WASHINGTON — Total lending through the Federal Reserve Board's discount window declined 4% this week, to $134.7 billion.
Traditional borrowing by commercial banks fell 1.9%, to $65.5 billion and there were no loans to unhealthy banks.
The Fed said it had extended nearly $42 billion by Wednesday through the discount window to support American International Group Inc. The central bank has also established a limited liability corporation through the Federal Reserve Bank of New York to help the insurance giant. Loans there were valued at $18.5 billion.
Investment bank borrowing was off 16.9%, to $19.6 billion.
Lending against asset-backed commercial paper held by money market mutual funds fell 15.5%, to $6.8 billion. The Fed has yet to make loans to another liability corporation that will buy unsecured assets held by money markets.
Most of the discount window loans — $75.7 billion — will mature within 15 days. Another $42.8 billion will come due in one to five years, and $16.1 billion will be repaid in 16 to 90 days. The final $55 million matures within 91 days to one year.
Separate from the discount window loans, the Fed purchased $240.9 billion of commercial paper by Wednesday.
Meanwhile, the New York Fed said it purchased $61.4 billion in mortgage-backed securities during the past week: $40.6 billion from Fannie Mae; $18.7 billion from Freddie Mac and $2.1 billion from the Government National Mortgage Association. Total purchases grew 4% during the week.
Total assets at the Fed declined slightly to $1.9 trillion. Reserves held at the Fed by financial institutions grew 2%, to $632.5 billion.