Availability of funds and collection of checks (Regulation CC): Next-day availability checks and local checks; routing number guide; technical amendment,

[Federal Register: February 23, 2005 (Volume 70, Number 35)]

[Rules and Regulations]

[Page 8716-8718]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr23fe05-4]

FEDERAL RESERVE SYSTEM

12 CFR Part 229

[Regulation CC; Docket No. R-1224]

Availability of Funds and Collection of Checks

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Final rule; technical amendment.

SUMMARY: The Board of Governors is amending appendix A of Regulation CC to delete the reference to the Detroit branch office of the Federal Reserve Bank of Chicago and reassign the Federal Reserve routing symbols currently listed under that office to the head office of the Federal Reserve Bank of Cleveland and delete the reference to the Houston branch office of the Federal Reserve Bank of Dallas and reassign the routing numbers listed under that office to the head office of that Reserve Bank. These amendments will ensure that the information in appendix A accurately describes the actual structure of check processing operations within the Federal Reserve System.

DATES: The amendments to appendix A under the Fourth and Seventh Federal Reserve Districts (Federal Reserve Banks of Cleveland and Chicago) are effective on April 16, 2005. The amendments to appendix A under the Eleventh Federal Reserve District (Federal Reserve Bank of Dallas) are effective on April 23, 2005.

FOR FURTHER INFORMATION CONTACT: Jack K. Walton II, Assistant Director (202) 452-2660, or Joseph P. Baressi, Senior Financial Services Analyst (202) 452-3959, Division of Reserve Bank Operations and Payment Systems; or Adrianne G. Threatt, Counsel (202) 452-3554, Legal Division. For users of Telecommunications Devices for the Deaf (TDD) only, contact (202) 263-4869.

SUPPLEMENTARY INFORMATION: Regulation CC establishes the maximum period a depositary bank may wait between receiving a deposit and making the deposited funds available for withdrawal.\1\ A depositary bank generally must provide faster availability for funds deposited by a local check than by a nonlocal check. A check drawn on a bank is considered local if it is payable by or at a bank located in the same Federal Reserve check processing region as the depositary bank. A check drawn on a nonbank is considered local if it is payable through a bank located in the same Federal Reserve check processing region as the depositary bank. Checks that do not meet the requirements for local checks are considered nonlocal.

\1\ For purposes of Regulation CC, the term ``bank'' refers to any depository institution, including commercial banks, savings institutions, and credit unions.

Appendix A to Regulation CC contains a routing number guide that assists banks in identifying local and nonlocal banks and thereby determining the maximum permissible hold periods for most deposited checks. The appendix includes a list of each Federal Reserve check processing office and the first four digits of the routing number, known as the Federal Reserve routing symbol, of each bank that is served by that office for check processing purposes. Banks whose Federal Reserve routing symbols are grouped under the same office are in the same check processing region and thus are local to one another.

As explained in detail in the Board's final rule published in the Federal Register on September 28, 2004, the Federal Reserve Banks have decided to reduce further the number of locations at which they process checks.\2\ The amendments set forth in this notice are part of a series of appendix A amendments related to that decision, and the Board will issue separate notices for each phase of the restructuring.\3\

\2\ See 69 FR 57837, September 28, 2004.

\3\ In addition to the general advance notice of future amendments provided by the Board, and the Board's notices of final amendments, the Reserve Banks are striving to inform affected depository institutions of the exact date of each office transition at least 120 days in advance. The Reserve Banks' communications to affected depository institutions are available at http://www.frbservices.org .

As part of the restructuring process, the Detroit branch office of the Federal

[[Page 8717]]

Reserve Bank of Chicago will cease processing checks on April 16, 2005, and banks with routing symbols currently assigned to that office for check processing purposes will be reassigned to the Federal Reserve Bank of Cleveland's head office. The Houston branch office of the Federal Reserve Bank of Dallas will cease processing checks on April 23, 2005, and banks with routing symbols currently assigned to that office for check processing purposes will be reassigned to the Federal Reserve Bank of Dallas's head office. As a result of these changes, some checks that are drawn on and deposited at banks located in the affected check processing regions and that currently are nonlocal checks will become local checks subject to faster availability schedules. Because the Cleveland check processing region will serve banks located in more than one Federal Reserve District, banks located in the expanded Cleveland check processing region cannot determine that a check is nonlocal solely because the paying bank for that check is located in another Federal Reserve district.

To assist banks in identifying local and nonlocal banks, the Board accordingly is amending the lists of routing symbols associated with the Federal Reserve Banks of Cleveland, Chicago, and Dallas to conform to the transfer of operations (1) from the Chicago Reserve Bank's Detroit branch office to the Cleveland Reserve Bank's head office and (2) from the Dallas Reserve Bank's Houston branch office to that Reserve Bank's head office. To coincide with the effective date of the underlying check processing changes, the amendments affecting the Federal Reserve Banks of Cleveland and Chicago are effective April 16, 2005, and the amendments affecting the Federal Reserve Bank of Dallas are effective April 23, 2005. The Board is providing advance notice of these amendments to give affected banks ample time to make any needed processing changes. The advance notice also will enable affected banks to amend their availability schedules and related disclosures, if necessary, and provide their customers with notice of these changes.\4\ The Federal Reserve routing symbols assigned to all other Federal Reserve branches and offices will remain the same at this time. The Board of Governors, however, intends to issue similar notices at least sixty days prior to the elimination of check operations at some other Reserve Bank offices, as described in the September 2004 Federal Register document.

\4\ Section 229.18(e) of Regulation CC requires that banks notify account holders who are consumers within 30 days after implementing a change that improves the availability of funds.

Administrative Procedure Act

The Board has not followed the provisions of 5 U.S.C. 553(b) relating to notice and public participation in connection with the adoption of this final rule. The revisions to the appendix are technical in nature, and the routing symbol revisions are required by the statutory and regulatory definitions of ``check-processing region.'' Because there is no substantive change on which to seek public input, the Board has determined that the Sec. 553(b) notice and comment procedures are unnecessary.

Paperwork Reduction Act

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3506; 5 CFR 1320 Appendix A.1), the Board has reviewed the final rule under authority delegated to the Board by the Office of Management and Budget. These technical amendments to appendix A of Regulation CC will (1) delete the reference to the Detroit branch office of the Federal Reserve Bank of Chicago and reassign the routing symbols listed under that office to the head office of the Federal Reserve Bank of Cleveland and (2) delete the reference to the Houston branch office of the Federal Reserve Bank of Dallas and reassign the routing symbols listed under that office to the Dallas Reserve Bank's head office. The depository institutions that are located in the affected check processing regions and that include the routing numbers in their disclosure statements would be required to notify customers of the resulting change in availability under Sec. 229.18(e). However, because all paperwork collection procedures associated with Regulation CC already are in place, the Board anticipates that no additional burden will be imposed as a result of this rulemaking.

12 CFR Chapter II

List of Subjects in 12 CFR Part 229

Banks, Banking, Reporting and recordkeeping requirements.

Authority and Issuance

0 For the reasons set forth in the preamble, the Board is amending 12 CFR part 229 to read as follows:

PART 229--AVAILABILITY OF FUNDS AND COLLECTION OF CHECKS (REGULATION CC)

0 1. The authority citation for part 229 continues to read as follows:

Authority: 12 U.S.C. 4001-4010, 12 U.S.C. 5001-5018.

0 2. The Fourth, Seventh, and Eleventh Federal Reserve District routing symbol lists in appendix A are revised to read as follows:

Appendix A to Part 229--Routing Number Guide to Next-Day Availability Check and Local Checks

* * * * *

Fourth Federal Reserve District

[Federal Reserve Bank of Cleveland]

Head Office

0410 2410 0412 2412 0430 2430 0432 2432 0433 2433 0434 2434 0720 2720 0724 2724

Cincinnati Branch

0420 2420 0421 2421 0422 2422 0423 2423 0515 2515 0519 2519 0740 2740 0749 2749 0813 2813 0830 2830 0839 2839 0863 2863

Columbus Office

0440 2440 0441 2441 0442 2442 * * * * *

Seventh Federal Reserve District

[Federal Reserve Bank of Chicago]

Head Office

0710 2710 0711 2711 0712 2712 0719 2719 0750 2750 0759 2759

Des Moines Office

0730 2730 0739 2739 1040 3040 1041 3041 1049 3049 * * * * *

Eleventh Federal Reserve District

[Federal Reserve Bank of Dallas]

Head Office

1110 3110 1111 3111 1113 3113 1119 3119 1120 3120 1122 3122

[[Page 8718]]

1123 3123 1130 3130 1131 3131 1140 3140 1149 3149 1163 3163 * * * * *

By order of the Board of Governors of the Federal Reserve System, acting through the Secretary of the Board under delegated authority, February 16, 2005.

Robert deV. Frierson, Deputy Secretary of the Board.

[FR Doc. 05-3419 Filed 2-22-05; 8:45 am]

BILLING CODE 6210-01-P