Finally Some Good News On The Bank Crisis

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by Tyler Durden
Friday, Mar 24, 2023 - 02:42 PM

One can argue that one of the catalysts that accelerated the bank crisis over last weekend, potentially culminating with the collapse of Credit Suisse, was JPMorgan's - accurate and objective - analysis, according to which the US bank crisis had already led to over $500 billion in deposits flight, bringing the YTD total to a staggering $1.1 trillion in bank runs from the "most vulnerable banks."

So it's only fair that one week after that potentially devastating piece of research, that JPM is now out with a follow up which actually presents a picture of a banking sector in turmoil which however appears to finally be stabilizing.

As JPMorgan's fixed income strategist Jay Barry writes after looking at the latest Fed H.4.1 statement, borrowing at the Fed’s liquidity facilities was little changed in the week through yesterday at $164bn. More importantly,FHLB issuance activity has declined materially, implying reduced FHLB advance borrowing demand. Thus, it appears that deposit outflows at the very least have slowed