Fed Announces Annual Indexing of Reserve Requirements

The Federal Reserve yesterday announced the annual indexing of the low reserve tranche and the reserve requirement exemption amount for 2016. These amounts are used to calculate reserve requirements for depository institutions.

For net transaction accounts in 2016, the first $15.2 million — up from $14.5 million in 2015 — will be exempt from reserve requirements. A 3 percent reserve ratio will be assessed on net transaction accounts between $15.2 million and $110.2 million. A 10 percent reserve ratio will be assessed on net transaction accounts over $110.2 million.