This paper studies two new models in which banks face a non-trivial asset allocation decision. The first model (CVH) predicts a negative relationship between ba

We study a banking model in which banks invest in a riskless asset and compete in both deposit and risky loan markets. The model predicts that as competition in

We present evidence of a risk-taking channel of monetary policy for the U.S. banking system. We use confidential data on the internal ratings of U.S. banks on l

This paper studies the impact of competition on the determination of interest rates and banks’ risk-taking behavior under different assumptions about deposit

This study reinvestigates the theoretical relationship between competition in banking and banks' exposure to risk of failure. There is a large existing literatu