Abstract

http://ssrn.com/abstract=672784
 
 

References (66)



 
 

Citations (4)



 


 



Bank Liquidity Creation (Previously titled 'The Measurement of Bank Liquidity Creation and the Effect of Capital')


Allen N. Berger


University of South Carolina - Moore School of Business; Wharton Financial Institutions Center; Tilburg University - CentER

Christa H. S. Bouwman


Case Western Reserve University - Department of Banking & Finance; Wharton Financial Institutions Center

April 30, 2008


Abstract:     
Although the modern theory of financial intermediation portrays liquidity creation as an essential role of banks, comprehensive measures of bank liquidity creation do not exist. We construct four measures and apply them to data on virtually all U.S. banks from 1993-2003. We find that bank liquidity creation increased every year and exceeded $2.8 trillion in 2003. Large banks, multibank holding company members, retail banks, and recently-merged banks created the most liquidity. Bank liquidity creation is positively correlated with bank value. Testing recent theories of the relationship between capital and liquidity creation, we find that the relationship is positive for large banks and negative for small banks.

Note: Previously titled Bank Capital and Liquidity Creation.

Number of Pages in PDF File: 64

Keywords: Capital Structure, Liquidity Creation, Regulation, and Banking

JEL Classification: G32, G28, G21

working papers series


Download This Paper

Date posted: February 26, 2005 ; Last revised: August 17, 2008

Suggested Citation

Berger, Allen N. and Bouwman, Christa H. S., Bank Liquidity Creation (Previously titled 'The Measurement of Bank Liquidity Creation and the Effect of Capital') (April 30, 2008). Available at SSRN: http://ssrn.com/abstract=672784 or http://dx.doi.org/10.2139/ssrn.672784

Contact Information

Allen N. Berger
University of South Carolina - Moore School of Business ( email )
1705 College St
Francis M. Hipp Building
Columbia, SC 29208
United States
803-576-8440 (Phone)
803-777-6876 (Fax)
Wharton Financial Institutions Center
Philadelphia, PA 19104-6367
United States
Tilburg University - CentER
P.O. Box 90153
Tilburg, DC 5000 LE
Netherlands
Christa H. S. Bouwman (Contact Author)
Case Western Reserve University - Department of Banking & Finance ( email )
10900 Euclid Ave.
Cleveland, OH 44106-7235
United States
216-368-3688 (Phone)
216-368-6249 (Fax)
Wharton Financial Institutions Center
2306 Steinberg Hall-Dietrich Hall
3620 Locust Walk
Philadelphia, PA 19104
United States
Feedback to SSRN


Paper statistics
Abstract Views: 3,662
Downloads: 1,019
Download Rank: 10,371
References:  66
Citations:  4

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo4 in 1.063 seconds