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September 5, 2025

Pre-Pledged Collateral and Likelihood of Discount Window Use

Puntos clave

About half of the financial institutions that filed legal documents have pledged collateral, impacting their borrowing options.
The analysis covers daily data from January 2015 to June 2025, focusing on banks and credit unions.
Engagement levels with pre-pledged collateral influence the likelihood of utilizing the discount window.
The sample includes depository institutions that legally qualify for borrowing under Operating Circular 10.

Resumen

The data for the analysis are daily and cover the period from January 1, 2015, to June 15, 2025. The sample consists of DIs (both banks and credit unions) that have filed the legal documents to be able to borrow (Operating Circular 10). This means that all the institutions have established arrangements to borrow; the key difference is the level of engagement and preparedness that is indicated by pre-pledging collateral. Overall, about half of the institutions that have filed the legal documents to enable them to borrow have also pledged collateral.

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