The theory of financial intermediation highlights various channels through which capital and liquidity are interrelated. Using a simultaneous equations framework, we investigate the relationship between bank regulatory capital and bank liquidity measured from on-balance sheet positions for...

We empirically investigate whether bank bondholders value bank managerial ability, measured as risk-return efficiency, when pricing bond spreads. We find, based on a sample of 1,924 bonds issued by 67 European listed banks, for the period 2002-2011, evidence that bank managerial ability affects...