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Title: Banks’ risk taking behavior and the optimization monetary policy
Authors: Triandhari, Risna
Safuan, Sugiharso
Syamsudin, M.
Alamsyah, Halim
Keywords: Global Financial Crisis, 2008-2009
Risk management
Financial risk management
Financial security
Monetary policy
Banks and banking
Banks and banking -- Law and legislation
Issue Date: 2017
Publisher: University of Piraeus. International Strategic Management Association
Citation: Triandhari, R., Safuan, S., Syamsudin, M., & Alamsyah, H. (2017). Banks’ risk taking behavior and the optimization monetary policy. European Research Studies Journal, 20(4B), 754-769.
Abstract: This study analyzes the behavior of risk taking on economic agents such as banks, households, and firms as a repond of monetary policy and macroprudential choices in Indonesia. The behavior of economic agents modeled in a DSGE models. In the model, the credit risk is modeled endogenously. Credit risk is a function of household and firm leverage ratio, bank leverage ratio, property market and general economy condition. Moreover, there are two types of bank in assessing the risks of credit. The results show that, endogenous credit risk, has an impact on the deepen procyclicality in credit. Furthermore, this research model contributes to a deeper understanding of the prudential policy framework. In the event of risk taking, analysis optimal policy responses using the loss function of central banks. The policy of lower interest rates should be combined with a loan to value ratio policy and increase CAR to generate the smallest losses
ISSN: 11082976
Appears in Collections:European Research Studies Journal, Volume 20, Issue 4, Part B

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