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January 24, 2024

The Federal Reserve announced that the Bank Term Financing Program (BTFP) will stop making new loans as scheduled on March 11.

To be published at 7:00 PM EST

The Federal Reserve announced on Wednesday that the Bank Term Funding Program (BTFP) will stop making new loans as scheduled on March 11. The program will continue to provide loans until that time and is available as an additional source of liquidity for eligible institutions.

During the tense period last spring, the bank's term financing program helped ensure stability of the banking system and provided support to the economy. After March 11, banks and other depository institutions will continue to have easy access to the discount window to meet liquidity needs.

With the end of the program, the interest rate applicable to new BTFP loans has been adjusted so that the interest rate on new loans extending from now until the end of the program will not be lower than the interest rate on reserve balances in effect on the day the loan was made. This rate adjustment ensures that the BTFP continues to support the program's objectives in the current interest rate environment. This change is effective immediately. All other conditions of the program remain unchanged.

The BTFP was established under Section 13(3) of the Federal Reserve Act, with the approval of the Secretary of the Treasury.

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Last updated: January 24, 2024