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ABA: The American Bankers Association
Comment Letter

Letter to the Board on the Discount Window and Intraday Credit RFI

  • From Alison T. Touhey
  • Published December 9, 2024

Re: Docket No. OP-1838; Request for Information on Operational Aspects of Federal Reserve Bank Extensions of Discount Window and Intraday Credit
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Dear Ms. Misback:

The American Bankers Association (ABA) appreciates the opportunity to comment on the Federal Reserve’s Request for Information on Operational Aspects of Federal Reserve Bank Extensions of Discount Window and Intraday Credit (RFI), which seeks information on questions related to the operational aspects of Federal Reserve Bank (FRB) extensions of discount window and intraday credit. The RFI solicits information on existing operational frictions or inefficiencies, ways such frictions or inefficiencies can be resolved, and if they are particularly acute for FHLB members or smaller institutions.

ABA supports this inquiry and appreciates the Federal Reserve’s willingness to understand and improve upon the frictions and inefficiencies banks of all sizes face when using the discount window. We acknowledge and appreciate the work the Federal Reserve is already doing to advance the functionality of the discount window, including automation of some of the official authorization lists, incorporation of DocuSign and incorporation of the Discount Window Direct service through FedLine. We encourage the Federal Reserve to continue working towards faster, more automated and streamlined processes. As this work progresses, it is important to ensure that, to the extent possible, the changes and improvements align with existing market practices, technology and infrastructure, and that over the course of the initiative input from banks and other stakeholders is frequently sought.

In writing our response, ABA consulted the breadth of our membership, which includes banks of all sizes, to identify areas of improvement and suggest solutions that are workable for all banks. To a large extent, ABA members’ experiences depend on which Federal Reserve Districts they are in, with some districts being more communicative and efficient than others. The comments below are meant to be applicable across the system.

Overall, ABA members feel that the discount window processes and operations are opaque, awkward and inefficient.

Download the comment letter to read the full text.

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