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F ed er a l R e se r v e Ba n k
DALLAS, TEXAS

of

Dallas

7S222

Circular No. T^-2i+2
September 6, 197^

TO THE CHIEF EXECUTIVE OFFICER
OF THE MEMBER BANK ADDRESSED:
On September
197^» the Board amended its Regulation D with
reference to the marginal reserve requirement on large denomination time
deposits and related domestic instruments. A copy of this amendment will
be forwarded to you shortly.
In summary, effective for the reserve computation week beginning
September 5, (with reserves maintained during the week beginning September 19)»
this amendment will provide for the removal of the 3 per cent marginal re­
serve requirement on large denomination time deposits and related domestic
instruments with an initial maturity of four months (120 days) or longer.
The full reserve requirement (the regular 5 per cent plus the
marginal 3 per cent) will now only apply to the amount by which the sum of
funds obtained by your bank through the issuance of obligations by affili­
ates with maturities of 30 days to less than 120 days, funds obtained by
your bank through the use of ineligible acceptances with maturities of 30
days to less than 120 days, and time deposits in denominations of $100,000
or more with maturities of less than 120 days exceed the base established
for your bank for the computation period May 10-l£>, 1973. The original base
does not change. The less than 120 day maturity of these obligations includes
those which on September 5» 197^+ had a remaining term to maturity of less
than 120 days, or those which were issued on or after September 5, 197^ with
an initial term to maturity of less than 120 days. Obligations with no
specified maturity date or term to maturity that can be redeemed with less
than 120 days prior notice are to be regarded as obligations with less than
120 days maturity.
All large time deposits and related domestic instruments outstand­
ing on September 5 with a remaining maturity of 120 days or longer and all
large time deposits and related domestic instruments issued on September 5
or thereafter with initial maturities of 120 days or longer will no longer
be subject to the marginal 3 per cent reserve requirement but will continue
to be subject to the regular 5 per cent reserve requirement.
In order for us to obtain the data for your bank, it will be nec­
essary for the form FR klka. entitled "Member Bank Special Reservable Lia­
bilities Report" to be revised to include a new column entitled "Amount in
Column 5 With Maturity Less Than Four Months (120 days)." Since this form
will not be available for your use for the reserve computation period Sep­
tember 5-11, it will be necessary for your bank to attach a letter or note

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

Circular No. Jk-2b2

- 2 -

September 6, 197^

to the current form FR 1+lUa for this computation period which provides seven
days of data for the amount of the present column 5 which has a maturity of
less than 120 days. This data must be reported weekly in addition to all
other data on form FR 1+lUa.
The new supply of form FR lnUa will be transmitted to you shortly
and, upon its receipt, all copies of the August 1973 version should be de­
stroyed.
If you have any questions, please call the accounting officer of
this Bank or appropriate branch.
Yours very truly,
P. E. Coldwell
President

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