Liquidity Management and the Banking Lending Mechanism

Abstract

The paper approaches the liquidity aspects from a banking perspective, the relationship between liquidity and banking lending, within the post crisis dynamic economic environment. After the introduction, we present in the first part, the main aspects related to the liquidity management, at the bank’s activity level. The second part reflects the changing regulatory framework and the various effects for the banking system. We refer mainly to the European regulations that shape the banking system, including also the Romanian perspectives. The third part of the paper emphasizes a macroeconomic view on liquidity and banking lending mechanism. The last part represents our concluding remarks.

Keywords

• regulations
• liquidity
• credit
• credit risk
• liquidity risk management
• banking system