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l l★K

Federal Reserve Bank
of Dallas

HELEN E. HOLCOMB
DALLAS, TEXAS
75265-5906

FIRST VICE PRESIDENT AND
CHIEF OPERATING OFFICER

August 30, 2002

Notice 02-46

TO: The Chief Operating Officer of each
financial institution and others concerned
in the Eleventh Federal Reserve District

SUBJECT
Revisions to Operating Circular 1
(Account Relationships)
DETAILS
The Federal Reserve Banks are amending the appendices or agreements to their
Operating Circular 1, Account Relationships, effective September 1, 2002. Appendix 5, Transaction Settlement Authorization, and Appendix 6, Service Fee Settlement Authorization, have been
combined into one Appendix 5 titled Transaction and Service Fee Settlement Authorization. The
wording in Operating Circular 1 has been amended to reflect the change in sections 2.8, 3.1, 4.2
and Appendix 1.
The amendments, which do not include any changes to account procedures, should
simplify the settlement arrangement agreements for transactions and service fees for account
holders.
ATTACHMENT
Revised Operating Circular 1 is attached. Please print a copy for your files. All
operating circulars can be found on our Financial Services web site at www.frbservices.org/
industry/operatingcirculars.cfm.

For additional copies, bankers and others are encouraged to use one of the following toll-free numbers in contacting the Federal
Reserve Bank of Dallas: Dallas Office (800) 333-4460; El Paso Branch Intrastate (800) 592-1631, Interstate (800) 351-1012;
Houston Branch Intrastate (800) 392-4162, Interstate (800) 221-0363; San Antonio Branch Intrastate (800) 292-5810.

-2MORE INFORMATION
For more information, please contact Finlay Higgins, Discount and Credit Department, (214) 922-5335. Paper copies of this notice or previous Federal Reserve Bank notices can
be printed from our web site at http://www.dallasfed.org/banking/notices/index.html.
Sincerely,

TABLE OF CONTENTS

OPERATING
CIRCULAR

1
Effective September 1, 2002

ACCOUNT RELATIONSHIPS
1.0
1.1
1.2
2.0
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
2.9
3.0
3.1
4.0
4.1
4.2
4.3
5.0
5.1
5.2
5.3
6.0
6.1
6.2
6.3
6.4
6.5

INTRODUCTION .............................................................................................................................................2
SCOPE ........................................................................................................................................................... 2
DEFINITIONS ............................................................................................................................................... 2
ACCOUNT RELATIONSHIPS ....................................................................................................................3
MASTER ACCOUNT................................................................................................................................. 3
ELIGIBLE ACCOUNT HOLDERS ......................................................................................................... 3
ESTABLISHING AN ACCOUNT............................................................................................................ 4
SUBACCOUNTS ......................................................................................................................................... 4
PASS-THROUGH RELATIONSHIPS .................................................................................................. 5
AUTHORIZED SIGNATURES ................................................................................................................ 5
ACCOUNT NUMBERS .............................................................................................................................. 5
TERMINATING AN ACCOUNT OR RELATIONSHIP .................................................................... 6
MAINTENANCE OF ACCOUNT AGREEMENT............................................................................... 6
SETTLEMENT..................................................................................................................................................7
SETTLEMENT.............................................................................................................................................. 7
STATEMENTS AND ACCOUNTING INFORMATION SERVICES ...............................................8
STATEMENT OF ACCOUNT................................................................................................................. 8
STATEMENT OF AND SETTLEMENT FOR SERVICE CHARGES......................................... 8
ACCOUNTING INFORMATION SERVICES ..................................................................................... 8
OVERDRAFTS.................................................................................................................................................9
OVERDRAFT POLICY .............................................................................................................................. 9
COLLECTION OF OVERDRAFTS ........................................................................................................ 9
SECURITY INTEREST............................................................................................................................. 9
GENERAL........................................................................................................................................................10
DUTY OF CARE ........................................................................................................................................ 10
RELIANCE ON AUTHORIZATIONS .................................................................................................. 10
NONPUBLIC PERSONAL INFORMATION ..................................................................................... 10
GOVERNING LAW AND ACTIONS ................................................................................................... 10
RIGHT TO AMEND .................................................................................................................................. 11

1

1.0

INTRODUCTION
1.1

SCOPE
This operating circular and its appendices (“Circular”) set forth the
terms for opening, maintaining, and terminating a master account
with a Federal Reserve Bank (“Reserve Bank”). It also contains
general provisions regarding Reserve Bank services applicable to
an institution whether or not it maintains an account at a Reserve
Bank. Each Reserve Bank has issued an operating circular
identical to this one.
An account is subject to Federal Reserve regulations and policies,
such as those on payments system risk, reserve balances, and
clearing balances, as they may be revised from time to time. An
institution also should be familiar with Operating Circular 10,
Lending, and other Reserve Bank operating circulars governing
specific services. These circulars may be found on the Internet at
http ://www.frbservices.org, and copies may also be obtained from
each Reserve Bank.

1.2

DEFINITIONS
a) Master Account or Account means the record of financial rights
and obligations of an account holder and the Reserve Bank with
respect to each other, where opening, intraday, and closing
balances are determined.
b) Subaccount means an information record of a subset of
transactions that affect the master account. A subaccount does not
reflect balances but does contain totals of debit and credit activity.
c) Correspondent means an institution that has authorized a
Reserve Bank to make debits and credits to its master account on
behalf of one or more other (respondent) institutions. The term also
includes an institution that maintains reserve balances in its master
account on behalf of one or more other (respondent) institutions.
d) Respondent means an institution that settles the debits and
credits for some or all of its Reserve Bank transactions (other than
Fedwire®1 transactions and Fed funds checks) in the master
account of another (correspondent) institution. The term also
includes a nonmember institution that maintains its required reserve

1

Fedwire is a registered service mark of the Federal Reserve Banks.

2

balances in the master account of another (correspondent)
institution.
2.0

ACCOUNT RELATIONSHIPS
2.1

MASTER ACCOUNT
Except as provided below, a separately chartered institution may
maintain a single master account with only the Reserve Bank in
whose District the institution is located (“Administrative Reserve
Bank” or “ARB”; see Section 2.2). The master account may be used
to maintain required reserve balances and other funds or securities
balances. Debits and credits arising from transactions conducted by
the institution on its own behalf and/or on behalf of others with or
through any Reserve Bank, regardless of location, are posted to the
master account.
An institution may have only one master account, except that:
• it may retain, for a transitional period not to exceed 12 months, the
master account of a nonsurviving institution with which it has
merged or consolidated. The Administrative Reserve Bank may
restrict the use of such an account as it deems necessary or
appropriate, and may require that the institution execute a security
agreement covering multiple master accounts;
• a U.S. branch or agency of a foreign bank, an Edge corporation,
or an agreement corporation may maintain a single master account,
or it may maintain a master account for each group of offices
located in the same state and the same Federal Reserve District;
and
• an Administrative Reserve Bank may, in its discretion, allow
multiple master accounts in other situations.
If an institution is allowed to have multiple master accounts, any
reference in this Circular to “master account” or “account” should be
read as “master accounts” or “accounts.”

2.2

ELIGIBLE ACCOUNT HOLDERS
An institution may apply to open a master account with a Reserve
Bank if the institution is located in the Reserve Bank’s District and
is:

3

• a member bank, as defined in Section 1 of the Federal Reserve
Act, 12 U.S.C. § 221;
• a depository institution, as defined in Section 19(b)(1)(A) of the
Federal Reserve Act, 12 U.S.C. § 461(b)(1)(A). (Section 19(b)(1)(A)
generally defines “depository institution” to include commercial
banks, mutual savings banks, federal savings banks, savings and
loan associations, and credit unions);
• a U.S. branch or agency of a foreign bank, as defined in Section
211.21(b) or (d) of Regulation K, 12 CFR § 211.21(b) or (d);
• an Edge or agreement corporation, as defined in Section 25A or
25 of the Federal Reserve Act, 12 U.S.C. §§ 611 et seq., or §§ 601
et seq., or
• any other entity authorized to apply to open a master account.
An institution is considered to be located in the Federal Reserve
District specified in its charter or organizing certificate (or, if no such
location is specified, in the District where its head office is located),
unless it has been notified that the Board of Governors of the
Federal Reserve System has determined otherwise (see Section
204.3(b)(2)(ii) of Regulation D).
2.3

ESTABLISHING AN ACCOUNT
To establish a master account with a Reserve Bank, an institution
must execute a Master Account Agreement (Appendix 1). By
opening or maintaining a master account, an institution agrees to
be bound by all the provisions, as amended from time to time, of
this Circular and of all other Reserve Bank operating circulars that
cover services that it obtains from any Reserve Bank. Each master
account is subject to Reserve Bank approval.
A foreign banking institution must execute the Foreign Banking
Institution Account Agreement and exhibits instead of the Master
Account Agreement. The Foreign Banking Institution Account
Agreement is available on request.

2.4

SUBACCOUNTS
An institution may establish one or more subaccounts to
accommodate its specific informational needs. To establish a
subaccount, the Subaccount Designation (Appendix 2) must be

4

completed. If a new routing number (also known as an ABA
number) is needed for a subaccount, refer to Section 2.7.
2.5

PASS-THROUGH RELATIONSHIPS
A pass-through relationship allows a nonmember respondent to
hold its required reserve balances with another (correspondent)
institution that maintains a master account with a Reserve Bank. A
balance in the correspondent’s master account is owed to the
correspondent and is subject to its sole order.
To establish a pass-through relationship, both the correspondent
and the respondent must complete the Pass-Through Agreement
(Appendix 3). Each pass-through agreement is subject to Reserve
Bank approval. A Reserve Bank may terminate any pass-through
relationship in which the correspondent is deficient in its record
keeping or other responsibilities. See Section 204.3(i) of Regulation
D for pass-through rules.
For a respondent’s options in settling for Reserve Bank services,
see Section 3.

2.6

AUTHORIZED SIGNATURES
If an institution intends to draw checks against its master account
(Fed funds checks), it must provide the Reserve Bank with a
signature card (Appendix 4), which bears the signature of each
individual who is authorized to sign such a check. A Reserve Bank
is under no obligation to honor a check if it is not signed by an
individual whose signature is on the signature card or if the account
does not contain sufficient actually and finally collected funds to
cover the debit and any other obligations the institution owes to any
Reserve Bank. A Reserve Bank may pay a check drawn on the
master account and signed by any individual whose signature is
listed on the signature card, even if the check directs payment to
the order of that person or to any other employee or agent of the
account holder, and even if the proceeds may be used for the
personal benefits of any such person. See also Section 3.

2.7

ACCOUNT NUMBERS
An institution’s nine-digit routing number (also known as an ABA
number) is used to identify its master account and to settle
transactions processed at any Reserve Bank. Routing numbers are
also used to identify respondents and subaccounts. A Reserve

5

Bank may, in its discretion, issue a customer identification number
if an institution cannot obtain a routing number.
2.8

TERMINATING AN ACCOUNT OR RELATIONSHIP
Any Master Account Agreement, Pass-Through Agreement,
Transaction and Service Fee Settlement Authorization, or other
agreement relating to an account and executed by an institution is
binding on its successors and assigns, and continues in effect until
amended or terminated as indicated below, unless otherwise
provided in the agreement. An institution may terminate its master
account by giving the Reserve Bank not less than five business
days prior notice. The notice must indicate the closing date and
provide instructions for the transfer of any remaining balance in the
account. A Reserve Bank may terminate a Master Account
Agreement, Pass-Through Agreement, or Transaction and Service
Fee Settlement Authorization at any time by notice to the account
holder and any other party, but will endeavor to give not less than
five business days prior notice. Termina tion of a pass-through
relationship usually is effective on the last day of a reserve
maintenance period.
A respondent may terminate a Pass-Through Agreement or a
Transaction and Service Fee Settlement Authorization by giving the
Reserve Bank not less tha n five business days prior notice, unless
a shorter period of notice is agreed to by the Reserve Bank.
A correspondent may terminate a Pass-Through Agreement or a
Transaction and Service Fee Settlement Authorization by giving not
less than one business day prior notice to the other parties, except
as otherwise specifically provided as to check and ACH services in
Reserve Bank operating circulars 3 and 4.
Termination of an agreement or authorization does not affect
liability arising from transactions received before or on the effective
date of the termination.

2.9

MAINTENANCE OF ACCOUNT AGREEMENT
An institution must maintain all account agreements continuously
as official records of the institution. A copy of the Master Account
Agreement, this Circular, any other account agreement,
amendments thereto, and a copy of the relevant portions of the
minutes of the meeting(s) at which the institution’s governing body
authorized execution of the account agreement(s), shall at all times
be kept together in one place.

6

3.0

SETTLEMENT
3.1

SETTLEMENT
An institution’s master account may be used to settle debits and
credits arising from transactions it conducts with or through any
Reserve Bank by executing a Master Account Agreement.
Alternatively, an institution and its correspondent may provide the
institution’s Administrative Reserve Bank with an executed
Appendix 5 instructing the ARB(s) of the institution and the
correspondent to settle some or all of the institution’s transactions
in the correspondent’s master account. However, Fed funds checks
and Fedwire® ?
funds and book-entry securities transfers must settle
in an institution’s own master account. Also, special transaction
settlement authorizations for loans and net settlement transactions
are found in operating circulars 10 and 12, respectively. A separate
Transaction and Service Fee Settlement Authorization is necessary
for each correspondent/respondent relationship.2 Transactions
recorded in a respondent’s subaccount may not settle directly in a
correspondent’s master account.
The Transaction and Service Fee Settlement Authorization
(Appendix 5) must be used to designate any separate settlement
arrangements for particular transaction types. A respondent that
maintains reserve balances with a correspondent in a pass-through
relationship, but desires to settle directly for some or all Reserve
Bank services may, with the approval of its ARB, open its own
master account for that purpose.
A respondent remains responsible for settling for its transactions
and associated fees if for any reason settlement throug h the master
account of the institution or its correspondent fails. A Reserve Bank
may also debit or credit a master account as provided by
regulation, operating circular, agreement or applicable law.

2

An institution (and correspondent) need not execute Appendix 5 if it has already executed a
settlement designation, unless it wishes to change that designation in some way. A designation
executed prior to January 2, 1998, remains in effect until superseded, but is subject to the terms
of this Circular.

7

4.0

STATEMENTS AND ACCOUNTING INFORMATION SERVICES
4.1

STATEMENT OF ACCOUNT
A Reserve Bank sends a daily Statement of Account to each
institution that maintains a master account on the Reserve Bank’s
books. The account holder is responsible for verifying the
information on each daily statement and promptly notifying the
Reserve Bank of any error in the statement. If an institution fails to
provide notice of an error within 30 calendar days of the date of the
entry, it is deemed to have approved the entry. A Reserve Bank will
investigate any notice of error and determine whether an error
actually occurred.

4.2

STATEMENT OF AND SETTLEMENT FOR SERVICE CHARGES
A monthly Statement of Service Charges is provided by the seventh
business day after the end of each month. Service fees are
computed on a calendar month basis, and are charged on the 15th
day of the following month (or the next business day), appearing on
the daily Statement of Account as FRB Service Charges. Charges
are debited from an institution’s master account unless it and its
correspondent designate the correspondent’s master account by
executing a Transaction and Service Fee Settlement Authorization
(Appendix 5).3 A Reserve Bank may accelerate the debiting of
service charges.
An institution should notify the Reserve Bank as soon as possible if
the institution believes there is an error on its Statement of Service
Charges. If the institution fails to do so within two calendar months
of the day it receives the statement, it is deemed to have approved
the service charge.

4.3

ACCOUNTING INFORMATION SERVICES
An institution may request certain accounting information services,
such as on-line and multiple deliveries of statements and reports,
and reports of respondent and subaccount activity. Operating
Circular 5, “Electronic Access”, applies to services accessed by
electronic connection. Charges set forth in Reserve Bank fee
schedules may apply to accounting information services.
Accounting information provided by a Reserve Bank may not be
timely as a result of Reserve Bank processing or transmission
delays.

3

See footnote 2.

8

5.0

OVERDRAFTS
5.1

OVERDRAFT POLICY
An overdraft occurs when a master account has a negative balance
at any time during the Reserve Bank’s business day (daylight
overdraft) or at the end of the Reserve Bank’s business day
(overnight overdraft). An account holder does not have a right to
incur an overnight overdraft in its account. An account holder may
incur daylight overdrafts in its account only to the extent permitted
by its Administrative Reserve Bank.

5.2

COLLECTION OF OVERDRAFTS
An overdraft is due and payable immediately, without the need for a
demand by the Reserve Bank, at the earliest of the following times:
• at the end of the funds transfer business day for purposes of
Fedwire® (see Operating Circular 6, “Funds Transfers Through
Fedwire”);
• at the time the Reserve Bank, in its sole discretion, deems itself
insecure and gives notice to the account holder; or
• at the time the account holder suspends payments or is closed.
The account holder is responsible for having in its account, at the
time the overdraft is due and payable, a balance of actually and
finally collected funds sufficient to cover the aggregate amount of
all its obligations to the Reserve Bank.

5.3

SECURITY INTEREST
To secure any overdraft in the master account, as well as any other
obligation, now existing or arising in the future, of the account
holder to any Reserve Bank, the account holder grants to the
Reserve Bank all the account holder’s right, title, and interest in
property, whether now owned or hereafter acquired, in the
possession or control of, or maintained with, any Reserve Bank,
including but not limited to the account holder’s deposit account
maintained with any Reserve Bank, items in the process of
collection and their proceeds, and any investment property
(including securities, security entitlements, and security accounts),
but excluding any investment property which the account holder
may not encumber under applicable law. This security interest is in
addition to, and shall be construed to be consistent with, any other

9

security interest granted to the Reserve Bank by the account holder
under regulation or agreement.
The Reserve Bank may take any action authorized by law to
recover the amount of an overdraft that is due and payable,
including, but not limited to, the exercise of setoff without demand
or notice and even if the obligations are contingent or unmatured,
the realization on any available collateral, and the exercise of any
rights the Reserve Bank may have as a creditor under applicable
law.
6.0

GENERAL
6.1

DUTY OF CARE
Unless otherwise specifically provided in another Reserve Bank
operating circular, a Reserve Bank shall be liable to an institution
only for actual damages incurred by the institution and proximately
caused by the Reserve Bank’s failure to exercise ordinary care. A
Reserve Bank is not liable for lost profits, claims by third parties, or
consequential or incidental damages, even if the Reserve Bank has
been informed of the possibility of such damages.

6.2

RELIANCE ON AUTHORIZATIONS
A Reserve Bank may rely on instructions and authorizations
purporting to be issued by an officer of an institution, whether by
written or electronic means, that the Reserve Bank reasonably
believes to be authorized by the institution, and may continue to
rely on such instructions and authorizations until they are revoked
by the institution.

6.3

NONPUBLIC PERSONAL INFORMATION
The Reserve Banks have implemented measures designed to
protect the security and confidentiality of nonpublic personal
information obtained by them, to protect against any anticipated
threats or hazards to the security or integrity of such information,
and to protect against unauthorized access to or use or reuse of
such information that could result in substantial harm or
inconvenience to an institution’s customer.

6.4

GOVERNING LAW AND ACTIONS
This Circular shall be governed by Federal law, and, to the extent
not inconsistent with Federal law, by the laws of the State in which

10

the Reserve Bank’s head office is located. Any action against a
Reserve Bank for any act or omission relating to an account
relationship or transaction must be brought within one calendar
year from the date of the transaction in the United States District
Court and Division where the head office of the Reserve Bank is
located, and shall not claim trial by jury.
6.5

RIGHT TO AMEND
The Reserve Banks reserve the right to amend this Circular at any
time without prior notice.

11

Operating Circular 1
Account Relationships
Appendices

Revised:
September 2002

To:

Appendix 1

Federal Reserve Bank of _________________
_______________________________________ Office

Attention:

_______________________________________ Department

Master Account Agreement

The Institution named below agrees to the provisions of Operating Circular 1, Account Relationships, of the Federal
Reserve Bank named above, and to the provisions of all operating circulars of each Federal Reserve Bank from which the
Institution obtains services, as the Circulars may be amended from time to time. The transactions and fees for services
obtained will be settled in the master account unless the Institution requests otherwise by submitting a Transaction and
Service Fee Settlement Authorization (Operating Circular 1) or a Letter of Agreement for Obtaining Advances Through a
Correspondent (Operating Circular 10).

For:
______________________________________
Official Signature

______________________________
Name of Institution

______________________________________
Printed Name and Title

_________________________________
Street Address

______________________________________
Date

_________________________________
City, State, Zip Code
__________________________________
Routing (ABA) Number

Questions regarding the account
should be directed to:
_______________________________________
Printed Name and Title
_______________________________________
Telephone Number

Alternate:

_________________________________
Printed Name and Title
_________________________________
Telephone Number

FRB use only:
Effective Date: __________________________ Date Received:___________________________ Processed by: _____________________________

Processing may take 5-7 business days.
Please contact the Federal Reserve Bank to confirm the date that the master account will be established.

To:

Appendix 2

Federal Reserve Bank of ____________________
__________________________________________ Office

Attention:

__________________________________________ Department

Subaccount Designations
We designate the following routing (ABA) number(s) to be a subaccount(s) of our master account. (Attach additional sheets as
needed.)
________________________________
Name of Institution (Master Account)

By:

__________________________
Official Signature

______________________
Date

________________________________
Street Address

______________________________
Printed Name and Title

________________________________
City, State, Zip Code

______________________________
Telephone Number

________________________________
Routing (ABA) Number

______________________________
Requested Effective Date

Subaccount
Routing
Number

1.

Subaccount Name
Used for
Funds
Transfers?

Subaccount Address
Please print the address
for each subaccount and
indicate if this represents
a change.

Please state the name of each
subaccount and indicate
whether you are adding,
changing, or deleting it.

Contacts for Questions about Subaccount
Activity
Please print the name, title, and telephone
number for each contact, and indicate if this
represents a change.

Yes/No
Add,

Delete?

Change?

Change?

Add,

Change,

Delete?

Change?

Change?

Add,

Change,

Delete?

Change?

Change?

Add,

Change,

Delete?

Change?

Change?

Add,

2.

Change,

Change,

Delete?

Change?

Change?

Yes/No

3.

Yes/No

4.

Yes/No

5.

Yes/No

FRB use only:
Effective Date: ____________________________ Date Received:

___________________________ Processed by: __________________________

Processing may take 5-7 business days. Please contact the Federal Reserve Bank to confirm the date that the above
subaccount(s) will be established, changed or deleted.

To:

Appendix 3

Federal Reserve Bank of __________________
_______________________________________Office

Attention:

_______________________________________ Department

Pass-Through Agreement
The Institutions named below agree to the provisions of Operating Circular 1, Account Relationships, of the Federal Reserve Bank
named above, and the provisions of all operating circulars of each Federal Reserve Bank from which the Institutions obtain services, as
the Circulars may be amended from time to time.

Respondent Agreement
We elect to maintain our required reserve balances on a pass-through basis with the correspondent named below.

Correspondent Agreement
We agree to serve as correspondent for the respondent named below. The required reserve balances for this respondent will be
commingled in our master account at the Reserve Bank.
Respondent

Correspondent

_____________________________________
Name of Institution

_____________________________________
Name of Institution

_____________________________________
Street Address

_____________________________________
Street Address

_____________________________________
City, State, Zip Code

_____________________________________
City, State, Zip Code

By: _____________________________________
Official Signature
(Date)

By:

_____________________________________
Official Signature
(Date)

_____________________________________
Printed Name and Title

_____________________________________
Printed Name and Title

____________________________________
Telephone Number

_____________________________________
Telephone Number

_____________________________________
Routing (ABA) Number

_____________________________________
Routing (ABA) Number

FRB use only:
Effective Date: ________________________ Date Received: ___________________________ Processed by: __________________________

Processing may take 5-7 business days. Please contact the Federal Reserve Bank to confirm the date that the above
pass-through arrangement will be in effect.

To:
Attention:

Appendix 4

Federal Reserve Bank of __________________
_______________________________________ Office
_______________________________________ Department

Certificate and Official Signature Card for Fed Funds Checks
I certify that the following is a true copy of a resolution adopted by the Board of Directors of _________________
Name of

____________________________, at a meeting of the Board duly held on ________________, at which a quorum was
Institution

Date

present and acting throughout, and that such resolution is in conformity with the provisions of the charter and by-laws of the
Institution, and that this resolution has not been modified and remains in effect.
Resolved, that any of the ________ officers listed below is authorized to sign checks (“Fed Funds Checks”) drawn on
Number of

the Institution’s master account at the Federal Reserve Bank of ___________________________.
Certified by:
For:
____________________________________

_________________________________

Signature of Certifying Officer*

Name of Institution

____________________________________

____________________________________

Name and Title

Routing (ABA) Number

____________________________________

____________________________________

Telephone Number

Street Address

____________________________________

____________________________________

Date

City, State, Zip Code

____________________________________
Signature of Second Certifying Officer*

____________________________________
Name and Title

____________________________________
Telephone Number

____________________________________
Date

* The certifying officer must be the cashier, comptroller, secretary, or other officer of similar or higher rank, must have the authority to
certify the statements in this document, and may not be a person listed below. If the Institution has a limited number of officers, then this
latter requirement will be waived if two officers of the Institution execute this Certificate.

Official Signatures
RULE OUT UNUSED SPACES
PLEASE TYPE NAMES IN THIS SPACE

PLEASE SIGN IN THIS SPACE

________________________________ WILL SIGN

__________________________________

________________________________

__________________________________

________________________________

________________________________

__________________________________

________________________________

________________________________

__________________________________

________________________________

TITLE ________________________________

FRB use only:
Effective Date: __________________________ Date Received: ___________________________ Processed by: _________________________

Processing may take 5-7 business days. Please contact the Federal Reserve Bank to confirm the date that Fed
Funds Checks may be drawn against the master account.

To:

Appendix 5

Federal Reserve Bank of ______________________
____________________________________________ Office
____________________________________________ Department

Attention:

TRANSACTION AND SERVICE FEE SETTLEMENT AUTHORIZATION
The Institutions named below agree to the provisions of Operating Circular 1, Account Relationships, of the Federal Reserve Bank named above and the provisions of all
operating circulars of each Federal Reserve Bank from which the Institutions obtain services, as the Circulars may be amended from time to time.
The Federal Reserve Bank is authorized to make debits and credits to the account of the correspondent named below to settle financial transactions and service charges for
the respondent named below for the selected service categories. (Select all that apply by checking the appropriate boxes in the table below.) The Federal Reserve Bank's
preferred method of settlement for the Billing service areas listed below is to match, where applicable, the service charge settlement with the financial transaction
settlement. A separate settlement authorization is required for each correspondent used.
•
Financial transactions related to Funds Transfers, Book-Entry Securities Transfers, and Fed Funds Checks may not be settled through a correspondent.
•
If you are an account holder, financial transactions and fees (service charges) for the services listed below will automatically settle in your own account unless you have
indicated on this form that you want them to settle in the correspondent's account.
•
Transaction settlement authorization for Loans requires submission of Exhibit 1 to Appendix C of Operating Circular 10 (“Letter of Agreement for Obtaining Advances
through a Correspondent”).
NOTE: The transaction category is the first two digits of the transaction code shown on your Statement of Account. Billing Service Areas are listed on your Statement of
Service Charges.
Financial Transaction Service Categories and
Associated Service Charges, if Any
All Financial Transaction Categories below

Transaction
Category
All below

Billing
Service Area

Other Service Charge Categories

ACH

57

5701

Accounting Information Services

8401

Account Charges (other than service charges )

84

Book-Entry Securities

2001

Capital Stock

66

Other Check Services:

All Billing Service Charges

Check Collection:

Billing
Service Area
All

Check Float

1508

Forward Checks (other than Fed Funds Checks)

15

1501

Check Transportation

1507

Return Checks

30

3001

Electronic Enhanced Checks

1503

Collection & Definitive Safekeeping

40

4001

Payor Bank Services

1505

Currency and Coin

63

6301

Redemption or Interest on Govt. or Agency Securities

Electronic Access

1201

20 or 27

Funds Transfer

1001

Savings Bonds

70

Net Settlement

1002

Treasury Investment Program & Paper Tax System

59

Purchase and Sales of Securities

2003

Other Treasury or Government Agency Service

08

Check this box if you want to discontinue all previous settlement arrangements and have the financial transactions and service charges listed on the table above to
settle in your own account. (Only the Respondent section below needs to be completed for this request.)
Unless the Federal Reserve Bank is specifically notified to the contrary, the correspondent named below authorizes the use of its earnings credits to offset the service
charges selected for the respondent named below. (Respondent earnings credits may not be used to offset service charges settling through a correspondent.)
Check this box if this Agreement does not authorize the use of the correspondent's earnings credits to offset the respondent's service charges.
Other Information: _______________________________________________________________________________________________________________
_______________________________________________________________________________________________________________________________
_______________________________________________________________________________________________________________________________

It is requested that the above settlement authorizations begin on _________________________ for financial transactions and on ________________________ (billing month
and year)* for service charges. On the date that such settlements begin, this authorization will supersede any previously executed authorization by the named respondent for each
service category selected above.
Respondent:
__________________________________________

Correspondent:
__________________________________________

Name of Institution

Name of Institution

__________________________________________

__________________________________________

Street Address

Street Address

__________________________________________

__________________________________________

City, State, Zip Code

City, State, Zip Code

_________________________________________

__________________________________________

Official Signature

Official Signature

(Date)

(Date)

_________________________________________

__________________________________________

Printed Name and Title

Printed Name and Title

_________________________________________

__________________________________________

Telephone Number

Telephone Number

__________________________________________

__________________________________________

Routing (ABA) Number

Routing (ABA) Number

FRB use only: Effective Date ___________________________

Date Received:___________________________

Processed by: _________________________________

*This notice must be received by the Reserve Bank by the last business day of the requested month for settlement of service charges. Processing may take 5-7
business days. Please contact the Federal Reserve Bank to confirm the date that this settlement authorization will go into effect.