address the following questions. How are macroeconomic shocks transmitted to bank risk and other banking variables? What are … the sources of bank heterogeneity, and what explains differences in individual banks’ responses to macroeconomic shocks …? Our paper has two main findings: (i) Average bank risk declines, and average bank lending increases following expansionary …

We investigate the effects of the abolition of double liability requirement imposed on bank shareholders in Canada on … bank risk-taking and lending behavior. Under the double liability rule, the shareholders of a bank were liable up to twice … the amount of their subscribed shares in the case of bankruptcy. With the establishment of the Bank of Canada in 1934, the …