Fed to auction 75 bln dlrs in liquidity move

0 Comments | AFP, March, 2008

WASHINGTON (AFP) — The US Federal Reserve said Thursday it would auction 75 billion dollars in credits under a program announced last week to deliver more liquidity to stressed banks and securities firms.

In a modification to the announcement a week earlier, the Fed said it would ease the collateral requirements for firms seeking credits under the new plan.

The Fed said March 11 it was pumping a total 200 billion dollars into a new Term Securities Lending Facility to help unfreeze the credit markets.

The change announced Thursday allows the companies to provide "schedule 2 collateral," instead of the schedule 1 collateral.

Analysts said this will make it it easier for companies holding some mortgage-backed securities that cannot be easily traded....

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