Working Paper 12
Banking System Stress: Observable Conditions, Latent Vulnerabilities, and the First Pressure Points
September 2026
Abstract
Is there stress in the global banking system right now? Reconstructing 56 banks across 13 jurisdictions from Q2 2026 filings, we find no observable system-level stress: capital and liquidity buffers are intact. But price conditions are deteriorating, the binding stress sequence runs through funding before capital, the 2023 backstops are gone, and a 13-indicator monitoring dashboard shows two indicators at warning thresholds.