Limiting characteristic function of the total solvency shock
Let S1(0)=∑w≠1Sw1(0)S^{(0)}_{1}=\sum_{w\ne 1}S^{(0)}_{w1}S1(0)=∑w=1Sw1(0) be the total solvency shock transmitted to bank 111 in step 000, conditioned on the type T1=TT_1=TT1=T. Let f^Δ(0)(k′∣T′)\hat f^{(0)}_\Delta(k'\mid T')f^Δ(0)(k′∣T′),…