Fed Board Amends Rates in Regs A and D

The Federal Reserve Board has published final rules in a recent Federal Register amending Regulation A (Extensions of Credit by Federal Reserve Banks) and Regulation D (Reserve Requirements of Depository Institutions) to increase certain interest rates.

• The amendment to Regulation A reflects the Board's approval of a 0.5% increase (to 1.00%) in the rate for primary credit at each Federal Reserve Bank. The interest rate for secondary credit automatically increases by formula to 1.50%.
• The amendment to Regulation D revises the rate of interest paid on reserve balances ("IORB") maintained at Federal Reserve banks by or on behalf of eligible institutions. The final amendments specify that IORB is 0.90%, a 0.50 percentage-point increase from its prior level. The amendment is intended to enhance the role of IORB in maintaining the federal funds rate in the target range established by the Federal Open Market Committee.

Both amendments were effective May 16, 2022, and applicable as of May 5, 2022. (Editor’s Note: “Reserve Requirements – Regulation D” has been updated in the Accounts channel in InfoSight to reflect this increase.)