Helping to keep a lid on yields has been guidelines requiring financial institutions to own the highest-quality assets while trimming risk-taking activities.

“The regulatory environment has driven banks to buy more Treasuries,” said Jeff Caughron, chief operating officer in Oklahoma City at Baker Group LP, which advises community banks with more than $45 billion in investments.

Basel III rules and requirements approved by the Fed, Office of the Comptroller of the Currency and FDIC, require banks to hold enough high-quality liquid assets to survive a 30- day credit seizure, in order to minimize a sudden shock to the global financial system.

“It’s liquidity. It’s convenience. What happens if deposits do dry up?” said Thomas Graff, who manages $3.6 billion of fixed-income assets at Brown Advisory Inc. in Baltimore. “All those concerns are there.”

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