Current Issues in Economics and Finance
The Term Securities Lending Facility: Origin, Design, and Effects
February 2009 Volume 15, Number 2
JEL classification: E52, E58, G14

Authors: Michael J. Fleming, Warren B. Hrung, and Frank M. Keane

The Federal Reserve launched the Term Securities Lending Facility (TSLF) in 2008 to promote liquidity in the funding markets and improve the operation of the broader financial markets. The facility increases the ability of dealers to obtain cash in the private market by enabling them to pledge securities temporarily as collateral for Treasuries, which are relatively easy to finance. The TSLF thus reduces the need for dealers to sell assets into illiquid markets as well as lessens the likelihood of a loss of confidence among lenders.

PDF full articlePDF 11 pages / 357 kb
Press release
Related New York Fed Content
By continuing to use our site, you agree to our Terms of Use and Privacy Statement. You can learn more about how we use cookies by reviewing our Privacy Statement.   Close