The article examines how active risk management in banks affects their stability. Banks that actively manage risks by buying and selling credit protection can take on more risks but are less likely to go bankrupt during economic crises. The study shows that banks with active risk management were better insulated from shocks and were less likely to become insolvent during the 2007-2009 financial crisis, despite having riskier balance sheets. This suggests that active risk management can help banks maintain stability even when facing higher risks.