Financial Institutions
Term Securities Lending Facility
Date:
March 11, 2008
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Loans
Maximum Amount:
$75.00 billion Lending entity created by the Federal Reserve to promote liquidity for primary dealers in the financing markets for Treasury and other collateral. A primary dealer is a bank or securities firm that trades directly with the Federal Reserve. Loans given are for a 28-day period. Initially, the maximum lending allowed through the facility was $200 billion.
However, in a Fed press release on 6/25/2009, the Fed reduced the maximum loan amount available through the facility to $75 billion due to weak demand in recent months.
Notes:
Amount spent indicates loans extended as of 6/9/2010 (http://www.federalreserve.gov/releases/h41/Current/). Activities of the Federal Reserve are not directly recorded in the federal budget. However, each year the Federal Reserve remits a portion of its earnings to the general treasury. This remittance is generally in the range of $20-$30 billion per year, but the CBO estimates that the Fed's earnings will be lower by approximately $90 billion over the next ten years.
Bear Stearns Funding
Date:
March 14, 2008
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Loans
Maximum Amount:
$29.00 billion
Amount Spent:
$29.05 billion To prevent further market disorder in the wake of Bear Stearn's collapse, the Fed issued $29 billion in non-recourse loans to a holding company ("Maiden Lane, LLC") set up by J.P Morgan to manage and gradually liquidate Bear Stearns' assets.
Source:
Notes:
Amount spent indicates loan extended as of 9/1/2010 (http://www.federalreserve.gov/releases/h41/Current/). The $29 billion in loans to Bear Sterns in 2008 is only worth $26 billion in 2009 dollars, which is how the Fed reports it on its balance sheet. Activities of the Federal Reserve are not directly recorded in the federal budget. However, each year the Federal Reserve remits a portion of its earnings to the general treasury. This remittance is generally in the range of $20-$30 billion per year, but the CBO estimates that the Fed's earnings will be lower by approximately $90 billion over the next ten years.
Primary Dealer Credit Facility
Date:
July 20, 2008
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Loans
Maximum Amount:
$134.07 billion Overnight lending program allows primary dealers to use collateral to borrow at the Federal Reserve's "discount window." A primary dealer is a bank or securities firm that trades directly with the Federal Reserve. This lending facility gives primary dealers greater capacity to provide financing in securities markets.
On August 17, 2007, the Federal Reserve increased the maximum maturity of primary credit loans to 30 days, citing a slight deterioration in financial market conditions.
Notes:
Maximum amount is the peak cumulative cost of the facility, which occurred on October 8, 2008. Amount spent indicates outstanding loans as of 6/9/2010 (http://www.federalreserve.gov/releases/h41/Current/). Activities of the Federal Reserve are not directly recorded in the federal budget. However, each year the Federal Reserve remits a portion of its earnings to the general treasury. This remittance is generally in the range of $20-$30 billion per year, but the CBO estimates that the Fed's earnings will be lower by approximately $90 billion over the next ten years.
Options on Term Security Lending Facility Auctions
Date:
September 15, 2008
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Loans
Maximum Amount:
$50.00 billion Federal Reserve auctions an additional $50 billion (maximum) of options under its Term Security Lending Facility (TSLF) auctions. Participating primary dealers receive Treasury securities (Treasury bills, notes, bonds or TIPS) in exchange for approved forms of collateral. Loans are short-term, usually less than the 28 days for normal TSLF loans. Primary dealers might exercise this option during times when they typically face heightened market pressure to hold additional collateral, such as near the end of the business quarter.
Notes:
Maximum amount is announced maximum value of program. Amount spent is total value of options not yet exercised or not yet at maturity (see here for details). Data current as of 10/7/2009. Activities of the Federal Reserve are not directly recorded in the federal budget. However, each year the Federal Reserve remits a portion of its earnings to the general treasury. This remittance is generally in the range of $20-$30 billion per year, but the CBO estimates that the Fed's earnings will be lower by approximately $90 billion over the next ten years.
Public-Private Investment Fund: FDIC Guarantees
Date:
February 10, 2009
Who:
FDIC
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Government Guarantee
Maximum Amount:
$600.00 billion
Amount Spent:
$0.73 billion See the companion TARP entry for the Public-Private Investment Program (PPIP) and the Fed entry for PPIP.
Program first announced by Treasury Secretary Geithner on 2/10/2009.
Notes:
Maximum risk is value of all debt that could possibly be guaranteed by FDIC under the current restrictions of a 6:1 debt-equity ratio. Amount spent as of 9/16/2009 (http://www.fdic.gov/news/news/press/2009/pr09172.html). Deficit impact unknown.
Fed Guarantee of Bank of America Assets
Date:
January 16, 2009
Who:
Fed
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Government Guarantee
Maximum Amount:
$87.00 billion Part of multi-agency government guarantee of approximately $118 billion in Bank of America assets, most of which it acquired through the purchase of investment bank Merrill Lynch. Under the terms of the agreement, Bank of America is responsible for the first $10 billion in losses on the assets. Remaining losses are divided 90/10 between the government and Bank of America. For the next $10 billion in losses, the Treasury and FDIC split the government’s 90% share. 90% of the remaining losses are covered by the Fed through a non-recourse loan.
Notes:
Maximum amount figure represents total potential liabilities.
Money Market Mutual Fund Liquidity Facility
Date:
September 19, 2008
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Loans
Maximum Amount:
$145.89 billion Establishment of Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility to allow Federal Reserve to increases market liquidity by purchasing three month unsecured and asset-backed commercial paper directly from selected corporate issuers.
Notes:
Amount spent indicates outstanding loans as of 10/21/2009 (http://www.federalreserve.gov/releases/h41/Current/). Facility maximum lending amount is unlimited, but never exceeded $416 billion. Activities of the Federal Reserve are not directly recorded in the federal budget. However, each year the Federal Reserve remits a portion of its earnings to the general treasury. This remittance is generally in the range of $20-$30 billion per year, but the CBO estimates that the Fed's earnings will be lower by approximately $90 billion over the next ten years.
Commercial Paper Funding Facility
Date:
October 7, 2008
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Loans
Maximum Amount:
$1,800.00 billion Federal Reserve increases market liquidity by purchasing three month unsecured and asset-backed commercial paper directly from selected corporate issuers.
Notes:
Maximum amount indicates size of the market. Amount spent indicates outstanding loans as of 7/28/2010 (http://www.federalreserve.gov/releases/h41/Current/). Activities of the Federal Reserve are not directly recorded in the federal budget. However, each year the Federal Reserve remits a portion of its earnings to the general treasury. This remittance is generally in the range of $20-$30 billion per year, but the CBO estimates that the Fed's earnings will be lower by approximately $90 billion over the next ten years.
Money Market Investor Funding Facility
Date:
October 21, 2008
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Loans
Maximum Amount:
$540.00 billion The Fed will fund private-sector investors to invest in mutual funds, promoting market liquidity. This entity was created by the Fed in response to the current financial crisis.
Source:
Notes:
Potential maximum indicates lending allowance. Maximum amount spent indicates outstanding loans as of 10/21/2009 (http://www.federalreserve.gov/releases/h41/Current/). Activities of the Federal Reserve are not directly recorded in the federal budget. However, each year the Federal Reserve remits a portion of its earnings to the general treasury. This remittance is generally in the range of $20-$30 billion per year, but the CBO estimates that the Fed's earnings will be lower by approximately $90 billion over the next ten years.
Fed Guarantee of Citigroup Assets
Date:
November 23, 2008
Who:
Fed
Policy Area:
Financial Sector Policy
Economic Target:
Financial Institutions
Action Type:
Government Guarantee
Maximum Amount:
$230.00 billion Part of a government guarantee of $301 billion in Citigroup assets by multiple entities (Treasury, FDIC, Federal Reserve). After Citigroup absorbs the first $29 billion in losses, the remaining losses are split 90:10 between the government and Citigroup, with the first $5 billion absorbed by the Treasury with TARP funds, the next $10 billion paid by the FDIC, and the remaining losses covered by the Federal Reserve with a non-recourse loan.
Notes:
Maximum amount figure represents total potential liabilities.
On 1/16/2008, the Treasury revised its figure for total Citigroup guaranteed assets from $306 billion down to $301 billion.
