Bank of Lithuania

Eglė Jakučionytė 

University of Amsterdam

Eglė is currently a PhD candidate at the University of Amsterdam, the Netherlands, working in the field of macrofinance. She holds an MPhil in Economics from Tinbergen Institute in Amsterdam. Her PhD project is centred on developing a DSGE framework to analyse the macro consequences of debt overhang with foreign currency debt.

During her research visit at the Bank of Lithuania, Eglė developed a coherent theoretical framework to study the bank portfolio choice in the presence of equilibrium mortgage default and personal bankruptcy protection. She shows that a decrease in the level of personal bankruptcy protection implies that lender returns on mortgages become less uncertain than returns on other assets, ceteris paribus. In that case, risk-averse banks would be incentivised to increase mortgage credit at the expense of other types of credit, including corporate loans. In contrast to the popular view that low regulations smooth credit provision and make the allocation of resources more efficient, a low level of personal bankruptcy protection can actually distort credit allocation and create output losses.

Period of visit: July–October 2016

 

 

Last update: 30-08-2017