Systemically important banks (Sibs) enjoyed increasing advantages in accessing finance during the early months of the Covid-19 pandemic, a Federal Reserve of New York blog post argues.

This benefit for Sibs grew despite post-financial crisis legislation meant to limit the advantages of “too big to fail” financial institutions, Asani Sarkar finds.

Sarkar compares the cost of equity for Sibs to that for other firms, using two approaches. He uses data for the largest 8% of banks against the next