We study whether government subsidies can stimulate bank funding of marginal investment projects and the associated … can use it as an exogenous shock to identify bank responses. On average, firm subsidies do not affect bank lending, but … reduce banks’ distance to default. Average effects conflate important bank-level heterogeneity though. Conditional on various …

sovereign debt exposures and the implications of sovereign exposures for bank risk. Our main findings are as follows. First … impact of sovereign bond holdings on bank risk. This result could indicate the widespread absence of marking-to-market for …

implications of these exposures for bank risk. Larger, more capital market affine, and less capitalised banks hold more sovereign … that riskiness of government bond holdings affects bank risk only since 2010.This confirms the existence of a nexus between … government debt and bank risk. …

Recent developments on international financial markets have called the benefits of bank globalization into question … necessarily made banks less risky. Yet, surprisingly little is known about the actual link between bank internationalization, bank … countries tends to increase bank risk. Fourth, the impact of internationalization differs across banks from different banking …

targeting bank management and, to a lesser extent, penalties mitigate moral hazard. Weak interventions, such as warnings, do not …