How do banks react to increased interbank competition? Recent banking theory offers conflicting predictions about the impact of interbank competition on bank orientation i.e., the choice of relationship based versus transactional banking and bank industry specialization. We empirically investigate the impact of interbank competition on bank orientation and specialization. We employ a data set c...

1. Systemic risk in this context is often defined as the risk that the failure of one participant in a financial system to meet its required obligations will cause other financial institutions to be unable to meet their obligations when due. 2. For more information on the topics discussed here, see Miller and Northcott (2002). T participant in the Japanese large-value payments system, BOJ-NET. ...

This paper investigates the growth dynamics of the bank sectors in the OECD area over the period 1985-1994 and examines whether the structural financial reforms of the late 1980s have affected their growth path. Based on a test of Gibrat’s law of proportionate effect, we find that the 1985-89 period was characterised by size convergence, implying that smaller bank sectors were expanding more ra...

Bank crises, by interrupting liquidity provision, have been viewed as resulting in welfare losses. In a model of banking with moral hazard, we show that second best bank contracts that improve on autarky ex ante require costly crises to occur with positive probability at the interim stage. When bank payoffs are partially appropriable, either directly via imposition of fines or indirectly by the...

ÐTechnological trends require that future scalable microprocessors be decentralized. Applying these trends toward memory systems shows that the size of the cache accessible in a single cycle will decrease in a future generation of chips. Thus, a bank-exposed memory system comprised of small, decentralized cache banks must eventually replace that of a monolithic cache. This paper considers how t...

We studied the potential role of seed bank in the dynamics of the understorey in a turkey oak-sessile oak forest (Querceteum petraeae-cerris) in Hungary. We used long-term records of the herb layer (1973-2006) and the seed bank composition of 2006 to assess the role of seed bank in the regeneration of herb layer. The total cover of herb layer decreased from 22% (1973) to 6% (1988), and remained...

This paper studies the impact of bank mergers on firm-bank lending relationships using information from individual loan contracts in Belgium. We analyse the effects of bank mergers on the probability of borrowers maintaining their lending relationships and on their ability to continue tapping bank credit. The Belgian financial environment reflects a number of interesting features: high banking ...

This paper examines the optimal priority structure and mix of bank and bond market debt within a continuous-time asset pricing framework. Closed-form expressions are derived for the values of renegotiable bank debt, non-renegotiable bond market debt, equity, and levered firm values. We show that the optimal debt structure hinges upon the ex post division of bargaining power between the firm and...