BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D.C.  20551

DIVISION OF CONSUMER
AND COMMUNITY AFFAIRS

CA 10-9

July 21, 2010

TO THE OFFICERS AND MANAGERS IN CHARGE OF CONSUMER AFFAIRS SECTIONS

SUBJECT: Updated Examination Procedures for Regulation DD

The Task Force on Consumer Compliance of the Federal Financial Institutions Examination Council recently approved the attached updated examination procedures for Regulation DD (Truth in Savings). The updated procedures incorporate technical clarifications to Regulation DD (75 Federal Register 31673), which were effective July 6, 2010 (except as noted below). The clarifications include:

• Requiring the use of the term "Total Overdraft Fees" when disclosing such fees on periodic statements (the effective date for this requirement is October 1, 2010).
• Clarifying that when disclosing balance information through automated systems for retail sweep accounts, the regulation does not require an institution to exclude funds from the consumer's balance that may be transferred from another account pursuant to a retail sweep account program. The commentary recognizes that retail sweep accounts have two legally distinct subaccounts, with the institution's allocating and transferring funds between the two subaccounts in order to maximize the balance in the savings account.

In addition to the regulatory changes, the examination procedures clarify that when listing overdraft fees and returned item fees in the required table on periodic statements, the table should have internal lines to distinguish rows and columns (see the illustration in the section on the disclosures requirements for overdraft services).

If you have any questions, please contact Kathleen Conley, Senior Supervisory Consumer Financial Services Analyst, at (202) 452-2389 or Paul Robin, Manager, Oversight and Policy, at (202) 452-3140.

Sincerely,
(signed)

Sandra F. Braunstein
Director
Division of Consumer and Community Affairs

Attachment: Reg DD exam procedures (7-7-10) (297 kb PDF)

Supercedes: CA 09-14 (December 16, 2009)