Bank's Assessment of the Potential for a U.S. Negative Rates Policy and Their Preparedness

In March 2020, RMA conducted a survey on the potential for negative
rates in the U.S. The survey originated in discussions with the RMA
Market Risk Council as coronavirus uncertainty dominated the
markets and the Federal Open Markets Committee took the Fed Funds
Target Rate to the effective zero rate “floor.” Council members
concluded that a survey covering the potential for a U.S. negative
rates policy, the probable industry impact, and financial firms’
readiness to operate in a negative rates environment would be
valuable to the industry. Fran Garritt, Director of Global Markets
Risk and Securities Lending at RMA, and Thomas Gregory, long-time
member of RMA’s Global Markets Council, discuss insights from the
“Negative Rates Preparedness and Strategy” white paper, the
likelihood and consequences of a negative rates policy, and how
regulators plan to address the issue. To read the paper in its
entirety, visit
www.rmahq.org/focus-on-the-negative-banks-assessment-of-the-potential-for-the-us-negative-rates-policy-and-their-preparedness/