Big U.S. Banks’ Government-Backed MBS Holdings Hit Record High

The largest U.S. banks increased their holdings of federally-backed mortgage securities by about $7 billion during the first week of February, raising their total stake to a record 15.8% of their combined assets, figures from the Federal Reserve show.

Across all banks in the U.S., total assets fell by 0.3% to $20.6 trillion in the week ended Feb. 3, according to the Fed.

  • The share of safe assets -- virtually riskless investments such as cash, Treasuries, and securities effectively guaranteed by the U.S. government -- dropped to 34.3% from 34.5%.
  • Loans and leases were little changed at 50.2% of total assets.
  • As a percentage of deposits, loans and leases fell to 63.4% -- a record low.
  • As a percentage of total assets, Treasuries and agency securities were the highest since Dec. 14, 1994.
Big U.S. Banks’ Government-Backed MBS Holdings Hit Record High

The Fed also reported the assets of large, small and foreign-related U.S. lenders. Here’s how their balance sheets compare on selected parameters:

Big U.S. Banks’ Government-Backed MBS Holdings Hit Record High
  • At the 25 biggest U.S. banks, total assets fell 0.2% to $11.99 trillion.
  • Loans and leases as a percentage of deposits hit an all-time low.

Here’s how big banks’ balance sheets have changed since the Fed’s previous weekly report:

Balance Sheet ItemThis Week, $ BnPrev Week, $ Bn% of Total Assets, Latest Week% of Total Assets, Year Before% pt Change from 5Y Avg
Cash1729.11731.214.47.73.2
Agency Mortgage-Backed Securities1895.51888.815.8152.1
Residential Real Estate Loans1397.91398.411.714.3-2.9
Commercial Real Estate Loans745.8747.46.27.3-1
Consumer Loans1129.91131.49.411.7-1.7
Commercial and Industrial Loans1274.21275.410.612.5-1.8
  • The total assets of smaller and foreign-related banks dropped 0.5% to $8.57 trillion.
  • As a percentage of total assets, small and foreign-related banks’ holdings of Treasuries and agency securities were the highest since Sept. 25, 2019.
  • Loans and leases as a percentage of deposits were the lowest since Sept. 02, 2015.

Here’s how smaller and foreign-related banks’ balance sheets have changed since the previous report:

Balance Sheet ItemThis Week, $ BnPrev Week, $ Bn% of Total Assets, Latest Week% of Total Assets, Year Before% pt Change from 5Y Avg
Cash1459.31519.11712.40.9
Agency Mortgage-Backed Securities720.1708.28.47.81.1
Residential Real Estate Loans831835.59.711-0.8
Commercial Real Estate Loans1672.61682.719.521.1-0.2
Consumer Loans380.63814.45.2-0.3
Commercial and Industrial Loans1295.41289.215.1140.8

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