We study how the subjective beliefs about loan repayment on the side of liquidity-constrained banks affect the central …

When financial intermediaries’ key characteristic is provision of liquidity through their liabilities, with financial … frictions the financial sector in the aggregate is likely to over-accumulate equity, thus decreasing liquidity provision and … financial sector. This policy increases the likelihood that intermediaries provide more liquidity and improves the stability of …

liquidity risks accumulated by this market maker affect his pricing of liquidity and the bid/ask spread he quotes on unsecured … borrowing and lending. We find that the larger the funding liquidity risk assumed by the market maker is, the higher the market … price for liquidity. Furthermore, his bid/ask spread and the sensitivity of his bid/ask spread to the maturity of the …

We consider a model in which banks vulnerable to liquidity crises may receive support from the lender of last resort … (LLR). Higher liquidity standards, though costly to banks, give the LLR more time to find out the systemic implications of … denying support to the banks in trouble. By modifying banks' prospects of being supported in a crisis, liquidity standards …

empirically test the predictions of a new signalling model that offers a rationale for offering two different liquidity facilities … risky than banks that accessed the DW. Our results can contribute to a better design of liquidity facilities during a …

In this paper we introduce two measures, the Systemic Liquidity Buffer (SLB) and the Systemic Liquidity Shortfall (SLS …) to assess liquidity in the banking system. The SLB takes an aggregated perspective on liquidity risks in the banking … system. In contrast, the SLS focusses on the problematic banks which suffer a liquidity shortfall. These measures provide an …