This paper investigates how business cycle volatility affects internal and external funding sources of banks. It argues that excessive credit growth, credit cycles, and bank failures are phenomena related to distinct patterns of banks’ financing options over the cycle.

The crisis of 2007-2009 has shown that financial market turbulence can lead to huge funding liquidity problems for banks. This paper provides empirical evidence on banks' responses to wholesale funding shocks, using data of seventeen of the largest Dutch banks over the period January 2004 to...

The crisis of 2007–2009 has shown that financial market turbulence can lead to huge funding liquidity problems for banks. This paper provides empirical evidence on banks’ responses to market funding shocks, using data of seventeen of the largest Dutch banks over the period January...