We study a preferred equity infusion government program set to mitigate interbank contagion. Financial institutions are prone to insolvency risk channeled through the network of interbank debt and to the risk of bank runs. The government seeks to maximize, under budget constraints, the total net worth of the financial system or, equivalently, to minimize the dead-weight losses induced by bank r...

Previous research has shown that loan loss provisions and security gains and losses are used to manage banks’ net income. However, these income components are reported below banks largest operating component, net interest income (NII). This study extends the literature by examining whether banks exploit the accounting permitted under past and current hedge accounting standards to manage NII by ...

Despite recent innovations that might have reduced banks’ reliance on brick-and-mortar branches for distributing retail financial services, the number of U.S. bank branches has continued to increase steadily over time. Further, an increasing percentage of these branches are held by banks with large branch networks. This paper assesses the implications of these developments by examining a series...

This study investigates monetary and financial shocks on macroeconomic variables, focusing on the role of banking intervention. For this purpose, a Keynesian dynamic stochastic general equilibrium (DSGE) model is designed for Iran’s economy that involves financial and banking sectors. The results of the model simulation show that the financial accelerator theory works in the Iranian economy. Al...

The research aims to examine the impact of credit risk evaluation on financial performance American and European commercial banks during period 2017-2021. A set 37 were selected represent entire banking industry those two continents. To measure this relationship, mathematical models created. Research has revealed that influences as represented by ROE ROA. study also concludes indicators analyze...

After the revolution of 1979, all of the private banks existing in Iran were nationalized and the economic system was based on public, cooperative and private sectors and banking operations were categorized in public sector. Consequently, private sector and foreign banks were bared from doing banking operations in Iran. According to the recent laws and regulations passed in Iran, the Irani...

Financial safety nets are intended to reduce the likelihood and severity of financial crises that have macroeconomic externalities. While safety nets are intended to confer benefits on the macroeconomy, their design and implementation may confer disproportionate benefits on identifiable sectors, such as banks and depositors. In this study, we distinguish between safety net benefits and subsidie...