Federal Reserve Bank Capital Stock

What it does

• •Adjusts the total consolidated asset threshold in Federal Reserve Regulation I from $13,182,000,000 to $13,712,000,000, effective January 1, 2027.
• •Applies an inflation adjustment based on the Gross Domestic Product Price Index, reflecting a 37.12% cumulative increase since the baseline year (second quarter 2015).
• •Determines dividend rates for Federal Reserve Bank stockholders: those at or below the threshold receive 6% dividend, while those above receive the lesser of 6% or the 10-year Treasury note yield.

Why it matters

• •The Federal Reserve Act requires annual inflation adjustments to this threshold to ensure dividend treatment remains aligned with actual changes in bank asset values over time.
• •The new threshold affects which member banks qualify for different dividend rates on their Reserve Bank stock holdings.

Who is affected

• •Member banks that hold capital stock in Federal Reserve Banks, particularly those with total consolidated assets near or above the $13.712 billion threshold.
• •Federal Reserve Banks and the Board of Governors responsible for implementing the dividend structure.

What happens next

The adjusted threshold takes effect January 1, 2027, and applies through December 31, 2027, with the Board expected to make another annual adjustment thereafter based on updated Gross Domestic Product Price Index data.