In a move that affects borrowers across Tennessee, Commissioner Greg Gonzales of the Department of Financial Institutions has announced the new maximum effective formula rate of interest in the state. According to an official statement released today, the rate has been set at 11.50 percent per annum. This rate is based on the addition of a 4 percent margin to the weekly average prime loan rate of 7.50 percent, recently published by the Federal Reserve yesterday.
The formula rate, which was derived following the statutes set forth by Chapter 464 of the Public Acts of 1983, will remain in force as long as the prime rate, announced by the Federal Reserve Bank, stays unchanged. Announcing weekly, Tennessee follows a structured approach to managing interest rates. As posted on their official website, the rate adjustment reflects the state's response to national financial changes.
As a matter of legislative requirement and financial governance, the Commissioner of Financial Institutions has the responsibility to provide these updates, aligning with the historical legislation that governs interest rates in Tennessee.
