69.2 F
Fort Worth
Monday, September 21, 2020
- Advertisements -
Banking Federal Reserve launches 3rd emergency lending program

Federal Reserve launches 3rd emergency lending program

Other News

Exxon’s oil slick

Exxon Mobil is slashing its capital spending budget for 2020 by 30% due to weak demand caused by the COVID-19 pandemic and a market...

Folk music’s Mark Twain: 7 Essential tracks from John Prine,

NEW YORK (AP) — Some people, the songs just come out of them. For nearly half a century, they tumbled out of John Prine...

Tarrant County records another COVID-19 death

Tarrant County Public Health (TCPH) on Wednesday, April 8 reported that a resident of Euless has died as the result of the COVID-19 virus....

Tradition stymied: A year unlike any since WWII for Augusta

The Masters is so intertwined with Augusta, they added an extra day to spring break.You see, the first full week of April isn't just...

Washington (AP) — The Federal Reserve announced late Wednesday that it will establish an emergency lending facility to help unclog a short-term credit market that has been disrupted by the viral outbreak.

The Fed said it will lend money to banks that purchase financial assets from money market mutual funds, including short-term IOUs known as commercial paper.

By facilitating the purchase of commercial paper, which is issued by large businesses and banks, the Fed hopes to spur more lending to firms that are seeking to raise cash as their revenues plummet amid the spread of the coronavirus.

The program is the third facility the Fed has revived from the financial crisis days of 2008, when the central bank set up an alphabet soup of programs intended to keep financial markets functioning.

This facility, known as the Money Market Mutual Fund Liquidity Facility, is intended to help money market funds unload assets such as commercial paper, but also Treasury securities and bonds guaranteed by mortgage giants Fannie Mae and Freddie Mac.

Money market mutual funds are owned by individual investors in brokerage accounts but also by institutional investors and businesses. Many of the funds have sought in the past two weeks to sell assets to raise cash as many investors redeem shares in the funds. Yet with demand for cash rising as stocks plunge and the economy slows sharply, money market funds have struggled to find buyers for their assets.

The Fed’s latest facility is ultimately intended to support demand for commercial paper so businesses are continue to borrow.

The program was established with the support of the Treasury Department, which will guarantee up to $10 billion in loans from the facility.

- Advertisements -
- Advertisements -

Latest News

Bank shares slide on reports of rampant money laundering

By The Associated Press Shares of some major banks are tumbling before the market open Monday following a report...

From abortion access to immigration, the battle over the open Supreme Court seat will affect Texas for a generation

By Abby Livingston, The Texas Tribune Sept. 20, 2020 "From abortion access to immigration,...

Initial public offerings scheduled to debut next week

Sep 18, 2020 3:00PM (GMT 20:00) - 90 words NEW YORK (AP) — The following is a list of initial...

Tropical Storm Beta churns slowly toward Texas and Louisiana

By JUAN A. LOZANO Associated PressHOUSTON (AP) — Tropical Storm Beta trudged toward the coasts of Texas and Louisiana on Sunday, threatening...

Fort Worth eye medication firm acquired for $225M

Fort Worth-based Eyevance Holdings LLC, founded in 2017 to provide medication to eye doctors, has been acquired by Santeen Holdings LLC for...