The Federal Reserve today said in a statement that it is ready to expand the Term Asset-Backed Securities Loan Facility to $1 trillion.
Expansion of the lending program aimed at thawing credit came as Treasury Secretary Timothy Geithner unveiled details of the plan that President Barack Obamas administration is putting in place to restore the financial systems health.
The Fed first announced the TALF program on Nov. 24, with the goal of extending up to $200 billion in loans against AAA-rated asset-backed securities backed by auto, student and small-business loans as well as credit cards.
An expansion of the TALF would be supported by the provision by the Treasury of additional funds from the Troubled Asset Relief Program, the Fed statement said.
Under its revised plan, the Fed also will expand the range of securities it will accept as collateral for TALF lending to include commercial mortgage-backed securities and other asset-backed securities, the statement also said.
The program is expected to start later this month.