Liquidity changes hands

Why asset owners need to rethink their role in a market-led regime

This Special Report, sponsored by New York Life Investment Management, explores how global liquidity provision has evolved from a bank-led system before the global financial crisis, to a central bank-led era through the crisis and pandemic, and now toward a more fragmented, market-led regime.

Drawing on New York Life Investment Management’s research across four decades and three major economies, and featuring insights from Julia Hermann, CFA, Global Market Strategist, the report examines how post-crisis regulation shifted risk warehousing, market-making and credit provision from traditional bank balance sheets towards non-bank financial institutions and asset owners.

Across five themes—migrating risk, allocators as liquidity suppliers, central bank responses, global divergence and portfolio adaptation—the report considers what this changing architecture means for investors. It highlights why asset owners should assess liquidity needs, risks and backstops across the portfolio as a whole, while asking whether today’s returns adequately compensate them for providing the balance-sheet capacity once supplied by banks.

Download the Special Report