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F ederal Reserve Bank DALLAS. TEXAS of Dallas 75222 Circular No. 80-60 March 26, 1980 REGULATION Q - INTEREST ON DEPOSITS Announcement of Rate for Two and One-Half Year Money Market C ertificates of Deposit TO ALL MEMBER BANKS AND OTHERS CONCERNED IN THE ELEVENTH FEDERAL RESERVE DISTRICT: Beginning January 1, 1980, member banks were perm itted to offer a non-negotiable tim e deposit with a maturity of two and one-half years or more a t a ra te tied to the average two and one-half year yield on United States Treasury securities. The rate is fixed for the m aturity of each two and one-half year deposit, but the ceiling itself varies from month to month. Member banks are perm itted to compound and compute interest on this deposit in accordance with any of the methods authorized by Section 217.3 of Regulation Q. For the month of April 1980, the ceiling rate of 11.75 percent is authorized for commercial banks. Effective March 1, 1980, the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Federal Home Loan Bank Board and the National Credit Union Administration have amended their respective regulations to place a new ceiling of 11.75 percent for commercial banks on the two and one-half year variable rate time deposit. Compounding is still perm itted. In following months, the ceiling rate will be the lower of the new fixed ceiling or the rate determined by the variable formula th at has been in effec t since January. Questions regarding Regulation Q should be directed to the Consumer Affairs Section of our Bank Supervision and Regulations De partm ent, Ext. 6171. Sincerely yours, Robert H. Boykin First Vice President Banks and others are encouraged to use the following incoming W A T S numbers in contacting this Bank: 1-800-442-7140 (intrastate) and 1-800-527-9200 (interstate). For calls placed locally, please use 651 plus the extension referred to above. This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
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