To use the income on depository institution reserves at the Federal Reserve banks to protect and enhance the deposit insurance system.

Amends the Federal Reserve Act to require Federal Reserve Banks to pay the Federal Reserve Board (the Board) an amount equal to their imputed earnings on reserves each calendar quarter.

Requires the Board to pay promptly to the Bank Insurance Fund, the Savings Association Insurance Fund and the Credit Union Insurance Fund that portion of the assessment attributable to reserves held at Federal Reserve Banks for that quarter by the members of each fund as calculated by the Board.

 
HR 5775 IH
101st CONGRESS
2d Session
 H. R. 5775
To use the income on depository institution reserves at the Federal Reserve
Banks to protect and enhance the deposit insurance system.
IN THE HOUSE OF REPRESENTATIVES
October 2, 1990
Mr. RIDGE introduced the following bill; which was referred to the Committee
on Banking, Finance and Urban Affairs
A BILL
To use the income on depository institution reserves at the Federal Reserve
Banks to protect and enhance the deposit insurance system.
  Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
  SECTION 1. Section 19(b) of the Federal Reserve Act, as amended, shall be
  amended by adding at the end thereof the following new paragraph:
  `(12) EARNINGS ON RESERVES- For each calendar quarter beginning on January
  1, 1991, the Board shall assess the Federal Reserve Banks, and the Reserve
  Banks shall pay to the Board, an amount equal to the imputed earnings on
  reserves. Upon receipt of such assessement, the Board shall promptly pay
  to the Bank Insurance Fund, the Savings Association Insurance Fund and
  the Credit Union Insurance Fund that portion of the assessment that is
  attributable to reserves held at Federal Reserve Banks for that quarter by
  the members of each fund as calculated by the Board. For the purposes of
  this paragraph, imputed earnings on reserves means the average required
  reserve balances held with the Federal Reserve Banks pursuant to this
  section during the applicable calendar quarter by depository institutions
  that are members of such insurance funds multiplied by the average Federal
  funds rate during that quarter, as determined by the Board.'.