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Board of Governors of the Federal Reserve System
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Board of Governors of the Federal Reserve System

Monthly Report on Credit and Liquidity Programs
and the Balance Sheet

February 2010 (1.35 MB PDF)

Overview

Recent Developments

  • As previously announced, the Federal Reserve closed the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility (AMLF), the Commercial Paper Funding Facility (CPFF), the Primary Dealer Credit Facility (PDCF), and the Term Securities Lending Facility (TSLF) on February 1, 2010, in light of the improvement in financial conditions over recent months. CPFF LLC will retain its existing commercial paper holdings to maturity, and the LLC's other assets will remain until the LLC is dissolved.
  • The temporary liquidity swap arrangements between the Federal Reserve and other central banks also expired on February 1, 2010.
  • The Federal Reserve is in the process of winding down its Term Auction Facility (TAF); the amount of 28-day credit offered on February 8, 2010, was reduced to $50 billion, and the final auction of $25 billion in 28-day credit will be held on March 8, 2010.
  • On February 18, 2010, the Federal Reserve announced three changes to its lending programs for depository institutions. First, the Board approved an increase in the primary credit rate (generally referred to as the discount rate) from 1/2 percent to 3/4 percent, effective February 19, 2010. Second, the Board announced that, effective March 18, 2010, the typical maximum maturity of primary credit loans would be shortened to overnight. These changes represent further normalization of the Federal Reserve's lending facilities and do not signal any change in the outlook for monetary policy. Finally, the Board announced that the minimum bid rate for the final TAF auction on March 8, 2010, had been raised by 1/4 percentage point to 1/2 percent.
  • In a letter to the U.S. Government Accountability Office (GAO) on January 19, 2010, the Federal Reserve announced that it would welcome a full review by the GAO of all aspects of the Federal Reserve's involvement in the extension of credit to American International Group, Inc. (AIG).
  • On February 10, 2010, in prepared remarks for the U.S. House of Representatives Committee on Financial Services, Chairman Ben Bernanke discussed the Federal Reserve's strategy for exiting from the extraordinary lending and monetary policies that it implemented to combat the financial crisis and support economic activity. (The remarks can be found at www.federalreserve.gov/newsevents/testimony/bernanke20100210a.htm.)
  • The fair value of the three Maiden Lane LLCs' net portfolio holdings, as of February, 10, 2010, were reported on the H.4.1 statistical release based on updated valuations as of December 31, 2009. The updated valuations resulted in a combined net unrealized gain of $0.7 billion for Maiden Lane LLC, Maiden Lane II LLC, and Maiden Lane III LLC.
  • On December 28, 2009, the Federal Reserve Board proposed amendments to Regulation D (Reserve Requirements of Depository Institutions) that would enable the establishment of a term deposit facility. The public comment period for the proposed amendments ended on February 1, 2010. The Federal Reserve anticipates issuing a final rule in coming weeks. Under the proposal, Federal Reserve Banks would offer interest-bearing term deposits to eligible institutions through an auction mechanism. Term deposits are one of several tools the Federal Reserve could employ to drain reserves in order to support the effective implementation of monetary policy. This proposal is one component of a process of prudent planning on the part of the Federal Reserve and has no implications for monetary policy decisions in the near term.

Table 1. Assets, Liabilities, and Capital of the Federal Reserve System
Billions of dollars

Item Current
January 27, 2010 		Change from
December 30, 2009 		Change from
January 28, 2009
Total assets 2,250 13 321
Selected assets
   Securities held outright 1,910 65 1,399
       U.S. Treasury securities1 777 +* 302
       Federal agency debt securities1 164 4 136
       Mortgage-backed securities2 970 62 963
       Memo: Term Securities Lending Facility3 0 0 -124
       Memo: Overnight securities lending3 4 -11 -2
       Memo: Net commitments to purchase mortgage-backed
          securities4 		133 -22 133
   Lending to depository and other financial institutions 54 -42 -478
       Primary, secondary, and seasonal credit 16 -4 -52
       Term auction credit 39 -37 -377
       Primary dealer and other broker-dealer credit 0 0 -32
       Asset-Backed Commercial Paper Money Market
          Mutual Fund Liquidity Facility 		0 0 -16
   Central bank liquidity swaps5 * -10 -466
   Lending through other credit facilities 55 -7 -193
       Net portfolio holdings of Commercial Paper Funding
          Facility LLC6 		9 -5 -239
       Term Asset-Backed Securities Loan Facility, net 46 -2 46
   Support for specific institutions 91 4 -20
       Credit extended to American International Group, Inc.,
          net7 		26 4 -12
       Net portfolio holdings of Maiden Lane8 27 +* 1
       Net portfolio holdings of Maiden Lane II LLC8 15 -1 -4
       Net portfolio holdings of Maiden Lane III LLC8 22 -1 -5
       Net portfolio holdings of TALF LLC9 * +* +*
       Preferred interests in AIA Aurora LLC and ALICO
          Holdings LLC10 		25 +* 25
Total liabilities 2,198 13 310
Selected liabilities
   Federal Reserve notes in circulation 878 -12 29
   Deposits of depository institutions 1,111 86 371
   U.S. Treasury, general account 127 -23 88
   U.S. Treasury, supplementary financing account 5 0 -170
   Other deposits * -27 -1
Total capital 52 +* 11
Note: Unaudited. Components may not sum to totals because of rounding.
* Less than $500 million. Return to table
1. Face value. Return to table
2. Guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae. Current face value, which is the remaining principal balance of the underlying mortgages. Does not include unsettled transactions. Return to table
3. Securities loans under the Term Securities Lending Facility and the overnight facility are off-balance-sheet transactions. These loans are shown here as a memo item to indicate the portion of securities held outright that have been lent through these programs. Return to table
4. Current face value. These generally settle within 180 days and include commitments associated with outright transactions as well as dollar rolls. Return to table
5. Dollar value of the foreign currency held under these agreements valued at the exchange rate to be used when the foreign currency is returned to the foreign central bank. Return to table
6. Includes commercial paper holdings, net, and about $5 billion in other investments. Return to table
7. Excludes credit extended to Maiden Lane II and III LLCs. Return to table
8. Fair value, reflecting values as of September 30, 2009. Fair value reflects an estimate of the price that would be received upon selling an asset if the transaction were to be conducted in an orderly market on the measurement date. Fair values are updated quarterly. Return to table
9. As of January 27, 2010, TALF LLC had purchased no assets from the FRBNY. Return to table
10. Book value. Return to table

Figure 1. Credit and Liquidity Programs and the Federal Reserve's Balance Sheet

Figure 1. Credit and Liquidity Programs and the Federal Reserve's Balance Sheet

Accessible version

 

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Last update: August 2, 2013