their lending to real sector firms.Our agent-based model considers five types of agents: banks, depositors, the Central Bank … fundamental role in banks' liquidity management; (3) banks avoid borrowing resources from the Central Bank; (4) when the monetary … insights regarding the relationship between monetary policy stances and bank risk-taking, opening an avenue to investigate the …

Bank, firms, and the clearinghouse. While banks and depositors are bounded-rational agents with adaptive strategies, the … fundamental role in banks' liquidity management; (3) banks avoid borrowing resources from the Central Bank; (4) when the monetary … insights regarding the relationship between monetary policy stances and bank risk-taking, opening an avenue to investigate the …

that liquidity requirements could bolster monetary policy transmission through the bank lending channel …

the retail deposit supply owing to, for example, a decrease in bank reserves or in money demand, banks try to substitute … monetary policy transmission through the bank lending channel by limiting the funding substitution of large banks. …

burden of the banking sector is modest. We model a regulator whose trade-off between bank risk and credit supply is derived … has through bank incentives. The larger the correlation between banks' projects, the more important the role for monetary … policy. In a dynamic setting, not internalizing bank risk leads a monetary authority to keep rates low for too long after a …

Why should monetary policy 'lean against the wind'? Can't bank regulation perform its task alone? We model banks that … choose both asset volatility and leverage, and identify how monetary policy transmits to bank risk. Subsequently, we … introduce a regulator whose tool is a risk-based capital requirement. We derive from welfare that the regulator trades off bank …

that liquidity requirements could bolster monetary policy transmission through the bank lending channel …

shocks, cuts are deeper but shorter-lived than otherwise. Keeping cuts short is crucial as bank risk responds primarily to …

brief is crucial as bank risk responds primarily to rates that are kept "too low for too long". Within this shorter time …

as soon as bank risk appetite heats up. Within this shorter time span, cuts must then be deeper than otherwise to also … achieve standard objectives. Finally, we analyze how robust this result is to the presence of a bank regulatory tool, and …