Fed Minutes Highlight Bank Interest Rate Risk Remains Above Historical Norms
According to ChainCatcher, citing Jinshi News, the Federal Reserve released the minutes of its July meeting, noting that vulnerabilities related to leverage in the financial sector were described as "significant." Although regulatory capital ratios in the banking industry remain high and all banks participating in the annual regulatory stress test were able to maintain minimum capital requirements under stress scenarios, banks are still considered more susceptible to interest rate risk compared to historical norms. In the non-bank sector, life insurance companies continue to increase their allocation to private credit and risk assets, with part of the funding coming from short-term non-traditional liabilities.
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