District Circular Letters
December 5, 2000
BANKING SUPERVISION AND REGULATION:
REGULATION D -
LOW RESERVE TRANCHE ADJUSTMENT
To Depository Institutions
in the Twelfth Federal Reserve District
Low Reserve Tranche Adjustment
and Reservable Liabilities Adjustments (R-1088)
PDF file 15.7 KB
The Federal Reserve Board has
announced the annual adjustments in the amount of net transaction accounts
used in the calculation of reserve requirements and the cutoff levels
used to determine the detail and frequency of deposit reporting.
All depository institutions
must retain a percentage of certain types of deposits in the form of vault
cash, or as a deposit in a Federal Reserve Bank, or a pass-through account
at a correspondent institution. Reserve requirements currently are assessed
on the depository institution’s net transaction accounts (mostly checking
accounts).
For net transaction accounts
in 2001, the first $5.5 million, up from $5 million in 2000, will be exempt
from reserve requirements. A 3 percent reserve ratio will be assessed
on net transaction accounts over $5.5 million to and including $42.8 million,
down from $44.3 million in 2000. A 10 percent reserve ratio will be applied
above $42.8 million.
The low reserve tranche adjustment
and the reservable liabilities exemption adjustment are based on growth
in net transaction accounts and total reservable liabilities, respectively,
at all depository institutions between June 30, 1999, and June 30, 2000.
Additionally, the Board increased
the deposit cutoff level that is used with the exemption level to determine
the frequency and detail of deposit reporting.
Effective September 2001, depository
institutions with total reservable liabilities greater than the exemption
level ($5.5 million) are subject to detailed deposit reporting and are
called nonexempt institutions. Those nonexempt institutions with total
deposits greater than or equal to $101 million, up from the $95 million
cutoff that became effective September 2000, must report their deposit
levels weekly. Those with total deposits less than $101 million must report
their deposit levels quarterly.
Depository institutions with
total reservable liabilities equal to or less than the exemption level
of $5.5 million are not subject to detailed deposit reporting and are
called exempt depository institutions. Exempt depository institutions
with total deposits of $5.5 million or more file a less detailed deposit
report once each year. Exempt depository institutions with total deposits
less than $5.5 million are not required to file deposit reports. In July
2000, the Board discontinued the quarterly report previously used by some
exempt institutions (form FR 2910q).
U.S. branches and agencies
of foreign banks and Edge and agreement corporations must file deposit
reports weekly, regardless of size.
For depository institutions
that report weekly, the low reserve tranche adjustment and the reservable
liabilities exemption adjustment will apply to the reserve computation
period that begins November 28, 2000, and the corresponding reserve maintenance
period that begins December 28, 2000.
For institutions that report
quarterly, the low reserve tranche adjustment and the reservable liabilities
exemption adjustment will apply to the reserve computation period that
begins December 19, 2000, and the corresponding reserve maintenance period
that begins January 18, 2001.
Copies
Copies of the Board's notice
(Docket R-1088) are available from our Corporate Services Department.
To request copies to be sent by mail, please call (415) 974-2060.
To request copies to be sent by fax, please call (415) 974-3333, and
specify document number 4245.
All circulars and documents
are available on the Internet through the Federal Reserve Bank of San
Francisco's Internet site, at http://www.frbsf.org/banking/bsr/regletters/.
Additional Information
For additional information
regarding Regulation D, please contact our Statistics Department, at (415)
974-3149.
FEDERAL RESERVE BANK OF SAN
FRANCISCO
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