How a historic drop in bank deposits shapes banks' loan supply? We exploit the effects of a large, and unexpected … includes all bank-firm lending relationships in all euro area countries. We find that banks experiencing large deposit outflows … is stronger for fixed rate and longer maturity loans, but not for riskier borrowers. The effect is mostly driven by banks …

bank runs. In an economy with panic-driven runs, higher deposits make banks less fragile, while the opposite is true when … runs are only driven by fundamentals. The effect of deposits is not internalized by depositors. A saving externality arises …

contagion is higher for banks with weaker fundamentals. Third, interbank linkages among surviving banks further propagate the …-prudential analysis ; deposit insurance ; interbank market ; wholesale depositors ; bank runs ; banking crisis ; liquidity dry-ups …

depositors and premiums raised from banks. Premiums contribute to a deposit insurance fund that lowers taxpayers' resolution cost …

competence of the banking regulator, and hence in other banks chartered by the same regulator. Thus depositors may withdraw funds … that banks have a common regulator. In our model, the failure of one bank can undermine the public's confidence in the … from other, unconnected, banks. The optimal regulatory response to this 'panic'; behaviour can be to privately exhibit …

This paper investigates the relationship between bank funding costs and solvency for a large sample of euro area banks …. Among the deposit rates, the interest rates of the overnight deposits are the least sensitive. Banks' asset quality …

provisions tend to be more procyclical at larger and better capitalized banks. The procyclicality of loan loss provisions can …

When the Covid-19 crisis struck, banks using internal-rating based (IRB) models quickly recognized the increase in risk … and reduced lending more than banks using a standardized approach. This effect is not driven by borrowers' quality or by … banks in countries with credit booms before the pandemic. The higher risk sensitivity of IRB models does not always result …

tends to be floored at zero. We investigate whether this friction affects banks’ reactions when the policy rate is lowered … to negative levels, compared to a standard rate cut in the euro area. We exploit the cross-sectional variation in banks …’ funding structures jointly with that in their excess liquidity holdings. We find evidence that banks highly exposed to the …