-employed are identical to employed borrowers during the boom. Banks with worse corporate governance problems soften even more the … standards. Finally, we analyze the mechanism by which banks could increase the supply of mortgage loans despite of regulatory … restrictions on LTVs. The evidence is consistent with banks encouraging real estate appraisal firms to introduce an upward bias in …

and banking with asymmetric information. Banks' optimal asset/liability policy is such that in equilibrium capital … adequacy constraints are always binding. Asymmetric information about banks' net worth adds a cost to outside equity capital …, which limits the extent to which banks can relax their capital constraint. In this context monetary policy does not affect …