Large Bank Supervision Forum eBook

Internal Use Only

Identify the correct waterfall under different stress conditions . . .

 Under an immediate stress:  Cash Equivalents (Fed Master Account)  Borrowing Capacity  Loan Capacity  Investment Capacity  Under a longer-term stress:  Brokered and Listing Service (use first under normal conditions or limited stress)  Raise deposit rates and core deposits

 Borrowing Capacity  Slow Loan Growth  Sell Unencumbered Investments (On-Balance Sheet)  Sell Loans

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Internal Use Only

Conclusion . . .

 The Regulatory Agencies need to modernize liquidity analytics and measurements to accommodate a digital world.  Other than having the FDIC insure all deposits, which would likely require congressional action, the rest of the FinPro Liquidity Solution involves actions that the Agencies can take on their own and quickly.  The Bank Term Funding Program could theoretically be melded into the Fed discount Window

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