Fed to undertake $50 bln TSLF auction on Thursday

NEW YORK, May 7 (Reuters) - The U.S. Federal Reserve will undertake a $50 billion 28-day Term Securities Lending Facility (TSLF) auction on Thursday, the New York Fed Web site announced on Wednesday.

The maximum award at the auction will be $10 billion, the Fed said. The Fed will accept Schedule 2 collateral in exchange for Treasuries.

Dealers can then lend out the Treasuries in exchange for short-term cash loans in the $4.5 trillion U.S. repurchase market, to help shore up balance sheets that have been depleted by the credit crisis.

For more details of the auction announcement click here

(Reporting by John Parry; Editing by Chizu Nomiyama)