The Federal Reserve Board published research assessing whether the global systemically important bank (GSIB) surcharge requirement led GSIBs to reduce the systemic risk posed by their activities, finding limited evidence overall that banks managed their activities to avoid increases in their surcharges. For a sample of international banks, proximity to GSIB surcharge thresholds is associated with slower growth in intra-financial system liabilities, underwriting activities, and holdings of trading and available-for-sale securities. For US GSIBs under the method 2 GSIB surcharge framework, proximity to surcharge thresholds is associated with slower growth in trading and available-for-sale securities and in short-term wholesale funding.
Federal Reserve Board 2025-04-16
Federal Reserve Board study finds limited evidence GSIBs adjust activities to avoid higher GSIB surcharges
The Federal Reserve Board's research found limited evidence that the global systemically important bank (GSIB) surcharge requirement led banks to reduce systemic risk. International banks near surcharge thresholds showed slower growth in intra-financial system liabilities and certain securities holdings. US GSIBs under method 2 also exhibited slower growth in trading securities and short-term wholesale funding.