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Reg CC Changes & Hold Notices

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We are a small hometown financial institution. Our funds availability policy is to give immediate credit for all deposits. On occasion, we issue a hold notice. With the upcoming Reg CC changes, there will no longer be a non-local check. Will our current disclosures change? If so, will we need to give advance notice, and what will that notice entail? Also, will a hold ever be placed again? Lastly, even though FRB check processing regions have been consolidated already, the new regulation does not take effect until February 27, 2010, correct?

The consolidation of Atlanta into Cleveland has been announced but not completed. It will be finished on February 26, and the amendment moving all routing numbers under Cleveland in Reg CC's Appendix A will be effective on Saturday, February 27.

Yes, holds will be placed again. Case by case holds on local checks have really limited utility, since they delay availability only one day, but exception holds, now requiring availability by the seventh business day (that's a week and two days in most cases) are still available for use when appropriate.

Whether your current disclosures will have to change depends on what they say now. If you say that funds will normally be available by the fifth business day, that's going to need attention. If you mention holds until the eleventh business day, that, too, will have to go.

First published on 3/22/10

First published on 03/22/2010

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