) and country-specific (disclosure requirements, concentration of the banking sector) variables. While most incentives are … substituted by liquidity regulation, a bank's disclosure requirement and size remain significant. A key takeaway from our analysis … is that the complementary nature of disclosure and liquidity requirements provides a strong rationale for considering …

find that solvent borrowers are more likely to default strategically when stricter disclosure creates common knowledge …. Borrowers' financial health, regardless of disclosure rules. We show that uncertainty about fundamentals changes the risk …