NEW YORK — A federal appeals court ruled Friday that the Federal Reserve's board of governors must disclose documents related to individual borrowing from its discount window and other "last resort" lending programs.
In separate rulings Friday, the Second Circuit Court of Appeals upheld a lower court's decision granting a request by Bloomberg LP's Bloomberg News for documents related to usage of the Fed's discount window and other programs and vacated a separate ruling denying a request for documents by Fox News Network LLC's Fox Business.
Both news organizations had sought Fed documents under the Freedom of Information Act and ultimately brought lawsuits after the Fed denied their requests.
"The requirement of disclosure under FOIA and its proper limits are matters of congressional policy," Circuit Judge Dennis Jacobs wrote in the Bloomberg decision. "The statute as written by Congress sets forth no basis for the exemption the Board asks us to read into it. If the Board believes such an exemption would better serve the national interest, it should ask Congress to amend the statute."
Bloomberg sued the Fed's board of governors last year seeking records related to collateral posted in order to access the Fed's Primary Dealer Credit Facility, the discount window, the Term Securities Lending Facility and the Term Auction Facility between April 4, 2008, and May 20, 2008.
Bloomberg also sought information about a portfolio of securities supporting a loan extended by the Fed in connection with J.P. Morgan Chase & Co.'s acquisition of Bear Stearns.
Fox Business separately sued, seeking access to disclosure about borrowers, their loan amounts and pledged collateral after the Fed temporarily reduced rates and lengthened the loan terms for money lent through the discount window.
In December, several media companies, including Dow Jones & Co., New York Times Co., the Associated Press and Reuters America LLC, filed an amicus brief with the circuit court backing Bloomberg's request.
News Corp. is the parent company of Dow Jones & Co., the publisher of this newswire and the owner of Fox News. Reuters America LLC is a subsidiary of Thomson Reuters Corp.
Matthew M. Collette, a lawyer for the Fed's board of governors, argued in January that banks would be less likely to use the discount window and other lending of last resort programs if they know their usage would be made public.
He said at the time that accessing the window carries a negative connotation if usage was made public, even when a healthy bank suffering a short-term liquidity issue does it.