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Discussion Paper

The interaction of bank leverage, interest-rate risk, and runnable funding


Abstract: Silicon Valley Bank (SVB), Signature Bank, First Republic Bank (FRC) had too little useable liquidity relative to their runnable funding and too little capital given the magnitude of their interest rate risk. The mismanagement of these vulnerabilities ultimately contributed to a loss of confidence in their business models.

https://doi.org/10.17016/2380-7172.3605

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File(s): File format is text/html https://www.federalreserve.gov/econres/notes/feds-notes/the-interaction-of-bank-leverage-interest-rate-risk-and-runnable-funding-20240830.html

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Bibliographic Information

Provider: Board of Governors of the Federal Reserve System (U.S.)

Part of Series: FEDS Notes

Publication Date: 2024-08-30

Number: 2024-08-30-2