This paper seeks to understand the interplay between banks, bank regulation, sovereign default risk and central bank guarantees in a monetary union. I assume that banks can use sovereign bonds for repurchase agreements with a common central bank, and that their sovereign partially backs up any...

Between October 28, 2008 and June 30, 2009 over six hundred banks and bank holding companies accepted money from the United States government in exchange for preferred shares and warrants. Based on a matched sample of banks participating and not participating in this Capital Purchase Program...

This work examines the impacts which the Covid-19 pandemic brought to the stability of the European financial sector. Lockdowns, businesses unable to operate and uncertainty about how the pandemic would evolve fueled a sharp recession. From the lessons learned in the global financial crises and...

We present in this note a method for computing the regulatory capital of financial institutions, along with the Basel Committee requirements, which avoids the pitfalls of the Value-at-Risk and, in particular, the fact that – as observed during 2008 crisis – it aggravates systemic risk rather...

This paper presents a novel approach to investigate and model the network of euro area banks' large exposures within the global banking system. Drawing on a unique dataset, the paper documents the degree of interconnectedness and systemic risk of the euro area banking system based on bilateral...

We examine the evolution of the Icelandic banking sector in its macroeconomic environment. The story culminates in the crisis of October 2008, when all three major banks in Iceland collapsed in three successive days. The country is still struggling to cope with the consequences. The paper...

This paper studies the effectiveness of Euro Area (EA) fiscal policy, during the recent financial crisis, using an estimated New Keynesian model with a bank. A key dimension of policy in the crisis was massive government support for banks - that dimension has so far received little attention in...

Maintaining the optimal level of liquidity in the banking system has always been a challenge for banks globally. Liquidity deficit Indian Banks turned to liquidity surplus due to the demonetization of higher denomination currencies in November 2016. The liquidity deficit has the potential to...

Maintaining the optimal level of liquidity in the banking system has always been a challenge for banks globally. Liquidity deficit Indian Banks turned to liquidity surplus due to the demonetization of higher denomination currencies in November 2016. The liquidity deficit has the potential to...

Understanding the impact of the asymmetric tax treatment of debt and equity on the capital structures of financial institutions is critical to shaping and assessing responses to the problem of excessive leverage that underlay the 2009 financial crisis - but there is no empirical evidence to draw...