61620 Federal Register / Vol. 62, No. 223 / Wednesday, November 19, 1997 / Rules and Regulations

required before parties may file suit in

court challenging this rule.

Executive Order 12866 and Regulatory

Flexibility Act

This direct final rule has been

determined to be not significant and,

therefore, has not been reviewed by

OMB.

Effect on Small Entities

The Administrator, FSIS, has made a

determination that this direct final rule

will not have a significant economic

impact on a substantial number of small

entities, as defined by the Regulatory

Flexibility Act (5 U.S.C. 601). This

direct final rule permits the use of an

additional binder matrix, a blend of

carrageenan, locust bean gum, and

xanthan gum, in ‘‘Ham Water Added’’

and ‘‘Ham and Water Product—X% of

Weight is Added Ingredients.’’

Manufacturers opting to use the binder

blend would incur labeling expenses in

revising the ingredients statements of

their labels to show the presence of the

blend. Decisions by individual

manufacturers on whether to use the

binder blend in these cured pork

products would be based on their

conclusions that the benefits outweigh

the implementation costs.

Paperwork Requirements

Manufacturers opting to use a blend

of carrageenan, locust bean gum, and

xanthan gum as a binder in specific

pork products must revise their product

labels. Such labeling changes will be

generically approved in accordance

with 9 CFR 317.5. Any burden

associated with labeling changes are

approved under OMB number 0583–

0092.

List of Subjects in 9 CFR Part 318

Food additives, Meat inspection.

For the reasons set out in the

preamble, 9 CFR part 318 is amended as

follows:

PART 318—ENTRY INTO OFFICIAL

ESTABLISHMENTS; REINSPECTION

AND PREPARATION OF PRODUCTS

1. The authority citation for part 318

continues to read as follows:

Authority: 7 U.S.C. 450, 1901–1906; 21

U.S.C. 601–695; 7 CFR 2.18, 2.53.

2. In section 318.7(c)(4), under the

Class of substance ‘‘Binders and

extenders,’’ a new entry for the

substance ‘‘Carrageenan, Locust Gum

Bean, and Xanthan Gum Blend’’ is

added at the end to read as follows:

§ 318.7 Approval of substances for use in

the preparation of products.

* * * * *

(c) * * *

(4) * * *

Class of Substance Substance Purpose Products Amount

* * * * * * *

Binders and extenders Carrageenan, Locust

bean gum, and

Xanthan gum blend.

To prevent purging of

brine solution.

Cured pork products

as provided in 9

CFR 319.104(d).

In combination, not to exceed 0.5 percent of

product formulation; not permitted in combination with other binders approved for

use in cured pork products; in accordance

with 21 CFR 172.620, 172.623, 172.626,

184.1343, and 172.695

* * * * * * *

Done at Washington, DC, on November 10,

1997.

Thomas J. Billy,

Administrator.

[FR Doc. 97–30324 Filed 11–18–97; 8:45 am]

BILLING CODE 3410–DM–P

FEDERAL RESERVE SYSTEM

12 CFR Part 204

[Regulation D; Docket No. R–0945]

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 decrease the

amount of transaction accounts subject

to a reserve requirement ratio of three

percent, as required by section

19(b)(2)(C) of the Federal Reserve Act,

from $49.3 million to $47.8 million of

net transaction accounts. This

adjustment is known as the low reserve

tranche adjustment. The Board is

increasing from $4.4 million to $4.7

million the amount of reservable

liabilities of each depository institution

that is subject to a reserve requirement

of zero percent. This action is required

by section 19(b)(11)(B) of the Federal

Reserve Act, and the adjustment is

known as the reservable liabilities

exemption adjustment. The Board is

also increasing the deposit cutoff levels

that are used in conjunction with the

reservable liabilities exemption to

determine the frequency of deposit

reporting from $75.0 million to $78.9

million for nonexempt depository

institutions and from $48.2 million to

$50.7 million for exempt institutions.

(Nonexempt institutions are those with

total reservable liabilities exceeding the

amount exempted from reserve

requirements ($4.7 million) while

exempt institutions are those with total

reservable liabilities not exceeding the

amount exempted from reserve

requirements.) Thus, beginning in

September 1998, nonexempt institutions

with total deposits of $78.9 million or

more will be required to report weekly

while nonexempt institutions with total

deposits less than $78.9 million may

report quarterly, in both cases on form

FR 2900. Similarly, exempt institutions

with total deposits of $50.7 million or

more will be required to report quarterly

on form FR 2910q while exempt

institutions with total deposits less than

$50.7 million may report annually on

form FR 2910a.

DATES: Effective date: December 16,

1997.

Compliance dates: For depository

institutions that report weekly, the low

reserve tranche adjustment and the

reservable liabilities exemption

adjustment will apply to the reserve

computation period that begins

Tuesday, December 30, 1997, and the

corresponding reserve maintenance

period that begins Thursday, January 1,

1998. For institutions that report

quarterly, the low reserve tranche

adjustment and the reservable liabilities

exemption adjustment will apply to the

reserve computation period that begins

Tuesday, December 16, 1997, and the

corresponding reserve maintenance

period that begins Thursday, January 15,

1998. For all depository institutions, the

deposit cutoff levels will be used to

screen institutions in the second quarter

of 1998 to determine the reporting

frequency for the twelve month period

that begins in September 1998.

FOR FURTHER INFORMATION CONTACT: Rick

Heyke, Attorney (202/452–3688), Legal
Federal Register / Vol. 62, No. 223 / Wednesday, November 19, 1997 / Rules and Regulations 61621

1Reservable liabilities include transaction

accounts, nonpersonal time deposits, and

Eurocurrency liabilities as defined in section

19(b)(5) of the Federal Reserve Act. The reserve

ratio on nonpersonal time deposits and

Eurocurrency liabilities is zero percent.

2Consistent with Board practice, the tranche and

exemption amounts have been rounded to the

nearest $0.1 million.

3 ‘‘Total deposits’’ as used in determining the

cutoff level includes not only gross transaction

deposits, savings accounts, and time deposits, but

also reservable obligations of affiliates, ineligible

acceptance liabilities, and net Eurocurrency

liabilities.

Division, or June O’Brien, Economist

(202/452–3790), Division of Monetary

Affairs; for the hearing impaired only,

contact Diane Jenkins,

Telecommunications Device for the Deaf

(TDD)(202/452–3544); Board of

Governors of the Federal Reserve

System, 20th and C Streets, N.W.,

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. The

initial reserve requirements imposed

under section 19(b)(2) were set at three

percent for net transaction accounts of

$25 million or less and at 12 percent on

net transaction accounts above $25

million for each depository institution.

Effective April 2, 1992, the Board

lowered the required reserve ratio

applicable to transaction account

balances exceeding the low reserve

tranche from 12 percent to 10 percent.

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 adjustment in the

tranche is to be 80 percent of the

percentage increase or decrease in net

transaction accounts at all depository

institutions over the one-year period

that ends on the June 30 prior to the

adjustment.

Currently, the low reserve tranche on

net transaction accounts is $49.3

million. Net transaction accounts of all

depository institutions decreased by 3.7

percent (from $740.1 billion to $712.8

billion) from June 30, 1996, to June 30,

1997. In accordance with section

19(b)(2), the Board is amending

Regulation D (12 CFR Part 204) to

decrease the low reserve tranche for

transaction accounts for 1998 by $1.5

million to $47.8 million.

Section 19(b)(11)(A) of the Federal

Reserve Act (12 U.S.C. 461 (b)(11)(B))

provides that $2 million of reservable

liabilities 1 of each depository

institution shall be subject to a zero

percent reserve requirement. Each

depository institution may, in

accordance with the rules and

regulations of the Board, designate the

reservable liabilities to which this

reserve requirement exemption is to

apply. However, if net transaction

accounts are designated, only those that

would otherwise be subject to a three

percent reserve requirement (i.e., net

transaction accounts within the low

reserve requirement tranche) may be so

designated.

Section 19(b)(11)(B) of the Federal

Reserve Act provides that, before

December 31 of each year, the Board

shall issue a regulation adjusting for the

next calendar year the dollar amount of

reservable liabilities exempt from

reserve requirements. Unlike the

adjustment for the low reserve tranche

on net transaction accounts, which

adjustment can result in a decrease as

well as an increase, the change in the

exemption amount is to be made only if

the total reservable liabilities held at all

depository institutions increase from

one year to the next. The percentage

increase in the exemption is to be 80

percent of the increase in total

reservable liabilities of all depository

institutions as of the year ending June

30. Total reservable liabilities of all

depository institutions increased by 7.7

percent (from $1,695.1 billion to

$1,824.8 billion) from June 30, 1996, to

June 30, 1997. Consequently, the

reservable liabilities exemption amount

for 1998 under section 19(b)(11)(B) will

be increased by $0.3 million to $4.7

million.2

The effect of the application of section

19(b) of the Federal Reserve Act to the

change in the total net transaction

accounts and the change in the total

reservable liabilities from June 30, 1996,

to June 30, 1997, is to decrease the low

reserve tranche to $47.8 million, to

apply a zero percent reserve

requirement on the first $4.7 million of

transaction accounts, and to apply a

three percent reserve requirement on the

remainder of the low reserve tranche.

The tranche adjustment and the

reservable liabilities exemption

adjustment for weekly reporting

institutions will be effective for the

reserve computation period beginning

Tuesday, December 30, 1997, and for

the corresponding reserve maintenance

period beginning Thursday, January 1,

1998. For institutions that report

quarterly, the tranche adjustment and

the reservable liabilities exemption

adjustment will be effective for the

computation period beginning Tuesday,

December 16, 1997, and for the reserve

maintenance period beginning

Thursday, January 15, 1998. In addition,

all institutions currently submitting

form FR 2900 must continue to submit

reports to the Federal Reserve under

current reporting procedures.

In order to reduce the reporting

burden for small institutions, the Board

has established deposit reporting cutoff

levels to determine deposit reporting

frequency. Institutions are screened

during the second quarter of each year

to determine reporting frequency

beginning the following September. In

July of 1988 the Board set a single cutoff

level for all depository institutions of

$40 million plus an amount equal to 80

percent of the annual rate of increase of

total deposits.3 In August of 1994, the

Board replaced the single deposit cutoff

level that had applied to both

nonexempt and exempt institutions

with separate cutoff levels, increasing

the cutoff level for nonexempt

institutions, and in September 1997

further increased the cutoff level for

nonexempt institutions. The cutoff level

for nonexempt institutions, which

determines whether they report (on FR

2900) quarterly or weekly, was thereby

raised to $75.0 million. The deposit

cutoff level for exempt institutions,

which determines whether they report

annually (on FR 2910a) or quarterly (on

FR 2910q), remained at the indexed

level of $48.2 million.

From June 30, 1996, to June 30, 1997,

total deposits increased 6.6 percent,

from $4,168.2 billion to $4,442.2 billion.

Accordingly, the nonexempt deposit

cutoff level will increase by $3.9 million

to $78.9 million and the exempt deposit

cutoff level will increase by $2.5 million

to $50.7 million. Based on the

indexation of the reservable liabilities

exemption, the cutoff level for total

deposits above which reports of

deposits must be filed will rise from

$4.4 million to $4.7 million. Institutions

with total deposits below $4.7 million

will be excused from reporting if their

deposits can be estimated from other

data sources. The $78.9 million cutoff

level for weekly versus quarterly FR

2900 reporting for nonexempt

institutions, the $50.7 million cutoff

level for quarterly FR 2910q versus

annual FR 2910a reporting for exempt

institutions, and the $4.7 million level

threshold for reporting will be used in

the second quarter 1998 deposits report

screening process, and the adjustments

will be made when the new deposit

reporting panels are implemented in

September 1998.

All U.S. branches and agencies of

foreign banks and all Edge and

agreement corporations, regardless of

size, are required to file weekly the
61622 Federal Register / Vol. 62, No. 223 / Wednesday, November 19, 1997 / Rules and Regulations

Report of Transaction Accounts, Other

Deposits and Vault Cash (FR 2900).

After the indexations become effective

in 1998, all other institutions that have

reservable liabilities in excess of the

exemption level of $4.7 million

prescribed by section 19(b)(11) of the

Federal Reserve Act (known as

‘‘nonexempt institutions’’) and total

deposits at least equal to the nonexempt

deposit cutoff level ($78.9 million) will

be required to file weekly the Report of

Transaction Accounts, Other Deposits

and Vault Cash (FR 2900) for the twelve

month period starting September 1998.

However, nonexempt institutions with

total deposits less than the nonexempt

deposit cutoff level ($78.9 million), will

be able to file the FR 2900 quarterly.

Institutions that obtain funds from nonU.S. sources or that have foreign

branches or international banking

facilities are required to file the Report

of Certain Eurocurrency Transactions

(FR 2950/2951) at the same frequency as

they file the FR 2900.

Institutions with reservable liabilities

at or below the exemption level ($4.7

million) (known as exempt institutions)

will be required to file the Quarterly

Report of Selected Deposits, Vault Cash,

and Reservable Liabilities (FR 2910q) if

their total deposits equal or exceed the

exempt deposit cutoff level ($50.7

million). Exempt institutions with total

deposits less than the exempt deposit

cutoff level ($50.7 million) but at least

equal to the exemption amount ($4.7

million) will be able to file the Annual

Report of Total Deposits and Reservable

Liabilities (FR 2910a). Institutions that

have total deposits less than the

exemption amount ($4.7 million) are not

required to file deposit reports if their

deposits can be estimated from other

data sources.

Finally, the Board may require a

depository institution to report on a

weekly basis, regardless of the cutoff

level, if the institution manipulates its

total deposits and other reservable

liabilities in order to qualify for

quarterly reporting. Similarly, any

depository institution that reports

quarterly may be required to report

weekly and to maintain appropriate

reserve balances with its Reserve Bank

if, during its computation period, it

understates its usual reservable

liabilities or overstates the deductions

allowed in computing required reserve

balances.

Notice and Public Participation

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

relating to notice and public

participation have not been followed in

connection with the adoption of these

amendments because the amendments

involve expected, ministerial

adjustments prescribed by statute and

by an interpretative statement

reaffirming the Board’s policy

concerning reporting practices.

Moreover, the low reserve tranche

adjustment and the reservable liabilities

exemption adjustment are required to be

effective for the next calendar year even

though the data which they are required

to reflect are only available late in the

prior year. In addition, the reservable

liabilities exemption adjustment and the

increases for reporting purposes in the

deposit cutoff levels reduce regulatory

burdens on depository institutions, and

the low reserve tranche adjustment will

have a de minimis effect on depository

institutions with net transaction

accounts exceeding $47.8 million.

Accordingly, the Board finds good cause

for determining, and so determines, that

notice and public participation is

unnecessary, impracticable, or contrary

to the public interest.

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

relating to notice of the effective date of

a rule have not been followed in

connection with the adoption of these

amendments because the low reserve

tranche adjustment and the reservable

liabilities adjustment are expected,

ministerial amendments prescribed by

statute. Moreover, they are required to

be effective for the next calendar year

even though the data which they are

required to reflect are only available late

in the prior year. In addition, the

reservable liabilities adjustment and the

increase in deposit cutoff levels for

reporting purposes relieve a restriction

on depository institutions, and the low

reserve tranche will have a de minimis

effect on depository institutions with

net transaction accounts exceeding

$47.8 million. Accordingly, there is

good cause to determine, and the Board

so determines, that such notice is

impracticable or unnecessary.

Regulatory Flexibility Analysis

The Board certifies that these

amendments will not have a substantial

economic impact on small depository

institutions. See ‘‘Notice and Public

Participation’’ above.

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 204.9 is revised to read as

follows:

§ 204.9 Reserve requirement ratios.

(a) Reserve percentages. The following

reserve ratios are prescribed for all

depository institutions, Edge and

Agreement corporations, and United

States branches and agencies of foreign

banks:

Category Reserve requirement 1

Net transaction accounts:

$0 to $47.8 million 3 percent of amount.

over $47.8 million .. $1,434,000 plus 10

percent of amount

over $47.8 million

Nonpersonal time

deposits.

0 percent.

Eurocurrency liabilities.0 percent.

1Before deducting the adjustment to be

made by the paragraph (b) of this section.

(b) Exemption from reserve

requirements. Each depository

institution, Edge or agreement

corporation, and U.S. branch or agency

of a foreign bank is subject to a zero

percent reserve requirement on an

amount of its transaction accounts

subject to the low reserve tranche in

paragraph (a) of this section not in

excess of $4.7 million determined in

accordance with § 204.3(a)(3).

By order of the Board of Governors of

the Federal Reserve System, November

13, 1997.

William W. Wiles,

Secretary of the Board.

[FR Doc. 97–30237 Filed 11–18–97; 8:45 am]

BILLING CODE 6210–01–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Airspace Docket No. 97–ASO–14]

Revocation of Class E Airspace;

Marietta Dobbins ARB (NAS Atlanta),

GA

AGENCY: Federal Aviation

Administration (FAA), DOT.

ACTION: Final rule.