Frequently Asked Questions

The New Discount Window & Payment System Risk Collateral Margins Table, Effective July 3, 2017

Last Updated: 6/1/2017

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  1. The Federal Reserve periodically reviews its collateral margins table and models.  The changes reflect analytical improvements in the methodology and the use of updated market data.  The new collateral margins table will be effective on July 3, 2017.

  2. No.  The Federal Reserve continually conducts reviews and adjusts collateral valuation and margin practices.  The new collateral margins table incorporates improved methodology and updated market data and is not a response to particular financial conditions.

  3. The impact on individual depository institutions will vary depending upon the composition of collateral pledged.  The lag between the announcement and implementation of the new collateral margins will provide depository institutions time to work with their Reserve Banks to pledge additional collateral if needed or desired.

  4. Yes. The Federal Reserve will now accept investment grade private label residential mortgage backed securities (RMBS).  Previously, only AAA rated private label RMBS were eligible.  Please refer to Federal Reserve Collateral Guidelines (PDF 193K) concerning eligibility.

  5. Yes. While the overall pledging process for loans remains unchanged, loan category definitions have been adjusted to map to the respective FFIEC (Schedule RC-C) and NCUA (Financial Condition FC/Schedule A-SA) call line items. Certain pledged loan pools may require category adjustments as a result.  Over a twelve-month implementation period beginning July 3rd, 2017, Reserve Banks will directly contact pledging institutions impacted by the change.  For more information, please refer to the Loans Valuation and Margins section of the Federal Reserve Collateral Guidelines (PDF 192K) or contact your local Reserve Bank.

  6. Discount window staff at each depository institution’s Federal Reserve Bank will provide this information upon request.

  7. An institution can review its Statement of Collateral Holdings to determine the total value of its collateral as well as the collateral value for security holdings and loan types. An institution should contact its Federal Reserve Bank to sign up for electronic delivery of its Statement of Collateral Holdings. Institutions that use Account Management Information (AMI) may also view their collateral value through that application.  Note that prior to July 3, 2017, these sources will reflect values calculated under the margins table in effect at that time.

  8. The Federal Reserve has already begun analyzing all depository institutions’ current discount window borrowings and payment system risk collateral requirements relative to their collateral values under the new collateral margins table. The Federal Reserve Banks will notify depository institutions that are required to pledge additional collateral in advance of the implementation date.

  9. Additional information is available in the collateral section of this website.  Information is also available from discount window staff at the Federal Reserve Banks.

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