banks to changes in their capital positions is larger than that of stronger banks. This non-linearity implies that not only … the level of capital but also its distribution across banks in the financial system affects the transmission of shocks to … aggregate lending. Likewise, the effects of bank recapitalization on loan growth depend on banks' starting capital positions and …

We present a model in which shadow banking arises endogenously and undermines marketdiscipline on traditional banks …. Depositors' ability to re-optimize in response to crisesimposes market discipline on traditional banks: these banks optimally … on the 2008 financial crisis in theUnited States, during which shadow banks experienced a sudden dry-up of funding …

I propose a dynamic general equilibrium model in which strategic interactions between banks and depositors may lead to … endogenous bank fragility and slow recovery from crises. When banks' investment decisions are not contractible, depositors form … complementarities and possibly multiple equilibria: in response to an increase in funding costs, banks may optimally choose to pursue …

. We find that industries which are more dependent on external finance, in countries where banks had higher liquidity and …

portfolio rebalancing channel. NIRP affects banks withhigher ex-ante net short-term interbank positions or, more broadly, more … liquid balance-sheets, notwith higher retail deposits. NIRP-affected banks rebalance their portfolios from liquid assets …

This paper studies banks' decision to form financial interconnections using a model of financial contagion that … behaviour of competitive banks, where they balance the benefits of forming interbank linkages against the cost of contagion. We …