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F ederal

reserve

Ba n k

DALLAS, TEXAS

of

Dallas

75222

Circular No. 80-22
February 7, 1980

LARGE DOLLAR VALUE CHECKS
TO ALL BANKS IN THE
ELEVENTH FEDERAL RESERVE DISTRICT:
Attached is a Federal Reserve p ress release dated January 14, 1980
announcing the Federal Reserve Board has decided to change its check col­
lection rules to speed up collection of large dollar value checks—$250,000 or
more—as a means of improving the nation's payments system and reducing the
amount of Federal Reserve Float.
In this connection, the Board directed the System's Conference of First
Vice Presidents to develop, as soon as practicable, procedures under which banks
sending checks to the Federal Reserve for collection will sort out all checks $250,000
or more. These large checks will be given special handling by the System to speed
up their collection. Checks of this size account for approximately a q u arter of the
average daily float.
The Board also asked the Federal Reserve Banks to complete a plan for
processing of large dollar value checks received by the Federal Reserve so that
the necessary information for collection can be electronically tran sferred to banks
on which these checks a re draw n, and thereby reduce float by speeding up
payment.
The Board will consider the plan presented to it, and will request
member banks' comments on any electronic check presentment plan that it
proposes to adopt.
Sincerely yours,
Robert H. Boykin
First Vice President

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

FEDERAL RESERVE press release

For immediate release

January 14, 1980

The Federal Reserve Board today announced that it has decided to
change its check collection rules to speed up collection of large dollar
value checks -- $250,000 or more -- as a means of improving the nation's
payments system and of cutting down the amount of Federal Reserve Float.
At the same time, and with the same objectives, the Board asked
the Federal Reserve Banks to complete development of a plan first suggested
by the Board last May for presenting large dollar value checks for collection
electronically, instead of initially presenting them by delivery of the
paper checks.

This could have the added benefit of conserving fuel used in

check collection.
Federal Reserve float —
billion daily, on the average —

currently running at approximately $5.5
is the amount that the Federal Reserve has

paid to banks that have sent checks received by them to the System for
collection, but that has not yet been collected from the banks whose customers
wrote the checks.
To reduce such float the Board directed the System's Conference of
First Vice Presidents

to

develop,

as soon as

practicable, proceduresunder

which banks sending checks to the Federal Reserve for collection will sort
all checks of $250,000 or more.

out

These large checks will be given special

handling by the System to speed up their collection.

Checks of this size

account for approximately a quarter of average daily float.
At the same time, the Board also asked the System's Conference of
First Vice Presidents

to

complete

a plan for

value checks received

by

the Federal Reserve

the processing of largedollar
so that the necessary

(OVER)

-2 -

information for collection can be electronically transferred to banks on
which these checks are drawn, and thereby reduce float by speeding up
payment.
The Board will consider Che plan presented to it, and will
request member bank comment on any electronic check presentment plan that
it proposes to adopt.

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Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102