While capital controls, particularly those on bond inflows, can have a direct effect on the share of debt liabilities, FX-related prudential measures that limit a bank's ability to pass on the currency risk to domestic borrowers can also affect debt liabilities indirectly, by limiting the bank's ability to fund itself abroad to the extent that foreign lenders demand a significant premium for holding currency risk. When included jointly in the regression, however, the statistical significance of the association between economy-wide capital controls and a lower share of debt liabilities survive. This makes intuitive sense inasmuch as FX-related prudential measures can, at most, affect flows that are intermediated through the banking system, whereas Kcont potentially apply to all flows.