Amadeusz Juskowiak

Us bank discount borrowings 310 mln dlrs

US bank discount window borrowings less extended credits averaged 310 mln dlrs in the week to Wednesday February 25 the Federal Reserve said

The Fed said that overall borrowings in the week fell 131 mln dlrs to 614 mln dlrs with extended credits up 10 mln dlrs at 304 mln dlrs The week was the second half of a twoweek statement period Net borrowings in the prior week averaged 451 mln dlrs

Commenting on the twoweek statement period ended February 25 the Fed said that banks had average net free reserves of 644 mln dlrs a day down from 134 billion two weeks earlier

A Federal Reserve spokesman told a press briefing that there were no large single day net misses in the Feds reserve projections in the week to Wednesday

He said that natural float had been acting a bit strangely for this time of year noting that there had been poor weather during the latest week

The spokesman said that natural float ranged from under 500 mln dlrs on Friday for which he could give no reason to nearly one billion dlrs on both Thursday and Wednesday

The Fed spokeman could give no reason for Thursdays high float but he said that about 750 mln dlrs of Wednesdays float figure was due to holdover and transportation float at two widely separated Fed districts

For the week as a whole he said that float related as of adjustments were small adding that they fell to a negative 750 mln dlrs on Tuesday due to a number of corrections for unrelated cash letter errors in six districts around the country

The spokesman said that on both Tuesday and Wednesday two different clearing banks had system problems and the securities and Federal funds wires had to be held open until about 2000 or 2100 EST on both days

However he said that both problems were cleared up during both afternoons and there was no evidence of any reserve impact

During the week ended Wednesday 45 pct of net discount window borrowings were made by the smallest banks with 30 pct by the 14 large money center banks and 25 pct by large regional institutions

On Wednesday 55 pct of the borrowing was accounted for by the money center banks with 30 pct by the large regionals and 15 pct by the smallest banks

The Fed spokesman said the banking system had excess reserves on Thursday Monday and Tuesday and a deficit on Friday and Wedndsday That produced a small daily average deficit for the week as a whole

For the twoweek period he said there were relatively high excess reserves on a daily avearge almost all of which were at the smallest banks