bank extracts from borrowers. Under limited liability, this increased profitability affects only upside returns, inducing …This paper develops a model to assess how monetary policy rates affect bank risk-taking. In the model, a reduction in … the risk-free rate increases lending profitability by reducing funding costs and increasing the surplus the monopolistic …

domestic monetary policy interest rates can have sizable effects on central bank''s net worth. In this paper we examine … measure of central bank financial strength. Our findings, using linear and nonlinear techniques, suggests that central bank …

links changes in the financial environment and the distribution of future bank capital ratios. This forward …

-to-assets ratio is ambiguous. Similarly, as competition increases, the probability of bank failure can either increase or decrease. We … literature are negatively and significantly related to measures of bank competition. Thus, there is no evidence of a trade …-off between bank competition and stability, and bank competition seems to foster banks'' willingness to lend …

bond returns are high. At the bank level, bondholdings correlate negatively with subsequent lending during sovereign …