Discussion Paper

The Side Effects of Shadow Banking on Liquidity Provision

Abstract: Over the past two decades, the growth of shadow banking has transformed the way the U.S. banking system funds corporations. In this post, we describe how this growth has affected both the term loan and credit line businesses, and how the changes have resulted in a reduction in the liquidity insurance provided to firms.

Keywords: liquidity; credit lines; term loans; shadow banks;

Access Documents


Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Liberty Street Economics

Publication Date: 2019-11-13

Number: 20191113b