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Fe d e r a l R e s e r v e

bank

of

Da l l a s

DALLAS, TEXAS

December 4, 1961

SUPPLEMENT TO REGULATION Q

To All Member Banks in the
Eleventh Federal Reserve District:
The Board of Governors o f the Federal Reserve System has
authorized an increase in the maximum permissible rates of interest
payable by member banks on savings deposits and on time deposits and
certificates, effective January 1, 1962.
After that date, member banks will be permitted to pay up to 3Y >
per cent on all savings deposits and on time deposits and certificates of
at least six months’ term, and up to 4 per cent on like deposits left in the
banks for one year or more. The present maximum rate is 3 per cent.
The Board action did not change the maximum permissible rates
for time deposits and certificates of less than six months duration. For
these, the maximum will continue to be 21/2 per cent for time deposits
and certificates of 90 days to six months, and 1 per cent for time
deposits and certificates of less than 90 days.
The changes were effected by a revision of the supplement to the
Board’s Regulation Q. A copy of the revised supplement is attached.
The action was taken a month in advance of the effective date because
many banks, by tradition, use January 1 as the date from which interest
on savings deposits is computed.
Member banks are requested to insert the new supplement in their
ring binders containing the Regulations of the Board of Governors and
the Bulletins of this bank. On January 1, 1962, the present supplement
to Regulation Q, effective January 1, 1957, should be destroyed.
Yours very truly,
Watrous H. Irons
President

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

SUPPLEMENT TO REGULATION Q
S E C T IO N 217.6

Maximum Rates of Interest Payable on Time and Savings
Deposits by Member Banks

I ssued by the Board of Governors of the F ederae R eserve System
E ffective January

1

,

1962

Pursuant to the provisions of section 19 of the Federal
Act and § 217.3, the Board of Governors of the Federal
System hereby prescribes the following maximum rates1 of
payable by member banks of the Federal Reserve System
and savings deposits:

Reserve
Reserve
interest
on time

(a) Maximum rate of 4 per cent.— No member bank shall pay
interest accruing at a rate in excess of 4 per cent per annum, com­
pounded quarterly,1regardless of the basis upon which such interest
2
may be computed:
(1) On that portion of any savings deposit that has remained
on deposit for not less than 12 months,
(2) On any time deposit having a maturity date 12 months
or more after the date of deposit or payable upon written notice
of 12 months or more,
(3) On that portion of any Postal Savings deposit which
constitutes a time deposit that has remained on deposit for not
less than 12 months.
(b) Maximum rate of 3^4 per cent.'— No member bank shall pay
interest accruing at a rate in excess of 2>y2 per cent per annum, com­
pounded quarterly,2regardless of the basis upon which such interest
may be computed:
(1) On any savings deposit, except as otherwise provided in
(a )(1 ) above,
(2) On any time deposit having a maturity date less than
12 months and not less than 6 months after the date of deposit
or payable upon written notice of less than 12 months and not
less than 6 months,
(3) On any Postal Savings deposit which constitutes a time
deposit, except as otherwise provided in (a)(3) above.
1 The maximum rates of interest payable by member banks of the Federal Reserve System on
time and savings deposits as prescribed herein arc not applicable to any deposit which is
payable only at an office of a member bank located outside o f the States of the United States
and the District o f Columbia.
2 This limitation is not to be interpreted as preventing the compounding of interest at other
than quarterly intervals, provided that the aggregate amount o f such interest so compounded
does not exceed the aggregate amount of interest at the rate above prescribed when compounded
quarterly.