Banks could be stuck with riskiest corporate loans during downturn – Fed paper

Federal Reserve

Banks may be forced to hold on to the riskiest loans during a downturn, research published by the Federal Reserve finds.

Seung Jung Lee et al use a dataset that links credit and pricing information to examine the disruption of corporate loans from 2010–18. They examine the loan syndication process, which involves a group of lenders funding various portions of a single loan.

The authors find that, at the end of 2018, the amount of outstanding leveraged loans – those graded BB or lower – was $1

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here:

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: