A Theory of Bank Capital

Banks can create liquidity because their deposits are fragile and prone to runs. Increased uncertainty can make deposits excessively fragile in which case there is a role for outside bank capital. Greater bank capital reduces liquidity creation by the bank but enables the bank to survive more often

银行能够创造流动性，因为其存款具有脆弱性且易发生挤兑。不确定性增加会使存款变得过度脆弱，此时外部银行资本便发挥作用。更多的银行资本会降低银行创造流动性的能力，但能提高银行的生存概率。