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Traditionally, like commercial banks, investment banks were eligible to borrow directly from the Fed Question 53...

Traditionally, like commercial banks, investment banks were eligible to borrow directly from the Fed

Question 53 options:

True
False
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Answer #1

This Statement isTrue
Commmercial banks and Investment banks can borrow directly from Fed to meet their requirements.
These loans are availale at a disount window they can easily borrow at a lower rate at any time, Fed charge lower rate as compared to when they take loan from the others banks.
Investment bank lend investment grade Eg- AAA securities as collateral.

I hope this clear your doubt.

Feel free to comment if you still have any query or need something else. I'll help asap.

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