Nguyen, Thach Vu Hong - 2020
We examine the impact of Federal Reserve stress tests from 2009 to 2016 on U.S. bank liquidity creation. Empirical … results show that regulatory stress tests have a negative effect on both on- and off-balance sheet bank liquidity creation and … asset-side liquidity creation. As banks enter the stress tests, they reduce their liquidity creation to avoid failing the …