The traditional model of bank-led financial intermediation, where banks issue demandable deposits to savers and make … size. Implicit banks' costs and subsidies explain shifting bank balance sheet composition. Together, these forces explain …

In the face of rising interest rates in 2022, banks mitigated interest rate exposure of the accounting value of their … derivatives left most assets unhedged. The banks most vulnerable to asset declines and solvency runs decreased existing hedges … declines, banks used accounting reclassification to diminish the impact of interest rate increases on book capital. Banks …