WASHINGTON — The past week was a topsy-turvy one at the Federal Reserve Board's discount window.
Loans to investment banks plummeted 91.3%, to just $700 million, while lending against asset-backed commercial paper held by money market mutual funds more than quadrupled to $3.7 billion.
There was no immediate explanation from the Fed about whether the changes were related, though investment bank borrowing has been on the decline for months. Overall lending through the discount window was relatively stable, dropping 1.4%, to $101.5 billion.
Traditional lending to commercial banks increased 3.4%, to $45.3 billion.
The Fed said it had extended $45.5 billion by Wednesday through the discount window to support American International Group Inc. The central bank also has a limited liability corporation designed to help the insurance giant. Loans there were valued at $18.3 billion.
Separate from the discount window, the Fed said it had purchased $181.8 billion in commercial paper by Wednesday, down 25% from a week earlier.
Meanwhile, the Federal Reserve Bank of New York purchased $59.6 billion of mortgage-backed securities from the government-sponsored enterprises during the past week: nearly $41 billion from Fannie Mae; $18.1 billion from Freddie Mac and $500 million from Ginnie Mae. Total purchases nearly doubled from a week earlier.