[Federal Register Volume 61, Number 99 (Tuesday, May 21, 1996)]
[Rules and Regulations]
[Pages 25389-25390]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-12683]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
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Federal Register / Vol. 61, No. 99 / Tuesday, May 21, 1996 / Rules
and Regulations
[[Page 25389]]
FEDERAL RESERVE SYSTEM
12 CFR Part 229
[Regulation CC; Docket No. R-0925]
Availability of Funds and Collection of Checks
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Final rule; technical amendment.
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SUMMARY: The Board is publishing technical amendments to Appendices A
and B of Regulation CC. The amendments will conform the Appendices to a
realignment in Federal Reserve check-processing regions by adding the
routing numbers formerly assigned to the Jericho check-processing
region to the East Rutherford check-processing region in Appendix A,
and by eliminating the reference to routing numbers formerly assigned
to the Jericho office that were subject to a reduced availability
schedule for depositary banks in the East Rutherford check-processing
territory in Appendix B.
EFFECTIVE DATE: October 15, 1996.
FOR FURTHER INFORMATION CONTACT: Stephanie Martin, Senior Attorney
(202/452-3198), or Heatherun Allison, Attorney (202/452-3565), Legal
Division. For the hearing impaired only: Telecommunications Device for
the Deaf, Dorothea Thompson (202/452-3544).
SUPPLEMENTARY INFORMATION: The Board's Regulation CC (12 CFR part 229)
implements the Expedited Funds Availability Act (12 U.S.C. 4001 et
seq.) and requires banks 1 to make funds deposited into
transaction accounts available for withdrawal within specified time
frames. The Act and regulation allow banks to place longer holds on
nonlocal checks than on local checks. A nonlocal check is one for which
the paying bank 2 is located in a different check-processing
region than the depositary bank. Regulation CC defines ``check-
processing region'' as ``the geographical area served by an office of a
Federal Reserve Bank for purposes of its check-processing activities.''
3 Appendix A of Regulation CC lists the Federal Reserve check-
processing offices and the 4-digit routing number prefixes that are
local to each office. Appendix B of Regulation CC lists 4-digit routing
number prefixes to which reduced availability schedules apply in
certain cases.
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\1\ The term bank refers to any depository institution,
including commercial banks, savings institutions, and credit unions.
\2\ The paying bank is the bank by, at, or through which a check
is payable. The depositary bank is the first bank to which a check
is transferred.
\3\ 12 CFR Sec. 229.2(m). The Act's definition is substantially
similar (12 U.S.C. 4001(9)).
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Effective October 15, 1996, the Federal Reserve Bank of New York
will discontinue processing checks at its Jericho office and will
incorporate the Jericho check-processing region into the East
Rutherford check-processing region. This consolidation is part of a
larger effort by the Federal Reserve Bank of New York to achieve
greater efficiency in its check operations by consolidating systems,
equipment, and operations.4 Accordingly, the routing number list
in Appendix A is being changed to reflect the Jericho-East Rutherford
consolidation. The reference in Appendix B to routing numbers formerly
assigned to the Jericho office that were subject to a reduced
availability schedule for depositary banks in the East Rutherford
check-processing territory is also being deleted, because those routing
numbers are now all ``local'' with respect to the East Rutherford
check-processing territory.
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\4\ In 1992 the Federal Reserve Bank of New York transferred its
head office check-processing operations to its Jericho office. The
Board made corresponding changes to Appendix A of Regulation CC at
that time. 58 FR 2, January 4, 1993. Similarly, the Federal Reserve
Bank of New York in 1994 discontinued check-processing at its
Buffalo office and incorporated the Buffalo check-processing region
into the Utica check-processing region. The Board made corresponding
changes to Appendices A and B-2 at that time. 59 FR 48789, September
23, 1994.
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Although the substance of Regulation CC will be unaffected by the
amendments to Appendices A and B, the consolidation of check-processing
regions may require some banks to adjust their internal procedures for
assigning funds availability. For example, beginning on October 15,
1996, checks deposited in the former Jericho region will now be
considered local checks in the East Rutherford region (and vice versa).
Banks that now distinguish between the Jericho and East Rutherford
regions in assigning availability will need to realign their internal
operating systems to reflect the consolidation.
Banks also need to reflect any availability policy changes in their
disclosures, as the availability for certain checks may be improved.
Section 229.18(e) of Regulation CC provides that, in the case of an
availability policy change that expedites the availability of funds, a
bank shall send a notice of the change to holders of consumer accounts
not later than 30 days after implementation.
The amendments adopted by the Board are technical amendments that
reflect the realignment of Federal Reserve check-processing regions and
are required by the statutory and regulatory definitions of ``check-
processing region.'' Accordingly, 5 U.S.C. 553(b), requiring public
comment, does not apply.
Final Regulatory Flexibility Analysis
The amendment will apply to all banks, regardless of size. There is
no possible alternative rule for small banks, as ``check-processing
region'' is defined by the Expedited Funds Availability Act, which
applies to all banks. The amendment will affect only those banks in the
current Jericho and East Rutherford check-processing regions that
distinguish between checks drawn on paying banks located in those two
regions for purposes of assigning availability. The Board expects that
the majority of small institutions located in those two regions will be
unaffected by the amendment.
List of Subjects in 12 CFR Part 229
Banks, banking, Federal Reserve System, Reporting and recordkeeping
requirements.
For the reasons set out in the preamble, 12 CFR part 229 is amended
as follows:
PART 229--[AMENDED]
1. The authority citation for part 229 continues to read as
follows:
[[Page 25390]]
Authority: 12 U.S.C. 4001 et seq.
2. In Appendix A to part 229, under the heading ``SECOND FEDERAL
RESERVE DISTRICT,'' the numbers appearing directly under the subheading
``Jericho Office'' are transferred in numerical order under the
subheading ``East Rutherford Office'', and the subheading ``Jericho
Office'' is removed.
3. In Appendix B to part 229, the entry for ``East Rutherford'' is
removed.
By order of the Board of Governors of the Federal Reserve
System, May 15, 1996.
William W. Wiles,
Secretary of the Board.
[FR Doc. 96-12683 Filed 5-20-96; 8:45 am]
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