Kirsten Schmidt

Kirsten Schmidt
Current Position

since 1/16

Economist in the Department of Financial Markets

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

Research Interests

  • banking regulation
  • monetary policy
  • financial stability

Kirsten Schmidt joined the Department of Financial Markets as a doctoral student in January 2016. Her research focuses on banking regulation, monetary policy, and financial stability.

Kirsten Schmidt received her bachelor's and master's degree from University of Tübingen. She also spent a semester at the University of Michigan, Ann Arbor.

Your contact

Kirsten Schmidt
Kirsten Schmidt
Mitglied - Department Financial Markets
Send Message +49 345 7753-723

Publications

Working Papers

cover_DP_2018-16.jpg

Interactions Between Regulatory and Corporate Taxes: How Is Bank Leverage Affected?

F. Bremus Kirsten Schmidt Lena Tonzer

in: IWH Discussion Papers, No. 16, 2018

Abstract

Regulatory bank levies set incentives for banks to reduce leverage. At the same time, corporate income taxation makes funding through debt more attractive. In this paper, we explore how regulatory levies affect bank capital structure, depending on corporate income taxation. Based on bank balance sheet data from 2006 to 2014 for a panel of EU-banks, our analysis yields three main results: The introduction of bank levies leads to lower leverage as liabilities become more expensive. This effect is weaker the more elevated corporate income taxes are. In countries charging very high corporate income taxes, the incentives of bank levies to reduce leverage turn ineffective. Thus, bank levies can counteract the debt bias of taxation only partially.

read publication

cover_DP_2017-12.jpg

Do Conventional Monetary Policy Instruments Matter in Unconventional Times?

Manuel Buchholz Kirsten Schmidt Lena Tonzer

in: IWH Discussion Papers, No. 12, 2017

Abstract

This paper investigates how declines in the deposit facility rate set by the European Central Bank (ECB) affect bank behavior. The ECB aims to reduce banks’ incentives to hold reserves at the central bank and thus to encourage loan supply. However, given depressed margins in a low interest environment, banks might reallocate their liquidity toward more profitable liquid assets other than traditional loans. Our analysis is based on a sample of euro area banks for the period from 2009 to 2014. Three key findings arise. First, banks reduce their reserve holdings following declines in the deposit facility rate. Second, this effect is heterogeneous across banks depending on their business model. Banks with a more interest-sensitive business model are more responsive to changes in the deposit facility rate. Third, there is evidence of a reallocation of liquidity toward loans but not toward other liquid assets. This result is most pronounced for non-GIIPS countries of the euro area.

read publication
Mitglied der Leibniz-Gemeinschaft LogoTotal-Equality-LogoWeltoffen Logo