Thanks to Fed’s huge release of lending documents today, we now know who received help from one of the Fed’s bank lending programs called the AMLF (Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility).
The AMLF loaned money to mutual funds that were inundated with redemptions by helping them sell illiquid assets.
In the Fed’s words, the program was designed to:
Money market mutual funds (MMMFs) are common investment vehicles that, in aggregate, hold trillions of dollars in funds on behalf of individuals, pension funds, municipalities, businesses, and others. During the financial crisis, MMMFs experienced significant withdrawals of funds by investors and were forced to meet the demand for withdrawals by selling assets in illiquid markets.
The Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility (AMLF) was introduced to help MMMFs that held asset-backed commercial paper (ABCP) meet investors’ demands for redemptions, and to foster liquidity in the ABCP market and money markets more generally. Without additional liquidity in the money markets, forced sales of ABCP could have depressed the price of ABCP and other short-term instruments, resulting in a cycle of losses to MMMFs and even higher levels of redemptions and a weakening of investor confidence in MMMFs and the financial markets.
The program made its first loans on September 22, 2008, to BNY Mellon, State Street, and JPMorgan.
It made its last on an unknown date – unknown because many of the later transactions are redacted with a “Not Applicable” note.
Check out all of the redactions after the jump. They start on page 41 and go until the last, page number 2400.
UPDATE: This is a note from the Boston Fed:Just to clarify, there were actually no redactions. The confusion may have arisen in that each AMLF loan was collateralized by between 1 and something like 28 ABCP CUSIPs. Consequently, the disclosure file has columns for up to 28 CUSIPS. If a particular loan was collateralized by anything less than 28 CUSIPs, the “un-needed” cells were left blank and/or may include the phrase “not applicable.”
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