83_FR_49663 83 FR 49472 - Regulation A: Extensions of Credit by Federal Reserve Banks

83 FR 49472 - Regulation A: Extensions of Credit by Federal Reserve Banks

FEDERAL RESERVE SYSTEM

Federal Register Volume 83, Issue 191 (October 2, 2018)

Page Range49472-49473
FR Document2018-21436

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 an increase in the rate for primary credit at each Federal Reserve Bank. The secondary credit rate at each Reserve Bank automatically increased by formula as a result of the Board's primary credit rate action.

Federal Register, Volume 83 Issue 191 (Tuesday, October 2, 2018) 
[Federal Register Volume 83, Number 191 (Tuesday, October 2, 2018)]
[Rules and Regulations]
[Pages 49472-49473]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-21436]


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FEDERAL RESERVE SYSTEM

12 CFR Part 201

[Docket No. R-1623]
RIN 7100-AF 17


Regulation A: Extensions of Credit by Federal Reserve Banks

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Final rule.

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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 an increase in the rate for primary credit at 
each Federal Reserve Bank. The secondary credit rate at each Reserve 
Bank automatically increased by formula as a result of the Board's 
primary credit rate action.

DATES: Effective date: The amendments to part 201 (Regulation A) are 
effective October 2, 2018.
    Applicability date: The rate changes for primary and secondary 
credit were applicable on September 27, 2018.

FOR FURTHER INFORMATION CONTACT: Sophia Allison, Senior Special Counsel 
(202-452-3565), Legal Division, or Lyle Kumasaka, Lead Financial 
Institution & Policy Analyst (202-452-2382), or Kristen Payne, Senior 
Financial Institution & Policy Analyst (202-452-2872), Division of 
Monetary Affairs; for users of Telecommunications Device for the Deaf 
(TDD) only, contact 202-263-4869; Board of Governors of the Federal 
Reserve System, 20th and C Streets NW, Washington, DC 20551.

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.
    On September 26, 2018, the Board voted to approve a \1/4\ 
percentage point increase in the primary credit rate in effect at each 
of the twelve Federal Reserve Banks, thereby increasing from 2.50 
percent to 2.75 percent the rate that each Reserve Bank charges for 
extensions of primary credit. In addition, the Board had previously 
approved the renewal of the secondary credit rate formula, the primary 
credit rate plus 50 basis points. Under the formula, the secondary 
credit rate in effect at each of the twelve Federal Reserve Banks 
increased by \1/4\ percentage point as a result of the Board's primary 
credit rate action, thereby increasing from 3.00 percent to 3.25 
percent the rate that each Reserve Bank charges for extensions of

[[Page 49473]]

secondary credit. The amendments to Regulation A reflect these rate 
changes.
    The \1/4\ percentage point increase in the primary credit rate was 
associated with an increase in the target range for the federal funds 
rate (from a target range of 1\3/4\ to 2 percent to a target range of 2 
to 2\1/4\ percent) announced by the Federal Open Market Committee on 
September 26, 2018, as described in the Board's amendment of its 
Regulation D regulations published elsewhere in this issue of the 
Federal Register.

Administrative Procedure Act

    In general, the Administrative Procedure Act (``APA'') \1\ imposes 
three principal requirements when an agency promulgates legislative 
rules (rules made pursuant to congressionally delegated authority): (1) 
Publication with adequate notice of a proposed rule; (2) followed by a 
meaningful opportunity for the public to comment on the rule's content; 
and (3) publication of the final rule not less than 30 days before its 
effective date. The APA provides that notice and comment procedures do 
not apply if the agency for good cause finds them to be ``unnecessary, 
impracticable, or contrary to the public interest.'' \2\ Section 553(d) 
of the APA also provides that publication at least 30 days prior to a 
rule's effective date is not required for (1) a substantive rule which 
grants or recognizes an exemption or relieves a restriction; (2) 
interpretive rules and statements of policy; or (3) a rule for which 
the agency finds good cause for shortened notice and publishes its 
reasoning with the rule.\3\ The APA further provides that the notice, 
public comment, and delayed effective date requirements of 5 U.S.C. 553 
do not apply ``to the extent that there is involved . . . a matter 
relating to agency management or personnel or to public property, 
loans, grants, benefits, or contracts.'' \4\
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    \1\ 5 U.S.C. 551 et seq.
    \2\ 5 U.S.C. 553(b)(3)(A).
    \3\ 5 U.S.C. 553(d).
    \4\ 5 U.S.C. 553(a)(2) (emphasis added).
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    Regulation A establishes the interest rates that the twelve Reserve 
Banks charge for extensions of primary credit and secondary credit. The 
Board has determined that the notice, public comment, and delayed 
effective date requirements of the APA do not apply to these final 
amendments to Regulation A for several reasons. The amendments involve 
a matter relating to loans and are therefore exempt under the terms of 
the APA. In addition, the Board has determined that notice, public 
comment, and delayed effective date would be unnecessary and contrary 
to the public interest because delay in implementation of changes to 
the rates charged on primary credit and secondary credit would permit 
insured depository institutions to profit improperly from the 
difference in the current rate and the announced increased rate. 
Finally, because delay would undermine the Board's action in responding 
to economic data and conditions, the Board has determined that ``good 
cause'' exists within the meaning of the APA to dispense with the 
notice, public comment, and delayed effective date procedures of the 
APA with respect to the final amendments to Regulation A.

Regulatory Flexibility Analysis

    The Regulatory Flexibility Act (``RFA'') does not apply to a 
rulemaking where a general notice of proposed rulemaking is not 
required.\5\ As noted previously, a general notice of proposed 
rulemaking is not required if the final rule involves a matter relating 
to loans. Furthermore, the Board has determined that it is unnecessary 
and contrary to the public interest to publish a general notice of 
proposed rulemaking for this final rule. Accordingly, the RFA's 
requirements relating to an initial and final regulatory flexibility 
analysis do not apply.
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    \5\ 5 U.S.C. 603, 604.
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Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act (``PRA'') of 
1995,\6\ the Board reviewed the final rule under the authority 
delegated to the Board by the Office of Management and Budget. The 
final rule contains no requirements subject to the PRA.
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    \6\ 44 U.S.C. 3506; see 5 CFR part 1320, appendix A.1.
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List of Subjects in 12 CFR Part 201

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

Authority and Issuance

    For the reasons set forth in the preamble, the Board is amending 12 
CFR part 201 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) and (s), 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.\3\
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    \3\ 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.
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    (a) Primary credit. The interest rate at each Federal Reserve Bank 
for primary credit provided to depository institutions under Sec.  
201.4(a) is 2.75 percent.
    (b) Secondary credit. The interest rate at each Federal Reserve 
Bank for secondary credit provided to depository institutions under 
Sec.  201.4(b) is 3.25 percent.
* * * * *

    By order of the Board of Governors of the Federal Reserve 
System, September 27, 2018.
Ann Misback,
Secretary of the Board.
[FR Doc. 2018-21436 Filed 10-1-18; 8:45 am]
BILLING CODE 6210-01-P

49472 Federal Register / Vol. 83, No. 191 / Tuesday, October 2, 2018 / Rules and Regulations under § 1416.400(c), the eligible are not eligible for consideration under ACTION: Final rule. orchardist or nursery tree grower must paragraph (b) of this section, unless the first have suffered a mortality loss of decision was based only on failure to SUMMARY: The Board of Governors of the more than 7.5 percent (adjusted for submit the application for payment by Federal Reserve System (‘‘Board’’) has normal mortality) on a stand as a result the prior applicable deadline, adopted final amendments to its of natural disaster as determined by the (b) To apply for TAP, a producer that Regulation A to reflect the Board’s Deputy Administrator. suffered eligible tree, bush, or vine approval of an increase in the rate for (b) The qualifying loss of a stand of losses that occurred during the 2017 and primary credit at each Federal Reserve trees, bushes, or vines specified in subsequent calendar years must provide Bank. The secondary credit rate at each paragraph (a) of this section will be an application for payment and Reserve Bank automatically increased determined based on: supporting documentation to FSA by by formula as a result of the Board’s (1) Each eligible disaster event, except the later of December 3, 2018 or within primary credit rate action. for losses due to plant disease; 90 calendar days of the disaster event or DATES: Effective date: The amendments (2) For plant disease, the time period, date when the loss of trees, bushes, or to part 201 (Regulation A) are effective as determined by the Deputy vines is apparent to the producer. October 2, 2018. Administrator, for which the stand is * * * * * Applicability date: The rate changes infected. ■ 36. Amend § 1416.406 as follows: (c) Mortality or damage loss not for primary and secondary credit were ■ a. In paragraph (a) introductory text, eligible for inclusion as a qualifying loss applicable on September 27, 2018. remove ‘‘Payment’’ and add ‘‘Once the under this section or for payment under loss threshold in § 1416.403(a) is FOR FURTHER INFORMATION CONTACT: § 1416.406 includes those losses where: satisfied, payment’’ in its place; Sophia Allison, Senior Special Counsel (1) The loss or damage could have ■ b. In paragraph (b), remove the words (202–452–3565), Legal Division, or Lyle been prevented through reasonable and ‘‘damage or’’ in both places where they Kumasaka, Lead Financial Institution & available measures; and appear; Policy Analyst (202–452–2382), or (2) The trees, bushes, or vines, in the ■ c. Add paragraph (d)(3); Kristen Payne, Senior Financial absence of a natural disaster, would ■ d. In paragraph (h), remove ‘‘eligible’’ Institution & Policy Analyst (202–452– normally have required rehabilitation or before the word ‘‘stand’’; and 2872), Division of Monetary Affairs; for replanting within the 12-month period ■ e. In paragraph (j), remove the number users of Telecommunications Device for following the loss. ‘‘500’’ and add the number ‘‘1,000’’ in the Deaf (TDD) only, contact 202–263– (d) The damage or loss must be visible its place. 4869; Board of Governors of the Federal and obvious to the county committee The addition reads as follows: Reserve System, 20th and C Streets NW, representative. If the damage is no Washington, DC 20551. § 1416.406 Payment Calculation. longer visible, the county committee SUPPLEMENTARY INFORMATION: The may accept other evidence of the loss as * * * * * (d) * * * Federal Reserve Banks make primary it determines is reasonable. and secondary credit available to (e) The county committee may require (3) Costs or expenses that the eligible orchardist or nursery tree grower did depository institutions as a backup information from a qualified expert, as not actually bear or incur because source of funding on a short-term basis, determined by the county committee, to someone or some other entity bore or usually overnight. The primary and determine extent of loss in the case of incurred those costs or expenses, or the secondary credit rates are the interest plant disease or insect infestation. costs were reimbursed under another rates that the twelve Federal Reserve (f) The Deputy Administrator will program. For example, if under any Banks charge for extensions of credit determine the types of trees, bushes, other program the expenses are paid for under these programs. In accordance and vines that are eligible. (g) A stand that did not suffer a on behalf of the eligible orchardist or with the Federal Reserve Act, the qualifying mortality loss as specified in nursery tree grower, those expenses are primary and secondary credit rates are paragraph (a) of this section is not not eligible for cost share under this established by the boards of directors of eligible for payment. subpart. the Federal Reserve Banks, subject to * * * * * the review and determination of the § 1416.404 [Amended] Board. Richard Fordyce, On September 26, 2018, the Board ■ 34. In § 1416.404, in paragraph (a), Administrator, Farm Service Agency. voted to approve a 1⁄4 percentage point remove ‘‘To’’ and add ‘‘Once the Robert Stephenson, increase in the primary credit rate in requisite qualifying eligible mortality loss is determined according to Executive Vice President, Commodity Credit effect at each of the twelve Federal Corporation. Reserve Banks, thereby increasing from § 1416.403, to’’. ■ 35. Amend § 1416.405 as follows: [FR Doc. 2018–21257 Filed 10–1–18; 8:45 am] 2.50 percent to 2.75 percent the rate that ■ a. Redesignate paragraphs (a) through BILLING CODE 3410–05–P each Reserve Bank charges for (d) as paragraphs (b) and (e); extensions of primary credit. In ■ b. Add new paragraph (a); and addition, the Board had previously ■ c. Revise newly redesignated FEDERAL RESERVE SYSTEM approved the renewal of the secondary paragraph (b). credit rate formula, the primary credit The addition and revision read as 12 CFR Part 201 rate plus 50 basis points. Under the follows: [Docket No. R–1623] formula, the secondary credit rate in effect at each of the twelve Federal amozie on DSK3GDR082PROD with RULES § 1416.405 Application. RIN 7100–AF 17 Reserve Banks increased by 1⁄4 (a) Applications for payment that had percentage point as a result of the Regulation A: Extensions of Credit by been filed under the regulations in effect Board’s primary credit rate action, Federal Reserve Banks at the time of filing and which were thereby increasing from 3.00 percent to issued an administrative decision for AGENCY: Board of Governors of the 3.25 percent the rate that each Reserve either a 2017 or 2018 program year loss Federal Reserve System. Bank charges for extensions of VerDate Sep<11>2014 16:20 Oct 01, 2018 Jkt 247001 PO 00000 Frm 00014 Fmt 4700 Sfmt 4700 E:\FR\FM\02OCR1.SGM 02OCR1

Federal Register / Vol. 83, No. 191 / Tuesday, October 2, 2018 / Rules and Regulations 49473 secondary credit. The amendments to would be unnecessary and contrary to § 201.51 Interest rates applicable to credit Regulation A reflect these rate changes. the public interest because delay in extended by a Federal Reserve Bank.3 The 1⁄4 percentage point increase in implementation of changes to the rates (a) Primary credit. The interest rate at the primary credit rate was associated charged on primary credit and each Federal Reserve Bank for primary with an increase in the target range for secondary credit would permit insured credit provided to depository the federal funds rate (from a target depository institutions to profit institutions under § 201.4(a) is 2.75 range of 13⁄4 to 2 percent to a target improperly from the difference in the percent. range of 2 to 21⁄4 percent) announced by current rate and the announced (b) Secondary credit. The interest rate the Federal Open Market Committee on increased rate. Finally, because delay at each Federal Reserve Bank for September 26, 2018, as described in the would undermine the Board’s action in secondary credit provided to depository Board’s amendment of its Regulation D responding to economic data and institutions under § 201.4(b) is 3.25 regulations published elsewhere in this conditions, the Board has determined percent. issue of the Federal Register. that ‘‘good cause’’ exists within the * * * * * Administrative Procedure Act meaning of the APA to dispense with By order of the Board of Governors of the the notice, public comment, and Federal Reserve System, September 27, 2018. In general, the Administrative delayed effective date procedures of the Procedure Act (‘‘APA’’) 1 imposes three Ann Misback, APA with respect to the final principal requirements when an agency amendments to Regulation A. Secretary of the Board. promulgates legislative rules (rules [FR Doc. 2018–21436 Filed 10–1–18; 8:45 am] made pursuant to congressionally Regulatory Flexibility Analysis BILLING CODE 6210–01–P delegated authority): (1) Publication The Regulatory Flexibility Act with adequate notice of a proposed rule; (‘‘RFA’’) does not apply to a rulemaking (2) followed by a meaningful where a general notice of proposed FEDERAL RESERVE SYSTEM opportunity for the public to comment rulemaking is not required.5 As noted on the rule’s content; and (3) 12 CFR Part 204 previously, a general notice of proposed publication of the final rule not less rulemaking is not required if the final [Docket No. R–1624] than 30 days before its effective date. rule involves a matter relating to loans. The APA provides that notice and RIN 7100–AF 18 Furthermore, the Board has determined comment procedures do not apply if the that it is unnecessary and contrary to Regulation D: Reserve Requirements agency for good cause finds them to be the public interest to publish a general of Depository Institutions ‘‘unnecessary, impracticable, or contrary notice of proposed rulemaking for this to the public interest.’’ 2 Section 553(d) final rule. Accordingly, the RFA’s AGENCY: Board of Governors of the of the APA also provides that requirements relating to an initial and Federal Reserve System. publication at least 30 days prior to a final regulatory flexibility analysis do ACTION: Final rule. rule’s effective date is not required for not apply. (1) a substantive rule which grants or SUMMARY: The Board of Governors of the recognizes an exemption or relieves a Paperwork Reduction Act Federal Reserve System (‘‘Board’’) is restriction; (2) interpretive rules and In accordance with the Paperwork amending Regulation D (Reserve statements of policy; or (3) a rule for Reduction Act (‘‘PRA’’) of 1995,6 the Requirements of Depository Institutions) which the agency finds good cause for Board reviewed the final rule under the to revise the rate of interest paid on shortened notice and publishes its authority delegated to the Board by the balances maintained to satisfy reserve reasoning with the rule.3 The APA Office of Management and Budget. The balance requirements (‘‘IORR’’) and the further provides that the notice, public final rule contains no requirements rate of interest paid on excess balances comment, and delayed effective date subject to the PRA. (‘‘IOER’’) maintained at Federal Reserve requirements of 5 U.S.C. 553 do not Banks by or on behalf of eligible apply ‘‘to the extent that there is List of Subjects in 12 CFR Part 201 institutions. The final amendments involved . . . a matter relating to agency Banks, Banking, Federal Reserve specify that IORR is 2.20 percent and management or personnel or to public System, Reporting and recordkeeping. IOER is 2.20 percent, a 0.25 percentage property, loans, grants, benefits, or point increase from their prior levels. contracts.’’ 4 Authority and Issuance The amendments are intended to Regulation A establishes the interest For the reasons set forth in the enhance the role of such rates of interest rates that the twelve Reserve Banks preamble, the Board is amending 12 in moving the Federal funds rate into charge for extensions of primary credit CFR part 201 to read as follows: the target range established by the and secondary credit. The Board has Federal Open Market Committee determined that the notice, public PART 201—EXTENSIONS OF CREDIT (‘‘FOMC’’ or ‘‘Committee’’). comment, and delayed effective date BY FEDERAL RESERVE BANKS DATES: Effective date: The amendments requirements of the APA do not apply (REGULATION A) to part 204 (Regulation D) are effective to these final amendments to Regulation October 2, 2018. A for several reasons. The amendments ■ 1. The authority citation for part 201 continues to read as follows: Applicability date: The IORR and involve a matter relating to loans and IOER rate changes were applicable on are therefore exempt under the terms of Authority: 12 U.S.C. 248(i)–(j) and (s), 343 September 27, 2018. the APA. In addition, the Board has et seq., 347a, 347b, 347c, 348 et seq., 357, 374, 374a, and 461. FOR FURTHER INFORMATION CONTACT: amozie on DSK3GDR082PROD with RULES determined that notice, public Sophia Allison, Senior Special Counsel comment, and delayed effective date ■ 2. In § 201.51, paragraphs (a) and (b) are revised to read as follows: 3 The primary, secondary, and seasonal credit 15 U.S.C. 551 et seq. rates described in this section apply to both 25 U.S.C. 553(b)(3)(A). 55 U.S.C. 603, 604. advances and discounts made under the primary, 3 5 U.S.C. 553(d). 6 44 U.S.C. 3506; see 5 CFR part 1320, appendix secondary, and seasonal credit programs, 4 5 U.S.C. 553(a)(2) (emphasis added). A.1. respectively. VerDate Sep<11>2014 16:20 Oct 01, 2018 Jkt 247001 PO 00000 Frm 00015 Fmt 4700 Sfmt 4700 E:\FR\FM\02OCR1.SGM 02OCR1


Document Created: 2018-10-02 01:19:14
Document Modified: 2018-10-02 01:19:14
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionRules and Regulations
ActionFinal rule.
DatesEffective date: The amendments to part 201 (Regulation A) are effective October 2, 2018.
ContactSophia Allison, Senior Special Counsel (202-452-3565), Legal Division, or Lyle Kumasaka, Lead Financial Institution & Policy Analyst (202-452-2382), or Kristen Payne, Senior Financial Institution & Policy Analyst (202-452-2872), Division of Monetary Affairs; for users of Telecommunications Device for the Deaf (TDD) only, contact 202-263-4869; Board of Governors of the Federal Reserve System, 20th and C Streets NW, Washington, DC 20551.
FR Citation83 FR 49472 
CFR AssociatedBanks; Banking; Federal Reserve System and Reporting and Recordkeeping
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