Circular
Board Announces Temporary Exemption to Limitations in Section 23A of Federal Reserve Act Will Expire on October 30, 2009
October 30, 2009
Circular No. 12150

The Federal Reserve Board has announced that a temporary exemption to the limitations in section 23A of the Federal Reserve Act, instituted as part of the response to the financial crisis, will expire as scheduled on October 30, 2009.

The exemption, which was subject to various conditions to promote safety and soundness, allowed all insured depository institutions to provide liquidity to their affiliates for assets typically funded in the tri-party repo market. It was originally approved on September 14, 2008, and was extended on January 30, 2009.

Since the approval of the extension in January, the functioning of the tri-party repo market has improved considerably.

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