Florida Bankers Association Stands in Support of Interest on Trust Accounts Reform

TALLAHASSEE, Fla. (January 11, 2024)--Last week, Senator Erin Grall (R-Vero Beach) and Representative Robert Brackett (R-Vero Beach) introduced SB 1336 and HB 1253, respectively, legislation that would reform Florida’s current Interest on Trust Accounts (IOTA) program.  The bills seek to provide a more appropriate index and interest rate rather than the 2023 rule, which inappropriately based the rate on the Prime Index and has imposed a 3000% increase from the prior rate.  The bills direct Florida’s CFO to release the interest rate quarterly, which amounts to 68% of the upper bound of Fed Funds as a safe harbor rate and then allows an option for banks to provide information on their products that show that they are paying comparable IOTA rates to other similarly situated accounts at their financial institutions.

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