In the recent financial crisis, risk management tools have been proven inadequate. Model risk, a key component of bank … risk, has shown its negative impact. It seems that risk models did not cover the included risks comprehensively and were … their models to reduce model risk. We discuss if banks undertake enough effort to improve their risk models. Furthermore …

regulation, recovery and resolution, and risk culture. …

regulation, recovery and resolution, and risk culture. …

present volume look with critical eyes on financial theories, supervisory structures, (mis)pricing of risk and distorted … incentives, risk management models and procedures, conflicts of interest and bank strategies. Their perspectives are quite …

innovation was to make capital charges more sensitive to risk. Using data from the German credit register, and employing a … approach. Interestingly, however, we find that risk models used for regulatory purposes tend to underpredict actual default …

to assess risk. This paper discusses the interaction and tensions between the leverage ratio and risk-based capital … potentially undermines risk weighting such that banks feel encouraged to take greater risks. The paper proposes an alternative … instrument that is conceived as a base risk weight and functions as a backstop. It ensures a minimum core capital ratio, based on …

/or risk taking and that this leads to higher expected losses for its depositors. To reduce the adverse effects of moral hazard …, policy measures have to be taken. However, a simple leverage ratio is likely to increase expected losses further and risk … adjusted capital requirements do not necessarily affect highly leveraged banks with very low risk assets. A combination of both …

between credit risk and liquidity risk of banks. This interaction is found to make a risk neutral bank behave as if it were … risk averse in an environment where there is no interbank market and liquidity regulation. Introducing a buoyant interbank … money market destroys endogenous risk aversion and allows banks to manage credit risk and liquidity risk independently. The …