in modern monetary and financial systems, namely central bank collateral frameworks. Their importance can be understood …, not defined in a market, but by the collateral frameworks and interest rate policies of central banks. Using the … collateral framework of the Eurosystem as a basis of illustration and case study, the paper brings to light the functioning …

A standard repurchase agreement between two counterparties is considered to examine the endogenous choice of collateral … assets, the feasibility of secured lending, and welfare implications of the central bank’s collateral framework. As an …

The industrial organization approach to banking is extended to analyze the effects of interbank market activity and … risk averse in an environment where there is no interbank market and liquidity regulation. Introducing a buoyant interbank … separating effect of interbank money markets and recreate endogenous risk aversion of banks. …

from trading assets for cash. -- interbank market ; fire sale …

To avoid illiquidity spillovers and basis risk in swaps, interbank lenders are especially cautious about whether … interbank borrowers can meet their claims. This paper is about examining whether the incentive of interbank lenders to penalize … risky borrowers can reduce the liquidity risk-taking of borrowers. We find that interbank borrowers, especially small and …