[Federal Register: November 29, 1999 (Volume 64, Number 228)] [Rules and Regulations] [Page 66553-66554] From the Federal Register Online via GPO Access [wais.access.gpo.gov] [DOCID:fr29no99-3] ======================================================================= ----------------------------------------------------------------------- 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. ----------------------------------------------------------------------- SUMMARY: The Board of Governors has amended its Regulation A on Extensions of Credit by Federal Reserve Banks to reflect its approval of an increase 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. DATES: The amendments to part 201 (Regulation A) were effective November 16, 1999. The rate changes for adjustment credit were effective on the dates specified in 12 CFR 201.51. FOR FURTHER INFORMATION CONTACT: Jennifer J. Johnson, Secretary of the Board, at (202) 452-3259; for users of Telecommunications Device for the Deaf (TDD), contact Diane Jenkins, at (202) 452-3544, Board of Governors of the Federal Reserve System, 20th and C Streets NW, Washington, DC 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 increasing the basic discount rate [[Page 66554]] from 4.75 percent to 5 percent, 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. The 25-basis-point increase in the discount rate was associated with a similar increase in the federal funds rate announced at the same time. Although cost pressures appear generally contained, risks to sustainable growth persist. Despite tentative evidence of a slowing in certain interest-sensitive sectors of the economy and of accelerating productivity, the expansion of activity continues in excess of the economy's growth potential. As a consequence, the pool of available workers willing to take jobs has been drawn down further in recent months, a trend that must eventually be contained if inflationary imbalances are to remain in check and economic expansion continue. 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........................... 5.0 Nov. 16, 1999 New York......................... 5.0 Nov. 18, 1999 Philadelphia..................... 5.0 Nov. 18, 1999 Cleveland........................ 5.0 Nov. 16, 1999 Richmond......................... 5.0 Nov. 16, 1999 Atlanta.......................... 5.0 Nov. 17, 1999 Chicago.......................... 5.0 Nov. 18, 1999 St. Louis........................ 5.0 Nov. 18, 1999 Minneapolis...................... 5.0 Nov. 18, 1999 Kansas City...................... 5.0 Nov. 16, 1999 Dallas........................... 5.0 Nov. 17, 1999 San Francisco.................... 5.0 Nov. 16, 1999 ------------------------------------------------------------------------ By order of the Board of Governors of the Federal Reserve System, November 22, 1999. Jennifer J. Johnson, Secretary of the Board. [FR Doc. 99-30852 Filed 11-26-99; 8:45 a.m.] BILLING CODE 6210-01-P