FT: Fed's Bailout Funds Benefited Foreign Banks

Wednesday, 29 Dec 2010 05:49 AM

 

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More than half of the credit granted under a U.S. Federal Reserve emergency facility set up during the financial crisis went to foreign banks, the Financial Times reported, citing its own analysis of Fed figures.

The so-called term auction facility was started three years ago to provide one-month loans to creditworthy banks and in August 2008, it started offering three-month loans as well; details of the uses to which the facility was put may fuel political criticism of the Fed, the newspaper said.

Rabobank Groep of the Netherlands and Canada’s Toronto- Dominion Bank, which are among the only banks in the world with triple A credit ratings, used a total of more than $20 billion under the facility, the FT said.

While the Fed declined to comment, it has said that all of its emergency credit was repaid in full with interest, the newspaper added.

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