affect the likelihood and the timing of bank recovery. Severe regulatory measures increase both the likelihood of recovery … conditions also matter for bank recovery. Hence, concerted micro- and macro-prudential policies are key to facilitate distressed … bank recovery. …

This paper provides the first empirical evidence that bank regulation is associated with cross-border spillover effects … different localities across 16 countries. We find that lower barriers to entry, tighter restrictions on bank activities, and … higher minimum capital requirements in domestic markets are associated with lower bank lending standards abroad. The effects …

makers reduces distortions in the decision making process, which has implications for the design of bank regulation and …In this paper, we examine how the institutional design affects the outcome of bank bailout decisions. In the German … savings bank sector, distress events can be resolved by local politicians or a state-level association. We show that decisions …

We develop a model in which financial intermediaries hold liquidity to protect themselves from shocks. Depending on … parameter values, banks may choose to hold too much or too little liquidity on aggregate compared with the socially optimal … underinsurance against liquidity choice. The model therefore provides a unified framework for thinking, on the one hand, about policy …

integrated micro-macro approach with two core virtues. First, we measure the probability of bank distress directly at the bank … level. Second, we integrate a microeconomic hazard model for bank distress and a standard macroeconomic model. The advantage … between bank distress and the real economy. We base the analysis on German bank and macro data between 1995 and 2004. Our …

Liquidity creation is one of banks' raisons d'être. But what happens to liquidity creation and risk taking when a bank … increases to up to around 50 percent when such actions are taken. Second, bank risk taking decreases in the aftermath of … capital injections are followed by lower levels of liquidity creation. The probability of a decline in liquidity creation …

We explore the effect of tax reforms in Italy and Belgium, respectively that decrease the cost of equity on bank …

theory that monopolistic firms undersupply the market when utilizing their high pricing power in the bank competition-liquidity … creation nexus. While positive IRS per se lead to an increase in bank liquidity creation, we find that a high bank …We study the effects of interest rate shocks (IRS) on banks' liquidity creation. A unique supervisory data set from the …

We employ a proprietary transaction-level dataset in Germany to examine how capital requirements affect the liquidity … average trade size. While non-bank affiliated dealers increase their market-making activity, they are unable to bridge this … gap - aggregate liquidity declines. Our results are stronger for banks with a higher capital shortfall, for noninvestment …

makers reduces distortions in the decision making process, which has implications for the design of bank regulation and …In this paper, we examine how the institutional design affects the outcome of bank bailout decisions. In the German … savings bank sector, distress events can be resolved by local politicians or a state-level association. We show that decisions …