View PDF

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

F ederal Reserve Bank o f Dallas

DALLAS, TEXAS

75222
C irc u la r No. 76-42
M arch 25, 1976

American ((evolution Bicentennial

IN D IV ID U A L RETIREM ENT ACCOUNTS (IR A ) AND KEOGH ACCOUNTS

TO TH E CHIEF EXEC UTIVE OFFICER
OF A L L MEMBER BANKS IN THE
ELEVENTH FEDERAL RESERVE D IS T R IC T :
As you know , recent legislation (P ublic Law 93-406) has authorized the
establishm ent of tax d e fe rre d In d iv id u a l R etirem ent Accounts (IR A ) by persons who
do not have retirem en t program s at th e ir place of w o rk . In Decem ber, the Board of
G overnors of the Federal R eserve System amended Regulation Q to facilitate the o ffe r­
ing of such accounts by member banks in the form of time and savings deposits and
many ban ks, as w ell as other fin an cial in stitu tio n s, a re now offering IRA plans in
deposit form . Su bsequ ently, the Board has received numerous requests from member
banks that consideration be g iv e n to the elim ination of the interest rate c e ilin g d iffe r ­
entials between commercial banks and th r ift institutions on IRA accounts. Many of
these requests assert that the ex is tin g d iffe re n tia l puts bank depositors at a s ig n ifi­
cant disadvantage v is - a -v is the deposit customers of th r if t in stitu tio n s, and as a
re s u lt these banks believe that they a r e unable to compete effe ctively for IRA depos­
its. Some of these letters suggest that IRA dep osits, because of th e ir lo n g -term ,
special tax status, and Congressional intent a re a unique form of deposit and should
be treated d iffe re n tly from other tim e and savings deposits. In a d d itio n , sim ilar
sentiment has been expressed re g a rd in g Keogh plans offered by banks in the form of
time and savings deposits.
As a resu lt of these le tte rs , the Board of G overnors is conducting a su rve y
of the amount of IRA and Keogh deposits at member banks in o rd e r to obtain inform ation
reg ard in g the d eg ree to w hich re la tiv e c e ilin g rates may have affected banks' a b ility
to attrac t such deposits. T h e Federal Deposit Insurance C orporation is jo in in g the
Federal R eserve in this s u rv e y . T h e Fed eral Home Loan Bank Board is also collecting
data on IRA and Keogh deposits from savings and loan associations.
I w ould, th e re fo re , g re a tly app reciate yo u r com pleting one of the two
enclosed forms w ith data as of M arch 31 and re tu rn in g it to the Federal R eserve Bank
of Dallas in the enclosed, p re -a d d re s s e d envelope by A p r il 14. T h e second copy of
the form is for yo u r file s . Even if you have n eith er IRA nor Keogh deposits out­
standing at the s u rv e y d ate, please check the a p p ro p ria te box and re tu rn one copy
of the re p o rtin g form .

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

- 2 -

Questions re g a rd in g this s u rv e y should be d irected to B ill G re tn in our
Research D epartm ent. You may telephone M r . G re e n , co llect, at (214) 651-6394 for
assistance. I ap p re cia te y o u r cooperation in o u r endeavor to collect tne Inform ation
necessary to make an accurate evaluation o f this issue.
S in c e re ly y o u rs ,
Ernest T . Baughman
P resident
Enclosures (3)

FR 1129
OM A p p ro v a l No. 5 5 - S76002
B
E x p ir e s May 1976

Name o f Bank

C ity , S t a t e , ZIP Code
SURVEY OF OUTSTANDING AMOUNTS OF INDIVIDUAL
RETIREMENT ACCOUNTS (IRA) AND KEOGH ACCOUNTS
AS OF
MARCH 3 1 , 1976
( P le a s e re a d i n s t r u c t i o n s on r e v e r s e )

DOES YOUR BANK HAVE OUTSTANDING EITHER INDIVIDUAL RETIREMENT ACCOUNTS
(IRA) OR KEOGH ACCOUNTS IN THE FORM OF TIME AND SAVINGS DEPQSXTS.
No

Yes

IF YOU HAVE NEITHER FORM OF ACCOUNT. PLEASE INDICATE THE NAM OF THE
E
PERSON PREPARING THIS REPORT AND RETURN IT TO THE FEDERAL RESERVE BANK
OF DALLAS
IF YOU HAVE OUTSTANDING EITHER IRA OR KEOGH ACCOUNTS IN THE FORM OF
TIME AND SAVINGS DEPOSITS, PLEASE PROVIDE THE INFORMATION REQUESTED
BELOW AND RETURN THE FORM TO THE FEDERAL RESERVE BANK OF DALLAS.

Type o f M a tu r ity o f D e p o s it

I n d iv id u a l
R e tire m e n t
A cco u n ts
M ils .

1.

M ils .

T hous.

S a v in g s d e p o s i ts

2.

T h o u s.

Keogh
A cco un ts

T in e d e p o s i t s w ith o r i g i n a l m a t u r i t i e s o f :
a,

30 d a y s up to b u t n o t in c l u d in g 4 y e a r s

b.

4 y e a r s up to b u t n o t I n c lu d in g 6 y e a r s

c.

6 y e a r s and o v e r

3.

T o ta l (sum o f l i n e s 1, 2 a , 2 b , and 2c)

4.

T o ta l number o f a c c o u n ts

RETURN ONE COPY TO:
RESEARCH DEPARTMENT
FEDERAL RESERVE BANK OF DALLAS
DALLAS, TEXAS
75222
NO LATER THAN APRIL 14. 1976

(Name o f p e rs o n p r e p a r in g t h i s
r e p o r t , p le a s e p r i n t )

J_ L
_

(T elep h o n e number in c lu d in g a r e a code
and e x te n s io n )

GENERAL INSTRUCTIONS

R e p o rt a l l d e p o s it b a la n c e s r e q u e s te d a s o f th e c lo s e o f b u s in e s s March 3 1 , 1976, to
th e n e a r e s t th o u sa n d d o l l a r s .

A ll f i g u r e s m ust r e f l e c t th e c o n s o l i d a t i o n o f a l l b ra n c h e s l o ­

c a te d in th e S t a t e s o f th e U n ite d S t a t e s and th e D i s t r i c t o f C olum bia and any d o m e s tic nonbank
s u b s id ia r y o f th e bank lo c a te d i n th e S t a t e s o f t h e U. S . , th e D i s t r i c t o f C o lu m bia, o r any
U. S . t e r r i t o r y o r p o s s e s s io n t h a t i s c o n s o lid a te d f o r t h e C o n s o lid a te d (D o m e stic ) R e p o rt o f
C o n d itio n ( C a ll R e p o rt) f i l e d by th e r e p o r t i n g b an k .
P le a s e EXCLUDE any t r u s t d e p a rtm e n t a d m in is te r e d I n d i v i d u a l R e tire m e n t A ccount o r
Keogh fu n d s t h a t a r e n o t in th e form o f tim e and s a v in g s d e p o s i t s a t y o u r b a n k .
I f th e r e p o r t i n g bank h a s no IRA o r Keogh A cco u n ts i n s p e c i f i c c a t e g o r i e s r e q u e s te d
on th e r e p o r t , p le a s e w r i t e th e word "n o n e" f o r t h a t ty p e o f a c c o u n t o r m a t u r i t y .

I f th e

r e p o r tin g bank h a s n e i t h e r IRA n o r Keogh d e p o s i t s i n t h e form o f tim e and s a v in g s d e p o s i t s ,
p le a s e ch e c k th e box so i n d i c a t i n g and r e t u r n t h e form to th e F e d e r a l R e se rv e Bank o f D a l l a s .
DEFINITIONS
INDIVIDUAL RETIREMENT ACCOUNTS (IRA) a r e s p e c i a l d e p o s i t s w h ich p e r m it th o s e i n d i ­
v i d u a l s who do n o t hav e r e ti r e m e n t p ro gram s a t t h e i r p l a c e o f work to d e f e r incom e ta x e s on
am ounts e q u a l to th e fu n d s d e p o s ite d t h e r e t o (and th e e a r n in g s t h e r e o n ) .

A nnual d e p o s i t s to

IRA a c c o u n ts may n o t ex ceed 15Z o f n e t e a r n in g s o r $ 1 ,5 0 0 ,w h ic h e v e r i s s m a l l e r .
KEOGH ACCOUNTS (HR-10) a r e s i m i l a r to IR A 's b u t a r e e s t a b l i s h e d by s e lf-e m p lo y e d
I n d i v i d u a l s , f o r th e m s e lv e s a n d /o r t h e i r e m p lo y e e s, and th e maximum a n n u a l d e p o s i t may n o t
exceed 15% o f n e t e a r n in g s from s e lf-e m p lo y m e n t, o r $ 7 ,5 0 0 , w h ic h e v e r i s s m a l le r .
Time and s a v in g s d e p o s it s a r e d e f in e d i n th e i n s t r u c t i o n s t o t h e R e p o rt o f C o n d itio n
(C a ll R e p o r t) .

SAVINGS DEPOSITS h ave no s p e c i f i e d m a tu r i ty and t h e r e i s no re q u ire m e n t f o r

th e d e p o s ito r to g iv e p r i o r w r i t t e n n o t i c e o f an i n t e n t i o n to w ith d ra w f u n d s .

H ow ever, th e

b a n k , a t i t s o p tio n , may a t any tim e r e q u i r e d e p o s i t o r s h o ld in g s a v in g s d e p o s i ts to g iv e
w r i t t e n n o t i c e o f an in te n d e d w ith d ra w a l n o t l e s s th a n 30 d a y s b e f o r e su c h w ith d ra w a l i s to
be m ade.

I n c o n t r a s t , TIME DEPOSITS h av e e i t h e r a minimum m a t u r ity o f a t l e a s t 30 d a y s , o r

a f ix e d m a t u r i t y , o r a r e w ith d ra w a b le a f t e r a s p e c i f i e d p e r io d f r o p d a t e o f d e p o s i t , o r f o l ­
lo w ing e x p i r a t i o n o f a p e r io d o f n o t i c e o f in te n d e d w ith d ra w a l g iv e n i n w r i t i n g by th e d e­
p o s ito r.
NUMBER OF ACCOUNTS a r e th e t o t a l number o f s e p a r a t e IRA o r Keogh a c c o u n ts i n th e
form o f tim e and s a v in g s d e p o s i t s .

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