2023 Risk Review | i

TABLE OF CONTENTS

INTRODUCTION............................................................................................................................... 1

SECTION 1: Executive Summary....................................................................................................... 3

Key Risks to Banks .................................................................................................................................. 4

SECTION 2: Overview of the Economy, Financial Markets, and Banking Industry ................................. 7

Economy ................................................................................................................................................. 7

Financial Markets.................................................................................................................................. 12

Banking Industry .................................................................................................................................. 16

SECTION 3: Credit Risks ...................................................................................................................... 23

Agriculture ............................................................................................................................................ 23

Commercial Real Estate........................................................................................................................ 28

Consumer Lending ............................................................................................................................... 33

Energy ................................................................................................................................................... 37

Housing ................................................................................................................................................. 40

Leveraged Lending and Corporate Debt.............................................................................................. 46

Nonbank Financial Institution Lending............................................................................................... 50

Small Business Lending........................................................................................................................ 53

SECTION 4: Market Risks .................................................................................................................... 57

Liquidity and Deposits.......................................................................................................................... 57

Net Interest Margins and Interest Rate Risk ........................................................................................ 62

SECTION 5: Operational Risk ..........................................................................................................67

SECTION 6: Crypto-Asset Risk .........................................................................................................71

SECTION 7: Climate-Related Financial Risk.....................................................................................73

ACRONYMS AND ABBREVIATIONS....................................................................................................79

GLOSSARY OF TERMS......................................................................................................................81