This paper is a contribution to the literature on possible pro-cyclical effects of capital rules under Basil 2 capital regulations. The addition of both idiosyncratic uncertainty and risk averse managers to a cash-in-advance model with financial intermediaries that finance working capital...

The exposure of the Argentine banking system to real interest rate changes is material and discourages long term credit. Quantification of this risk would help to manage it and may promote new credit, although it is not an easy job, especially in emerging markets. This paper proposes a Value at...