The Federal Reserve announced plans today to lend up to $200 billion to struggling financial institutions. The Term Securities Lending Facility will lend Treasury securities to primary dealers for 28 days through weekly auctions beginning March 27 in exchange for debt, including private mortgage-backed securities that have fallen in value as homeowners have defaulted on payments.

This is yet another effort by Chairman Ben Bernanke to boost the economy as the finance industry is restricting credit to homeowners and companies even after the Fed lowered its main interest rate by 2.25 percentage points, Bloomberg reported. The Fed will work with primary dealers, a group of 20 banks and securities firms that trade Treasuries directly with the Federal Reserve Bank of New York, to work out the details of the new tool.

The announcement comes after the Fed said last week that it would make up to $200 billion available to banks through tools to help boost liquidity.

The Federal Open Market Committee also approved increasing the amount of dollars available to European central banks through swap lines as part of a collaboration among central banks including Bank of England, Bank of Canada, European Central Bank and Swiss National Bank.