Amid growth in products such as high-interest savings account ETFs, federal banking regulators are seeking feedback on whether liquidity rules adequately capture the risks of these products.

The Office of the Superintendent of Financial Institutions (OSFI) launched a review of banks’ liquidity adequacy requirements, citing the need to consider whether new categories of wholesale funding are needed “to appropriately reflect the risks of such retail-like wholesale products.”

In a letter to the industry, OSFI said products like high-interest savings account ETFs have “seen significant growth” in the current higher interest rate environment “as they aim to mimic traditional savings accounts through an ETF structure while offering higher yields.”

Yet unlike sources of wholesale funding such as ordinary deposits, which have historically proven to be relatively sticky, ETFs provide a high degree of liquidity “as clients’ withdrawals are usually not subject to restrictions,” it noted.

Last year, assets in cash alternative ETFs more than doubled to $15 billion, according to National Bank Financial, and strong flows have continued this year, totalling $3.8 billion as of April 30.

The review comes in the wake of several high-profile bank failures in the U.S., where an unusually fast decline in deposits negatively impacted the banks’ funding and liquidity positions.

As part of its review, OSFI is seeking feedback on whether the existing liquidity rules properly capture the risks posed by wholesale funding vehicles that have retail characteristics.

It’s also seeking specific data or stress-testing models from financial institutions on “unitholder composition and redemption history” for these sorts of products.

If it finds that new wholesale funding categories are needed, the regulator said the earliest implementation date would be in 2024.

In the meantime, the deadline for providing feedback to the review is June 21.