Bank Resolution Trade-Offs Under Coupled Liquidity and Credit Risks: An Agent-Based Network Analysis of Systemic Stability
Qianqian Gao, Hongjie Pan, Yinglin Liu, Naixi Chen · 2026
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Description
Qianqian Gao, Hongjie Pan, Yinglin Liu, and Naixi Chen simulate bank resolution choices when liquidity and credit risks interact, in a 2026 agent-based study. Their network holds banks, depositors, firms, and a central bank, letting plans play out over time. Resolution options included selling assets, expanding liabilities, granting debt relief, and extending debt maturities.
Selling assets helped at mid-level depreciation yet hurt when losses grew severe. Debt relief clearly made the whole system steadier, while extension helped only under certain liquidity settings and extension limits. Pairing debt relief with asset sales produced a positive synergy. The authors offer the results as guidance for joined, adaptive regulation.
Catalog record
| CREATOR | Qianqian Gao, Hongjie Pan, Yinglin Liu, Naixi Chen |
|---|---|
| YEAR | 2026 |
| COLLECTION | PAPERS |
| FORMAT | TXT |
| FILE SIZE | 60 KB |
| VERSION | 1.0 |
| LICENSE | CC BY 4.0 |
| RIGHTS | CC BY |
| SOURCE | Europe PMC |