Research news, analysis and insights

Bank liquidity and the cost of debt

Since the 2007–09 crisis, tougher bank liquidity regulation has been imposed which aims to ensure banks can survive a severe funding stress. Critics of this regulation suggest that it raises the cost of maturity transformation and reduces productive lending. Rhiannon Sowerbutts discusses a bank run model with a unique equilibrium where solvent banks can fail due to illiquidity.

 

Publication

Total
0
Shares
Leave a Reply

Your email address will not be published. Required fields are marked *

Previous Article

Empire and Aftermath

Next Article

Tolstoy’s thinking on teaching and learning

×
You have free insight(s) remaining for this month.
Related Posts
error: Faculti Content is protected. Please check our Privacy Policy and Terms and Conditions.

Add the Faculti Web App to your Mobile or Desktop homescreen

Install
×