conditions, credit default and bank capitalization for the transmission of macroeconomic shocks. We fit the model to euro area … empirical literature, i.e. the pro-cyclicality of bank profitability and the counter-cyclical response of firm default rates and …

In this paper we model the volatility of the spread between the overnight interest rate and the central bank policy … is the main determinant of the volatility of the policy spread, but also that private bank credit risk has become more …

We show that the impact of government bailouts (liquidity injections) on a representative bank's risk taking depends on … the level of systematic risk of its loans portfolio. In a model where bank's output follows a geometric Brownian motion … and the government guarantees bank's liabilities, we show first that more generous bailouts may or may not induce banks to …

We model EU countries' bank ratings using financial variables and allowing for intercept and slope heterogeneity. Our …

Why do banks remain passive? In a model of bank-firm relationship we study the trade-off a bank faces when having … defaulting firms declared bankrupt. First, the bank receives a payoff if a firm is liquidated. Second, it provides information … about a firm's type to its competitors. Thereby, asymmetric information between banks is reduced and bank competition …

developed considering this new paradigm and discuss how institutional features relating to bank closure policy influences lender …