We argue that risk sharing motivates the bank-wide structure of bonus pay. In the presence of financial frictions that …

compensation increase a bank’s contribution to systemic distress risk and systemic crash risk. We also predict and find that this … CEO incentive–systemic risk relation operates through three channels: (i) a bank’s engagement in non-interest income … relation is moderated by information transparency, bank size, market liquidity, and financial crisis. We also discuss relevant …

Banks are growing ever larger compared to their national economies. We show that increases in relative bank size … (measured as a bank's liabilities divided by national GDP) are linked to banks displaying higher tail risk. This effect is not …, or banking crises. Instead, we detect a persistent component in the tail risk of relatively large banks that is bank …