Fed's New Emergency-lending Rule Will Require At Least 5 Firms To Be Eligible

The Federal Reserve on Monday is set to vote on emergency-lending rules that would restrict the central bank from creating any facility unless at least 5 firms were eligible. That was one of the key modifications the Fed made in tailoring a regulatory requirement made by the sweeping Dodd-Frank bank reform law. Other parameters include that emergency loans can only be made at a penalty rate that exceeds the market rate and that any program can only last a year unless both the Federal Reserve's board and the Treasury secretary approve.