US considers more support for banks and gives time to FRB – 03/27/2023 – Market
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US officials are considering expanding an emergency lending facility that would offer more support to banks, in an effort that could give First Republic Bank more time to bolster its balance sheet, Bloomberg News reported on Saturday.
All deliberations are at an early stage and an expansion of the Federal Reserve’s emergency lending program is one of many considerations by officials to support the failed creditor, the report said, citing people with knowledge of the situation.
While any changes to the Fed’s liquidity offers apply to all eligible users, the adjustments can be designed to ensure the First Republic benefits from the changes, Bloomberg said.
Representatives of the US Treasury Department, the FDIC (the US deposit-guarantee agency) and First Republic Bank declined to comment. The Federal Reserve did not immediately respond to a Reuters request for comment.
US banks sought record amounts of emergency liquidity from the Federal Reserve last month following the failures of Silicon Valley Bank and Signature Bank.
Earlier this month, US President Joe Biden’s economic team worked with regulators to lay out measures to support the banking system, including creating a new mechanism to give banks access to emergency funds and facilitate Fed lending. in emergencies.
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