The U.S. Federal Reserve Board on Sunday evening announced two new initiatives designed to bolster market liquidity and promote orderly market functioning.

The Fed voted unanimously to authorize the Federal Reserve Bank of New York to create a lending facility to improve the ability of primary dealers to provide financing to participants in securitization markets. This facility will be available for business on Monday, March 17. It will be in place for at least six months and may be extended as conditions warrant.

Credit extended to primary dealers under this facility may be collateralized by a broad range of investment-grade debt securities. The interest rate charged on such credit will be the same as the primary credit rate, or discount rate, at the Federal Reserve Bank of New York.

It also unanimously approved a request by the Federal Reserve Bank of New York to decrease the primary credit rate from 3.5% to 3.25%, effective immediately. This step lowers the spread of the primary credit rate over the Federal Open Market Committee’s target federal funds rate to 25 basis points. The Fed also approved an increase in the maximum maturity of primary credit loans to 90 days from 30 days.