TT&L/TIO/Repo Actions

Glossary

Direct Investment:
This term refers to the transfer of excess Treasury operating funds to financial institutions participating in the Treasury Tax and Loan Program. These funds are placed with either a one-day or same-day notice.

Dynamic Investment:
This term refers to the transfer of funds to participating financial institutions that agree to accept unexpected excess Treasury operating funds on a same-day basis. These investments are made on an hourly basis, as funds become available for investment throughout the day.

Federal Reserve Account Balance:
This term refers to the balance in the U.S. Treasury's General Account representing available funds held at the close of business. Currently, this balance is targeted between $5 and $7 billion daily.

Notice of Transfers:
This Notice announces Treasury's intention to invest or withdraw funds from the Tax and Loan Note Accounts in order to meet its target balance in the Federal Reserve Account.

Repo Investment:
This term refers to the placement of excess operating funds through Repo (Repurchase Agreement) transactions for an overnight term. Repo investments typically occur daily. Settlement is delivery-versus-payment. The Repo must be fully collateralized using specified acceptable collateral determined by the Treasury.

Results of Transfers:
These Results provide information of actual transfers to and from the Tax and Loan Note Accounts accomplished on the previous business day. These Results also appear in the Daily Treasury Statement published later the same day.

Special Direct Investments:
This term refers to the placement of excess operating funds into a participating financial institution's Special Direct Investment (SDI) account. The investment must be fully collateralized using specified acceptable collateral determined by the Treasury.

Tax and Loan Note Account Balance, TT&L:
This term refers to the balance of funds held in accounts at financial institutions in the name of the U.S. Treasury. The funds are taxes received directly from the public or excess operating funds transferred by Treasury. The investment must be fully collateralized using specified acceptable collateral determined by the Treasury.

Term Investment:
This term refers to the placement of excess operating funds directly with TT&L depositaries for a set period of time at a rate of interest determined through a competitive bidding process. The TIO (Term Investment Option) must be fully collateralized using specified acceptable collateral determined by the Treasury.

Term Maturity:
This term refers to the procedure whereby Treasury withdraws Term Investment balances on the designated maturity date.

Term Withdrawal:
This term refers to the procedure whereby Treasury withdraws Term Investment balances prior to the designated maturity date. The types of withdrawals are:

• TT&L Financial Institution Initiated Withdrawal - these withdrawals result from the financial institution terminating a Term Investment prior to the maturity date.
• Collateral Deficiency Withdrawal - these withdrawals result from the financial institution failing to maintain sufficient acceptable collateral.

Withdrawals:
This term refers to the procedure whereby tax and loan note option financial institutions transfer a specified dollar amount or percentage of funds from their TT&L account to the U.S. Treasury's Federal Reserve Account. The types of depositaries are:

• "C" Class Depositary Bank - Depositaries which have over $100 million in deposits from TT&L applications (electronic and paper-based tax deposits, excluding Fedwire collections), or over $5 billion in demand and time liabilities (deposit liability) or over $250 million in balances.
• "B" Class Depositary Bank - Depositaries which have between $10 million and $100 million in deposits from TT&L applications (EFTPS and paper-based excluding Fedwire) but less than $100 million in demand and time liabilities (deposit liability).
• "A" Class Depositary Bank - Depositaries which have less than $10 million in deposits from TT&L applications (EFTPS and paper-based excluding Fedwire).