[Federal Register Volume 90, Number 189 (Thursday, October 2, 2025)]
[Rules and Regulations]
[Pages 47512-47513]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-19303]
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FEDERAL RESERVE SYSTEM
12 CFR Part 201
[Docket No. R-1872]
RIN 7100-AG98
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 a decrease in the rate for primary credit 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:
Effective date: This rule (amendments to part 201 (Regulation A))
is effective October 2, 2025.
Applicability date: The rate changes for primary and secondary
credit were applicable on September 18, 2025.
FOR FURTHER INFORMATION CONTACT: M. Benjamin Snodgrass, Special Counsel
(202-263-4877), Legal Division, or Nicole Trachman, Financial
Institution & Policy Analyst (202-973-5055), Division of Monetary
Affairs; for users of telephone systems via text telephone (TTY) or any
TTY-based Telecommunications Relay Services, please call 711 from any
telephone, anywhere in the United States; 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 review and determination of the
Board.
On September 17, 2025, the Board voted to approve a 0.25 percentage
point decrease in the primary credit rate, thereby decreasing the
primary credit rate from 4.50 percent to 4.25 percent. 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 decreased by 0.25 percentage points
as a result of the Board's primary credit rate action, thereby
decreasing the secondary credit rate from 5.00 percent to 4.75 percent.
The amendments to Regulation A reflect these rate changes.
The 0.25 percentage point decrease in the primary credit rate was
associated with a 0.25 percentage point decrease in the target range
for the federal funds rate (from a target range of 4\1/4\ percent to
4\1/2\ percent to a target range of 4 percent to 4\1/4\ percent)
announced by the Federal Open Market Committee on September 17, 2025,
as described in the Board's amendment of its Regulation D published
elsewhere in today's 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
[[Page 47513]]
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).
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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. The amendments involve a matter relating to
loans and are therefore exempt under the terms of the APA. Furthermore,
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 chapter II 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, revise paragraphs (a) and (b) to read as follows:
Sec. 201.51 Interest rates applicable to credit extended by a Federal
Reserve Bank.\3\
(a) Primary credit. The interest rate at each Federal Reserve Bank
for primary credit provided to depository institutions under Sec.
201.4(a) is 4.25 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 4.75 percent.
* * * * *
\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.
By order of the Board of Governors of the Federal Reserve
System.
Michele Taylor Fennell,
Associate Secretary of the Board.
[FR Doc. 2025-19303 Filed 10-1-25; 8:45 am]
BILLING CODE 6210-01-P