The euro area is experiencing a severe and highly complex crisis. It comprises three problem areas, the difficulties of some highly indebted European sovereigns to ascertain funding at palatable cost, the disconcerting fragility of the European banking system and disappointing growth prospects...

Over the past decades, banks have significantly increased their cross-border asset positions. The ongoing crisis on international financial markets has raised the question whether this increase in cross-border activities has allowed banks to diversify risks and to what extent it has increased...

Government interventions into the financial system in the form of bail out operations or liquidity assistance are often justified with the systemic importance of large banks for the real economy. In this paper, we test whether idiosyncratic shocks to loan growth at large banks have effects on...