Banks’ maximization problem

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Table of contents

Chapter 1 General Introduction
1.1 Several Major Features of Eurozone Crisis
1.2 The Outline of the Ph.D. Thesis
Chapter 2 Money and Banking crisis in a small open economy
2.1 Introduction
2.2 The framework
2.2.1 Basic assumptions
2.2.2 The economic and environmental sequence of actions
2.2.3 Currency
2.3 The maximization problem of banks at date 2
2.3.1 Banks’ maximization problem at date 2 without a currency mismatch
2.3.2 Banks’ maximization problem at date 2 with a currency mismatch
2.4 Economic policies
2.4.1 Intervention in project restructuring
2.4.2 Minimum capital ratio
2.4.3 The impact of the informal sector and open market policy
2.5 Conclusion
Chapter 3 The banking crisis with interbank market freezes
3.1 Introduction
3.2 Related literature
3.3 The model
3.3.1 The environment
3.3.2 Market discipline in the interbank lending market
3.3.3 The maximization problem of banks
3.4 Crises in the interbank market
3.4.1 Pure confidence crisis
3.4.2 Foreign debt crisis and the domestic interbank market
3.4.3 Asymmetric information and the interbank market
3.5 The government’s crisis response
3.5.1 Bailout during a pure confidence crisis
3.5.2 Bailout during a crisis resulting from a foreign debt crisis
3.5.3 Preventive policy to avoid a crisis due to gambling behavior
3.6 Conclusion
Chapter 4 Banking and Sovereign Debt Crises in a Monetary Union Without Central Bank Intervention
4.1 Introduction
4.2 A small economy model with a banking system
4.2.1 The environment
4.2.2 The optimal allocation (normal times)
4.3 The financial safety net: regulatory measures and government deposit guarantee
4.3.1 The unregulated economy (α = 0)
4.3.2 Liquidity regulation : α > 0
4.3.3 Government deposit guarantee
4.4 The financial safety net in a sovereign debt crisis
4.4.1 Role of investors’ expectations
4.4.2 Twin banking and sovereign debt crisis
4.4.3 Potentially perverse effects of regulation
4.5 Policy issues
4.5.1 Role of credit rating agencies
4.5.2 Contagion
4.5.3 Eurobonds
4.6 Conclusion
Chapter 5 Banking Crisis, Moral Hazard and Fiscal Policy Responses
5.1 Introduction
5.1.1 Relationship to the literature
5.2 Basic framework
5.3 Fiscal policy ignoring the potential bailout
5.4 Fiscal response to the crisis
5.4.1 Commitment
5.4.2 Discretion
5.5 Crisis resolution through public lending
5.6 Conclusion
Chapter 6 Conclusion
6.1 Summary
6.2 Extensions
Bibliography