In this regard, it is worth recalling that the leverage ratio does not account for the real risk of assets in addition to ignoring bank-specific business models – even if universal banks have been proven to be more resilient than investment banks (see figure 4) Indeed, diversified banks were not the main channel underlying the spread of the subprime crisis that originated in the United States.
Rather it was the investment financial institutions, including the shadow banking system, that seemed to be the main vehicle of contagion.