whether government subsidies to firms affect quantity and quality of bank lending. We combine recipient firms under the … to firms are determined at the EU level. Therefore, we use it to identify bank outcomes. Banks with relationships to more … subsidized firms exhibit higher lending volumes without any significant differences in bank stability. Subsidized firms, in turn …

We study whether government subsidies can stimulate bank funding of marginal investment projects and the associated … can use it as an exogenous shock to identify bank responses. On average, firm subsidies do not affect bank lending, but … reduce banks’ distance to default. Average effects conflate important bank-level heterogeneity though. Conditional on various …

We develop a model of bank risk-taking with strategic sovereign default risk. Domestic banks invest in real projects … their default risks through purchases of bonds. But, for high debt levels, this influence is lost since bank and government …

We study whether government subsidies can stimulate bank funding of marginal investment projects and the associated … can use it as an exogenous shock to identify bank responses. On average, firm subsidies do not affect bank lending, but … reduce banks' distance to default. Average effects conflate important bank-level heterogeneity though. Conditional on various …

study whether government subsidies to firms affect the quantity and quality of bank lending. We combine the universe of … modalities of GRW subsidies to firms are determined at the EU level. Therefore, we use it to identify bank outcomes. Banks with … relationships to more subsidized firms exhibit higher lending volumes without any significant differences in bank stability …

whether government subsidies to firms affect quantity and quality of bank lending. We combine recipient firms under the … to firms are determined at the EU level. Therefore, we use it to identify bank outcomes. Banks with relationships to more … subsidized firms exhibit higher lending volumes without any significant differences in bank stability. Subsidized firms, in turn …

One of the main concerns associated with central bank digital currencies (CBDC) is the disintermediating effect on the … banking sector in general, and the risk of bank runs in times of crisis in particular. This paper examines the implications of … an interest-bearing CBDC on banking crises in a dynamic bank run model with a financial accelerator. The analysis …

We integrate bank and bond financing into a two-sector neoclassical growth model to examine the stabilization effect of … endogenous bank leverage adjustment. We show that although bank leverage amplifies shocks, the increase of leverage to a decline … in bank equity is an automatic stabilizer in downturns, since it partially offsets the decline of bank lending to …

Loan guarantees represent a form of government intervention to support bank lending. However, their use raises concerns … as to their effect on bank risk-taking incentives. In a model of financial fragility that incorporates bank capital and a … bank incentive problem, we show that loan guarantees reduce depositor runs and improve bank underwriting standards, except …