This research aims to analyze the impact of monetary policies on money creation in Iran's banking system, utilizing the Berger and Bouwman approach and the Markov Switching model. Within this framework, the nonlinear behavior of monetary variables and the transmission mechanism of expansionary and contractionary monetary policies across different economic regimes have been examined. For this purpose, quarterly time-series data from Iran's banking system for the period 1387 to 1402 (2008-2023) were used. The findings indicate that the effect of monetary policies on money creation in the banking sector varies depending on the prevailing economic regime (recession or boom), and banks exhibit different reactions to policy changes in each regime. Specifically, during a stable or normal economic regime, the banking sector's response to monetary policies is largely aligned with the central bank's policy objectives. These findings highlight the importance of flexibility in monetary policymaking and the necessity of its coordination with the structural conditions of the economy.