U.S. Markets

NY Fed retains Pimco and State Street to run commercial paper funding facility

FILE PHOTO: The Federal Reserve Bank of New York building is seen in the Manhattan borough of New York, U.S., December 16, 2017. REUTERS/Eduardo Munoz

NEW YORK (Reuters) - The Federal Reserve Bank of New York has retained two financial firms to manage and run its new commercial paper funding facility, according to a statement on the bank’s website.

The New York Fed hired Pacific Investment Management Company (PIMCO) to serve as investment manager for the facility here, which will use a special purpose vehicle to get money directly into the hands of large businesses.

The Fed previously hired Pimco and three other investment managers during the 2008 financial crisis to assist with purchases of agency mortgage-backed securities.

The New York Fed also retained State Street Bank & Trust Company to be the custodian and accounting administrator for upcoming commercial paper funding facility, which should be up and running in the first half of April.

Read more about the vendors here here.

Reporting by Jonnelle Marte