First Tennessee, BBVA unit took big Fed loans in late 2010
WASHINGTON Dec 28 (Reuters) - First Tennessee Bank and a U.S. affiliate of Spanish bank BBVA were among the largest borrowers from the Federal Reserve's emergency lending program in late 2010, according to data released on Friday.
By far the largest loan in the quarter was the roughly $1.02 billion that First Horizon unit First Tennessee borrowed on Nov. 24, 2010 for a two-day term. That one loan represented about 29 percent of all primary credit lending from the discount window for the quarter.
Company officials said they took the loan because of a technical problem relating to wire transfers between the bank and the Federal Reserve Bank of St. Louis.
Because it was the eve of the Thanksgiving holiday, and the wire transfer glitches were taking too long to repair, First Tennessee agreed to take the loan as a stopgap until the holiday ended and the problems were fixed.
The BBVA unit borrowed $200 million in two transactions. A representative of the parent company in Spain said the transactions were a routine test of the discount window mechanism by its U.S. wholesale unit and said it conducts similar operations every year.
The Fed began releasing the data earlier this year, albeit with a two-year lag, under the terms of the Dodd-Frank financial reform law. The central bank had lobbied to keep such lending figures private for fear it could create a stigma for emergency loans in the future.
Other small but frequent borrowers during the final quarter of 2010 were First National Bank of Jeffersonville, New York, and Grand Bank of Hamilton, New Jersey. Representatives at both banks were not available for comment.
Some 456 separate financial institutions took loans of one kind or another during the quarter.
The Fed data can be found at: