When can low interest rates weaken the economy (lead to a restrictive monetary policy)?

We want to examine a peculiar characteristic of monetary policy , namely that when interest rates have remained low for a long time, the capital gains on banks' bond portfolio s disappear, and what persists is the decline in net interest received by the banks. This harms the banks' profitability and weakens their capital, therefore leading to a decline in the supply of bank credit, a development which clearly corresponds to a mo re restrictive monetary policy due to interest rates that are low for a long time. We illustrate this in the case of the euro zone.