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Discussion Paper
Foreign banks' asset reallocation in response to the introduction of the Intermediate Holding Company rule of 2016
The implementation of the 2016 intermediate holding company (IHC) rule required foreign banking organizations (FBOs) operating with more than $50 billion total global consolidated assets and with $50 billion or more in U.S. non-branch assets to consolidate their non-branch activities – including their U.S. subsidiaries and U.S. broker-dealers – into holding companies, to be supervised by the Federal Reserve.
Report
Uptake of the Main Street Lending Program
The Main Street Lending Program (Main Street) was one of several new credit facilities launched by the Federal Reserve and the U.S. Department of the Treasury (Treasury) in response to the COVID-19 pandemic. The Federal Reserve published draft terms for Main Street on April 9, 2020, and the program started purchasing loan participations on July 6, 2020, with the goal of supporting lending to a wide range of small and medium-sized businesses that were in sound financial condition before the onset of the COVID-19 pandemic. When the program’s draft terms were first circulated, pandemic-related ...
Discussion Paper
Uptake of the Main Street Lending Program
The Main Street Lending Program (Main Street) was one of several new credit facilities launched by the Federal Reserve and the U.S. Department of the Treasury (Treasury) in response to the COVID-19 pandemic.
Discussion Paper
The Side Effects of Shadow Banking on Liquidity Provision
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.
Working Paper
Cross-Border Bank Flows and Monetary Policy
We analyze the impact of monetary policy on bilateral cross-border bank flows using the BIS Locational Banking Statistics between 1995 and 2014. We find that monetary policy in the source countries is an important determinant of cross-border bank flows. In addition, we find evidence in favor of a cross-border bank portfolio channel. As relatively tighter monetary conditions in source countries erode the net worth and collateral values of domestic borrowers, banks reallocate their claims toward safer foreign counterparties. The cross-border reallocation of credit is more pronounced for banks ...