Friday Dec 12, 2025 ⋅ 2pm – 4pm (Brasilia Standard Time - São Paulo)

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This analysis examines **who used the Bank Term Funding Program (BTFP)** during the 2023 banking crisis and what determined that choice. Building on Jiang et al. (2024) Market-to-market (MTM) Loss, we test whether BTFP's unique **par valuation** feature attracted banks facing **insolvency risk** (not just liquidity risk). **Key Hypotheses:** 1. Banks with higher insolvency risk AND more OMO-eligible assets preferentially chose BTFP 2. BTFP usage is driven more by insolvency concerns than pure liquidity needs 3. The interaction of run risk and OMO-eligible capacity predicts BTFP usage (Borrowing)

Linear Simple Regression