Banks trim emergency borrowing from Federal Reserve as credit stresses ease
By APThursday, September 24, 2009
Banks trim borrowing from Fed as credit improves
WASHINGTON — Banks reduced their borrowing from the Federal Reserve’s emergency lending facility over the past week, and cut back their use of other programs designed to ease the financial crisis.
The reductions indicate that banks are having an easier time borrowing in private markets for short-term loans.
Banks averaged $28.2 billion in daily borrowing over the week ended Wednesday, down from $28.7 billion in the week ended Sept. 16.
The Fed has pumped trillions of dollars into the financial system through an array of short-term lending programs in an effort to ease the crisis that worsened with the fall of Lehman Brothers last September.
The identities of the financial institutions that receive emergency loans are not released. They pay just 0.50 percent in interest for the emergency loans.
