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What Is Reg W?

David Miller • • 7 min read
What Is Reg W?

Regulation W is a U.S. Federal Reserve System (Fed) regulation that limits certain transactions between depository institutions

depository institutions
Depositories may be organizations, banks, or institutions that hold securities and assist in the trading of securities. They provide security and liquidity, use the money deposited to lend to others, invest in securities, and offer a funds transfer system.
› terms › depository
, such as banks, and their affiliates. In particular, it sets quantitative limits on covered transactions and requires collateral for certain transactions.

What is Reg W 23A?

Section 23A of the Federal Reserve Act (12 USC 371c) is the primary statute governing transactions between a bank and its affiliates.

How does regulation W limit a bank's risks from transactions with affiliates?

2 As background, Regulation W (along with Sections 23A and 23B) limits the risks to a bank from transactions between the bank and its affiliates and limits the ability of a bank to transfer to its affiliates the subsidy arising from the bank's access to the federal safety net (i.e., lower-cost insured deposits, the ...

David Miller
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David Miller

David Miller brings 15 years of experience in global economics, personal finance strategy, and market dynamics. He specializes in turning complex economic trends into actionable insights for everyday readers.