We investigate how liquidity regulations affect banks by examining a dormant monetary policy tool that functions as a … liquidity regulation. Our identification strategy uses a regression kink design that relies on the variation in a marginal high … credit supply. Liquidity requirements also depress banks' profitability, though some of the regulatory costs are passed on to …

We evaluate the effects of post-crisis liquidity regulation on the U.S. banking system. We find that regulated banks … have substantially improved their liquidity ratios by holding more liquidity buffers and terming out their liabilities …. However, some liquidity transformation has migrated to intermediaries not subject to liquidity regulation, such as small banks …

default coexist, and bank default is a self-fulfilling prophecy. Capital and liquidity regulation can prevent bank default and …We study the interplay of capital and liquidity regulation in a general equilibrium setting by focusing on future … return prospects on the long-term investment turn out to be bad. For moderate return risk, equilibria with and without bank …