accounts can be held jointly with residents • in case of collection of cheques, banks are required to formulate and disclose their policy for affording immediate credit, time frame for collection and interest payment for delayed collection, taking care to ensure that the interests of the small depositors are fully protected. the policy should clearly lay down the liability of the banks by way of interest payments due to delays for non - compliance with the standards set by the banks themselves. compensation by way of interest payment, where necessary, should be made without any claim from the customer. • banks are required to provide both the drop box facility and the facility for acknowledgement of the cheques at the regular collection counters and no branch should refuse to give an acknowledgement if the customer tenders the cheques at the counters. • banks have been advised to ensure that brief, intelligible particulars are invariably entered in passbooks / statements of account and they adhere to the prescribed monthly periodicity while sending statement of accounts. • it has been clarified to banks that payment to the survivor / nominee of a deceased depositor where there is a valid nomination or where the account has been opened with a survivorship clause is a valid discharge of liability provided inter alia it has been made clear to the survivor ( s ) / nominee that he would be receiving the payment from the bank as a trustee of the legal heirs of the deceased depositor, i. e., such payment to him shall not affect the right or claim which any person may have against the survivor ( s ) / nominee to whom the payment is made. in such cases insistence on production of legal representation is unwarranted and would, invite serious supervisory disapproval. in such case, therefore, while making payment to the survivor ( s ) / nominee of the deceased depositor, the banks have to desist from insisting on production of succession certificate, letter of administration or probate, etc., or obtain any bond of indemnity or surety from the survivor ( s ) / nominee, irrespective of the amount standing to the credit of the deceased account holder. • in case where the deceased depositor had not made any nomination or for the accounts other than those styled as “ either or survivor ” ( such as single or jointly operated accounts ), banks have been told to adopt a simplified procedure for repayment to legal heir ( s ) of the depositor keeping in view the imperative need to avoid inconvenience and undue hardship to

to that end, the federal reserve and other federal regulators are devoting considerable time to implementing the requirements of the dodd - frank act. translating all of the new legislative requirements into rules and regulations, and then into an effective supervisory and examination program, is a massive undertaking, but it is essential to moving beyond the stabilization phase of crisis recovery and into that phase where we address the underlying fault lines in our financial institution landscape. as we work through dodd - frank implementation, we will need to ask : what constitutes effective supervision in the post - crisis world? i expect that the answer will be the subject of debate for months and possibly years. the process of identifying the factors most important to constructing an effective supervisory and examination program has already begun. for america ’ s community banks, the vast majority of which did not contribute to the subprime crisis, the contours of this program will be of critical importance. bis central bankers ’ speeches as we have learned all too well, a financial system dominated by a handful of large institutions is unlikely to be resilient in the face of a crisis. my view is that a diffuse financial system – one with a diverse range of institutions of varying size and complexity – is preferable to a system that is highly concentrated. in fact, the need for diversification is one of the great lessons of the crisis. indeed, we found that, irrespective of size, those banks most likely to weather the crisis were those with diverse loan portfolios, management information systems capable of monitoring concentrations, reasonably diversified funding sources and liquidity management processes, and forward - looking analyses that considered how loan portfolios might perform and affect bank conditions under periods of stress. we need many, many more banks with these characteristics because these are the banks that absorbed the shocks of the crisis, remained relatively healthy, and, most significantly, now have the potential to thrive as robust sources of credit in their communities after the crisis. as i see it, we need to create within the dodd - frank regulatory architecture a supervisory and examination program that encourages diversification and forward - looking strategies as a means to ensuring a healthy financial system and a steady flow of loans to creditworthy borrowers. am i saying that it is the responsibility of examiners, in essence, to guarantee that the banking system becomes more resilient and incapable of failure? no. a regulatory system that guarantees against bank failures is not in my mind desirable, even if such a system could be established in a cost -