This paper analyzes banks' usage of CDS. Combining bank-firm syndicated loan data with a unique EU-wide dataset on … bilateral CDS positions, we find that stronger banks in terms of capital, funding and profitability tend to hedge more. We find … no evidence of banks using the CDS market for capital relief. Banks are more likely to hedge exposures to relatively …

This paper analyzes the effect of bank recapitalizations on lending, funding and asset quality of European banks … between 2000 and 2013. Controlling for market implied capital shortfall of banks, we find that banks that receive a … sufficiently large recapitalization increase lending, attract more deposits and clean up their balance sheets. In contrast, banks …

Basel II regulatory framework makes capital requirements vary across both banks and across firms, which allows us to control … capital requirements reduces lending by 10%. Firms can attenuate this reduction by substituting borrowing across banks, but …

I develop a model where the sovereign debt capacity depends on the capitalization of domestic banks. Low-capital banks … the sovereign risk is sufficiently high, low-capital banks reduce private lending to further increase their holdings of …

The crisis management framework for banks in the European Union (EU) requires the resolution authorities to identify … Banking Union and to banks of heterogeneous size. In case of mid-sized banks, this common analytical framework could reduce …

We analyze securities trading by banks during the crisis and the associated spillovers to the supply of credit. We use … a proprietary dataset that has the investments of banks at the security level for 2005-2012 in conjunction with the … credit register from Germany. We find that - during the crisis - banks with higher trading expertise (trading banks) increase …

By providing liquidity to depositors and credit line borrowers, banks are exposed to doubleruns on assets and …-shock liquidity risk management by more exposed banks granting credit lines to firms that run less in a crisis. …