Federal Register / Vol. 90, No. 9 / Wednesday, January 15, 2025 / Rules and Regulations 3615 

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). 

5 5 U.S.C. 603, 604. 

6 44 U.S.C. 3506; see 5 CFR part 1320, appendix 

A.1. 

decreased by 0.25 percentage points as 

a result of the Board’s primary credit 

rate action, thereby decreasing the 

secondary credit rate from 5.25 percent 

to 5.00 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 41⁄2 percent to 43⁄4

percent to a target range of 41⁄4 percent 

to 41⁄2 percent) announced by the 

Federal Open Market Committee on 

December 18, 2024, 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 

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

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. 

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. 

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) 

■ 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. 

■ 2. In § 201.51, paragraphs (a) and (b) 

are revised to read as follows: 

§ 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 § 201.4(a) is 4.50 

percent. 

(b) Secondary credit. The interest rate 

at each Federal Reserve Bank for 

secondary credit provided to depository 

institutions under § 201.4(b) is 5.00 

percent. 

* * * * * 3The 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. 

Ann E. Misback, 

Secretary of the Board. 

[FR Doc. 2025–00429 Filed 1–14–25; 8:45 am] 

BILLING CODE 6210–02–P 

FEDERAL RESERVE SYSTEM 

12 CFR Part 204 

[Docket No. R–1863; RIN 7100–AG90] 

Regulation D: Reserve Requirements 

of Depository Institutions 

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 D to revise the rate of 

interest paid on balances (‘‘IORB’’) 

maintained at Federal Reserve Banks by 

or on behalf of eligible institutions. The 

final amendments specify that IORB is 

4.4 percent, a 0.25 percentage point 

decrease 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 

(‘‘FOMC’’ or ‘‘Committee’’). 

DATES: 

Effective date: This rule (amendments 

to part 204 (Regulation D)) is effective 

January 15, 2025. 

Applicability date: The IORB rate 

change was applicable on December 19, 

2024. 

FOR FURTHER INFORMATION CONTACT: M. 

Benjamin Snodgrass, Senior Counsel 

(202–263–4877), Legal Division, or 

Kristen Payne, Lead Financial 

Institution & Policy Analyst (202–306– 

9573); 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 


lotter on DSK11XQN23PROD with RULES1
3616 Federal Register / Vol. 90, No. 9 / Wednesday, January 15, 2025 / Rules and Regulations 

1 12 U.S.C. 461(b). In March 2020, the Board set 

all reserve requirement ratios to zero percent. See 

Interim Final Rule, 85 FR 16525 (Mar. 24, 2020); 

Final Rule, 86 FR 8853 (Feb. 10, 2021). 

2 12 CFR 204.5(a)(1). 

3 12 U.S.C. 461(b)(1)(A) and (b)(12)(A). 

4See 12 U.S.C. 461(b)(1)(A) & (b)(12)(C); see also 

12 CFR 204.2(y). 

5See 12 U.S.C. 461(b)(12)(B). 

6See 12 CFR 204.10(b)(1). 

7 5 U.S.C. 551 et seq. 

8 5 U.S.C. 553(b)(3)(A). 

9 5 U.S.C. 553(d). 

10 5 U.S.C. 603, 604. 

11 44 U.S.C. 3506; see 5 CFR part 1320 Appendix 

A.1. 

System, 20th and C Streets, NW, 

Washington, DC 20551. 

SUPPLEMENTARY INFORMATION: 

I. Statutory and Regulatory Background 

For monetary policy purposes, section 

19 of the Federal Reserve Act (‘‘Act’’) 

imposes reserve requirements on certain 

types of deposits and other liabilities of 

depository institutions.1 Regulation D, 

which implements section 19 of the Act, 

requires that a depository institution 

meet reserve requirements by holding 

cash in its vault, or if vault cash is 

insufficient, by maintaining a balance in 

an account at a Federal Reserve Bank 

(‘‘Reserve Bank’’).2 Section 19 also 

provides that balances maintained by or 

on behalf of certain institutions in an 

account at a Reserve Bank may receive 

earnings to be paid by the Reserve Bank 

at least once each quarter, at a rate or 

rates not to exceed the general level of 

short-term interest rates.3 Institutions 

that are eligible to receive earnings on 

their balances held at Reserve Banks 

(‘‘eligible institutions’’) include 

depository institutions and certain other 

institutions.4 Section 19 also provides 

that the Board may prescribe regulations 

concerning the payment of earnings on 

balances at a Reserve Bank.5 Prior to 

these amendments, Regulation D 

established IORB at 4.65 percent.6

II. Amendment to IORB 

The Board is amending § 204.10(b)(1) 

of Regulation D to establish IORB at 4.4 

percent. The amendment represents a 

0.25 percentage point decrease in IORB. 

This decision was announced on 

December 18, 2024, with an effective 

date of December 19, 2024, in the 

Federal Reserve Implementation Note 

that accompanied the FOMC’s statement 

on December 18, 2024. The FOMC 

statement stated that the Committee 

decided to lower the target range for the 

federal funds rate to 41⁄4 to 41⁄2 percent. 

The Federal Reserve Implementation 

Note stated: 

The Board of Governors of the Federal 

Reserve System voted unanimously to lower 

the interest rate paid on reserve balances to 

4.4 percent, effective December 19, 2024. 

As a result, the Board is amending 

§ 204.10(b)(1) of Regulation D to 

establish IORB at 4.4 percent. 

III. Administrative Procedure Act 

In general, the Administrative 

Procedure Act (‘‘APA’’) 7 imposes three 

principal requirements when an agency 

promulgates legislative rules (rules 

made pursuant to Congressionallydelegated 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.’’ 8 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.9

The Board has determined that good 

cause exists for finding that the notice, 

public comment, and delayed effective 

date provisions of the APA are 

unnecessary, impracticable, or contrary 

to the public interest with respect to 

these final amendments to Regulation D. 

The rate change for IORB that is 

reflected in the final amendment to 

Regulation D was made with a view 

towards accommodating commerce and 

business and with regard to their 

bearing upon the general credit situation 

of the country. Notice and public 

comment would prevent the Board’s 

action from being effective as promptly 

as necessary in the public interest and 

would not otherwise serve any useful 

purpose. Notice, public comment, and a 

delayed effective date would create 

uncertainty about the finality and 

effectiveness of the Board’s action and 

undermine the effectiveness of that 

action. Accordingly, the Board has 

determined that good cause exists to 

dispense with the notice, public 

comment, and delayed effective date 

procedures of the APA with respect to 

this final amendment to Regulation D. 

IV. Regulatory Flexibility Analysis 

The Regulatory Flexibility Act 

(‘‘RFA’’) does not apply to a rulemaking 

where a general notice of proposed 

rulemaking is not required.10 As noted 

previously, 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. 

V. Paperwork Reduction Act 

In accordance with the Paperwork 

Reduction Act (‘‘PRA’’) of 1995,11 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. 

List of Subjects in 12 CFR Part 204 

Banks, Banking, Reporting and 

recordkeeping requirements. 

Authority and Issuance 

For the reasons set forth in the 

preamble, the Board amends 12 CFR 

part 204 as follows: 

PART 204—RESERVE 

REQUIREMENTS OF DEPOSITORY 

INSTITUTIONS (REGULATION D) 

■ 1. The authority citation for part 204 

continues to read as follows: 

Authority: 12 U.S.C. 248(a), 248(c), 461, 

601, 611, and 3105. 

■ 2. Section 204.10 is amended by 

revising paragraph (b)(1) to read as 

follows: 

§ 204.10 Payment of interest on balances. 

* * * * * 

(b) * * * 

(1) For balances maintained in an 

eligible institution’s master account, 

interest is the amount equal to the 

interest on reserve balances rate (‘‘IORB 

rate’’) on a day multiplied by the total 

balances maintained on that day. The 

IORB rate is 4.4 percent. 

* * * * * 

By order of the Board of Governors of the 

Federal Reserve System. 

Ann E. Misback, 

Secretary of the Board. 

[FR Doc. 2025–00430 Filed 1–14–25; 8:45 am] 

BILLING CODE 6210–01–P 


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