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F E D E R A L R E S E R V E BANK O F NEW YORK Fiscal Agent of the United States f Circular N o. 4 4 6 3 T L M ay 16, 1957 J R E G U LA TIO N V LO AN G UARAN TEES F O R DEFENSE PRODUCTION T o A ll Banlcs, Other Financing Institutions, and O thers Concerned in the Second Federal R eserve D istrict: The B oa rd o f G overnors o f the F ederal R eserve System yesterday raised the m axi mum perm issible rate o f interest on V -loan s from 5 to 6 per cent. This increase, which was made by the B oard a fter consultation with the guaranteeing agencies o f the G overn ment— Departm ents o f the A rm y, Navy, A ir F orce, Commerce, Interior, and A griculture, the A tom ic E n ergy Commission, and the General Services Adm inistration— involves no change in the present maximum commitment fee o f one-half o f 1 per cent o r in the schedule o f guarantee fees now in effect. A ccordin gly, the maximum perm issible rate o f interest, schedule o f guarantee fees, and m aximum commitment fee now prescribed by the B oa rd o f G overnors o f the F ederal R eserve System, pursuant to section 5 o f its R egulation V , are as follow s: Rate of interest.—The maximum rate of interest that may be charged with respect to a guaranteed loan is 6 per cent. Guarantee fees.—Guarantee fees are established in accordance with the following schedule: P e r cen t o f loan guaranteed Guarantee f e e (p er cent o f interest payable by borrow er on guaranteed __________ portion o f loan) ______ 70 or less 75 80 85 90 95 Over 95 10 15 20 25 30 35 40-50 Commitment fees.—If unused portion of the ing agency shall share guaranteed portion of a financing institution charges a commitment fee to the borrower on the loan, such fee may not exceed one-half of 1 per cent, and the guarantee in the commitment fee on the same basis as it shares in the interest on the the loan. A dditional copies o f this circular w ill be furnished upon request. A lfred H ayes, President.
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