The severity and longevity of the recession caused by the 2007 financial crisis has
highlighted the lack of a reliable macro-based financial regulation framework. As a …

This paper empirically examines how capital affects a bank's performance (survival and
market share) and how this effect varies across banking crises, market crises, and normal …

In a model with bankruptcy costs and segmented deposit and equity markets, we
endogenize the cost of equity and deposit finance for banks. Despite risk neutrality, equity …

Banks are intrinsically fragile because of their role as liquidity providers. This results in
under-provision of liquidity. We analyze the effect of government guarantees on the …

This paper tests whether an increase in insured deposits causes banks to become more
risky. We use variation introduced by the US Emergency Economic Stabilization Act in …

The European Union (EU) is currently assembling the com-ponents of a Banking Union,
mostly in order to break the close link between banks and their sovereigns, which proved …

This paper examines the potential impact a central bank digital currency (CBDC) on banks'
balance sheets. We first analyze the possible implications of the introduction of a CBDC for …

This paper studies the effects of government guarantees on the interconnection between
banking and sovereign debt crises in a framework where both the banks and the …

This paper investigates the impact and appropriateness of establishing a fully mutualized
European deposit insurance scheme (EDIS) using a unique supervisory micro-level data set …

In this paper, we address a long-standing policy question of whether higher levels of
regulatory capital, ex-ante, makes banks risk-resilient in times of severe economic …