We study the effects of a bank's engagement in trading. Traditional banking is relationship-based: not scalable, long …-based: scalable, shortterm, capital constrained, and with the ability to generate risk from concentrated positions. When a bank … inefficiencies. A bank may allocate too much capital to trading ex-post, compromising the incentives to build relationships ex …

Despite revisions to bank capital standards, fundamental shortcomings remain: the rules for setting capital … system of capital regulation that addresses these needs by making changes to all three pillars of bank regulation: only …

to take on risk by reducing market discipline or by increasing charter value. We use an international sample of bank data …

procyclicality of bank credit dynamics to the private sector and contain systemic risk. Reserve requirements, in particular, have … new cross-country evidence on how they influence real private bank credit growth. Our results show that these instruments …

centralization on bank risk taking depends on the balance of these two effects …

We formulate the “High Liquidity Creation Hypothesis” (HLCH) that a proliferation in the core activity of bank … creation measures as a comprehensive proxy for overall bank output, we find that high liquidity creation significantly … increases the probability of bank failure; this finding survives multiple robustness checks. Our results suggest that regulatory …