benefit of greater diversification in terms of higher monitoring dominates the costs of free-riding and duplication of efforts …

increase prevails through a second channel: an increase in risk shifting. (3) Risk shifting decreases with the diversification …

The paper examines whether bank diversification in multiple dimensions can protect bank lending from uncertainty shocks … significantly alleviated by bank diversification in the loan portfolio, income, and funding aspects. Our findings offer practical … implications for regulators and banks themselves: bank diversification can effectively act as a lending shock absorber in periods …

selection and moral hazard, allocating funds to most productive projects, risk diversification. Therefore, sound functioning of …

Recent policy discussion includes the introduction of diversification requirements for sovereign bond portfolios of … European banks. In this paper, we evaluate the possible effects of these constraints on risk and diversification in the … analysis. We then analyse the risk and diversification in the sovereign bond portfolios of the largest European banks and …