This bill would cap the total assets of all Federal Reserve banks at 10% of U.S. gross domestic product, with that cap taking effect 10 years after enactment. It would also force the Fed to shut down its Overnight Reserve Repurchase Facility within a year and bar the creation of any similar facility, and it would set a floor on bank reserve requirements at the levels in effect on March 25, 2020. The Fed and each reserve bank would have to report annually how many foreign-owned banks and financial institutions are receiving interest on reserves or using the Fed's lending facilities. Supporters frame it as shrinking a Fed balance sheet that ballooned past $7 trillion during the pandemic; critics warn the cap and reserve floor could constrain how the Fed responds to future financial stress.
Average Household Impact
- Federal Reserve balance sheet ceiling — Total Fed assets capped at 10% of GDP starting 10 years after enactment
- Reserve requirements floor — Locked at March 25, 2020 levels, restricting downward adjustment by the Fed
Transparency & Accountability
- Foreign-bank interest reporting — Annual report to Congress on foreign institutions receiving Fed interest or lending
Congressional Summary
Right-size the Federal Reserve ActThis bill places restrictions on the Federal Reserve System, including by placing a cap on specified assets, eliminating a Federal Reserve Board facility, and setting forth conditions on bank reserve requirements.The bill places a cap on the total aggregate assets of all Federal Reserve banks. Specifically, these assets must not amount to more than 10% of the U.S. gross domestic product. This cap takes effect 10 years after the bill’s enactment.The bill also eliminates the Overnight Reverse Repurchase Facility, a board facility that conducts monetary policy through security repurchase agreements.The board’s depository institution reserves requirements must not be lower than the reserve requirements as of March 25, 2020. The board and each Federal Reserve bank must annually report on certain interest payments to foreign-owned banks and financial institutions.
Details
- Congress
- 119th
- Chamber
- Senate
- Status
- summarized
- Action
- Introduced in Senate
- Action Date
- 2025-05-07
- Date Added
- 2026-04-28
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