Federal Register / Vol. 74, No. 198 / Thursday, October 15, 2009 / Rules and Regulations 52873 

annual basis by December 31 of any year 

covered by the agreement, any 

production shortfall will be carried 

forward and added to the successful 

bidder’s production obligations for next 

year covered by the agreement. 

(d) Shortfalls remaining at the end of 

the production period. If, for any reason, 

by December 31 of the last year of the 

production agreement, the bidder has 

failed to produce the total production 

volumes for all years covered by the 

agreement, any such remaining shortfall 

shall be awarded to the bidder with the 

next lowest bid in the auction round for 

which the award was made. If, however, 

the next best bidder is unable to enter 

into a production agreement with DOE 

within 30 days after being notified of its 

award, the shortfall shall be allocated 

instead to the next reverse auction. 

(e) Incentive award limitations. The 

following limits shall apply to awards of 

cellulosic biofuels production 

incentives under this part: 

(1) During the first four years after the 

commencement of the program, the 

incentive shall be limited to $1.00 per 

gallon. For purposes of this limitation, 

the program shall be deemed to have 

commenced on the date that the first 

solicitation for a reverse auction is 

issued; 

(2) A per gallon cap over the 

remaining lifetime of the program of 

$.95 per gallon provided that— 

(i) This cap shall be lowered by $.05 

each year commencing the first year 

after annual cellulosic biofuels 

production in the United States exceeds 

1 billion gallons; 

(ii) Not more than 25 percent of the 

funds committed within each reverse 

auction shall be awarded to any single 

project; 

(iii) Not more than $100 million in 

production incentives shall be awarded 

in any one calendar year; and 

(iv) Not more than $1 billion in 

production incentives shall be awarded 

over the lifetime of the program. 

(f) Participation in subsequent 

auctions. A successful bidder in a 

reverse auction under this part may 

participate in subsequent reverse 

auctions if the incentives sought will 

assist the addition of plant production 

capacity for the eligible cellulosic 

biofuels production facility associated 

with its previously successful bid. 

(g) Transferability of awards. A 

production incentive award under this 

part may be transferred to a successor 

entity at the same production facility for 

which the award was made, provided 

that the successor entity meets all 

eligibility requirements of this part, 

including execution of an agreement 

with DOE to commence production of 

cellulosic biofuels in commercially 

significant quantities not later than 

three years of the date that bidding 

closes on the reverse auction in which 

the predecessor entity submitted a 

successful bid. 

[FR Doc. E9–24778 Filed 10–14–09; 8:45 am] 

BILLING CODE 6450–01–P 

FEDERAL RESERVE SYSTEM 

12 CFR Part 204 

[Regulation D; Docket No. R–1373] 

Reserve Requirements of Depository 

Institutions 

AGENCY: Board of Governors of the 

Federal Reserve System. 

ACTION: Final rule. 

SUMMARY: The Board is amending 

Regulation D, Reserve Requirements of 

Depository Institutions, to reflect the 

annual indexing of the reserve 

requirement exemption amount and the 

low reserve tranche for 2010. The 

Regulation D amendments set the 

amount of total reservable liabilities of 

each depository institution that is 

subject to a zero percent reserve 

requirement in 2010 at $10.7 million, up 

from $10.3 million in 2009. This 

amount is known as the reserve 

requirement exemption amount. The 

Regulation D amendments also set the 

amount of net transaction accounts at 

each depository institution that is 

subject to a three percent reserve 

requirement in 2010 at $55.2 million, up 

from $44.4 million in 2009. This 

amount is known as the low reserve 

tranche. The adjustments to both of 

these amounts are derived using 

statutory formulas specified in the 

Federal Reserve Act. The Board is also 

announcing changes in two other 

amounts, the nonexempt deposit cutoff 

level and the reduced reporting limit, 

that are used to determine the frequency 

at which depository institutions must 

submit deposit reports. 

DATES: Effective Date: November 16, 

2009. 

Compliance Dates: For depository 

institutions that report deposit data 

weekly, the new low reserve tranche 

and reserve requirement exemption 

amount will apply to the fourteen-day 

reserve computation period that begins 

Tuesday, December 1, 2009, and the 

corresponding fourteen-day reserve 

maintenance period that begins 

Thursday, December 31, 2009. For 

depository institutions that report 

deposit data quarterly, the new low 

reserve tranche and reserve requirement 

exemption amount will apply to the 

seven-day reserve computation period 

that begins Tuesday, December 15, 

2009, and the corresponding seven-day 

reserve maintenance period that begins 

Thursday, January 14, 2010. For all 

depository institutions, these new 

values of the nonexempt deposit cutoff 

level, the reserve requirement 

exemption amount, and the reduced 

reporting limit will be used to 

determine the frequency at which a 

depository institution submits deposit 

reports effective in either June or 

September 2010. 

FOR FURTHER INFORMATION CONTACT: 

Sophia Allison, Senior Counsel (202/ 

452–3565), Legal Division, or MaryFrances Styczynski, Financial Analyst 

(202/452–3303), Division of Monetary 

Affairs; for users of 

Telecommunications Device for the Deaf 

(TDD) only, contact (202/263–4869); 

Board of Governors of the Federal 

Reserve System, 20th and C Streets, 

NW., Washington, DC 20551. 

SUPPLEMENTARY INFORMATION: Section 

19(b)(2) of the Federal Reserve Act (12 

U.S.C. 461(b)(2)) requires each 

depository institution to maintain 

reserves against its transaction accounts 

and nonpersonal time deposits, as 

prescribed by Board regulations, for the 

purpose of implementing monetary 

policy. Section 11(a)(2) of the Federal 

Reserve Act (12 U.S.C. 248(a)(2)) 

authorizes the Board to require reports 

of liabilities and assets from depository 

institutions to enable the Board to 

conduct monetary policy. The Board’s 

actions with respect to each of these 

provisions are discussed in turn below. 

1. Reserve Requirements 

Pursuant to section 19(b) of the 

Federal Reserve Act (Act), transaction 

account balances maintained at each 

depository institution are subject to 

reserve requirement ratios of zero, three, 

or ten percent. Section 19(b)(11)(A) of 

the Act (12 U.S.C. 461(b)(11)(A)) 

provides that a zero percent reserve 

requirement shall apply at each 

depository institution to total reservable 

liabilities that do not exceed a certain 

amount, known as the reserve 

requirement exemption amount. Section 

19(b)(11)(B) provides that, before 

December 31 of each year, the Board 

shall issue a regulation adjusting the 

reserve requirement exemption amount 

for the next calendar year if total 

reservable liabilities held at all 

depository institutions increase from 

one year to the next. No adjustment is 

made to the reserve requirement 

exemption amount if total reservable 


jlentini on DSKJ8SOYB1PROD with RULES
52874 Federal Register / Vol. 74, No. 198 / Thursday, October 15, 2009 / Rules and Regulations 

1Consistent with Board practice, the low reserve 

tranche and reserve requirement exemption 

amounts have been rounded to the nearest $0.1 

million. 

2Consistent with Board practice, the nonexempt 

deposit cutoff level has been rounded to the nearest 

$0.1 million, and the reduced reporting limit has 

been rounded to the nearest $1 million. 

liabilities held at all depository 

institutions should decrease during the 

applicable time period. The Act requires 

the percentage increase in the reserve 

requirement exemption amount to be 80 

percent of the increase in total 

reservable liabilities of all depository 

institutions over the one-year period 

that ends on the June 30 prior to the 

adjustment. 

Total reservable liabilities of all 

depository institutions increased 5.0 

percent (from $4,770 billion to $5,011 

billion) between June 30, 2008, and June 

30, 2009. Accordingly, the Board is 

amending Regulation D to increase the 

reserve requirement exemption amount 

by $0.4 million, from $10.3 million for 

2009 to $10.7 million for 2010.1

Pursuant to Section 19(b)(2) of the Act 

(12 U.S.C. 461(b)(2)), transaction 

account balances maintained at each 

depository institution over the reserve 

requirement exemption amount and up 

to a certain amount, known as the low 

reserve tranche, are subject to a three 

percent reserve requirement. 

Transaction account balances over the 

low reserve tranche are subject to a ten 

percent reserve requirement. Section 

19(b)(2) also provides that, before 

December 31 of each year, the Board 

shall issue a regulation adjusting the 

low reserve tranche for the next 

calendar year. The Act requires the 

adjustment in the low reserve tranche to 

be 80 percent of the percentage increase 

or decrease in total transaction accounts 

of all depository institutions over the 

one-year period that ends on the June 30 

prior to the adjustment. 

Net transaction accounts of all 

depository institutions increased 31.0 

percent (from $665 billion to $868 

billion) between June 30, 2008 and June 

30, 2009. Accordingly, the Board is 

amending Regulation D to increase the 

low reserve tranche for net transaction 

accounts by $10.8 million, from $44.4 

million for 2009 to $55.2 million for 

2010. 

For depository institutions that file 

deposit reports weekly, the new low 

reserve tranche and reserve requirement 

exemption amount will be effective for 

the fourteen-day reserve computation 

period beginning Tuesday, December 1, 

2009, and for the corresponding 

fourteen-day reserve maintenance 

period beginning Thursday, December 

31, 2009. For depository institutions 

that report quarterly, the new low 

reserve tranche and reserve requirement 

exemption amount will be effective for 

the seven-day reserve computation 

period beginning Tuesday, December 

15, 2009, and for the corresponding 

seven-day reserve maintenance period 

beginning Thursday, January 14, 2010. 

2. Deposit Reports 

Section 11(b)(2) of the Federal 

Reserve Act authorizes the Board to 

require depository institutions to file 

reports of their liabilities and assets as 

the Board may determine to be 

necessary or desirable to enable it to 

discharge its responsibility to monitor 

and control the monetary and credit 

aggregates. The Board screens 

depository institutions each year and 

assigns them to one of four deposit 

reporting panels (weekly reporters, 

quarterly reporters, annual reporters, or 

nonreporters). The panel assignment for 

annual reporters is effective in June of 

the screening year; the panel assignment 

for weekly and quarterly reporters is 

effective in September of the screening 

year. 

In order to ease reporting burden, the 

Board permits smaller depository 

institutions to submit deposit reports 

less frequently than larger depository 

institutions. The Board permits 

depository institutions with net 

transaction accounts above the reserve 

requirement exemption amount but total 

transaction accounts, savings deposits, 

and small time deposits below a 

specified level (the ‘‘nonexempt deposit 

cutoff’’) to report deposit data quarterly. 

Depository institutions with net 

transaction accounts above the reserve 

requirement exemption amount but 

with total transaction accounts, savings 

deposits, and small time deposits above 

the nonexempt deposit cutoff are 

required to report deposit data weekly. 

The Board requires certain large 

depository institutions to report weekly 

regardless of the level of their net 

transaction accounts if the depository 

institution’s total transaction accounts, 

savings deposits, and small time 

deposits exceeds a specified level (the 

‘‘reduced reporting limit’’). The 

nonexempt deposit cutoff level and the 

reduced reporting limit are adjusted 

annually, by an amount equal to 80 

percent of the increase, if any, in total 

transaction accounts, savings deposits, 

and small time deposits of all 

depository institutions over the one-year 

period that ends on the June 30 prior to 

the adjustment. 

From June 30, 2008 to June 30, 2009, 

total transaction accounts, savings 

deposits, and small time deposits at all 

depository institutions increased 10 

percent (from $6,461 billion to $7,126 

billion). Accordingly, the Board is 

increasing the nonexempt deposit cutoff 

level to $243.1 million for 2010. The 

Board is also increasing the reduced 

reporting limit to $1.362 billion for 

2010.2

Beginning in 2010, the boundaries of 

the four deposit reporting panels will be 

defined as follows. Those depository 

institutions with net transaction 

accounts over $10.7 million (the reserve 

requirement exemption amount) or with 

total transaction accounts, savings 

deposits, and small time deposits 

greater than or equal to $1.362 billion 

(the reduced reporting limit) are subject 

to detailed reporting, and must file a 

Report of Transaction Accounts, Other 

Deposits and Vault Cash (FR 2900 

report) either weekly or quarterly. Of 

this group, those with total transaction 

accounts, savings deposits, and small 

time deposits greater than or equal to 

$243.1 million (the nonexempt deposit 

cutoff level) are required to file the FR 

2900 report each week, while those with 

total transaction accounts, savings 

deposits, and small time deposits less 

than $243.1 million are required to file 

the FR 2900 report each quarter. Those 

depository institutions with net 

transaction accounts less than or equal 

to $10.7 million (the reserve 

requirement exemption amount) and 

with total transaction accounts, savings 

deposits, and small time deposits less 

than $1.362 billion (the reduced 

reporting limit) are eligible for reduced 

reporting, and must either file a deposit 

report annually or not at all. Of this 

group, those with total deposits greater 

than $10.7 million (but with total 

transaction accounts, savings deposits, 

and small time deposits less than $1.362 

billion) are required to file the Annual 

Report of Deposits and Reservable 

Liabilities (FR 2910a) report annually, 

while those with total deposits less than 

or equal to $10.7 million are not 

required to file a deposit report. A 

depository institution that adjusts 

reported values on its FR 2910a report 

in order to qualify for reduced reporting 

will be shifted to an FR 2900 reporting 

panel. 

Notice and Regulatory Flexibility Act. 

The provisions of 5 U.S.C. 553(b) 

relating to notice of proposed 

rulemaking have not been followed in 

connection with the adoption of these 

amendments. The amendments involve 

expected, ministerial adjustments 

prescribed by statute and by the Board’s 

policy concerning reporting practices. 

The adjustments in the reserve 

requirement exemption amount, the low 


jlentini on DSKJ8SOYB1PROD with RULES
Federal Register / Vol. 74, No. 198 / Thursday, October 15, 2009 / Rules and Regulations 52875 

1For purposes of Regulation CC, the term ‘‘bank’’ 

refers to any depository institution, including 

commercial banks, savings institutions, and credit 

unions. 

reserve tranche, the nonexempt deposit 

cutoff level, and the reduced reporting 

limit serve to reduce regulatory burdens 

on depository institutions. Accordingly, 

the Board finds good cause for 

determining, and so determines, that 

notice in accordance with 5 U.S.C. 

553(b) is unnecessary. Consequently, 

the provisions of the Regulatory 

Flexibility Act, 5 U.S.C. 601, do not 

apply to these amendments. 

List of Subjects in 12 CFR Part 204 

Banks, banking, Reporting and 

recordkeeping requirements. 

■ For the reasons set forth in the 

preamble, the Board is amending 12 

CFR part 204 as follows: 

PART 204—RESERVE 

REQUIREMENTS OF DEPOSITORY 

INSTITUTIONS (REGULATION D) 

■ 1. The authority citation for part 204 

continues to read as follows: 

Authority: 12 U.S.C. 248(a), 248(c), 371a, 

461, 601, 611, and 3105. 

■ 2. Section 204.4(f) is revised to read as 

follows: 

§ 204.4 Computation of required reserves. 

* * * * * 

(f) For all depository institutions, 

Edge and Agreement corporations, and 

United States branches and agencies of 

foreign banks, required reserves are 

computed by applying the reserve 

requirement ratios below to net 

transaction accounts, nonpersonal time 

deposits, and Eurocurrency liabilities of 

the institution during the computation 

period. 

Reservable liability Reserve requirement ratio 

NET TRANSACTION ACCOUNTS: 

$0 to reserve requirement exemption amount ($10.7 million) ....................................................................... 0 percent of amount. 

Over reserve requirement exemption amount ($10.7 million) and up to low reserve tranche ($55.2 million).3 percent of amount. 

Over low reserve tranche ($55.2 million) ....................................................................................................... $1,335,000 plus 10 percent of 

amount over $55.2 million. 

Nonpersonal time deposits ............................................................................................................................. 0 percent. 

Eurocurrency liabilities .................................................................................................................................... 0 percent. 

By order of the Board of Governors of the 

Federal Reserve System, October 9, 2009. 

Jennifer J. Johnson, 

Secretary of the Board. 

[FR Doc. E9–24767 Filed 10–14–09; 8:45 am] 

BILLING CODE 6210–01–P 

FEDERAL RESERVE SYSTEM 

12 CFR Part 229 

[Regulation CC; Docket No. R–1372] 

Availability of Funds and Collection of 

Checks 

AGENCY: Board of Governors of the 

Federal Reserve System. 

ACTION: Final rule; technical 

amendment. 

SUMMARY: The Board of Governors 

(Board) is amending the routing number 

guide to next-day availability checks 

and local checks in Regulation CC to 

delete the reference to the head office of 

the Federal Reserve Bank of Dallas and 

to reassign the Federal Reserve routing 

symbols currently listed under that 

office to the head office of the Federal 

Reserve Bank of Cleveland. The Board is 

also amending the routing number guide 

to delete the reference to the Los 

Angeles branch office of the Federal 

Reserve Bank of San Francisco and to 

reassign the routing symbols currently 

listed under that office to the head office 

of the Federal Reserve Bank of 

Cleveland. These amendments reflect 

the restructuring of check-processing 

operations within the Federal Reserve 

System. The Board is also providing 

advance notice about anticipated future 

amendments in connection with the 

Reserve Banks’ restructuring such that 

by early next year there will only be a 

single check-processing region for 

purposes of Regulation CC. Accordingly, 

at that time there will no longer be any 

checks that would be considered 

nonlocal. 

DATES: The amendments to appendix A 

to part 229 in amendatory instruction 2 

are effective October 17, 2009. 

The amendments to appendix A to 

part 229 in amendatory instruction 3 are 

effective November 14, 2009. 

FOR FURTHER INFORMATION CONTACT: 

Jeffrey S. H. Yeganeh, Financial Services 

Manager (202/728–5801), or Joseph P. 

Baressi, Financial Services Project 

Leader (202/452–3959), Division of 

Reserve Bank Operations and Payment 

Systems; or Dena L. Milligan, Attorney 

(202/452–3900), Legal Division. For 

users of Telecommunications Devices 

for the Deaf (TDD) only, contact 202/ 

263–4869. 

SUPPLEMENTARY INFORMATION: 

Background 

Regulation CC establishes the 

maximum period a depositary bank may 

wait between receiving a deposit and 

making the deposited funds available 

for withdrawal.1 A depositary bank 

generally must provide faster 

availability for funds deposited by a 

‘‘local check’’ than by a ‘‘nonlocal 

check.’’ A check is considered local if it 

is payable by or at or through a bank 

located in the same Federal Reserve 

check-processing region as the 

depositary bank. 

Appendix A to Regulation CC 

contains a routing number guide that 

assists banks in identifying local and 

nonlocal banks and thereby determining 

the maximum permissible hold periods 

for most deposited checks. The 

appendix includes a list of each Federal 

Reserve check-processing office and the 

first four digits of the routing number, 

known as the Federal Reserve routing 

symbol, of each bank that is served by 

that office for check-processing 

purposes. Banks whose Federal Reserve 

routing symbols are grouped under the 

same office are in the same checkprocessing region and thus are local to 

one another. 

Final Amendments to Appendix A 

On October 17, 2009, the Reserve 

Banks will transfer the check-processing 

operations of the head office of the 

Federal Reserve Bank of Dallas to the 

head office of the Federal Reserve Bank 

of Cleveland. On November 14, 2009, 

the Reserve Banks will transfer the 

check-processing operations of the Los 

Angeles branch office of the Federal 

Reserve Bank of San Francisco to the 

head office of the Federal Reserve Bank 

of Cleveland. As a result of these 

changes, some checks that are drawn on 

and deposited at banks located in the 

Dallas, Los Angeles, and Cleveland 

check-processing regions and that 

currently are nonlocal checks will 


jlentini on DSKJ8SOYB1PROD with RULES