|
Archive@NYU >
Stern School of Business >
Finance Working Papers >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/26362
|
| Title: | Liquidity Risk and Competition in Banking |
| Authors: | Landskroner, Yoram
Paroush, Jacob |
| Issue Date: | 30-Jan-2008 |
| Series/Report no.: | FIN-07-053 |
| Abstract: | Liquidity risk is one of the major risks faced by banks in addition to
credit risk, market risk and operating risk. In this paper we construct
a stylized model of bank management where the asset and liabilities
liquidity structure are a key element in determining the bank's exposure
to liquidity risk. The main results of our model are that liquidity risk
increases when competition in the credit market increases while
increasing competition in the deposit market will decrease the liquidity
shortage. Our results are of particular importance as banks face
increased liquidity risk due to the recent developments in the financial markets. |
| URI: | http://hdl.handle.net/2451/26362 |
| Appears in Collections: | Finance Working Papers
|
All items in Faculty Digital Archive are protected by copyright, with all rights reserved.
|
