  This paper provides a framework for modeling the financial system with
multiple illiquid assets when liquidation of illiquid assets is caused by
failure to meet a leverage requirement. This extends the network model of
Cifuentes, Shin & Ferrucci (2005) which incorporates a single asset with fire
sales and capital adequacy ratio. This also extends the network model of
Feinstein (2015) which incorporates multiple illiquid assets with fire sales
and no leverage ratios. We prove existence of equilibrium clearing payments and
liquidation prices for a known liquidation strategy when leverage requirements
are required. We also prove sufficient conditions for the existence of an
equilibrium liquidation strategy with corresponding clearing payments and
liquidation prices. Finally we calibrate network models to asset and liability
data for 50 banks in the United States from 2007-2014 in order to draw
conclusions on systemic risk as a function of leverage requirements.
