Data Snacks, Getting the rules right, Member Exclusive

Risk on the mind: Shadow bank loans and AI may be a risk to the financial system

  • Data by the Federal Board of Governors revealed that lenders in the US have loaned upwards of $1 trillion to non-deposit-taking financial companies.
  • Along with loans to shadow banks, regulators are also eyeing AI and its possible negative impacts on the financial system.
Rabab Ahsan | February 13, 2024
close

Email a Friend

Risk on the mind: Shadow bank loans and AI may be a risk to the financial system

The Financial Stability Oversight Council (FSOC), which brings the leadership from the Federal Reserve and Securities and Exchange Commission under one roof to monitor systemic risks, has identified loans to shadow banks and growing AI usage as possible risks to the current financial system.

Shadow bank loans: Last week, data by the Federal Board of Governors revealed that lenders in the US have loaned upwards of $1 trillion to non-deposit-taking financial companies like fintechs and private credit investors by the end of January this year. The total amount of loans to shadow banks increased by 12% last year while general lending growth remained slow.

Trend lines showing that loans to non-bank financial groups are growing faster than overall lending.
Source: Financial Times

subscription wall for TS Pro

0 comments on “Risk on the mind: Shadow bank loans and AI may be a risk to the financial system”

10-Q, Member Exclusive

Year-End Showdown: Wall Street’s perks & promotions are messier than your holiday leftovers

  • Wall Street bonuses are set to jump by as much as 35% this year, fueled by a rebound in corporate deals, stock sales, and debt transactions in 2024.
  • However, not all members of Wall Street institutions may find a pot of gold at the end of the rainbow. Citi, for example, is moving in the opposite direction.
Sara Khairi | December 09, 2024
10-Q, Member Exclusive

Bank of America on unlocking greater accessibility in reward programs

  • How effective are reward programs in retaining customers, how do different generations interact with them, and how accessible are they to the average consumer?
  • Shikha Narula, Bank of America's Head of Rewards, shares how Bank of America's Preferred Rewards program measures and evaluates its performance in these areas.
Sara Khairi | November 25, 2024
10-Q, Member Exclusive

Trump 2.0: Can Wall Street handle round two?

  • With the leader now chosen, it's time to face the bigger question: what impact will Trump's victory have on the nation, the economy, and the banking sector?
  • While there’s plenty of talk around this topic, we narrow in on the core cause-and-effect dynamics that could unfold in the banking sector.
Sara Khairi | November 18, 2024
10-Q, Member Exclusive

The little-noticed side of TikTok finance: From off-the-wall money tips to fresh perspectives

  • Following TikTok for financial advice is about learning to separate the real value from the misleading chatter.
  • We look at one of the more grounded voices in the TikTok financial space and discuss why her content may make practical sense for those looking to improve their financial journey -- especially women.
Sara Khairi | November 11, 2024
10-Q, Member Exclusive

What practices could differentiate banks in the talent war, even if they ruffle their feathers?

  • Reports of sudden deaths among young people, including One Direction's Liam Payne, have raised alarms. A recent case in the financial sector linked to brutal work hours has particularly gained attention and unsettled the industry.
  • Banks are keen to attract top talent through job fairs and internships, yet may miss out on addressing what employees value beyond salary.
Sara Khairi | November 04, 2024
More Articles