Banking in the Ninth

Disclosing Borrowing Information

Disclosure of Discount Window Borrowing Information - June 2011

Published June 1, 2011  |  June 2011 issue

Historically, Reserve Banks have not disclosed information on individual depository institution (DI) borrowings from the discount window. But two recent events have changed that.

First, Fox News Network LLC and Bloomberg LP were successful in winning cases under the Freedom of Information Act to obtain public release of certain information on individual DI borrowings from the discount window from Aug. 8, 2007, through March 1, 2010. Information released consisted of the names of borrowers, loan amounts, dates and some limited collateral information. That information was released to the public on March 31, 2011. Each affected DI was contacted by its Reserve Bank prior to release of the data.

The announcement regarding the release of this data is available on the FOIA Service Center section of the Board's public website. The documents released are available to the public upon request.

Second, the Dodd-Frank Act required the disclosure, by Dec. 1, 2010, of information regarding certain loans and financial assistance provided to institutions between Dec. 1, 2007, and July 21, 2010. This disclosure requirement included information on Term Auction Facility (TAF) borrowings from the discount window. Dodd-Frank also requires the disclosure of discount window lending information for loans outstanding on or after July 21, 2010, on a roughly two-year lag basis. Information to be disclosed on a two-year lag basis includes:

  1. The name of the borrow DI.
  2. The amount borrowed.
  3. The interest rate paid.
  4. Information identifying the types and amounts of collateral securing the loan.

The discount window is designed primarily to be a backup source of funding for banks in sound financial condition. Institutions usually borrow, on an overnight basis, in response to tight money markets or undue market volatility, to prevent an overnight overdraft in their Federal Reserve account or to meet a need for backup funding. The Interagency Advisory on the Use of the Federal Reserve’s Primary Credit Program in Effective Liquidity Management (July 23, 2003) encourages depository institutions to consider the discount window as part of their backup liquidity arrangements. If you have any questions pertaining to disclosure of discount window borrowing information, please contact Jim Deusterhoff (612-204-5868) or Jean Garrick (612-204-5862).

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