[Federal Register Volume 63, Number 205 (Friday, October 23, 1998)]
[Rules and Regulations]
[Pages 56785-56786]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-28499]


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FEDERAL RESERVE SYSTEM

12 CFR Part 201

[Regulation A]


Extensions of Credit by Federal Reserve Banks; Change in Discount 
Rate

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Final rule.

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SUMMARY: The Board of Governors has amended its Regulation A on 
Extensions of Credit by Federal Reserve Banks to reflect its approval 
of a decrease in the basic discount rate at each Federal Reserve Bank. 
The Board acted on requests submitted by the Boards of Directors of the 
twelve Federal Reserve Banks.

EFFECTIVE DATE: The amendments to part 201 (Regulation A) were 
effective October 15, 1998. The rate changes for adjustment credit were 
effective on the dates specified in 12 CFR 201.51.


[[Page 56786]]


FOR FURTHER INFORMATION CONTACT: Jennifer J. Johnson, Secretary of the 
Board (202/452-3259); for users of Telecommunications Device for the 
Deaf (TDD), please contact Diane Jenkins, (202/452-3544), Board of 
Governors of the Federal Reserve System, 20th and C Streets N.W., 
Washington, D.C. 20551.

SUPPLEMENTARY INFORMATION: Pursuant to the authority of sections 10(b), 
13, 14, 19, et. al., of the Federal Reserve Act, the Board has amended 
its Regulation A (12 CFR part 201) to incorporate changes in discount 
rates on Federal Reserve Bank extensions of credit. The discount rates 
are the interest rates charged to depository institutions when they 
borrow from their district Reserve Banks.
    The ``basic discount rate'' is a fixed rate charged by Reserve 
Banks for adjustment credit and, at the Reserve Banks' discretion, for 
extended credit. In decreasing the basic discount rate, the Board acted 
on requests submitted by the Boards of Directors of the twelve Federal 
Reserve Banks. The new rates were effective on the dates specified 
below. Growing caution by lenders and unsettled conditions in financial 
markets more generally are likely to be restraining aggregate demand in 
the future. Against this backdrop, further easing of the stance of 
monetary policy was judged to be warranted to sustain economic growth 
in the context of contained inflation.

Regulatory Flexibility Act Certification

    Pursuant to section 605(b) of the Regulatory Flexibility Act (5 
U.S.C. 605(b)), the Board certifies that the change in the basic 
discount rate will not have a significant adverse economic impact on a 
substantial number of small entities. The rule does not impose any 
additional requirements on entities affected by the regulation.

Administrative Procedure Act

    The provisions of 5 U.S.C. 553(b) relating to notice and public 
participation were not followed in connection with the adoption of the 
amendment because the Board for good cause finds that delaying the 
change in the basic discount rate in order to allow notice and public 
comment on the change is impracticable, unnecessary, and contrary to 
the public interest in fostering sustainable economic growth.
    The provisions of 5 U.S.C. 553(d) that prescribe 30 days prior 
notice of the effective date of a rule have not been followed because 
section 553(d) provides that such prior notice is not necessary 
whenever there is good cause for finding that such notice is contrary 
to the public interest. As previously stated, the Board determined that 
delaying the changes in the basic discount rate is contrary to the 
public interest.

List of Subjects in 12 CFR Part 201

    Banks, banking, Credit, Federal Reserve System.

    For the reasons set out in the preamble, 12 CFR Part 201 is amended 
as set forth below:

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

    1. The authority citation for 12 CFR part 201 continues to read as 
follows:

    Authority: 12 U.S.C. 343 et seq., 347a, 347b, 347c, 347d, 348 et 
seq., 357, 374, 374a and 461.

    2. Section 201.51 is revised to read as follows:


Sec. 201.51  Adjustment credit for depository institutions.

    The rates for adjustment credit provided to depository institutions 
under Sec. 201.3(a) are:

------------------------------------------------------------------------
       Federal reserve bank          Rate             Effective
------------------------------------------------------------------------
Boston............................    4.75  October 15, 1998.
New York..........................    4.75  October 15, 1998.
Philadelphia......................    4.75  October 15, 1998.
Cleveland.........................    4.75  October 16, 1998.
Richmond..........................    4.75  October 16, 1998.
Atlanta...........................    4.75  October 15, 1998.
Chicago...........................    4.75  October 15, 1998.
St. Louis.........................    4.75  October 15, 1998.
Minneapolis.......................    4.75  October 15, 1998.
Kansas City.......................    4.75  October 15, 1998.
Dallas............................    4.75  October 16, 1998.
San Francisco.....................    4.75  October 15, 1998.
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    By order of the Board of Governors of the Federal Reserve 
System, October 19, 1998.
Jennifer J. Johnson,
Secretary of the Board.
[FR Doc. 98-28499 Filed 10-22-98; 8:45 am]
BILLING CODE 6210-01-P