Loans through the Federal Reserve Board's discount window dropped 7.1% during the past week, to $29.763 billion Wednesday, as commercial and investment banks decreased their borrowing.
A week after setting a record, lending to commercial banks in the form of primary credit fell 11.1%, to $11.964 billion.
Investment bank lending through the Fed's primary dealer credit facility fell 4.2%, to $17.775 billion. There were no loans made to weak institutions in the form of secondary credit, and the remaining $24 million was distributed to banks in rural or resort regions as seasonal credit.
Nearly $19 billion of the loans will mature within 15 days, while another $10.801 billion will come due in 16 to 90 days.
Much of last week's lending spike was centered at the Federal Reserve Bank of Cleveland, prompting speculation that National City Corp. may have borrowed from the Fed. But a week later the Cleveland Fed's discount window balance was zero.
The New York Fed, which has taken the lead in lending to investment banks, continued to dominate the discount window, issuing $27.526 billion of loans. The San Francisco Fed came in second place, lending $1.106 billion.
The New York Fed said it accepted $24.12 billion of collateral in exchange for Treasury securities.
