Dodd Praises Fed's Decision to Take Action on Student Loans

Statement

DODD PRAISES FED'S DECISION TO TAKE ACTION ON STUDENT LOANS
U.S. Senate Committee on Banking, Housing, and Urban Affairs

Senator Chris Dodd (D-CT), Chairman of the Senate Banking, Housing, and Urban Affairs Committee today responded to the Fed's decision to accept government-backed student loan securities as collateral. Two weeks ago, Chairman Dodd and other members of the Committee sent a letter to Federal Reserve Board Chairman Ben Bernanke urging him to take such a step in order to ensure the availability and accessibility of educational loans for students during the upcoming academic year. The text of the letter is attached.

"I am pleased that the Federal Reserve Board has changed its policy regarding access to the Fed's Term Securities Lending Facility. The Fed's decision to accept government-backed, and AAA-rated, student loan securities as collateral will help inject much-needed liquidity into the student loan market. This action, coupled with the swift enactment of The Ensuring Continued Access to Student Loans Act, legislation recently passed by my colleagues Senator Kennedy and Representative Miller, represents a timely response to funding concerns in the student loan market and should allow lenders to continue to make loans to students who need them. It's my hope that, combined, these measures will help prevent today's concern from worsening into tomorrow's crisis. I intend to keep a close eye on this liquidity situation in the student loan market, and will remain vigilant about ensuring that American students have the funding they need to pursue their dream of a higher education."

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