by this theory, we show that banks closely match the interest-rate sensitivities of their income and expenses, and that …

relatively attractive rate of return and two embedded options: a customer's option to withdraw money at any time and a bank …

interest rate bids increase monotonically with bank risk and that firms in general prefer higher deposit interest rates … increases above central bank policy rates suggesting that central bank funding crowds out deposits thereby reducing monitoring …

The work of Diamond and Dybvig, 1983 is commonly understood as a theory of bank runs driven by self …-fulfilling prophecies. Their contribution may alternatively be interpreted as a theory for preventing these bank runs. Absent aggregate risk …-run equilibrium, which suggests that Diamond and Dybvig, 1983 can be understood as a theory of bank runs. The use of direct mechanisms …

Diamond and Dybvig (1983) is commonly understood as providing a formal rationale for the existence of bank …-run equilibria. It has never been clear, however, whether bank-run equilibria in this framework are a natural byproduct of the … (2003) demonstrate that bank-run equilibria can exist under an optimal contractual arrangement. The difficulty of preventing …

make bank deposits endogenously long-term. Capital regulation addresses deposit dilution but is subject to a time … significantly impacts optimal bank capital regulation. We examine how capital regulation stringency changes across different … countries around the 2008 global financial crisis and document novel facts that are consistent with our theory …

instant-access deposits. Exploiting variation in information acquisition for different brands of the same bank, we show that … complementarities. Our results point to a previously undocumented source of self-fulfilling bank fragility …