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EX·OFFICIO MEMBERS
P. G. HARDING, GOYIRNOit'-'PAUL M. WARBURG, VJCI GOVIRNOR
FREDERIC A. DELANO
ADOLPH C. MILLER
CHARLES S. HAMLIN
WILLIAM G. McADOO
SECRETARY OF THE TREASURY
CHAIRMAN
JOHN SKELTON WILLIAMS
FEDERAL RESERVE BOARD
COMPTROLLER OF THE CURRENCY
H. PARKER WILLIS, SECRETARY
SHERMAN P. ALLEN, ASST. SECRETARY
AND FISCAL AGENT
WASHINGTON
ADDRESS REPLY TO
FEDERAL RESERVE BOARD
x.. 936
Dear Sir:
.As the Attorney General of the United States has tendered an opinion,
which appears on pages 367-371 of tha May
is~e
of the Federal Reserve Bul-
letin 1 in which he holds that member and de positing banks must remit without
charge to Federal Reserve banks for checks
depos~ted
with
them~
and as the
service charges by Federal Reserve banks fQr handling checks will be abolished ·On June 15, it now seems desirable that the Federal Reserve Board
should issue regulations covering charges which rray be made by member banks
against their customers and against each
other~
in.accordance with that por-
tion of Section 16 of the Federal Reserve Act, page 36, reading as follows:
.,The Federal Reserve Board shall, by rule, fix the charges to be
collected by the nembar banks from its patrons whQse checks are
cleared through the Federal Reserve bank and the charge which n:a.y
be imposed for the service of clearing or collection which may be
rendered by the Federal Reserve bank. 0
Heretofore the Board has not deeaed it necessary to establish a schedule of
charges~
believing that the banks themselves would adopt fair and
reasonable rates 1 but in viow of the reasons above outlined and of the further
fact that there is no
made, it
unifo~ty
in banking practice with respect to chargJa
proper for the Board to fix a schedule of rates which may .
seems
be charged by member banks against their customers and against other banks 1
except Federal Reserve banks, for their services in making collectioroand
rendttances.
These rates should
becorr~
effective not later than July 1 1 next.
With this end in viewJ the Federal Reserve Board will be pleased to
have your sugffestions as to what rates should be established 1 it being
X-936
- 2 -
desirable that they should
~a
as uniform as possible throughout the country.
In establishing a schedule of rates it is assutt:ed that the following
transactions
should be considered:
(1)
Remittance of exchange in payrr~nt for checks;
(2)
Remittance of exchange for collection ite~ which
must first be collected and then remitted;
(3)
Crediting items in reciprocal accounts; balances to
be remitted at stated interrals, or upon requestj
(4)
Cashing out-of-town checks for depositors or non-depositors;
{5)
Crediting customers with out-of-town checksi thereby rraking
funds iarr~diately available, although the checks may not be
actually collected except at the expiration of 21 4, 6, or
8 days.
!n cases (4) and (5) 1 there should be considered the question of interest while the checks are in transit)
a~d
in the case of ( 5) there should
also be taken into account whether or not the bank allows interest on the
deposit.
The Board would be pleased to have you give i.mn::ediate cons ide ration
to this matter 1 and hopes to pave as prompt a reply as possible.
Very truly yours,
Governor ..
The Governor,
Federal Reserve
Bank~
·
@FedFRASER