Large Bank Supervision Forum 2023

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Puppies 2

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Q4 Summary • Influx of liquidity from COVID • Record NIM • Strong profitability • Interest rates are crushing securities values • Banks trying to deploy that liquidity, while also trying to manage liquidity risk caused by security portfolio • Liquidity cited as a concern for Fed and FDIC Risk staff • Started with having it in the bank • Now making loans • Is loan making too aggressive? • Loan to deposits up across the board • Is this coming on backs of their customers? • CSBS predictive analytics, number of high-risk banks has doubled • Liquid assets to total assets is coming back down