The Discount Window, Repo and FHLBs: A Guide to Funding Stress

The ongoing crunch in the US banking system is driving intense scrutiny of funding markets and the various places that firms turn to for dollars when the financial plumbing is at risk of getting jammed.

The scramble for cash over the past week saw US banks tap the Federal Reserve’s emergency facilities for a record amount of money, eclipsing even the levels seen during the 2008 crisis. They’ve also been hitting up the Federal Home Loan Banks system, another vital source of funding, in a way that’s prompted the institution to bolster its war chest in an unprecedented way. And ...