This paper uses bank-level fragility to explain why bank loans are universally senior. High leverage makes banks more fragile than the marginal bond investor and thus more willing to pay for safety. Seniority reduces loan-level systematic risk, which mitigates the bank's financial distress costs. If banks need skin in the game, holding junior debt may create stronger incentives to screen or monitor than holding the same amount of senior debt. Nevertheless, bank seniority remains efficient because simultaneously increasing the size and seniority of a loan preserves bank incentives while reducing bank-level capital structure costs. This holds because a large senior loan imposes losses and capital structure costs when borrower value is lowest and the bank is most likely to have shirked. Adding insured deposits or bailouts to my model makes seniority even more attractive to banks, as senior claims benefit the most from subsidies to tail risk. Beyond these seniority structure results, my model provides natural explanations for why procyclical firms avoid bank loans, why bank lending falls during recessions, and a host of other debt structure phenomena.