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- W4361002092 abstract "The majority of bank liabilities are deposits typically not withdrawn for extended periods. We propose a dynamic model of banks in which depositors forecast banks' leverage and default decisions, and withdraw optimally by trading off current against future liquidity needs. Endogenous deposit maturity creates a time-varying dilution problem that has major effects on bank dynamics. Interest rate cuts produce delayed increases in bank risk which are stronger in low rate regimes. Deposit insurance can exacerbate the deposit dilution and amplify the increase in bank risk." @default.
- W4361002092 created "2023-03-30" @default.
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- W4361002092 date "2023-04-01" @default.
- W4361002092 modified "2023-09-25" @default.
- W4361002092 title "Dynamic banking with non-maturing deposits" @default.
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- W4361002092 doi "https://doi.org/10.1016/j.jet.2023.105644" @default.
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