8  When the Desk conducts a reverse repo transaction, it sells securities held in the System Open Market Account (SOMA) under an agreement to repurchase the securities at a predetermined price. The difference between the sale price and the repurchase price, together with the length of time between the two legs of the transaction, implies a rate of interest (the reverse repo rate) paid by the Federal Reserve to its counterparty. The transaction leaves the size of the SOMA securities portfolio unchanged but shifts some of the liabilities on the Fed’s balance sheet from bank reserves to reverse repos while the trade is outstanding. A repo (as opposed to a reverse repo) is the opposite. Before the crisis, repos were more common than reverse repos. The eligible collateral for the Desk’s repo and reverse repo operations is set forth in the FOMC’s Authorization for Domestic Open Market Operations. 9  Autonomous factors are those components of the Federal Reserve’s balance sheet that affect reserve balances but are not directly under the central bank’s control. The largest of these, by far, is currency in circulation. Others include U.S. Treasury deposits, Federal Reserve Bank “float,” and overnight reverse repos conducted with foreign central banks. See, for example, Hilton (2008). 10  The 2005 speech by then-Governor Bernanke that I noted earlier provides great detail on a day in the life on the Desk prior to the financial crisis.
Some infamous examples include the Bangladesh Bank incident, the hacking of ATMs in Taiwan and various other countries, Target’s credit card data breach which resulted in data of  1  over 70 million credit cards stolen, Equifax’s data leakage in which the company was fined 700 million USD, and more recently the case of Capital One Bank in which over 100 million customers’ data were leaked. Thailand is also not immune to these cyber threats. A state bank’s ATMs were hacked, customers’ data from 2 large banks were leaked on the Dark Web, and the WannaCry ransomware outbreak. In addition to attacks on financial institutions, customers’ behavior and lack of cyber threat awareness also pose significant cyber risks as well. Social media scams through LINE or Facebook Messenger in which attackers pretend to be the victim’s acquaintance, asking for a favor to transfer money; or users’ submitting their bank account information to questionable, illegal gambling website from which their data eventually got leaked a few weeks prior are some examples of cyber-attacks that hinge on the user’s inexperience or lack of awareness of online threats. As such, I don’t think it is an over exaggeration to say that cyber threats have kept many bank executives and regulators awake at night given the nature of these threats that can occur anytime and anywhere without warning, and the significant damage they could cause.