investment system of Bank
Federal Reserve Bank of New York
Staff Reports
Shadow Banking
Zoltan Pozsar
Tobias Adrian
Adam Ashcraft
Hayley Boesky
Staff Report No. 458
July 2010
Revised February 2012
FRBNY
Staff
REPORTS
This paper presents preliminary findings and is being distributed to economists and other interested readers solely to stimulate discussion and elicit comments.
The views expressed in this paper are those of the authors and are not necessarily reflective of views at the Federal Reserve Bank of New York or the Federal
Reserve System. Any errors or omissions are the responsibility of the authors.
Shadow Banking
Zoltan Pozsar, Tobias Adrian, Adam Ashcraft, and Hayley Boesky
Federal Reserve Bank of New York Staff Reports, no. 458
July 2010: revised February 2012
JEL classification: G20, G28, G01
Abstract
The rapid growth of the market-based financial system since the mid-1980s changed the nature of financial intermediation. Within the market-based financial system, “shadow banks” have served a critical role. Shadow banks are financial intermediaries that conduct maturity, credit, and liquidity transformation without explicit access to central bank liquidity or public sector credit guarantees. Examples of shadow banks include finance companies, asset-backed commercial paper (ABCP) conduits, structured investment vehicles (SIVs), credit hedge funds, money market mutual funds, securities lenders, limited-purpose finance companies (LPFCs), and the government-sponsored enterprises
(GSEs). Our paper documents the institutional features of shadow banks, discusses their economic roles, and analyzes their relation to the traditional banking system. Our description and taxonomy of shadow bank entities and shadow bank activities are accompanied by “shadow banking maps” that schematically represent the funding flows of the shadow banking system.
Key words: shadow banking, financial intermediation
Adrian, Ashcraft: Federal Reserve Bank of
Staff Reports
Shadow Banking
Zoltan Pozsar
Tobias Adrian
Adam Ashcraft
Hayley Boesky
Staff Report No. 458
July 2010
Revised February 2012
FRBNY
Staff
REPORTS
This paper presents preliminary findings and is being distributed to economists and other interested readers solely to stimulate discussion and elicit comments.
The views expressed in this paper are those of the authors and are not necessarily reflective of views at the Federal Reserve Bank of New York or the Federal
Reserve System. Any errors or omissions are the responsibility of the authors.
Shadow Banking
Zoltan Pozsar, Tobias Adrian, Adam Ashcraft, and Hayley Boesky
Federal Reserve Bank of New York Staff Reports, no. 458
July 2010: revised February 2012
JEL classification: G20, G28, G01
Abstract
The rapid growth of the market-based financial system since the mid-1980s changed the nature of financial intermediation. Within the market-based financial system, “shadow banks” have served a critical role. Shadow banks are financial intermediaries that conduct maturity, credit, and liquidity transformation without explicit access to central bank liquidity or public sector credit guarantees. Examples of shadow banks include finance companies, asset-backed commercial paper (ABCP) conduits, structured investment vehicles (SIVs), credit hedge funds, money market mutual funds, securities lenders, limited-purpose finance companies (LPFCs), and the government-sponsored enterprises
(GSEs). Our paper documents the institutional features of shadow banks, discusses their economic roles, and analyzes their relation to the traditional banking system. Our description and taxonomy of shadow bank entities and shadow bank activities are accompanied by “shadow banking maps” that schematically represent the funding flows of the shadow banking system.
Key words: shadow banking, financial intermediation
Adrian, Ashcraft: Federal Reserve Bank of