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F E D E R A L R E S E R V E B A N K OF D A L L A S
Station K, Dallas, Texas 7 5 2 2 2
C i r c u l a r No. 84-115
December 4, 1984
TO:
All d e p o s i t o r y i n s t i t u t i o n s
Reserve D i s t r i c t
ATTENTION:
Chief Executive O f f i c e r
SUBJECT:
Request for public comment on proposed revisions to
the
fee
structures
for
the Federal Reserve's
definitive
securities
safekeeping
and
noncash
collection service
SUMMARY:
The Board o f Governors o f t he Federal Reserve System
is r e q u e s t i n g p u b l i c comment on a proposal to r e v i s e
the s t r u c t u r e o f fees charged by Federal Reserve Banks
for th e ir d efin itiv e secu rities
s afek eep i n g
and
noncash c o l l e c t i o n
service.
Complete d e t a i l s a re
provided in t h e a t t a c h e d m a t e r i a l s .
in t h e Eleventh Federal
I n t e r e s t e d p a r t i e s a re i n v i t e d t o submit comments to
William W Wiles, S e c r e t a r y , Board o f Governors o f t he
.
Federal Reserve System, 20th S t r e e t and C o n s t i t u t i o n
Avenue, N.W., Washington, D.C. 20551.
Comments must
be re c ei v e d by December 28, 1984, and should r e f e r to
Docket No. R-0533.
ATTACHMENTS:
B oard' s p r es s r e l e a s e and m a t e r i a l as
p u b l i c a t i o n in t he Federal R e g i s t e r
MORE INFORMATION:
Lynn
Vick,
(214) 651-6263 a t t he Head O f f i c e ;
Robert W S c h u l t z , (915) 544-4730 a t t h e El Paso
.
Branch;
Andrew W Hogwood,
.
(713) 659-4433
Houston Branch;
or
Tony
G.
Val en ci a ,
(512)
224-2141 a t t h e San Antonio Branch
ADDITIONAL COPIES:
s ub mi tt ed
for
Public A f f a i r s Department, Ext ension 6289
Banks and others are encouraged to use the following incoming WATS 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)
at
FEDERAL RESERVE press release
For immediate r e l e a s e
November 21, 1984
The Federal Reserve Board t oday p u b l i s h ed f o r p u b l i c comment proposed
r e v i s i o n s to th e s t r u c t u r e of fe es charged by t h e Federal Reserve Banks f o r t h e i r
d e f i n i t i v e s e c u r i t i e s sa f e ke ep ing and noncash c o l l e c t i o n s e r v i c e .
The Board
r e q u e s t s comment by December 28, 1984.
The Board proposed two changes in t h e fee s t r u c t u r e f o r d e f i n i t i v e
s e c u r i t i e s sa f e k e e p in g .
These changes i n c l u d e t h e i n t r o d u c t i o n of a r e r e g i s t r a t i o n
f e e ( t o r ecove r t h e c o st of sending a r e g i s t e r e d s e c u r i t y t o a t r a n s f e r agent f o r
r e r e g i s t r a t i o n ) and an a d d i t i o n a l fee f o r m a i n t a i n i n g coupon b e ari n g s e c u r i t i e s .
The Board a l s o proposed t h r e e changes t o t h e fee s t r u c t u r e f o r noncash
collection.
A fe e would be charged t o t h e d e p o s i t o r f o r any coupon d e p o s i t t h a t
i s r e tu r n e d as u n c o l l e c t i b l e .
Reserve Banks would be given t h e o p t i on of a do pt ing
a mixed d e p o s it program, which allows a d e p o s i t o ry i n s t i t u t i o n t h e o p p o rt u n i t y t o
d e p o s i t a l l of i t s coupons in one mixed d e p o s i t .
The Reserve Banks would a l s o have
t h e option of c ha rging a hig he r fe e t o reco v er t h e a d d i t i o n a l c o s t s of c o l l e c t i n g
noncash items payable a t c ountry e n d p o i n t s .
The B oard's n o t i c e i s a t t a c h e d .
-0-
Attachment
FEDERAL RESERVE SYSTEM
(Docket No. R-053 3)
FEE SCHEDULES FOR FEDERAL RESERVE BANK SERVICES
AGENCY:
Board of Governors of the Federal Reserve System.
ACTION:
Request for Comment.
SUMMARY:
on
The Board of Governors
proposed
Reserve's
revisions
definitive
to the
is requesting public
fee structures
securities
for
safekeeping
the
and
comment
Federal
noncash
collection service.
DATE:
Comments must be received by December 28,
ADDRESS:
Comments,
m a y be mailed
Governors
which should refer
to Mr.
of
the
Federal
Constitution Avenue,
to
Room
B-2223
William W.
Reserve
Wiles,
8:45
a.m.
Docket
and
No.
Secretary,
System,
N.W., Washington,
between
to
1984.
2 0th
D.C.
Board of
Street
20551,
5:15
R - 0 5 3 3,
p.m.
and
or delivered
Cbmments
received may be inspected at Room B-1122 between 8:45 a.m.
5:15 p.m.,
Rules
except as
Regarding
the
provided
in
Availability
§ 261.6(a)
of
of
the
Information,
and
Board's
12 C.F.R.
§ 261.6(a) .
FOR FURTHER INFORMATION CONTACT:
(202/452-3954)
or
Donna
A.
Gerald D. Manypenny,
DeCbrleto,
Senior
Manager
Analyst
(2 02/452-3956), Division of Federal Reserve Bank Operations; or
Gilbert T. Schwartz,
Associate
General
or Daniel L.
Attorney
(2 02/452-3711),
Rhoads,
Counsel
(202/452-362 5);
Legal
Division,
- 2 -
Board of Governors of the Federal
Reserve
System,
Washington,
D.C. 20551.
SUPPLEMENTARY
INFORMATION:
approved
schedules
fee
safekeeping
and
(September 29,
matching
Factor
of
of
1983).
costs,
("PSAF"),
1984.
for
September
the
1983,
definitive
collection
excluding
data
However,
the
the
Private
48
Sector
indicate
in order
PSAF,
and
that
F.R.
4467
revenues
in
Accordingly,
the
Board
a
Adjustment
the third quarter
this
to achieve
believes that certain changes in the current
be necessary.
Board
securities
service.
and revenues by the end of
including
the
The fees were established to provide
Preliminary
virtually met.
costs,
noncash
In
goal
was
a matching
1985
the
of
Board
fee structure ma y
proposes
to adopt
the
following changes:
Definitive Securities Safekeeping -- Two structural changes are
proposed for the definitive securities safekeeping activity.
The
first
reregistration fee,
proposed
change,
introduction
of
a
Reserve Banks to recover
the
cost of sending a registered security to a transfer agent
for
reregistration.
would enable
the
Securities delivered to
the
Reserve Bank are
generally registered in the name of the former owner and must
be reregistered in the name of
sending
a
security
to
a
the new owner.
transfer
agent
and
The costs of
related
recordkeeping have been increasing as the number of registered
securities
increases.
It
is proposed
that all
Reserve Banks
offering the service would institute a reregistration fee.
- 3 -
The
definitive
second proposed pricing
securities
optional basis,
safekeeping
is more
bearing
the
securities.
securities
Safekeeping
costly since maturing
yearly.
is
of a fee to differentiate
coupon
registered
safekeeping
structure modification in
Registered
coupon
do
not
on
the higher
as
coupons must
securities
addition,
cost of
compared
bearing
be
incur
an
with
securities
clipped
these
twice
expenses
because they generally have no coupons.
This proposed fee would be based on the par value of
the bearer securities
value
of
coupon
rather
bearing
than number of pieces.
securities
is
appropriate measure for three reasons:
closely approximates
bearer
municipal
the number
securities
believed
to
be
(1) par value
of pieces involved
are
The par
since most
minimize
(3)
par
value
value pricing
practice.
option
in
its
1985
Bank
account
Reserve
a
basis
for
reconcilement costs
sector
Reserve
as
(Philadelphia)
maintenance
Banks
providing
to be
Reserve
(New York,
this
Therefore,
fee
would
for depository institutions;
appears
Three
assessing
(2)
their holdings
in terms of par value rather than number of pieces.
par
pricing
in £5,000 denominations;
depository institutions typically keep track of
using
an
consistent
Banks
Cleveland,
proposes
fee.
At
definitive
not intend to adopt this option.
propose
and
time
securities
private
to adopt
Dallas);
to adopt
this
with
a
and
this
fourth
it by altering
the
remaining
safekeeping
do
- 4 -
Proposed
structural
fees
for
modifications,
1985,
and
incorporating
current
fees
the
are
proposed
shown
in
Schedule 1.
Noncash
Collection
—
Three
pricing
structure
changes
proposed
in noncash collection:
fee;
the addition of a mixed deposit option on a permanent
(2)
basis; and
program,
(1) an optional
are
return
item
(3) for Reserve Banks not choosing the mixed deposit
the
option
of
setting
different
city
and
country
collection fees.
The return item fee would be charged
deposit
that
Noncash
return
security
is
costs
separately
for
returned
items
are
involved
return
parts of the country.
to
depositor
costly due
with
items
All
the
to
handling
parallels
as
for any coupon
uncollectible.
the high
labor
them.
the
and
Charging
practice
in
Reserve Banks except Atlanta
most
propose
to adopt this option.
The second proposed structure change would be to adopt
the noncash mixed deposit
mixed deposit program,
program on an optional basis.
The
implemented by four Reserve Banks on a
pilot basis, offers a depository institution the opportunity to
deposit all of its coupons
in one mixed
the need for depositors to
pre-sort coupons
in-district
Reserve
Atlanta,
versus
Banks
now
items
payable
participating
St. Louis, and Dallas)
deposit.
into
This
reduces
items
payable
out-of-district.
in
the
pilot
The
four
(Cleveland,
plan to adopt this option.
- 5 -
The final proposed structure change would give Reserve
Banks not participating in the mixed deposit program the option
of
charging a higher
fee
collecting
items
payable
additional
costs
to recover
at
reflect
the additional
country
added
expenses associated with these
costs of
endpoints.
handling
items.
and
These
preparation
At this
time only the
New York Reserve Bank plans to adopt this option.
Proposed fees for 198 5, which incorporate the proposed
revisions to the fee structure,
and current
fees are shown in
Schedule II.
The Board believes
the
definitive
securities
that the proposed modifications to
safekeeping
and
noncash
collection
fee schedules will enable the Federal Reserve System to recover
fully the costs of providing this service,
1985.
Further,
the Board believes
including
that the options
PSAF,
in
provided
Reserve Banks by these proposals wil permit the Reserve Banks
greater
flexibility
in
meeting
the
needs
of
depository
institutions and responding to local market conditions.
B y order
Reserve System,
of
the
Board
November 20,
of
Governors
of
the
Federal
1984.
(sig n ed )
W illiam
W.
W iles
William W. Wiles
Secretary of the Board
SCHEDULE I
1985 PRICE SCHEDULE
DEFINITIVE SAFEKEEPING
RECEIPTS/ISSUES
PURCHASES
RE-
1-400
1984
1-400
1985
400+
1984
400+
1985
A D SALES
N
1984
1985
12.50
2.80
2.90
2.10
2.20
15.00
15.00
12.50
----
35.50
35.50
5.35
5.35
4.75
4.75
23.00
23.00
35.50
0.0050
16.00
15.00
16.00
3.00
3.25
2.00
2.25
19.00
20.00
20.00
15.00
15.00
15.00
15.00
2.25
2.00
1.75
1.50
25. 00
25.00
15.00
RICHM
OND
4/
ATLANTA
15.00
15.00
15.00
15.00
1.50
1.95
1.00
1.45
20.00
20.00
15.00
0.00
0.00
5.00
5.00
N/A
N/A
5.00
CHICAGO
11.00
11.00
11.00
5/
DETROIT “
11.00
11.00
ST. LOUIS
8.00
MINNEAPOLIS
DEPOSITS
1985
1984
W
ITHDRAW
ALS 1/
1984
1985“
12.50
12.50
12.50
35.50
35.50
PHILADELPHIA
15.00
CLEVELAND
BOSTON
N W Y RK
E
O
REGISTRATIONS
1985 1/
VALUE
1985 ;
3/
0.0050
* see below
* see below
11.00
3.00
3. 50
2.75
2.75
19.00
21.00
11.00
----
11.00
11.00
2.00
2.25
1.75
2.00
N/A
N/A
11.00
----
10.00
8.00
10.00
1.25
1.50
0.90
0.90
N/A
N/A
10.00
----
8.00
8.00
8.00
8. 00
1.40
1.40
0.75
0.75
10.00
10.00
8. 00
KANSAS CITY
15.00
15.00
15.00
15.00
1.50
2.50
1.25
2.25
20.00
20.00
15.00
----
DALLAS
10.00
10.00
10.00
10.00
2.75
2.25
2.50
2.00
26.50
26.50
10.00
0.0080
1/
ACTUAL SHIPPING COSTS ADDITIONAL.
2/
APPLIED TO COUPON BEARING SECURITIES ONLY; FEE PER $1,000 PAR VALUE.
3/
PHILADELPHIA IS PROPOSING A $2.25 FEE FOR ALL REGISTERED SECURITIES.
OF REGISTERED SECURITIES VERSUS BEARER SECURITIES.
4/
ATLANTA 1-500 RECEIPTS @ $2.50 IN 1984/85, 500-1000 @ $2.00 IN 1984/85, AND 1000+ @ $1.50
5/
DETROIT PILOT 1-100 RECEIPTS PRICED AT @ $3.00 1984/85, OVER 100 RECEIPTS @ $2.25 IN 1984 AND $2.50 IN
INCLUDING COLLECTION OF COUPONS.
THIS IS TO RECOGNIZETHE LOWER HANDLING COSTS
IN 1984/85.
198
SCHEDULE I I
198 5 PRICE SCHEDULE
NONCASH COLLECTION
(FOR BANKS NOT OFFERING A MIXED DEPOSIT PRODUCT)
LOCAL COUPONS
ADD-ON FEE FOR
INTERDISTRICT
COUPONS
RETURN
ITEMS
BOND REDEMPTIONS
AND SALES
1/
198 5
1985
198 4
1985
1.00
1.00
3.00
12.50
12.50
2.75
0.50
0.75
10.00
35.50
35.50
2.55
2 .85
1.00
1.00
10.00
15.00
20.00
2.00
2.50
3.50
1.00
1.00
5.00
20.00
20.00
3.50
3.50
2.75
2.75
.7 0 /
.7 0 /
1.70
1.70
10.00
11.00
11.00
2.50
2.50
2 .50
2.60
3.00
1.00
1.00
10.00
11.00
11.00
MINNEAPOLIS
2.50
2. 5 0
2 .50
2.70
3.00
0.60
0.60
10.00
8.00
8.00
KANSAS CITY
3.20
3.50
3.50
2.50
3.50
1.00
1.00
10.00
15.00
20.00
SAN FRANCISCO
4.00
5.00
5.00
N/A
N/A
1.00
1.00
10.00
35.50
35.50
POSTAGE 4
INSURANCE
LOCAL
CITY
1 98 4
198 5
1 98 5
1984
1985
1984
BOSTON
2.00
2.00
2.00
2.55
2.75
NEW YORK
2.50
2.75
4.00
2.75
PHILADELPHIA
2.90
2.90
2.90
RICHMOND
2.00
2. 00
3.50
COUNTRY
2/
CHICAGO
DETROIT
3/
(FOR BANKS OFFERING A MIXED DEPOSIT PRODUCT)
LOCAL COUPONS FROM
I N-DI STRICT D F T S
CITY
LOCAL COUPONS FROM
OUT-OF-DISTRICT U F I ' S
COUNTRY
INTER-DISTRICT
COUPONS
FINE SORT
MIXED
RETURN
ITEMS
BOND REDEMPTIOf
AND SALES
1/
COUNTRY
4/
1984
198 5
1984
1985
1984
1985
1985
1984
198 5
1984
198 5
1 98 4
19 85
CITY
4/
198 4
1985
CLEVELAND 2 . 2 5
2.75
2.75
3.00
3.00
3.25
3.00
3. 50
2.75
4.00
3.75
5.00
10.00
15.00
15.00
ATLANTA
1.75
1.75
2.50
2.50
1.40
2.40
1.40
3.15
2.75
2.75
3.75
3.75
0. 00
7.50
7.50
ST. LOUIS 2 . 0 0
3.25
2.00
3 .25
2.00
3.25
2 .00
3.25
2 . 75
3.25
3. 25
3.25
10.00
10.00
10.00
2.75
3.00
2.75
3.00
2.10
3.50
2. 10
3.50
2.75
3.25
3.75
4.50
10.00
15.00
20.00
DALLAS
J ./
ACTUAL SHIPPING COSTS ADDITIONAL.
2/
CHICAGO - POSTAGE AND INSURANCE $ . 7 0 LOCAL,
3/
MINNEAPOLIS -
4/
PLUS POSTAGE AND INSURANCE.
$ 1 . 7 0 INTERDISTRICT.
12TH DISTRICT COUPONS $ 4 . 0 0 ; BONDS $ 8 . 0 0 .
@FedFRASER