Frésard, Laurent; Pérignon, Christophe; Wilhelmsson, … - In: Journal of Banking & Finance 35 (2011) 10, pp. 2569-2583
Banks hold capital to guard against unexpected surges in losses and long freezes in financial markets. The minimum level of capital is set by banking regulators as a function of the banks' own estimates of their risk exposures. As a result, a great challenge for both banks and regulators is to...