Fed gets 60-day delay on bailout disclosure
NEW YORK (Reuters) - A appeals court granted the Federal Reserve a 60-day delay in implementing a ruling to force the central bank to reveal details of its emergency lending programs to banks during the financial crisis.
The delay is 30 days shorter than the Fed requested and was granted in a two-sentence order by the U.S. Second Circuit Court of Appeals. It gives the Fed time to consider whether to appeal to the U.S. Supreme Court.
In March, the court had ordered the Fed to disclose the names of bailout recipients, amounts received and other information that Bloomberg LP, the parent of Bloomberg News, and News Corp's Fox News Network requested under the federal Freedom of Information Act.
"The stay is necessary to permit the board to consult with the Department of Justice regarding an appeal to the Supreme Court," Fed spokesman David Skidmore said. He made the same statement on Wednesday when the Fed sought the 90-day delay.
The Fed programs were designed to shore up the financial markets. They more than doubled the central bank's balance sheet to well over $2 trillion, especially after the September 2008 collapse of Lehman Brothers Holdings Inc.
The Fed has maintained that allowing disclosure could stigmatize banks, causing a loss of confidence that could lead to deposit runs, bank failures and damage to the economy. A group of major U.S. and European banks known as The Clearing House Association supports the Fed in the case.
The cases are Bloomberg LP v. Board of Governors of the Federal Reserve System et al, U.S. Court of Appeals for the Second Circuit, Nos. 09-4083, 09-4097.