We develop a model of banking industry dynamics to study the quantitative impact of capital requirements on bank risk … taking, commercial bank failure, and market structure. We propose a market structure where big, dominant banks interact with … banks' buffer stocks of securities. We test the model using business cycle properties and the bank lending channel across …

bank risk taking, commercial bank failure, interest rates on loans, and market structure. We propose a market structure … addition to aggregate shocks to the fraction of performing loans in their portfolio. A nontrivial bank size distribution arises … consistent with untargeted business cycle properties, the bank lending channel, and empirical studies of the role of …

bank risk taking, commercial bank failure, interest rates on loans, and market structure. We propose a market structure … addition to aggregate shocks to the fraction of performing loans in their portfolio. A nontrivial bank size distribution arises … consistent with untargeted business cycle properties, the bank lending channel, and empirical studies of the role of …

banking group. The mechanism partially writes off creditors to recapitalise the bank over a weekend, providing them with … immediate certainty on their maximum loss. The bank is subsequently sold in a manner that enables the market to determine the …