Each separately chartered financial institution may have one master account at a designated Reserve Bank. The master account is both a record of financial transactions that reflects the financial rights and obligations of an account holder and of the Reserve Bank with respect to each other, and the place where opening and closing balances are determined. For each institution, all credits and debits resulting from the use of Federal Reserve services are booked to this single master account at one Reserve Bank. All overnight and daylight credit is disbursed and repaid through this account, and the Reserve Bank holding the account manages the credit risk posed by the institution's use of Federal Reserve services.
Reserve administration is also managed through this account, unless an institution has entered into a pass-through agreement with a correspondent. All end-of-day balances maintained in a master account during the reserve maintenance period are used by the institution to satisfy its reserve balance requirement. Funds that an institution deposits in a term deposit with the Federal Reserve cannot be used to satisfy its reserve requirement.
If an institution is not required to maintain balances to satisfy a reserve requirement, it may still establish a master account with a Reserve Bank and earn interest on reserve balances at the interest rate paid on excess balances, provided the institution is eligible to receive interest payments.
List of Federal Reserve Banks
- Boston
- New York
- Philadelphia
- Cleveland
- Richmond
- Atlanta
- Chicago
- St. Louis
- Minneapolis
- Kansas City
- Dallas
- San Francisco
The master account is held in the district where the bank or financial institution is chartered.