Seasonal Credit Is Available for Community Banks

The Federal Reserve offers seasonal credit to qualifying community banks to help them meet their local customers' seasonal needs. Community banks that experience yearly fluctuations in their deposits and loans--caused by construction or farming operations, college or resort activities, municipal financing and other types of seasonal business--frequently can qualify.

To qualify, a financial institution must:

• be under $500 million in deposits and in sound financial condition,
• meet the general requirements for the program, and
• complete a brief application that includes monthly deposit and loan data.

There is no commitment fee or stock purchase required. Likewise, banks do not need to be Federal Reserve members to be eligible for the program.

Once approved, banks can use their credit lines as a primary seasonal funding source or as backstop credit. The Fed applies a market-based rate on all outstanding loans that are secured to our satisfaction. Credit may be drawn down incrementally, as needed, and partial and full prepayments are allowed without penalty.

The seasonal credit program is a safe, sound, flexible and affordable way to meet a community's peak seasonal funding requirements. If you have any questions or would like an application or program brochure, please contact anyone in the Credit Office. Those numbers are (314) 444-8316, 444-8769 and 444-8622 or 1-800-333-0810, extensions 44-8316, 44-8769 and 44-8622.