Rocheteau, Randy Wright, Joseph Ritter, John Duca, and seminar participants at the Federal Reserve Bank of Cleveland, University of California at Irvine, the Summer Workshop on Money, Banking and Payments, and the 2006 Summer Meetings of the Econometric Society for helpful comments. Bethany Tinlin and Patrick Higgins provided excellent research assistance. The views expressed here do not represent the views of the Federal Reserve Bank of Cleveland, or the Board of Governors of the Federal Reserve System.


Changes in net lending hide the much larger and more variable gross lending flows. We present a series of stylized facts about gross loan flows and how they vary over time, bank size, and the business cycle. We look at both the intensive (increases and decreases) and extensive (entry and exits) margins. In contrast to the standard result with net lending, gross lending quantities respond to monetary policy.