bank's failure risk solely by means of liquidity requirements. However, their effectiveness can be restored if, in addition …

Consider a competitive bank whose illiquid asset portfolio is funded by short-term debt that has to be refinanced … of social externalities of bank failures further lowers the optimal level of transparency. Moreover, asset risk taking …

bank’s failure risk solely by means of liquidity requirements. However, their effectiveness can be restored if, in addition …

runs, and face a threat of entry. Higher competition increases deposit rates and bank fragility, resulting in an … intermediate socially optimal level of bank competition. We provide a novel theory of bank opacity. The cost of opacity is more … is to deter entry of competitors, which increases bank charter value. Banks can be excessively opaque, motivating …

This paper analyzes central bank policies on monitoring banks in distress when liquidity provisions are conditional on … performance and a bad shock occurs. A sequential game model is used to analyze two policies: one in which the central bank acts …, there is more central bank monitoring and less need to provide emergency financing. Public information about monitoring …