IMF’s Adrian on the systemic threat posed by a ‘weak tail’ of financial institutions

IMF’s financial counsellor discusses the need for action on run rate assumptions, interest rate risk, deposit insurance and crypto regulation

Tobias Adrian
Photo: John Harrington

The IMF’s Global Financial Stability Report has repeatedly raised concerns about financial institutions being mindful of liquidity, duration and credit risks, especially when leverage is involved. So, were you surprised about the unhedged interest rate exposures at the US’s Silicon Valley Bank (SVB) and other banks?

The GFSR is about multilateral surveillance – the common themes across institutions. As you point out, we have warned about duration risk, credit risk and liquidity risk in general

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