Editor’s Note: The Federal Reserve Bank of New York’s Staff Report, Shadow Banking Regulation, by Tobias Adrian and Adam B. Ashcraft is attached below.
The Federal Reserve Bank of New York has published a staff report that finds “uneven” progress in achieving a more stable shadow-banking system.
Authors Tobias Adrian and Adam Ashcraft review the rapidly growing literature on shadow banking and provide a “conceptual” framework for its regulation.
Having contributed to the credit boom in the early 2000s, the authors note how shadow banks “collapsed during the financial crisis of 2007–09”. Since that time, regulatory reform efforts have aimed at strengthening the stability of the shadow banking system.