To All Depository Institutions and Others Concerned in the Second Federal Reserve District:
The following is from a statement by the Board of Governors of the Federal Reserve System:
The Federal Reserve Board has requested comments on a proposal to establish a Century Date Change Special Liquidity Facility, a program for lending to depository institutions from November 1, 1999 through April 7, 2000. The facility should enable depository institutions to confidently commit to supplying loans to other financial institutions and businesses through the rollover to the new century.
Comments are requested by July 2, 1999.
Under the proposal, the interest rate charged on loans from the special facility would be higher than the Federal Open Market Committee's intended federal funds rate. Although the collateral requirements would be the same as for regular discount window loans, there would be fewer restrictions on the use and duration of loans from the special facility. Moreover, borrowers would not be required to seek funds elsewhere first. Use of the special facility would be restricted to adequately and well capitalized institutions.
The Board's proposed rule, as published in the May 27th issue of the Federal Register, is available as a file (pdf - 28kb). Comments should be sent by July 2 to the Board, as specified in the notice, or, at this Bank, to William A. Walsh, Staff Coordinator, Discount Window.