March 2023 issue contents
Bank Lending and the European Debt Crisis: Evidence from a New Survey

Andrea Orame, Bank of Italy


I study the supply of credit in Italy in the years 2009–14, covering the European sovereign debt crisis period. By using a new survey, I find that 40 percent of the decline in business lending originates from the tightening of bank credit standards, with a significant change in 2011 and a seemingly greater role for supply in the South of the country. The unique regional breakdown and the wider cross-section of the new survey also improve our understanding of the variation in the data and reveal substantial differences between banks.

JEL Code: E32, E51, G01, G21, G28, G32