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Top US banks’ secured funding outflows grow to record $1.6trn

Created at 26 Aug · 3:41 AM1 source↑ Market-relevant
IN SHORT

Secured wholesale funding outflows under the liquidity coverage ratio stress scenario climbed by $127.7 billion at eight US global systemically important banks in Q2, reaching a record $1.59 trillion. All eight banks reported record highs for this component.

Key Numbers

$1.6trnrecord secured funding outflows at top US banks
$127.7 billionquarterly increase in outflows
8.7%quarterly rise in combined outflows
2017year record-keeping began

Who's Involved

US global systemically important banks (G-Sibs)
experienced record secured funding outflows in Q2
BNY
experienced the sharpest increase in outflows

↳ Why This Matters

Record outflows suggest potential stress in the banking system's funding, which could impact liquidity and lending capacity, potentially signaling broader financial stability concerns.

Key facts

  • Secured wholesale funding outflows under the liquidity coverage ratio stress scenario increased by $127.7 billion at eight US global systemically important banks in Q2.
  • The combined outflows reached a record $1.59 trillion.
  • This represents an 8.7% increase in outflows for the quarter.
  • All eight banks involved set new record highs for this specific LCR component.

Secured wholesale funding outflows at the eight US global systemically important banks (G-Sibs) reached a record $1.59 trillion in the second quarter, marking the largest quarterly increase since 2017. These outflows climbed by $127.7 billion during the quarter, an increase of 8.7%. All eight banks reported record highs for this specific component of the liquidity coverage ratio (LCR) stress scenario.

Frequently asked questions

These are outflows of cash that banks must hold to meet obligations under stressed conditions, specifically related to secured funding arrangements.

The LCR is a regulatory standard designed to ensure banks hold sufficient high-quality liquid assets to survive a significant stress scenario lasting 30 days.

These are the largest and most interconnected banks in the US financial system, designated by regulators as critical to global financial stability.
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How It Developed

Secured wholesale funding outflows at eight US global systemically important banks increased by $127.7 billion in Q2.
Combined outflows reached a record $1.59 trillion, an 8.7% rise.
All eight banks reported record highs for this liquidity coverage ratio component.

Sources

T1
Top US banks’ secured funding outflows grow to record $1.6trnRisk.net

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