In a recent announcement from Nashville, Greg Gonzales, Commissioner of the Tennessee Department of Financial Institutions, revealed a significant update to the state’s maximum effective formula interest rate. As of February 21, 2024, borrowers in Tennessee will be subject to a new rate of 12.50 percent per annum. This adjustment is based on the addition of 4 percent to the weekly average prime loan rate of 8.50 percent, as recorded by the Federal Reserve on February 20, 2024.
Commissioner Gonzales emphasized that this rate will remain in place until there is a change in the average prime loan rate announced by the Federal Reserve Bank. This decision is in line with Chapter 464, Public Acts of 1983, which mandates the Commissioner of Financial Institutions to weekly announce any changes to the formula rate of interest.
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This adjustment reflects the dynamic nature of financial markets and underscores the importance of regulatory oversight in maintaining economic stability. The Department of Financial Institutions plays a critical role in ensuring that the financial environment within Tennessee remains robust and fair for all participants.
For further information, individuals and institutions are encouraged to contact Alica Owen, Public Information Officer at the Tennessee Department of Financial Institutions.
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