Commercial Banks Step to Fed Window

NEW YORK -- U.S. commercial banks this week increased their use of the Federal Reserve's discount window while investment banks cut their use of a direct-lending program, a sign that the focus of credit strains may be shifting from brokers to depository institutions, The Wall Street Journal reported Friday.

Lending through the discount window's primary credit facility -- used by commercial banks -- as of Wednesday was $13.46 billion, up sharply from $8.83 billion the previous week, according to Thursday's report. Average daily borrowings were $10.73 billion, the highest since after the Sept. 11, 2001, terrorist attacks, the paper reported.

Lending through the separate primary-dealer credit facility -- open to many of the largest investment banks -- totaled $18.56 billion as of Wednesday, down from $25.66 billion the previous week, the paper reported.

-- NYSSCPA.org News Staff

Posted on 4/25/08