Federal Reserve Proposes to Collect Additional Data Every Day on Fed Funds, Eurodollars and CDs from Larger Banks

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The Federal Reserve proposes to implement the mandatory Report of Selected Money Market Rates (FR 2420). The FR 2420 would be a transaction-based report that collects liability data on federal funds, Eurodollar transactions and certificates of deposits (CDs) each and every day from domestically chartered commercial banks and thrifts that have $26 billion or more in total assets and from US branches and agencies of foreign banks with total third-party assets of $900 million or more.  

FR 2420 would collect data for three liability types including federal funds, Eurodollars and CDs, specifically the amount of each transaction on the report date, the maturity of the transaction and the interest rate for each transaction. In addition, as CDs may have floating rates, several additional items are being requested to better understand their interest rate structure. The Federal Reserve explained that “[t]he federal funds transaction data would be the only source of high-frequency data used in the analysis of current market conditions.” Presumably, this data would be of academic use, and perhaps additionally in a crisis scenario.  

Commercial banks and thrifts with $26 billion or more in total assets on the September 30 Call Report each year would be required to submit the FR 2420 daily for the following year. “This threshold would currently capture the 50 largest depository institutions which would provide sufficient coverage to have a statistically representative sample. U.S. branches and agencies of foreign banks would be required to report daily, if third-party assets are $900 million or more on the September 30 FFIEC 002. This threshold would currently capture the 105 largest U.S. branches and agencies of foreign banks.” 

The proposal is available here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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