preponderance of evidence suggests that (1) financial development—both the development of banks and stock markets—spurs economic …

We analyze how bank profitability impacts financial stability from both theoretical and empirical perspectives. We … first develop a theoretical model of the relationship between bank profitability and financial stability by exploring the … empirical determinants of bank risks and profitability, and how the level and the source of bank profitability affect risks for …

of homogenous impact across banks, the strength of this relationship is often bank-specific, and imposing homogeneity may … banks' heterogeneous reaction to macro-financial shocks in a dynamic context and potential cross-sectional dependence across … banks caused by common shocks. An application to Ecuador suggests that substantial heterogeneity is present and that this …

nontraditional bank intermediation or that has a high proportion of foreign banks has in some cases been associated with adverse …