US banks shun least liquid assets for HQLAs
Charles Schwab bucks trend with move toward Level 2
US banks shrunk the proportion of their high-quality liquid assets (HQLAs) stemming from Level 2 assets to just 2.8% in the second quarter, the lowest such figure on record.
Across 13 reporting banks, Level 2 assets – made up mostly of certain government securities, covered bonds and corporate debt securities and generally less safe and liquid than Level 1 assets – were at $97.7 billion at the end of Q2, down 40.4% quarter over quarter and 70% year on year.
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