Title: Market Liquidity, Funding Liquidity and Bank Quality
Abstract: The seminal paper of Brunnermeier & Pedersen (2009) distinguishes two channels for
banks to obtain liquid assets, namely a market liquidity channel and a funding liquidity
channel. This thesis adds to the existing literature by examining whether the use of market
liquidity and funding liquidity channels depends on bank quality. The data covers quarterly
data from 2001 until 2014 of banks in the USA. I find that high-quality banks make less
use of the market liquidity channel compared to low-quality banks. The use of the funding
liquidity channel could not be associated with bank quality.
Publication Year: 2017
Publication Date: 2017-02-16
Language: en
Type: article
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