Full text of Federal Reserve Notes : February 1985

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Federal Re/erve Plote/
Federal Referee Bank of /an Franci/co • February 1985
/erving fllilM&Wffiiono, California, Hawaii, Idaho, Nevada, Oregon, Utah, &UJa/hington
NEW SERVICES

FedLine "Update"

UpDate is a new FedLine application designed to give depository institutions timely cash management
information. Cash Letter information was made available in January 1985 and Account Statement
information will be available in the middle of the year. Both enhancements feature summary and
detailed information.

Cash Letter- Summary information for this enhancement includes the amount of both debits and
credits for the day and one-, two- or three-day availability schedules. The information reflects on
going check processing activity.

Account Statement —The summary format for Account Statements will include the prior day's
closing account balance and total debit or credit figures grouped by transaction code. The detailed
format lists each transaction by account type (ABA number).

Summary information also will be available to institutions not participating in FedLine UpDate at the
offline price of $5.00 per call. Pricing for the online service is listed below:
Pricing for FedLine UpDate
Checks Summary

$45.00/ month

Statement Summary

$45.00/ month

Checks and Statement Summary

$60.00/ month

Detail Information

$ 0.50/ request

For further information, please call the Financial Services Officer in your area: Martha Perry, San
Francisco (415) 974-2127; Mary Ellen Martin, Los Angeles (213) 683-8318; Susan Robertson,
Portland (503) 221-5909; Andrea Wolcott, Salt Lake City (801) 322-7927; William Ferensen, Seattle
(206) 442-2754.

REGULATIONS AND OPERATIONS UPDATE

New ACH Deposit
and Delivery
Schedules

All Federal Reserve Banks implemented a new ACH deposit schedule on December 17, 1984. The
schedule applies to all originators of ACH files and is part of the Federal Reserve's efforts to enhance
ACH services and to respond to depository institutions' expressed need for uniform nationwide
deadlines.

Federal Reserve ACH \ Deposit Schedule —

Closing Times

Day Cycle

Night Cycle

0730 (PST)
0830 (Mtn)

2000 (PST)
2100 (Mtn)

0830 (PST)
0930 (Mtn)

2100 (PST)
2200 (Mtn)

Direct

1000 (PST)
1100 (Mtn)

2230 (PST)
2330 (Mtn)

Intraregional

1000 (PST)
1100 (Mtn)

2230 (PST)
2330 (Mtn)

Interregional
Mixed
Presort
•
•

Consolidated

To implement the improved deposit deadlines, some minor changes have been made in delivery
schedules. For further information, please contact the Financial Services Officer at the Federal
Reserve Branch serving your territory.

REGULATIONS AND OPERATIONS UPDATE (continued)
Automated

Processing ACH
Paper Return Items

All ACH paper return items and paper notifications of change deposited with the Federal Reserve
will be converted to automated form at the local Reserve office beginning February 7, 1985. Some
information regarding the operation is listed below. For further details, please contact the Financial
Services Officer serving your territory.

Deposit of Paper Items. Paper return letters and paper notifications of change should be prepared in
the same manner as before automated processing. However, institutions need no longer sort return
letters by type of originating depository institution to obtain the best availability. For ease in recon
ciling Fed notices of return item settlement, institutions should try to deposit only one debit return
letter and one credit return letter per day (not to exceed 50 items per return letter).
Settlement and Advising. With the automation of ACH returns, all items received prior to 0300
Pacific Time will be settled on the same day. All items received after the deadline will be settled the
next day.

The total of all return letters received prior to the day-cycle deadline and night-cycle deadline will be
listed on the Statement of ACH Activity by file ID. The Statement will also list, in the "Batch Rejection
Adjustment" section, return items deposited at the Federal Reserve Bank that were rejected because
of invalid or incomplete information.

For depository institutions that send multiple debit or credit return letters each day, advices detailing
all ACH return deposit activity also will be provided.

Billing. A fee of $2.50 will be charged to the returning depository institution for each paper commer
cial ACH return item and paper notification of change deposited with the Reserve Bank.
Return Inquiries. A depository institution contacting a Reserve Office about a deposit or paper ACH
return and/or notification of change should provide the Reserve Bank with the following informa
tion: date of deposit, file date, file ID modifier from the Statement of ACH Activity, and dollar
amounts of the return letter and the return item.

FOR PUBLIC COMMENT

Regulation Y
BHC and Change

The Federal Reserve Board is requesting comment by February 14, 1985 on a proposal to lift some
restrictions on the operation of nonbank bank affiliates of bank holding companies.

in Bank Control

The Board has received requests to permit the following types of activities, among others: loan and
deposit account data processing, check clearing, account maintenance and review services,
management information services, certain trust services, and audit, compliance and general legal
support services.

Copies of the Board's notice are available from Corporate Services at (415) 974-2752. For further in
formation, please contact Robert Johnston in Supervision, Regulation and Credit at (415) 974-2352.

CONSUMER GUIDE TO ARMs

A task force made up of housing, finance, regulatory and congressional officials has written a 25-page Consumer
Handbook on Adjustable Rate Mortgages. The booklet explains how adjustable rate mortgages (ARMs) work and
defines terms a consumer might encounter in ARM advertisements or in applying for an ARM. The booklet also
includes a checklist to help homebuyers compare the features of one ARM with another or with a fixed rate mortgage.

The House Banking Committee called for lenders to provide the booklet free to all consumers considering an ARM.
Copies are available by writing the Federal Reserve Bank of San Francisco, Public Information Department, P.O. Box
7702, San Francisco, CA 94120, or calling (415) 974-2163.