Kristle Romero Cortés |

Research Economist


Kristle Romero Cortés, Research Economist

Kristle Cortés is a research economist in the Research Department of the Federal Reserve Bank of Cleveland. Her research interests include empirical corporate finance, entrepreneurial finance, and the structure, optimization, and regulatory practices of the financial services industry.

Kristle has a PhD in finance from Boston College and a BA in economics and philosophy from Northwestern University.

  • Fed Publications
  • Other Publications
Title Date Publication Author(s) Type

 

November, 2012 Federal Reserve Bank of Cleveland, working paper no. 12-29 ; Josh Lerner; Working Papers
Abstract: The consequences of providing public funds to financial institutions remain controversial. We examine the Community Development Financial Institution (CDFI) Fund's impact on credit union activity, using hitherto little studied U.S. Treasury data. The CDFI Fund grants increase lending at credit unions by 3%. For every dollar awarded, 45 additional cents are loaned out to borrowers in the first year, and up to an additional $1.60 is loaned out within three years. Delinquent loan rates also increase slightly. Our panel results are supported by a broadband regression discontinuity analysis. Politics does not seem to play a role in allocating funding.

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November, 2012 Federal Reserve Bank of Cleveland, working paper no. 12-26 ; Working Papers
Abstract: This paper shows that mortgage lenders with a physical branch near the property being financed have better information about home-price fundamentals than nonlocal lenders. During the real estate run-up from 2002-06, home price growth negatively correlates with the share of loans made by local lenders, namely lenders with a branch in the respective county. Moreover, home prices fell less from 2006-09 in areas where more of the loans were made by local lenders. California foreclosure rates during the crisis are negatively correlated with local lending during the run-up. A 1 standard deviation increase in local loans is associated with 5 fewer foreclosures for every 1,000 houses. When local lenders retain loans for their portfolio rather than securitizing, the results for both home price growth and foreclosures are even stronger.

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Title Date Publication Author(s) Type
Bridging the Gap? Government Subsidized Lending and Access to Capital

 

March, 2013 Review of Corporate Finance Studies, forthcoming ; Josh Lerner; Journal Article
Abstract: The consequences of providing public funds to financial institutions remain controversial. We examine the Community Development Financial Institution (CDFI) Fund's impact on credit union activity, using hitherto little studied U.S. Treasury data. The CDFI Fund grants increase lending at credit unions by 3%. For every dollar awarded, 45 additional cents are loaned out to borrowers in the first year, and up to an additional $1.60 is loaned out within three years. Delinquent loan rates also increase slightly. Our panel results are supported by a broadband regression discontinuity analysis. Politics does not seem to play a role in allocating funding.

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