The Federal Reserve’s discount window is not typically used in “life or death” scenarios and in most cases banks could find other means to deal with specific funding needs, a paper published by the Richmond Fed finds.
Huberto Ennis, Sara Ho and Elliot Tobin examine why banks used the facility from 2010 to 2017, a period of relative calm in financial markets. They cross-reference discount-window borrowing with banks’ financial statements and performance.
The facility provides a backstop source
You are currently unable to print this content. Please contact [email protected] to find out more.
You are currently unable to copy this content. Please contact [email protected] to find out more.