(Bloomberg) -- Banks reduced their borrowings from two Federal Reserve backstop lending facilities in the most recent week, a sign that liquidity demand may be stabilizing.

US institutions had a combined $152.6 billion in outstanding borrowings in the week through March 29, compared with $163.9 billion the previous week. 

The latest figures suggest efforts by policymakers to stem contagion following a string of bank collapses is working, though banks are still borrowing much more than is typical during periods of low stress.

“After the dust has settled a little bit this week with the banks, today’s report offers some assurance that, at a minimum, things haven’t gotten any worse,” Jefferies economists Thomas Simons and Aneta Markowska wrote in a note to clients.

Data showed $88.2 billion in outstanding borrowing from the Fed’s traditional backstop lending program, known as the discount window, compared with $110.2 billion the previous week and a record $152.9 billion in a period of bank distress earlier this month.

The discount window is the Fed’s oldest liquidity backstop for banks. Loans can be extended for 90 days and banks can post a broad range of collateral.

Outstanding borrowings from the Bank Term Funding Program stood at $64.4 billion compared with $53.7 billion the previous week. The BTFP was opened March 12 after the Fed declared emergency conditions following the collapse of California’s Silicon Valley Bank and New York’s Signature Bank. 

Credit can be extended for one year under the program and collateral guidelines are tighter.

The reduction in usage “suggests a slightly improving bank liquidity picture, although the situation “remains uncertain,” according to TD Securities strategists Priya Misra and Molly McGown, who pointed to earlier data for the period through March 15 showing declines in bank deposits in the first half of the month. Bank deposits fell by $98.4 billion to $17.5 trillion in the week ended March 15, according to numbers released March 24 by the Fed, with the next batch of similar data due Friday.

Fed loans to bridge banks established by the Federal Deposit Insurance Corp. to resolve SVB and Signature Bank rose slightly to $180.1 billion in the week through March 29 from $179.8 the previous week.

Foreign central banks tapped the Fed’s Foreign and International Monetary Authorities repurchase agreement facility for $55 billion in the week through March 29, data show. That’s after it reached an all-time high of $60 billion the prior week.

(Updates with comments and data in paragraph nine.)

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