the interbank market. Using a simple network structure, it shows that if there is a non-zero bailout probability, banks …

bank when its partner bank fails. We investigate how capital constraints affect the choice of the healthy bank to takeover … or liquidate the exposure held jointly with the failing bank, and how the bank's ex ante optimal capital holding and … possibility of contagion are affected by anticipation of bail-out policy, capital requirements and the joint exposure. We identify …

The objective of this research is to examine the inter-bank network of clients as a channel for credit risk … banking network channel. There were different models of bank behaviour, from a group of banks that fully aligned their risk …