This paper studies the relation between bank herding and financial system stability. I develop a set of bank … relation between bank herding and systemic risk contribution. I find that for large banks, asset herding is associated with … between bank herding and systemic risk contribution …

This paper presents a new theory that explains why it is beneficial for banks to be highly interconnected and to engage … in herding behavior. It shows that these two important causes of systemic risk are interdependent and thus cannot be …

We examine the nature, extent and possible causes of bank contagion in a high frequency setting. Looking at six major … coexceedances. We find some evidence that herding occurred …

We find that the level of bank herding in real estate loans during boom period is substantially higher than the level … of bank herding in commercial and industrial loans or consumer loans. More importantly, we find that bank herding … find bank herding interacts with boom period to provide a stronger predictive power of systemic risk to next period beyond …

tie these features together in a model of banks' herding behavior. Most existing models of herding behavior can explain … the other hand, many models that try to explain excessive risk-taking do not contain any incentive for herding. This paper … develops astate-preference model of simultaneous herding and excessive risktaking. Thus, the model can help in understanding …

, rigid bank regulations, stakeholder-focused incentive structures within banks and uncritical adoption of innovations may …