The Banking Spread and the Resource Cost of Capital

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Banco de la Republica de Colombia, Borradores de Economia, No: 092

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Gómez-Pineda, Javier Guillermo
Banco de la República
E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit; E43 - Interest Rates: Determination, Term Structure, and Effects; G21 - Banks; Depository Institutions; Micro Finance Institutions; Mortgages; F30 - International Finance: General; O4 - Economic Growth and Aggregate Productivity; F34 - International Lending and Debt Problems; Banking; Cost; Capital; Industria bancaria; Tasas de interés; Costos de capital; F30 - Finanzas internacionales: Generalidades; F34 - Préstamos internacionales y problemas relacionados con la deuda externa; E43 - Tipos de interés: determinación, estructura temporal y efectos; O4 - Crecimiento económico y productividad agregada; E5 - Política monetaria, bancos centrales, oferta de dinero y crédito; G21 - Bancos; Instituciones de depósito; Instituciones Microfinancieras; Hipotecas; Bank spread,; Bank spread, banking firm, banking output, interest rates.
paper description
The paper provides a model of the banking firm in the macroeconomy intended to explain what determines the interest rate spread. A key factor explaining the spread in our model is the resource cost of capital. A statistical result confirms the prediction