{
  "p": "ons",
  "op": "post",
  "title": "\"Dozens of Banks May Have Risks Similar to Silicon Valley Bank, Economists Find \"",
  "url": "https://archive.is/MTGuh",
  "author": "Matt Grossman (@mattgrossman)",
  "body": "Mar 17, 2023 at 3:45 pm ET\nBy  [Matt Grossman](https://archive.is/o/MTGuh/https://www.wsj.com/news/author/matt-grossman)\n\n![](https://archive.is/MTGuh/b037a5586726f34f891438093b4328c4d6e52dc5.jpg)\n*BRYAN BANDUCCI FOR THE WALL STREET JOURNAL*\n\nSilicon Valley Bank failed after rising interest rates reduced the value of its assets and worried customers scrambled to withdraw uninsured deposits. In a new study, economists said they found 186 banks that may be prone to similar risks.\n\nIn a  [paper posted this week](https://archive.is/o/MTGuh/https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4387676)  to the Social Science Research Network, the economists estimated how much market value individual U.S. banks' asset books have lost during the Fed's rapid rate-increasing campaign. The value of such assets, which often include as Treasury notes and mortgage loans, can fall when new bonds have higher rates.\n\nThe economists also examined the proportion of banks' funding that comes from uninsured depositors, or accounts with more than $250,000. They estimated that there are 186 U.S. banks where, if half of uninsured depositors quickly withdrew their funds, even insured depositors  **c**ould face impairments because the bank wouldn't have enough assets to make all depositors whole, potentially forcing the FDIC to step in.\n\nThe research carries an important caveat: It does not take into account hedging, which may help protect many banks against rising interest rates.\n\n\"Our calculations suggest these banks are certainly at a potential risk of a run, absent other government intervention or recapitalization,\" the economists wrote."
}