under previously committed credit lines. We show that during the collapse of the Asset Backed Commercial Paper market in the … conditions on the outstanding credit lines offered to borrowers in violation of a covenant. Looking at the broader period of the …, following a covenant violation on a credit line. Our paper suggests that a worsening in financial conditions of lenders can bear …

We study how the consequences of violations of covenants associated with bank lines of credit to firms vary with the … financial health of lenders. Following a violation banks restrict usage of lines of credit by raising spreads, shortening … during the recent crisis. Banks in worse financial health are more likely to restrict access to credit lines following a …

Over the past two decades, banks have increasingly focused on offering contingent credit in the form of credit lines as …' provision of liquidity insurance in the form of credit lines, their significance in managing corporate liquidity, and the … repay credit lines are put options issued by banks, which are exercised by firms in a correlated manner during periods of …

rolled over. This insurance effect induces them to relax lending standards. The resulting access to cheap credit can fuel …

We build a model with heterogeneous firms and banks to analyze how policy affects credit allocation and long … "diabolical sorting", whereby low-capitalization banks extend new credit or evergreen existing loans to low-productivity firms. If …