3,882
edits
Banking Industry health after Silicon Valley Bank collapse: Difference between revisions
Banking Industry health after Silicon Valley Bank collapse (view source)
Revision as of 19:31, 16 March 2023
, 16 March 2023no edit summary
No edit summary |
|||
| Line 87: | Line 87: | ||
== Mark to Market Losses == | == Mark to Market Losses == | ||
[[File:Banks 1.PNG|thumb|[https://deliverypdf.ssrn.com/delivery.php?ID=916073065102098074098005011117089007031005031068030005011122071010111071127088114109050018100005055097010089127107091118073001055038014069012120114100031011116019036079067003012072028106075069028021119109075123005010127067089072026112069005065092005&EXT=pdf&INDEX=TRUE Mark-to-Market Statistics by Bank Size]]] | |||
Recent research suggests that Tte market value of U.S. banking system assets is approximately $2 trillion lower than suggested by their book value. (see image for more details). <ref>https://deliverypdf.ssrn.com/delivery.php?ID=916073065102098074098005011117089007031005031068030005011122071010111071127088114109050018100005055097010089127107091118073001055038014069012120114100031011116019036079067003012072028106075069028021119109075123005010127067089072026112069005065092005&EXT=pdf&INDEX=TRUE</ref> | Recent research suggests that Tte market value of U.S. banking system assets is approximately $2 trillion lower than suggested by their book value. (see image for more details). <ref>https://deliverypdf.ssrn.com/delivery.php?ID=916073065102098074098005011117089007031005031068030005011122071010111071127088114109050018100005055097010089127107091118073001055038014069012120114100031011116019036079067003012072028106075069028021119109075123005010127067089072026112069005065092005&EXT=pdf&INDEX=TRUE</ref> | ||
| Line 95: | Line 96: | ||
=== The Role of Uninsured Leverage === | === The Role of Uninsured Leverage === | ||
The average bank funds 10 % of its assets with equity, 63% with insured deposits, and 23% with uninsured debt comprising uninsured deposits and other debt funding. | The average bank funds 10 % of its assets with equity, 63% with insured deposits, and 23% with uninsured debt comprising uninsured deposits and other debt funding. | ||
[[File:Banks 2.PNG|thumb|Insolvent Banks Under Different Cases]] | |||
Banks differ significantly in the share of funding they obtain from uninsured sources. The 5th percentile bank uses 6 percent of uninsured debt. For this bank, 94% of funding is not run prone comprising equity and deposits. | Banks differ significantly in the share of funding they obtain from uninsured sources. The 5th percentile bank uses 6 percent of uninsured debt. For this bank, 94% of funding is not run prone comprising equity and deposits. | ||