Cash-strapped banks borrowed $300 billion from the Fed’s emergency funds over the past week amid the global financial turmoil

March 16, 2023, 9:09 PM UTC
Federal Reserve Building in Washington, DC.
Federal Reserve Building in Washington, DC.
Al Drago—Bloomberg/Getty Images

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.

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