CHAIRMAN RAND PAUL RELEASES NEW REPORT REVEALING HUNDREDS OF BILLIONS IN TAXPAYER-FUNDED PAYMENTS TO DOMESTIC AND FOREIGN BANKS THROUGH THE FEDERAL RESERVE'S INTEREST ON RESERVE BALANCES PROGRAM

The following information was released by the U.S. Senate Committee on Homeland Security and Governmental Affairs:

Chairman Rand Paul (R-Ky.) of the Senate Homeland Security and Governmental Affairs Committee (HSGAC), released a new report exposing the Federal Reserve's use of Interest on Reserve Balances (IORB). The report is based on over 40,000 pages of documents Chairman Paul obtained from the Federal Reserve detailing IORB payments for every two-week period from July 2013 through July 2025.

The report reveals how the Federal Reserve has quietly transferred over half a trillion dollars to major domestic and foreign financial institutions a practice that has increased the federal deficit, enriched the largest banks in the world, and sent billions of U.S. taxpayer dollars overseasto foreign banks.The new report comes in advance of the Committee's upcominghearingto examine these findings and consider Chairman Paul's"End the Fed's Big Bank Bailout Act,"whichwould end the Federal Reserve's authority to pay interest on reserve balances and prevent the use of taxpayer dollars to subsidize large domestic and foreign financial institutions.

"This report marks the first step in finally Auditing the Fed, but there is still much more work left to do,"said Chairman Paul."My 'End the Fed's Big Bank Bailout Act' would end the forcible transfer of wealth from average Americans to Wall Street institutions under the guise of IORB payments, while my 'Federal Reserve Transparency Act' would allow meaningful oversight of all functions of the Fed, which is long overdue. If the Fed handed over this data, what is hiding in the information they still refuse to provide?"

Findings of the Committee Report:

IORB Payments Now Account for a Significant Share of the Federal Deficit

InFiscal Year2023 IORB payments equaled 8.8 percent of the federal deficit. InFiscal Year2024, IORB payments equaled 10.3 percent of the federal deficit. These payments would have otherwise gone back to the taxpayer.

The Federal Reserve paid $187 billion in IORB in FY24 10.3% of the entire federal deficit.

In FY23, the Fed paid $149 billion, representing 8.8% of that year's deficit.

Wall Street's Largest Banks Are Among the Primary Beneficiaries

The top 20 bank recipients received over half ($305B) of all IORB payments since 2013 roughly equal to the combined amount for the other 4,500 banks.

IORB payments account for 12 percent of all profits for the 5 largest American banks from 2013-2024.

In 2024, taxpayer-financed IORB payments were a considerable driver for profitability for these banks accounting for 16.5 percent of net interest income for the U.S.'s 5 largest banks.

JPMorgan Chase received $15B in IORBpaymentsin 2024 outpacing the profits from its entire investment banking division.

IORB Is Also Functioning as a Subsidy for Foreign Banks

From January 2013 through July 2025, 39 percent ($235B) of IORB payments were issued to foreign or majority foreign-owned banks.

Of top 10 recipients of IORB payments from July 2013 to July 2025, 4 are foreign banks, and 11 of the top 20 are foreign banks.The Fed sent $10 billion to Chinese banks alonesince 2013.

The American taxpayer has financed over 50 percent of Bahrain's bank profits, 47 percent of Norway's bank profits, and 22 percent of Japan's bank profits.

IORB Payments Have Driven Record Federal Reserve Losses

Since 2022 the Fed has been operating at an unprecedented loss, averaging $96 billion in losses in each of the last two years.

Without an IORB regime, totalremittancesby the Federal Reserveto the Treasury would have totaled more than $1.5 trillionsince 2008.

The newreportbuilds on Chairman Paul'sefforts to provide additional transparency and accountability of the Federal Reserve including the"Federal Reserve Transparency Act"which would require a full audit of the Fed's operations and increase congressional oversight.