Stress-tests provide complementary information about banks’ risk exposures. Recent empirical evidence, however, has uncovered potential inaccuracies in stress-test based assessments. We investigate the regulatory implications of these inaccuracies. Without stress-tests, the regulator cannot...

2008 Global Financial Crisis has highlighted the importance of systemic risk, which had been overlooked prior to the crisis. Since then, systemic risk, which focuses on the risk contributions of financial institutions to the whole financial system, has become a necessary complement of...

The Durbin Amendment to the Dodd–Frank Act yielded regulations that cap debit card interchange fees for banks with over $10 billion in assets. Using a difference-in-differences identification strategy, we document and quantify the resulting decline in interchange income for treated banks. We...

Using administrative account level data, we study the largest financial inclusion program in India that led to 255 million new bank account openings. About 77% of these accounts maintain a positive balance. While the initial usage remains quite infrequent, it gradually converges to that of...

We quantify the gains from regulating banks' maturity transformation in an infinite horizon model of banks which finance long-term assets with non-tradable debt. Banks choose the amount and maturity of their debt trading off investors' preference for short maturities with the risk of systemic...

Continued consolidation of the U.S. banking industry and a general increase in the size of banks has prompted some policymakers to consider policies that discourage banks from getting larger, including explicit caps on bank size. However, limits on the size of banks could entail economic costs...

This paper presents a balance sheet approach to understanding the reform of the financial system to include narrow banking. It was prepared for a conference at the Jerome Levy Economics Institute of Bard College, June 23-28, 1991

The book “New Cooperative Banking in Europe. Strategies for Adapting the Business Model Post Crisis”, edited by Marco Migliorelli and published by Palgrave Macmillian in 2018, rigorously delves into the future of the European cooperative banking sector. Corroborated by up to date and hard to...

This paper is a review of fintech and its interaction with banking. Included in fintech are innovations in payment systems (including cryptocurrencies), credit markets (including P2P lending), and insurance, with blockchain-assisted smart contract playing a role. The paper provides a definition...

Using unique data on over-the-counter bank stock prices and balance sheet information we explore bank funding cost differentials using the risk-adjusted return gap between the largest and the smallest depository institutions. We find that the largest commercial bank stocks, ranked by market...