asymmetric information the banks face the risk of adverse selection. Credit Value-at-Risk (CVaR) regulation counters the problem …Banks provide risky loans to firms which have superior information regarding the quality of their projects. Due to … distorts the operation of credit markets. We show that a binding CVaR constraint introduces credit rationing and lowers social …

Modern banking systems are highly interconnected. Despite their various benefits, the linkages that exist between banks … carry the risk of contagion. In this paper we investigate how banks decide on direct balance sheet linkages and the … implications for contagion risk. In particular, we model a network formation process in the banking system. The trade-off between …

We study the effects of a bank’s engagement in trading. Traditional banking is relationship-based: not scalable, long … leads trading in banks to become increasingly risky, so that problems in managing and regulating trading in banks will … scale restrictions in banking. …

Under Basel III rules, banks become subject to a liquidity coverage ratio (LCR) from 2015 onwards, to promote short …

We study the dependence between the downside risk of European banks and insurers. Since the downside risk of banks and … diversification within large banks and financial conglomerates. We discuss the limited value of the normal distribution based … versus large banks. …

of capital markets and banking systems as well as the distribution of access to external finance across firms …

moderate moral hazard, as the banking union encourages risk taking by systemic institutions. If banks hold opaque assets, the …A banking union limits international bank default contagion, eliminating inefficient liquidations. For particularly low … net welfare effect of a banking union can be negative. Restricting the banking union mandate restores incentives …

, funding composition and access to credit. Evolution in political institutions can account for financial evolution, and appear …

requirements can lead to more entry into banking, essentially by reducing the competitive strength of lower quality banks. We also …We assess the influence of competition and capital regulation on the stability of the banking system. We particularly … extant literature in that it recognizes the fixed costs associated with banks' monitoring technologies. These costs make …