We show that the regulation of bank lending practices is necessary for the optimal provision of private liquidity. In … system nor narrow banking can provide the socially efficient amount of liquidity. If the bankers provided such an amount …

liquidity regulations. Basel III and the capital stress tests introduced new requirements and new definitions while retaining … (HQLAs) are the binding constraints at large U.S. banks, especially for banks that are active in capital markets activities …. Banks have been holding more CET1 and a larger share of Level 1 HQLAs since the financial crisis of 2007 to 2009. We also …

the interaction between entrepreneurs' moral hazard and liquidity provision by banks as analyzed by Holmstrom and Tirole … (1998). They impose capital requirements on banks and calibrate the regulation using the Basel II risk-weight formula …

projections as an exogenous shock to banks and analyze how this shock is transmitted to consumer credit markets. First, we … document that banks in the 90th percentile of the capital gap reduce their new supply of risky credit by 13 percent compared … these banks find alternative ways to remain competitive and attract customers by lowering interest rates and offering more …