How responsive are banks to monetary policy?

I provide evidence that the response of commercial banks' loans to monetary policy shocks in the US has changed. In particular, using bank data from the period 1959 to 2007, I show that the effect of monetary policy shocks on banks' credit has significantly decreased over time. My results contrast significantly with previous finding in the literature (Bernanke and Blinder, 1992). As potential explanations to the lower effect of monetary shocks, I describe some of the changes in bank regulation that triggered bank consolidation and changes in the bank-size distribution, as well as changes in the banks' portfolio towards an increasing share of real estate loans.