Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
We investigate how banks adjust lending and provisioning following credit risk stage migrations under IFRS 9, using loan-level data from the European credit register, AnaCredit. While provisions rise with downgrades and fall with upgrades, lending responses are sharply asymmetric: downgrades prompt immediate credit contraction, while upgrades lead to only cautious recovery. Stage 2 acts as an early-warning signal, and Stage 3 defaults leave a lasting stigma, constraining post-recovery credit. These findings suggest IFRS 9 enhances risk recognition but may amplify procyclical lending, with important policy implications for balancing financial stability and credit access across the cycle.