Purchases of high-quality assets The third major category of assets on the Fed's balance sheet is holdings of high-quality securities, notably Treasury securities, agency debt, and agency-backed MBS. These holdings currently total about $ billion, or about three-eighths of Federal Reserve assets. Of this $ billion, holdings of Treasury securities currently make up about $ billion.
Some of these Treasury securities are lent out through the Term Securities Lending Facility that I mentioned earlier. Obviously, these holdings are very safe from a credit perspective. Longer-term securities do pose some interest-rate risk; however, because the Federal Reserve finances its purchases with short-term liabilities, on average and over time, that risk is mitigated by the normal upward slope of the yield curve.