In addition, the rule expands the use to which the proceeds of pledged Government obligations may be applied in the event of a default in performance. We are establishing a new part in the CFR for this purpose. This final rule provides a central location for the acceptability and valuation provisions for Treasury's collateral programs without substantive changes. Public money includes, but is not limited to, revenue and funds of the United States and deposit funds subject to the control or regulation of the United States or any of its officers, agents, or employees. Agencies are responsible for ensuring the security of public money.
Financial institutions are responsible for pledging collateral as requested by agencies.
Depositary Arrangements for funds held outside Treasury. Collateral is pledged to secure compensating balances, funds held outside Treasury and collectable balances. FMS requires that financial institutions pledge collateral before receiving the time balance. FMS issues instructions on the deposit, acceptance, valuation, substitution and release of collateral. At FMS s direction, the FRB provides safekeeping and valuation and provides reports to agencies monthly, quarterly, and in response to any deposit, substitution or release.