Negative interest rates impact bank lending policies and capital ratios.
The European Central Bank has had negative interest rates since 2014. Some banks are affected by this more than others, mainly due to their capital levels. The banks most affected tightened their loan terms to manage risks and maintain capital ratios. However, the total amount of credit offered by both affected and unaffected banks remained the same. This suggests that negative interest rates have not reduced the overall credit supply from banks.