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federal r eserv e Bank DALLAS. TEXAS of Dallas 75222 Circular No. 81-84 April 27, 1981 BULLETIN 2 "LOANS" TO THE CHIEF EXECUTIVE OFFICER OF ALL FINANCIAL INSTITUTIONS IN THE ELEVENTH FEDERAL RESERVE DISTRICT: Effective May 1, 1981, the hours during which the discount window at this Bank is open will be extended to parallel the extended hours for wire transfers and other settlements made via the Fedwire network. At our Dallas, Houston, and San Antonio Offices, the discount window will be open until 4 p.m. Central Time for routine advances, and until 5:30 p.m. Central Time if collateral has been prearranged. For our El Paso Office, the window will be open until 3 p.m. Mountain Time for routine advances, and until 4:30 p.m. Mountain Time with prearranged collateral. To implement this change, Section 3.10(b) of our Bulletin 2 has been revised and a revised page 2 of that bulletin is enclosed. It should be filed in Volume 1 of the Regulations and Bulletins Binders furnished by the Federal Reserve Bank of Dallas, and the current page 2 should be destroyed. Sincerely yours, William H. Wallace First Vice President Enclosure This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) BULLETIN 2 FEDERAL RESERVE BANK OF DALLAS Section 1, DEFINITIONS institution pledges to secure an advance. 1.00 Reference: sections 6, 7, and 8 of this bulletin. Acceptable and acceptability “ A cceptable” and “ acceptability” refer to the credit quality of p a p e r and other collateral. Ac ceptability depends on the financial responsibility of m akers, endorsers, or guarantors, or on the security behind the obligation, or on all of these, as appropriate. We determ ine to our own satisfaction the acceptability of p ap er and cer tain other collateral. “ Depository institution” m eans a member bank or another depository institution, as th at term is defined in section 19(b) of the Act, which holds tra n s a c tio n accounts or nonpersonal time deposits and which is eligible to obtain advances from or discounts with a Federal Reserve Bank. 1.05 1.35 1.30 Act Advance “ A dvance” m eans a borrowing under the Contin uing Lending Agreement Regarding Advances by Federal Reserve Bank of Dallas (Form LD-176), or a t our option on a note of the borrowing depository institution. All advances a re secured. Reference: Supplement A to this bulletin for current rates. 1.40 1.15 Authorized officer and duly authorized officer Reference: section 7 of this bulletin. “ Authorized officer” and “ duly authorized of ficer” mean, for purposes of this bulletin, an of ficer or other agent of a depository institution c u r rently holding one of the positions which the depository institution’s borrow ing resolution authorizes to borrow from this Bank, and whose signature is currently on file with us. 1.45 Section 2, REFERENCES In addition to the specific references found throughout this bulletin, the following general references a re im portant to an understanding of borrowing transactions with this Bank: Borrow and borrowing “ Borrow” and “borrow ing” refer to a depository institution receiving an extension of credit from this Bank. (1) Section 201.1(b) of Regulation A, containing general principles concerning the use of Federal Reserve credit. Reference: 3.00, 4.00, and 4.05 of this bulletin. (2) Section 201.2 of Regulation A, covering defini tions of depository institutions eligible to borrow. Collateral (3) Section 201.3 of Regulation A, covering availability and term s. “ C ollateral” refers to obligations in the form of securities or p ap er which a borrowing depository 10-80 Reference to Bulletin 1 Several definitions, rules of construction, and other provisions applicable to this bulletin are found in our Bulletin 1, “ General Provisions,” and are incorporated herein by reference. Reference: 3.30 and 5.05 of this bulletin. 1.25 Paper “P a p e r” refers to notes and similar obligations of various obligors, usually custom ers of borrowing depository institutions. Reference: 3.05 and 5.35 of this bulletin. 1.20 Basic rate “ Basic r a te ” refers to the lowest ra te charged for borrowing. It is fixed by our Board of Directors subject to review and determ ination by the Board of Governors of the Federal Reserve System. “ A ct” m eans the Federal Reserve Act. 1.10 Depository institution 1 BULLETIN 2 FEDERAL RESERVE BANK OF DALLAS 3.05 (4) Section 201.4 of Regulation A, covering ad vances and discounts. In general, we will make advances to a depository institution pursu an t to a continuing lending agree ment (Form LD-176) to be executed by a duly authorized officer of the depository institution; and p a rticu la r advances pursu an t to such agree ment will be evidenced by an advice of credit th a t w e shall transm it to the depository institution at the time of the p a rticu la r advance, specifying the amount and m aturity of the advance and the rate of in terest with respect thereto. However, we reserve the right a t any time to require the execu tion by any depository institution of a promissory note with respect to a p articu lar advance or p a r ticular advances. (5) Section 201.5 of Regulation A, covering general requirem ents. (6) The following portions of the Act: sections 4(8), 9(13), 10(b), 12(2), 13(2), 13(3), 13(4), 13(5), 13(6), 13(7), 13(8), 13(10), 13(12), 13(13), 13a(l), 13a(2), 13a(4), 14(5), 19(5), and 24(4). Section 3, UNIFORM PROVISIONS1 3.00 Continuing lending agreement Kinds of credit accommodations Under provisions of the Federal Reserve Act and subject to Regulation A and in the light of the general principles set forth in th at regulation, we a re authorized to make credit available to depository institutions by the following means: Reference: 5.35 of this bulletin. 3.10 (a) W e may m ake advances to a depository in stitution, pursu an t to section 10(b) of the Act, for periods not to exceed four m onths,2 secured to our satisfaction, w hether or not the collateral m eets the requirem ents of p a ra g ra p h s (b) or (c) below. Granting of credit accommodations (a) In general, we do not require th a t a request for an advance be accom panied by a w ritten ap plication, and any such request m ay be m ade by telephone, letter, or w ire by an authorized officer of a depository institution. However, we reserve the right to require the submission of a w ritten ap plication. Each request for an advance must specify the amount and m aturity of the requested advance, the collateral offered as security, and, in the event such collateral is not already held by us, the m anner in w hich such collateral will be placed in our possession, under our control, or otherw ise pledged to us. Any depository institu tion desiring to discount p ap er w ith us, as in dicated in 3.00(d) above, should consult us reg a rd ing the procedure to be followed. (b) W e may m ake advances to a depository in stitution, pursu an t to section 13 of the Act, for periods not exceeding 90 days,2 on the security of obligations of, or fully guaran teed as to both prin cipal and in terest by, the United States or any agency of the United States. (c) W e may make advances to a depository in stitution, pursu an t to section 13 of the Act, for periods not exceeding 90 days,2 on the security of any p a p e r eligible for discount or for purch ase by the Reserve Banks under provisions of the Act. (d) W e may discount custom ers’ p a p e r of a depository institution, p u rsu an t to sections 13 and 13a of the Act, if such p a p e r satisfies the “ eligibility” requirem ents set forth in section 201.4 of Regulation A. In ordinary circum stances, we would prefer to make advances secured by such collateral. (b) If a request for credit is received by us before 4 p.m. (or 5:30 p.m. w hen collateral has been prearranged) and the request is approved, the borrowing depository institution will be given im m ediate credit in its reserve or clearing or other account on our books unless the depository in stitution requests th a t credit be given on a subse quent day. (For our El Paso Branch, the times are 3 p.m . a n d 4:30 p.m . M o u n ta in Tim e, respectively.) Re/erence: section 4 of this bulletin for the various program s by which credit is extended under the statutory provisions cited above, and particularly 4.05for the usual method of extending credit. Also, 201.3 of Regulation A. 3.15 Collateral security (a) Collateral offered as security for any ad- 1Section 3 contains uniform provisions on extensions of credit adopted by all Federal Reserve Banks. Sections 5 through 8 contain information, procedures, and other provisions applicable only to the Federal Reserve Bank of Dallas. It is expected, however, that advances normally will be for shorter periods commensurate with the period of time Federal Reserve credit is actually needed. 5-81 2
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