Banks’ U.S. Debt Holdings Top $2 Trillion as Treasuries Rally

American banks increased U.S. government debt holdings to a record $2 trillion as global regulators implement post-2008 financial-crisis rules requiring financial institutions to own the highest-quality assets while trimming risk-taking activities.

U.S. debt has returned 5.3 percent this year as commercial lenders increased their net holdings of Treasuries to $615.6 billion this year as of Nov. 26, little changed from the highest ever, data from the Federal Reserve show. Banks have been net buyers of Treasuries and other agency debt for 14 straight months, equaling the longest streak of gains since June 2003.