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The little-known banks loaning billions to failing banks like First Republic : The Indicator from Planet Money Unsung hero of the financial system or enabler of failing banks? Today on the show, how the Federal Home Loan Bank system, originally designed to support homeownership and affordable housing, ended up loaning billions to failing banks like First Republic.

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The Indicator from Planet Money

The banking system that loaned billions to SVB and First Republic

The banking system that loaned billions to SVB and First Republic

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SAN FRANCISCO, CALIFORNIA - MAY 01: Federal Regulators seized troubled lender First Republic Bank on Monday and sold all of its deposits and most of its assets to JPMorgan Chase. First Republic becomes the second largest bank in U.S. history to fail since Washington Mutual failed in 2008.
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Justin Sullivan/Getty Images
SAN FRANCISCO, CALIFORNIA - MAY 01: Federal Regulators seized troubled lender First Republic Bank on Monday and sold all of its deposits and most of its assets to JPMorgan Chase. First Republic becomes the second largest bank in U.S. history to fail since Washington Mutual failed in 2008.
Justin Sullivan/Getty Images

Four major banks in the U.S. have collapsed this year. All of them, including First Republic, borrowed money from institutions called Federal Home Loan Banks before their demise. These little-known banks keep showing up in periods of banking turmoil, but they were actually designed to support homeownership and affordable housing. Today on the show, how the Federal Home Loan Banks have become a lender-of-almost-last-resort for financial institutions in trouble.

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For sponsor-free episodes of The Indicator from Planet Money, subscribe to Planet Money+ via Apple Podcasts or at plus.npr.org.