Spillovers of funding dry-ups

We uncover a new channel for spillovers of funding dry-ups. The US money market fund (MMF) reform led to an exogenous reduction in unsecured MMF some banks. use novel data trace those banks corporate deposit platform. As they sought replace the lost dollar funding, squeeze spilled over other with no exposure. latter paid more deposits, and their pool providers deteriorated. Their lending volumes margins declined. Our results suggest banks’ competitiveness markets affect markets.