The Federal Reserve stated that "the U.S. banking sector is generally well-positioned to overcome the recent disruptions it has experienced. However, the experience may cast a shadow over credit conditions in the future." In its semi-annual report on financial stability, it noted that "the overall funding risks facing banks remain low, and companies still have ample liquidity."
It emphasized that "the additional efforts made by regulatory bodies in the United States following the sudden collapses of Silicon Valley Bank and Signature Bank in March should support the system if further pressures arise." The Federal Reserve added that it is prepared to tackle any liquidity pressures that may emerge and is committed to ensuring the U.S. banking system continues to perform its vital roles.
The central bank mentioned in its report that "more than 45% of bank assets are set to be repriced or mature within a year, indicating no significant exposure to lower-quality securities for extended periods." Although the amount of uninsured deposits in banks is declining, it remains above historical averages following the influx of deposits due to the COVID-19 pandemic.
The bank issued this report shortly after releasing a survey indicating that "banks are tightening credit standards amid weak demand for loans."
