For immediate release

The Federal Reserve Board today requested comment on whether the last fifteen minutes of the Fedwire funds transfer operating day (from 6:15 p.m. to 6:30 p.m. Eastern Time) should be restricted to funds transfers sent and received by depository institutions for their own account. This would facilitate the end-of-day management of their balances held at the Federal Reserve. Comment is requested by August 12, 1998. The Fedwire funds transfer system operates from 12:30 a.m. to 6:30 p.m. Eastern Time, with the last half hour of the operating day reserved for settlement transfers. Settlement transfers are typically used by depository institutions to adjust their Federal Reserve account positions, as well as their account positions at correspondent banks. Since the early 1990's significant changes have affected depository institutions' management of reserve accounts, including reductions in reserve requirements and a decrease in reservable deposits due to the increased use of sweep accounts. Some depository institutions believe that these changes have made reserve management more difficult and that these difficulties are exacerbated by unexpected late-day funds transfers. The Board's notice is attached.

Summary only | Summary and request for comment (17 KB PDF)

1998 Banking and consumer regulatory policy