The effect of market power on bank liquidity creation by bank profitability level
| Dependent variable | Fat liquidity creation (FLC) | Non-fat liquidity creation (NFLC) |
|---|---|---|
| Lag of FLC | 0.2820*** | |
| (6.36) | ||
| Lag of NFLC | 0.2053*** | |
| (2.69) | ||
| LERNER | 0.4371** | 0.7560*** |
| (1.96) | (2.62) | |
| LERNER*D_HIGH | 0.1559** | 0.1558* |
| (2.19) | (1.73) | |
| CAP | −1.3197*** | −1.6122*** |
| (−4.00) | (−3.81) | |
| SIZE | −6.9548*** | −6.6564** |
| (−2.74) | (−2.23) | |
| NPL | 1.9913*** | 1.8154*** |
| (4.48) | (3.92) | |
| GDPGR | 0.5060 | −1.9382* |
| (0.65) | (−1.91) | |
| RATE | −0.1250 | −0.1797 |
| (−1.00) | (−1.45) | |
| Constant | 228.9966*** | 229.7151** |
| (2.85) | (2.33) | |
| Observations | 192 | 192 |
| Number of groups | 24 | 24 |
| Number of IVs | 24 | 23 |
| AR(1) (p-value) | 0.0153 | 0.0321 |
| AR(2) (p-value) | 0.2924 | 0.4185 |
| Hansen (p-value) | 0.1586 | 0.1627 |
| Dependent variable | Fat liquidity creation (FLC) | Non-fat liquidity creation (NFLC) |
|---|---|---|
| Lag of FLC | 0.2820*** | |
| (6.36) | ||
| Lag of NFLC | 0.2053*** | |
| (2.69) | ||
| LERNER | 0.4371** | 0.7560*** |
| (1.96) | (2.62) | |
| LERNER*D_HIGH | 0.1559** | 0.1558* |
| (2.19) | (1.73) | |
| CAP | −1.3197*** | −1.6122*** |
| (−4.00) | (−3.81) | |
| SIZE | −6.9548*** | −6.6564** |
| (−2.74) | (−2.23) | |
| NPL | 1.9913*** | 1.8154*** |
| (4.48) | (3.92) | |
| GDPGR | 0.5060 | −1.9382* |
| (0.65) | (−1.91) | |
| RATE | −0.1250 | −0.1797 |
| (−1.00) | (−1.45) | |
| Constant | 228.9966*** | 229.7151** |
| (2.85) | (2.33) | |
| Observations | 192 | 192 |
| Number of groups | 24 | 24 |
| Number of IVs | 24 | 23 |
| AR(1) ( | 0.0153 | 0.0321 |
| AR(2) ( | 0.2924 | 0.4185 |
| Hansen ( | 0.1586 | 0.1627 |
Note(s): significance level (***p < 1%), (**p < 5%), (*p < 10%) and ( ) is t-statistic
Source(s): Authors
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