Discussion Paper

Dealer Participation in the TSLF Options Program

Abstract: Our previous post described the workings of the Term Securities Lending Facility Options Program (TOP), which offered dealers options for obtaining short-term loans over month- and quarter-end dates during the global financial crisis of 2007-08. In this follow-up post, we examine dealer participation in the TOP, including the extent to which dealers bid for options, at what fees, and whether they exercised their options. We also provide evidence on how uncertainty in dealers? funding positions was related to the demand for the liquidity options.

Keywords: Crisis; Liquidity facilities; Dealers; Lender of last resort;

JEL Classification: E63;

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Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Liberty Street Economics

Publication Date: 2019-03-06

Number: 20190306a