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Borrowing backstop.

Banks borrowed a combined $164.8 billion from two Federal Reserve backstop facilities in the week ended March 15, in a sign of escalated funding strains in the aftermath of Silicon Valley Bank’s failure. Federal Reserve data showed a record $152.85 billion was borrowed from the discount window, the traditional liquidity backstop for banks, in the week ended March 15 — way up from $4.58 billion the previous week. And a further $11.9 billion was borrowed from the Fed’s new emergency backstop fund, launched Sunday. The credit highlights a banking system that is still fragile and dealing with deposit migration in the wake of the failures of SVB and Signature Bank. Elsewhere, the biggest US banks pledged $30 billion of deposits to rescue First Republic; and SVB is still hunting for a buyer.

Photo-Illustration: Alexandra Citrin-Safadi | The Wall Street Journal

Money market funds get biggest cash inflow since early 2020

Money-market funds attracted their biggest weekly influx of cash since the early part of the Covid pandemic as depositors pulling their money away from more at-risk US banks sought a place to park their dollars. More than $5 trilion is now parked in the cash-like vehicles. The inflows were turbocharged by concern about the US banking system. (Bloomberg Markets | Mar 16)

Crisis narrative forcing out all others in bank-obsessed markets

Is upheaval in the banking sector the prelude to a financial crisis, or just the biggest bump yet on the road to restoring order to the economy? Stock investors clinging to hopes this too shall pass are having their tolerance for pain severely tested. Battling narratives over how pervasive a risk bank stress poses to the economy had opened one of the widest gulfs ever between equity and Treasury volatility in the aftermath of three bank failures in the past week. (Bloomberg Markets | Mar 15)

Bank chaos clouds outlook for markets

Few investors had bank failures on their list of potential market risks for 2023. Now, after the collapse of Silicon Valley Bank and resulting market upheaval, the calculus has changed. The Fed will weigh risks to financial stability as well as inflation at its policy meeting next week. And for investors, both worries are suddenly front and center. (The Wall Street Journal | Mar 15)

Market stress snarls trading in US Treasurys

The markets for the world’s safest and most liquid assets, the government bonds issued by the US and other wealthy countries, came under immense stress on Wednesday following a week of worries about the health of global banks. (The Wall Street Journal | Mar 15)

Boom in ‘zero day’ options draws regulatory attention

The Commodity Futures Trading Commission is examining the impact on markets of extremely short-dated options contracts after analysts warned the booming trend could be contributing to wild swings in stock prices. Rostin Behnam, chair of the CFTC, on Wednesday said the agency was assessing the potential risks or systemic issues that could arise from so-called zero-day trading strategies, which have surged in popularity since the start of the coronavirus pandemic. (Financial Times | Mar 15)

FBI, CISA, and MS-ISAC release #StopRansomware: LockBit 3.0

The Federal Bureau of Investigation, the Cybersecurity & Infrastructure Security Agency, and the Multi-State Information Sharing and Analysis Center released a joint cybersecurity advisory (CSA), #StopRansomware: LockBit 3.0. The advisory details known indicators of compromise (IOCs) and tactics, techniques, and procedures (TTPs) that FBI investigations correlated with LockBit 3.0 ransomware as recently as March 2023. LockBit 3.0 functions as an affiliate-based ransomware variant and is a continuation of LockBit 2.0 and LockBit.

— FBI, CISA, MS-ISAC

SEC takes aim at cyber risks to NYSE, Nasdaq, market players

Nasdaq and the New York Stock Exchange would need to immediately alert the Securities and Exchange Commission about significant cybersecurity incidents under a new proposal from the agency. Commissioners voted to propose the cyber regulation for stock exchanges, brokers and dealers, and other parts of the US securities market at an agency meeting Wednesday where two other related proposals were also issued.

— Bloomberg Law

Ransomware attacks have entered a 'heinous' new phase

In February, attackers from the Russia-based BlackCat ransomware group hit a physician practice in Lackawanna County, Pennsylvania, that's part of the Lehigh Valley Health Network (LVHN). At the time, LVHN said that the attack “involved” a patient photo system related to radiation oncology treatment. The health care group said that BlackCat had issued a ransom demand, “but LVHN refused to pay this criminal enterprise.” After a couple of weeks, BlackCat threatened to publish data stolen from the system.

— Ars Technica

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Illustration: Mark Wang | Bloomberg

Wild staff secrets from a ‘White Lotus’ Hawaiian pleasure palace

To call Turtle Bay an icon would be an understatement — more than 150 movies and TV shows have been filmed on its 1,300 acres, including Lost, Pirates of the Caribbean, NCIS, The Hunger Games and cult comedy favorite Forgetting Sarah Marshall. Additionally, the hotel’s beaches boast one of the world’s best surf schools, the Jamie O’Brien Surf Experience.

— Bloomberg Pursuits

A spy wants to connect with you on LinkedIn

At the murkiest end of LinkedIn’s problem with fake accounts, sophisticated state-backed groups from Iran, North Korea, Russia, and China regularly leverage LinkedIn to connect with targets in an attempt to steal information through phishing scams or by using malware.

— Wired

Banking in very uncertain times

“The world sits atop four elephants who stand astride the risk-free rate, and then it is interest rates all the way down.” How we got here, how the relevant institutions are generally expected to work, what seems to be different this time, and what smart people who are not normally professionally engaged in this might find relevant to know about the infrastructure that we all depend on.

— Bits About Money