repayments (default). Firms in Italy defaulted more against banks with high levels of past losses. We control for borrower … fundamentals with firm-quarter fixed effects; thus, identification comes from a firm's choice to default against one bank versus … bank relationships comes into doubt …

We show that financial sector bailouts and sovereign credit risk are intimately linked. A bailout benefits the economy …-financial sector to fund the bailout may be inefficient since it weakens its incentive to invest, decreasing growth. Instead, the … sovereign may choose to fund the bailout by diluting existing government bondholders, resulting in a deterioration of the …

monetary policy. The theory unifies an endogenous supply of illiquid local loans and risk-sharing among subsidiaries of bank …

crucial year 1930. When the crisis worsened, state and local authorities began declaring bank holidays,' which limited the … right of depositors to make withdrawals, a movement that culminated in the declaration of a national bank holiday by …

A lending boom is reflected in the composition of bank liabilities when traditional retail deposits (core liabilities …

style of central banking affects central banks' solvency. A central bank is insolvent if its requirement to pay dividends to … Bank), and exchange-rate risk (central banks of small open economies). We find that a central bank that pays dividends … circumstances, the dividend will be negative, meaning that the government is making a payment to the bank. If the charter does not …