This paper studies the optimal intraday pricing in payment systems and its impact on banks' payment behaviour and … intraday liquidity management. A model is developed to compare the performance of two different mechanisms to reduce payment … better outcome unless the payment system experiences a system-wide liquidity shock. We show that settlement delay can be …

This paper studies banks' incentives regarding the timing of payment submissions in a collateral-based RTGS payment … system and how these incentives change with the introduction of a liquidity-saving mechanism (LSM). We show that an LSM … allows banks to economise on collateral while also providing incentives to submit payments earlier. This is because in our …

liquidity in the Bank of England's (BoE) operations. Between 2010 and 2016 there was regular usage of two BoE facilities …: Indexed Long-Term Repos (ILTR) and the Funding for Lending Scheme (FLS). Using BoE proprietary data, we show that … facilities to meet their liquidity needs. Collateral assets used for FLS are less liquid, since almost all assets are loan …

funding is not necessarily reduced, credit and liquidity provision to the private sector need not contract, and the risk of a … bank deposits into CBDC at commercial banks (and therefore by implication at the central bank). (iv) The central bank …

. Using data from CHAPS, the UK large-value payment system, we find that smaller banks tend to provide more liquidity than … larger banks, relative to their payment flows. We use a Gini coefficient to measure these variations in liquidity provision … individual banks. We use a recombinant approach to detect instances where observed patterns of liquidity provision are unlikely …

existence of a core of highly connected banks alongside a periphery. We find that membership of this core expanded during the … crisis and suggest that this is due to a few intermediate banks becoming more connected. The widened reserve target bands may … allowing banks to exercise more discretion in forming relationships. However, there is an asymmetry between borrowers and …

regulator finds it ex-post optimal to bail out some or all failed banks, whereas when the number of bank failures is small …, failed banks can be acquired by the surviving banks. This gives banks incentives to herd and increases the risk that many … banks may fail together. The ex-post optimal regulation may thus be time-inconsistent or sub-optimal from an ex …