A thin slice of banks drove almost the entire stress-period increase
GAO analyzed Federal Home Loan Bank membership and borrowing from 2015 through June 2025. Small banks—institutions with $10 billion or less in assets—made up 97% of banks in the analysis, leaving large banks at roughly 3% by count.
Yet large banks supplied 97% of the increase in total Federal Home Loan Bank borrowing during the first quarter of 2023. The concentration means the aggregate liquidity surge was not representative of how the typical member bank changed its borrowing during the crisis.
| Measure | GAO finding | Newsroom calculation/context |
|---|---|---|
| U.S. banks that were members, June 2025 | About 4,100; 93% | Roughly 300 nonmembers implied by rounded figures |
| Outstanding borrowing range, 2015–June 2025 | $189B to $804B | High was about 4.3× the low |
| Small banks in GAO analysis | 97% | Large banks about 3% by count |
| Large-bank share of Q1 2023 borrowing increase | 97% | Nearly all of the aggregate jump |
The decade-wide borrowing range was wide, but median reliance was steadier
Quarter-end outstanding borrowing ranged from $189 billion to $804 billion over the review period. The high is about 4.3 times the low, showing how sharply the system-wide dollar total can move.
GAO nevertheless found median borrowing as a share of median assets generally stayed within a consistent range, including for large banks. A volatile aggregate can coexist with stable typical-bank reliance when a small number of very large institutions drive the dollars.
The evidence did not support a simple troubled-bank narrative
GAO’s econometric models controlled for bank health, macroeconomic factors and economic cycles. From 2015 through 2024, higher Home Loan Bank borrowing was generally associated with more real-estate lending and a lower likelihood of a problem-bank flag, failure or voluntary closure. Results were largely driven by small banks.
Association is not proof that the loans caused those outcomes. GAO also reviewed concerns that secured advances could mask trouble or raise resolution costs. Three large 2023 bank failures renewed those questions, but the study’s results did not support treating all borrowing as a distress signal.
Coordination improved after 2023, but work was still early
Federal Home Loan Banks and regulators added tabletop exercises, collateral-reallocation discussions and a January 2025 working group with the Federal Reserve System. GAO described some efforts as early-stage, with completion expected in late 2025 or 2026.
This newsroom calculated the 4.3-to-one range and the approximate nonmember count from GAO’s rounded figures. The latter is necessarily imprecise: 4,100 divided by 93% implies about 4,409 total banks and about 309 nonmembers, so it is reported only as roughly 300.