European supervisors aggressively requested more capital at large banks. That may cut credit to the economy. We confirm … that especially larger banks cut loans while less-significant banks partly offset that credit drop. Moreover, we identify … nasty spillovers from that interaction. Specifically, larger banks’ deleveraging was associated with significant portfolio …

This paper analyzes the financing choices of banks under capital regulation during the expansion period that preceded … the crisis. We use data from Dealogic on the issuances of financial instruments of Spanish banks to test whether financing … choices respond to predictions derived from the corporate finance theory and/or to capital regulation. We find that banks …