This paper examines banks' disclosures and loss recognition in the financial crisis and identifies several core issues …, banks' disclosures about relevant risk exposures were relatively sparse. Such disclosures came later after major concerns … about banks' exposures had arisen in markets. Similarly, the recognition of loan losses was relatively slow and delayed …

When the Covid-19 crisis struck, banks using internal-rating based (IRB) models quickly recognized the increase in risk … and reduced lending more than banks using a standardized approach. This effect is not driven by borrowers' quality or by … banks in countries with credit booms before the pandemic. The higher risk sensitivity of IRB models does not always result …

policy and therefore ultimately the real economy. In particular, it facilitates banks' liquidity management. This paper aims … at extending the literature which views interbank markets as mutual liquidity insurance mechanism by taking into account … persistence of liquidity shocks. Following a theory of long-term interbank funding a financial system which is modeled as a micro …

Although banks are at the center of systemic risk, there are other institutions that contribute to it. With the … private equity firms with their high-risk deals. Given these risks and the interconnectedness of the banks through the LBO … between 2000 and 2013 from 165 global banks, I show that banks with higher LBO exposure also have a higher level of systemic …

feature which also afflicts the SRM imperils the key policy objective to re-instill market discipline on banks’ debt financing …

transaction banks. Soft information can be interpreted as a private signal about the quality of a firm that is observable to a … relationship bank, but not to a transaction bank. We show that borrowers self-select to relationship banks depending on whether … private signal from firms by relationship banks and transaction banks asymmetrically. Relationship banks invest more …

This paper presents a theory that explains why it is beneficial for banks to engage in circular lending activities on … the interbank market. Using a simple network structure, it shows that if there is a non-zero bailout probability, banks … interbank market before investing in loan portfolios. Therefore, banks are better able to attract funds from uninsured creditors …

government guarantees rather than from corporate governance failures within banks. The idea of the proposed regulation is to …

This paper tests whether an increase in insured deposits causes banks to become more risky. We use variation introduced … $100,000 to $250,000 per depositor and bank. For some banks, the amount of insured deposits increased significantly; for … others, it was a minor change. Our analysis shows that the more affected banks increase their investments in risky commercial …