area countries (i.e. Germany, France, Italy, and Spain), with particular attention to the calibration of cross …

results enhanced price discrimination as the impact on bank CDS spreads and equity prices tended to be stronger for the weaker …

-section of individual bank portfolio decisions. For this purpose, an augmented version of the DSGE model of Gertler and Karadi … (2013), featuring a segmented banking sector, is estimated for the euro area and combined with a bank portfolio optimisation … approach using granular bank level data. An important feature of our modelling approach is that it captures the heterogeneity …