, complementary channel: risk taking. We model banks’ portfolio choice under moral hazard and emphasize the ‘incentive function’ of … equity. We find that (i) an allowance for corporate equity (ACE) and a lower tax rate discourage risk taking and offer … and deposit insurance influence the risk-taking effects of taxation …

results suggest that exposing shareholders to more downside risk can successfully reduce bank failure …

Using evidence from Russia, we explore the effect of the introduction of deposit insurance on bank risk. Drawing on … that larger declines in market discipline generate larger increases in traditional measures of risk. These results hold in …

We analyze link between mortgage-related regulatory penalties levied on banks and the level of systemic risk in the U ….S. banking industry. We employ a frequency decomposition of volatility spillovers (connectedness) to assess system-wide risk … the public, long-term systemic risk among banks tends to increase. From the dynamic perspective, bank penalties represent …

This paper analyzes the effect of the removal of government guarantees on bank risk taking. We exploit the removal of …

. Moreover, pre-crisis incentive pay appears too strong for an optimal trade-off between trading income and risk which maximizes …

incentives to take risk and raise failure probabilities. The competition-stability trade-off is characterized and the …

liquidity risk and characterizes them. Both a solvency (leverage) and a liquidity ratio are required to control the …