Extensions of Credit by Federal Reserve Banks, 7202 [E8-2209]

Download as PDF 7202 Federal Register / Vol. 73, No. 26 / Thursday, February 7, 2008 / Rules and Regulations federal funds rate (from 3.50 percent to 3.00 percent) approved by the Federal Open Market Committee (Committee) and announced at the same time. A press release announcing these actions indicated that: FEDERAL RESERVE SYSTEM 12 CFR Part 201 [Regulation A] Extensions of Credit by Federal Reserve Banks Board of Governors of the Federal Reserve System. ACTION: Final rule. AGENCY: SUMMARY: The Board of Governors of the Federal Reserve System (Board) has adopted final amendments to its Regulation A to reflect the Board’s approval of a decrease in the primary credit rate at each Federal Reserve Bank. The secondary credit rate at each Reserve Bank automatically decreased by formula as a result of the Board’s primary credit rate action. DATES: The amendments to part 201 (Regulation A) are effective February 7, 2008. The rate changes for primary and secondary credit were effective on the dates specified in 12 CFR 201.51, as amended. rfrederick on PROD1PC67 with RULES FOR FURTHER INFORMATION CONTACT: Jennifer J. Johnson, Secretary of the Board (202/452–3259); for users of Telecommunication Devices for the Deaf (TDD) only, contact 202/263–4869. SUPPLEMENTARY INFORMATION: The Federal Reserve Banks make primary and secondary credit available to depository institutions as a backup source of funding on a short-term basis, usually overnight. The primary and secondary credit rates are the interest rates that the twelve Federal Reserve Banks charge for extensions of credit under these programs. In accordance with the Federal Reserve Act, the primary and secondary credit rates are established by the boards of directors of the Federal Reserve Banks, subject to the review and determination of the Board. The Board approved requests by the Reserve Banks to decrease by 50 basis points the primary credit rate in effect at each of the twelve Federal Reserve Banks, thereby decreasing from 4.00 percent to 3.50 percent the rate that each Reserve Bank charges for extensions of primary credit. As a result of the Board’s action on the primary credit rate, the rate that each Reserve Bank charges for extensions of secondary credit automatically decreased from 4.50 percent to 4.00 percent under the secondary credit rate formula. The final amendments to Regulation A reflect these rate changes. The 50-basis-point decrease in the primary credit rate was associated with a similar decrease in the target for the VerDate Aug<31>2005 15:02 Feb 06, 2008 Jkt 214001 Financial markets remain under considerable stress, and credit has tightened further for some businesses and households. Moreover, recent information indicates a deepening of the housing contraction as well as some softening in labor markets. The Committee expects inflation to moderate in coming quarters, but it will be necessary to continue to monitor inflation developments carefully. Today’s policy action, combined with those taken earlier, should help to promote moderate growth over time and to mitigate the risks to economic activity. However, downside risks to growth remain. The Committee will continue to assess the effects of financial and other developments on economic prospects and will act in a timely manner as needed to address those risks. Regulatory Flexibility Act Certification Pursuant to the Regulatory Flexibility Act (5 U.S.C. 605(b)), the Board certifies that the new primary and secondary credit rates will not have a significantly adverse economic impact on a substantial number of small entities because the final rule does not impose any additional requirements on entities affected by the regulation. Administrative Procedure Act The Board did not follow the provisions of 5 U.S.C. 553(b) relating to notice and public participation in connection with the adoption of these amendments because the Board for good cause determined that delaying implementation of the new primary and secondary credit rates in order to allow notice and public comment would be unnecessary and contrary to the public interest in fostering price stability and sustainable economic growth. For these same reasons, the Board also has not provided 30 days prior notice of the effective date of the rule under section 553(d). 12 CFR Chapter II List of Subjects in 12 CFR Part 201 Banks, Banking, Federal Reserve System, Reporting and recordkeeping. PART 201 EXTENSIONS OF CREDIT BY FEDERAL RESERVE BANKS (REGULATION A) 1. The authority citation for part 201 continues to read as follows: I Authority: 12 U.S.C. 248(i)–(j), 343 et seq., 347a, 347b, 347c, 348 et seq., 357, 374, 374a, and 461. 2. In § 201.51, paragraphs (a) and (b) are revised to read as follows: I § 201.51 Interest rates applicable to credit extended by a Federal Reserve Bank.1 (a) Primary credit. The interest rates for primary credit provided to depository institutions under § 201.4(a) are: Federal Reserve Bank Rate Boston .................. New York ............. Philadelphia ......... Cleveland ............. Richmond ............. Atlanta .................. Chicago ................ St. Louis ............... Minneapolis .......... Kansas City ......... Dallas ................... San Francisco ...... 3.50 3.50 3.50 3.50 3.50 3.50 3.50 3.50 3.50 3.50 3.50 3.50 Effective Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. 30, 30, 30, 30, 31, 30, 30, 31, 31, 30, 31, 30, 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. (b) Secondary credit. The interest rates for secondary credit provided to depository institutions under 201.4(b) are: Federal Reserve Bank Rate Boston .................. New York ............. Philadelphia ......... Cleveland ............. Richmond ............. Atlanta .................. Chicago ................ St. Louis ............... Minneapolis .......... Kansas City ......... Dallas ................... San Francisco ...... * * * 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 4.00 * Effective Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. 30, 30, 30, 30, 31, 30, 30, 31, 31, 30, 31, 30, 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. 2008. * By order of the Board of Governors of the Federal Reserve System, February 4, 2008. Jennifer J. Johnson, Secretary of the Board. [FR Doc. E8–2209 Filed 2–6–08; 8:45 am] BILLING CODE 6210–01–P Authority and Issuance For the reasons set forth in the preamble, the Board is amending 12 CFR Chapter II to read as follows: I PO 00000 Frm 00016 Fmt 4700 Sfmt 4700 1 The primary, secondary, and seasonal credit rates described in this section apply to both advances and discounts made under the primary, secondary, and seasonal credit programs, respectively. E:\FR\FM\07FER1.SGM 07FER1

Agencies

[Federal Register Volume 73, Number 26 (Thursday, February 7, 2008)]
[Rules and Regulations]
[Page 7202]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-2209]



[[Page 7202]]

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FEDERAL RESERVE SYSTEM

12 CFR Part 201

[Regulation A]


Extensions of Credit by Federal Reserve Banks

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Board of Governors of the Federal Reserve System (Board) 
has adopted final amendments to its Regulation A to reflect the Board's 
approval of a decrease in the primary credit rate at each Federal 
Reserve Bank. The secondary credit rate at each Reserve Bank 
automatically decreased by formula as a result of the Board's primary 
credit rate action.

DATES: The amendments to part 201 (Regulation A) are effective February 
7, 2008. The rate changes for primary and secondary credit were 
effective on the dates specified in 12 CFR 201.51, as amended.

FOR FURTHER INFORMATION CONTACT: Jennifer J. Johnson, Secretary of the 
Board (202/452-3259); for users of Telecommunication Devices for the 
Deaf (TDD) only, contact 202/263-4869.

SUPPLEMENTARY INFORMATION: The Federal Reserve Banks make primary and 
secondary credit available to depository institutions as a backup 
source of funding on a short-term basis, usually overnight. The primary 
and secondary credit rates are the interest rates that the twelve 
Federal Reserve Banks charge for extensions of credit under these 
programs. In accordance with the Federal Reserve Act, the primary and 
secondary credit rates are established by the boards of directors of 
the Federal Reserve Banks, subject to the review and determination of 
the Board.
    The Board approved requests by the Reserve Banks to decrease by 50 
basis points the primary credit rate in effect at each of the twelve 
Federal Reserve Banks, thereby decreasing from 4.00 percent to 3.50 
percent the rate that each Reserve Bank charges for extensions of 
primary credit. As a result of the Board's action on the primary credit 
rate, the rate that each Reserve Bank charges for extensions of 
secondary credit automatically decreased from 4.50 percent to 4.00 
percent under the secondary credit rate formula. The final amendments 
to Regulation A reflect these rate changes.
    The 50-basis-point decrease in the primary credit rate was 
associated with a similar decrease in the target for the federal funds 
rate (from 3.50 percent to 3.00 percent) approved by the Federal Open 
Market Committee (Committee) and announced at the same time. A press 
release announcing these actions indicated that:

    Financial markets remain under considerable stress, and credit 
has tightened further for some businesses and households. Moreover, 
recent information indicates a deepening of the housing contraction 
as well as some softening in labor markets.

    The Committee expects inflation to moderate in coming quarters, 
but it will be necessary to continue to monitor inflation 
developments carefully.

    Today's policy action, combined with those taken earlier, should 
help to promote moderate growth over time and to mitigate the risks 
to economic activity. However, downside risks to growth remain. The 
Committee will continue to assess the effects of financial and other 
developments on economic prospects and will act in a timely manner 
as needed to address those risks.

Regulatory Flexibility Act Certification

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 605(b)), the 
Board certifies that the new primary and secondary credit rates will 
not have a significantly adverse economic impact on a substantial 
number of small entities because the final rule does not impose any 
additional requirements on entities affected by the regulation.

Administrative Procedure Act

    The Board did not follow the provisions of 5 U.S.C. 553(b) relating 
to notice and public participation in connection with the adoption of 
these amendments because the Board for good cause determined that 
delaying implementation of the new primary and secondary credit rates 
in order to allow notice and public comment would be unnecessary and 
contrary to the public interest in fostering price stability and 
sustainable economic growth. For these same reasons, the Board also has 
not provided 30 days prior notice of the effective date of the rule 
under section 553(d).

12 CFR Chapter II

List of Subjects in 12 CFR Part 201

    Banks, Banking, Federal Reserve System, Reporting and 
recordkeeping.

Authority and Issuance

0
For the reasons set forth in the preamble, the Board is amending 12 CFR 
Chapter II to read as follows:

PART 201 EXTENSIONS OF CREDIT BY FEDERAL RESERVE BANKS (REGULATION 
A)

0
1. The authority citation for part 201 continues to read as follows:

    Authority: 12 U.S.C. 248(i)-(j), 343 et seq., 347a, 347b, 347c, 
348 et seq., 357, 374, 374a, and 461.

0
2. In Sec.  201.51, paragraphs (a) and (b) are revised to read as 
follows:


Sec.  201.51  Interest rates applicable to credit extended by a Federal 
Reserve Bank.\1\
---------------------------------------------------------------------------

    \1\ The primary, secondary, and seasonal credit rates described 
in this section apply to both advances and discounts made under the 
primary, secondary, and seasonal credit programs, respectively.
---------------------------------------------------------------------------

    (a) Primary credit. The interest rates for primary credit provided 
to depository institutions under Sec.  201.4(a) are:

------------------------------------------------------------------------
        Federal Reserve Bank          Rate            Effective
------------------------------------------------------------------------
Boston.............................    3.50  Jan. 30, 2008.
New York...........................    3.50  Jan. 30, 2008.
Philadelphia.......................    3.50  Jan. 30, 2008.
Cleveland..........................    3.50  Jan. 30, 2008.
Richmond...........................    3.50  Jan. 31, 2008.
Atlanta............................    3.50  Jan. 30, 2008.
Chicago............................    3.50  Jan. 30, 2008.
St. Louis..........................    3.50  Jan. 31, 2008.
Minneapolis........................    3.50  Jan. 31, 2008.
Kansas City........................    3.50  Jan. 30, 2008.
Dallas.............................    3.50  Jan. 31, 2008.
San Francisco......................    3.50  Jan. 30, 2008.
------------------------------------------------------------------------

    (b) Secondary credit. The interest rates for secondary credit 
provided to depository institutions under 201.4(b) are:

------------------------------------------------------------------------
        Federal Reserve Bank          Rate            Effective
------------------------------------------------------------------------
Boston.............................    4.00  Jan. 30, 2008.
New York...........................    4.00  Jan. 30, 2008.
Philadelphia.......................    4.00  Jan. 30, 2008.
Cleveland..........................    4.00  Jan. 30, 2008.
Richmond...........................    4.00  Jan. 31, 2008.
Atlanta............................    4.00  Jan. 30, 2008.
Chicago............................    4.00  Jan. 30, 2008.
St. Louis..........................    4.00  Jan. 31, 2008.
Minneapolis........................    4.00  Jan. 31, 2008.
Kansas City........................    4.00  Jan. 30, 2008.
Dallas.............................    4.00  Jan. 31, 2008.
San Francisco......................    4.00  Jan. 30, 2008.
------------------------------------------------------------------------

* * * * *

    By order of the Board of Governors of the Federal Reserve 
System, February 4, 2008.
Jennifer J. Johnson,
Secretary of the Board.
 [FR Doc. E8-2209 Filed 2-6-08; 8:45 am]
BILLING CODE 6210-01-P