The Congressional Research Service reviewed (i) how proposed amendments to bank capital rules would change the capital treatment of unrealized losses on the debt securities that large banks hold as assets and (ii) policy considerations on unrealized capital losses post the collapse of Silicon Valley Bank.
The Congressional Research Service found that "binding" leverage requirements on large banking organizations may be "incentivizing behavior counter to financial stability."
In a working paper titled "Digital Currency and Bank Sector Stability," the Office of Financial Research found that when banks face financial friction, a central bank digital currency and other types of stablecoins would likely contribute to financial instability and increase the chances for banking sector crises and financial system distress.
In a "Primer" on bank capital requirements, the Congressional Research Service reviewed the current capital framework and highlighted regulatory policy issues.
A researcher from the Office of Financial Research analyzed the potential threats that decentralized finance poses to financial stability if its growth continues without the guardrails of traditional finance.