Fed lent $300B in emergency funds to banks in the past week
Cash-short banks have borrowed about $300 billion in emergency funding from the Federal Reserve in the past week, the Fed announced
Cash-short banks have borrowed about $300 billion in emergency funding from the Federal Reserve in the past week, the Fed announced Thursday.
Nearly half the money — $143 billion — went to holding companies for two major banks that failed over the past week, Silicon Valley Bank and Signature Bank, triggering widespread alarm in financial markets.
An additional $148 billion in lending was provided through a longstanding program called the “discount window," and amounted to a record level for that program.
The Fed has lent an additional $11.9 billion from a new lending facility it announced on Sunday. The new program enables banks to raise cash and pay any depositors withdrawing funds.
Banks have posted high-quality collateral, such as Treasury bonds, for all the loans. The Fed expects all the loans to be repaid.
Subscribe to Independent Premium to bookmark this article
Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.