A central bank possesses various instruments to provide liquidity. These are either outright monetary transactions (OMT) of securities or other refinancing facilities, primarily repos, which are executed with standard tenders. The eligible securities (i.e. bonds or equities) need to conform with...

We model the bank loan negotiation process as a bargaining game interaction between two individuals (the firm applicant and the bank officer). The novelty of our model lies in that the relative outcome of the players (as measured by the spread) is affected by different behavioral and situational...