This paper reviews empirical and theoretical work on the links between banks and their
governments (the bank-sovereign nexus). How significant is this nexus? What do we know …

The COVID-19 pandemic has caused an unprecedented human and health crisis. The
measures taken to contain the damage caused a global economic slowdown. Investors face …

We quantify the role of financial leverage behind the sluggish post-crisis investment
performance of European firms. We use a cross-country firm-bank matched database to …

We explore the causes of the credit crunch during the European sovereign debt crisis and its
impact on the corporate policies of European firms. Our results show that value impairment …

We model a loop between sovereign and bank credit risk. A distressed financial sector
induces government bailouts, whose cost increases sovereign credit risk. Increased …

This paper examines the macroeconomic implications of sovereign risk in a model in which
banks hold domestic government debt. News of a future sovereign default hampers financial …

The recent unravelling of the Eurozone's financial integration raised concerns about
feedback loops between sovereign and banking insolvency. This article provides a theory of …

Using novel monthly data for 226 euro-area banks from 2007 to 2015, we investigate the
determinants of banks' sovereign exposures and their effects on lending during and after the …

At the end of 2013, the share of domestic government debt held by the banking sectors of
Eurozone countries was more than twice the amount held in 2007. We show that these …

A framework for macroprudential regulation that defines systemic risk and macroprudential
policy, describes macroprudential tools, and surveys the effectiveness of existing …