Effects of Real Exchange Rates Disequilibrium on Banking System Lending

mahboobeh taebi¹ gholam reza abbasi² roya seifi poor³

1) Master of economic sciences (the author responsible for the article)
2) Lecturer and member of the academic staff of the Faculty of Economics of the Tehran Center of unit
3) Lecturer and member of the academic staff of the Faculty of Economics of the Tehran Center of unit

Publication : 1ST International Conference on Researches in Accounting, Economics, Management & Humanities (meaconf.com/1st)
Abstract :
Recently, many countries, including Iran have experienced monetary and banking crises and exchange rate shocks manifested as bank capital erosion and a reduction in bank lending. Banks credits and lending may play great significant role in economic boom. So it is worthy to note that the behavior of bank lending to the economy is very important and positive and negative factors on bank lending rates should be considered. This paper examines the impact of deviations of real exchange rate from the equilibrium and on bank lending rates using vector regression model. The research period was from 2003 to 2013 in quarter manner. The results of the research model estimates reflects the fact that deviation of real exchange rate had a negative impact on Parsian bank lending rates.
Keywords : : Real exchange rate – deviation from equilibrium path - lending rates - GARCH -VAR