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Bond giant Pacific Investment Management Co. will be paid at least $3 million every three months to manage a U.S. Federal Reserve program aimed at supporting short-term corporate borrowing markets.

On Friday, the Federal Reserve Bank of New York released on its Web site documents detailing arrangements around its various emergency lending programs.

In one, the bank said it will pay Newport Beach, Calif.-based Pimco a $3 million fixed fee per quarter "to compensate for overhead and dedicated personnel" related to Pimco's management of the commercial-paper funding facility program. Pimco also will get an asset-management fee of 0.25 basis points per quarter on the average of the month-end assets in the program.

As of July 15, the facility's net portfolio holdings were $112 billion.

Companies use the commercial-paper market to finance their daily operations and meet payroll and other obligations. The program is part of a collection of central bank lending initiatives aimed at improving activity in various corners of the fixed-income market, and was launched last year when this market for short-term corporate debt froze in the wake of the Lehman Brothers bankruptcy.

The Fed's efforts to revive the market have been counteracted by the economic downturn, which means companies have less need for cash. The commercial paper market, which hit a peak of $2.2 trillion in July, now stands at $1.097 trillion, the lowest level since the central bank began tracking data in 2001.

The New York Fed recently reported that money manager BlackRock Inc. (BLK) would minimally be paid $43 million to manage Fed vehicles that hold the assets of Bear Stearns and American International Group Inc. (AIG).

The Fed has faced various levels of controversy about how it has selected investment managers for its various programs.

Pimco, a unit of Allianz SE (AZ), couldn't be reached for comment.

-By Michael S. Derby; Dow Jones Newswires, 212-416-2214 michael.derby@dowjones.com

(Anusha Shrivastava contributed to this report.)