* Fed urges judge not to enforce order pending appeal
* Banks say disclosure could cause loss of confidence
By Jonathan Stempel
NEW YORK, Aug 27 The U.S. Federal Reserve asked
a federal judge not to enforce her order that it reveal the
names of the banks that have participated in its emergency
lending programs and the sums they received, saying such
disclosure would threaten the companies and the economy.
The central bank filed its request on Wednesday, two days
after Chief Judge Loretta Preska of the U.S. District Court in
Manhattan ruled in favor of Bloomberg News, which had sought
information under the federal Freedom of Information Act.
Preska said the Fed failed to show that revealing the names
would stigmatize the banks and result in "imminent competitive
harm." The Fed asked the judge not to require disclosure while
it readies an appeal.
"Immediate release of these documents will cause
irreparable harm to these institutions and to the board's
ability to effectively manage the current, and any future,
financial crisis," the central bank argued.
It added that the public interest favors a delay, citing a
potential for "significant harms that could befall not only
private companies, but the economy as a whole" if the
information were disclosed.
Underlying this case and a similar one involving News
Corp's (NWSA.O) Fox News Network LLC is a question of how much
the public has a right to know about how the government is
bailing out a financial system in a crisis.
The Clearing House Association LLC, which represents banks,
in a separate filing supported the Fed's call for a delay. It
said speculation that banks' liquidity is drying up could cause
runs on deposits, and trading partners to demand collateral.
"Survival can depend on the ephemeral nature of public
confidence," Clearing House general counsel Norman Nelson
wrote. "Experience in the banking industry has shown that when
customers and market participants hear negative rumors about a
bank, negative consequences inevitably flow."
The Clearing House said its members include ABN Amro
Holding NV, Bank of America Corp (BAC.N), Bank of New York
Mellon Corp (BK.N), Citigroup Inc (C.N), Deutsche Bank AG
(DBKGn.DE), HSBC Holdings Plc (HSBA.L), JPMorgan Chase & Co
(JPM.N), UBS AG UBSN.VX, U.S. Bancorp (USB.N) and Wells Fargo
& Co (WFC.N).
The case arose when two Bloomberg reporters submitted FOIA
requests about actions the Fed took to shore up the financial
system in 2007 and early 2008, including an expansion of
lending programs and the sale of Bear Stearns Cos to JPMorgan.
The case is: Bloomberg LP v. Board of Governors of the
Federal Reserve System, U.S. District Court, Southern District
of New York (Manhattan), No. 08-9595.
(Additional reporting by Patrick Rucker, editing by Leslie