Using GMM framework on the data of the US commercial banks spanning over 2002 to 2018, this study shows that banks adjust their regulatory capital ratios faster than traditional capital ratios. Our results show that the speed of adjustment of regulatory capital ratios and traditional capital...

A model of loan rate competition with liquidity provision by banks is used to study bank mergers. Both loan rate competition and liquidity needs are seen to be "localised" phenomena. This allows for tracing down the effects of particular types of bank mergers. As such, we contrast the effects of...

There is growing evidence showing that large and small banks differ in how they service retail customers. Large, multi-market banks (LMBs) have more standardized operations and set interest rates that are uniform across local markets, while small banks have greater autonomy to set rates...

Testimony before the Financial Crisis Inquiry Commission, Washington, D.C.

There is growing evidence showing that large and small banks differ in how they service retail customers. Large, multi-market banks (LMBs) have more standardized operations and set interest rates that are uniform across local markets, while small banks have greater autonomy to set rates...

Testimony before the Financial Crisis Inquiry Commission, Washington, D.C.

Over the last few decades, most central banks, concerned about settlement risks inherent in payment netting systems, have implemented real-time gross settlement (RTGS) systems. Although RTGS systems can significantly reduce settlement risk, they require greater liquidity to smooth...

A recent innovation in large-value payments systems has been the design and implementation of liquidity-saving mechanisms (LSMs), tools used in conjunction with real-time gross settlement (RTGS) systems. LSMs give system participants, such as banks, an option not offered by RTGS alone: they can...