[Code of Federal Regulations]
[Title 12, Volume 2]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 12CFR204.6]

[Page 138-139]
 
                       TITLE 12--BANKS AND BANKING
 
                   CHAPTER II--FEDERAL RESERVE SYSTEM
 
PART 204--RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS (REGULATION D)--Table of Contents
 
Sec. 204.6  Supplemental reserve requirement.

    (a) Finding by Board. Upon the affirmative vote of at least five 
members of the Board and after consultation with the Board of Directors 
of the Federal Deposit Insurance Corporation, the Federal Home Loan Bank 
Board, and the National Credit Union Administration Board, the Board may 
impose a supplemental reserve requirement on every depository 
institution of not

[[Page 139]]

more than 4 percent of its total transaction accounts. A supplemental 
reserve requirement may be imposed if:
    (1) The sole purpose of the requirement is to increase the amount of 
reserves maintained to a level essential for the conduct of monetary 
policy;
    (2) The requirement is not imposed for the purpose of reducing the 
cost burdens resulting from the imposition of basic reserve 
requirements;
    (3) Such requirement is not imposed for the purpose of increasing 
the amount of balances needed for clearing purposes; and
    (4) On the date on which supplemental reserve requirements are 
imposed, the total amount of basic reserve requirements is not less than 
the amount of reserves that would be required on transaction accounts 
and nonpersonal time deposits under the initial reserve ratios 
established by the Monetary Control Act of 1980 (Pub. L. 96-221) in 
effect on September 1, 1980.
    (b) Term. (1) If a supplemental reserve requirement has been imposed 
for a period of one year or more, the Board shall review and determine 
the need for continued maintenance of supplemental reserves and shall 
transmit annual reports to the Congress regarding the need for 
continuing such requirement.
    (2) Any supplemental reserve requirement shall terminate at the 
close of the first 90-day period after the requirement is imposed during 
which the average amount of supplemental reserves required are less than 
the amount of reserves which would be required if the ratios in effect 
on September 1, 1980, were applied.
    (c) Earnings Participation Account. A depository institutions's 
supplemental reserve requirement shall be maintained by the Federal 
Reserve Banks in an Earnings Participation Account. Such balances shall 
receive earnings to be paid by the Federal Reserve Banks during each 
calendar quarter at a rate not to exceed the rate earned on the 
securities portfolio of the Federal Reserve System during the previous 
calendar quarter. Additional rules and regulations maybe prescribed by 
the Board concerning the payment of earnings on Earnings Participation 
Accounts by Federal Reserve Banks.
    (d) Report to Congress. The Board shall transmit promptly to the 
Congress a report stating the basis for exercising its authority to 
require a supplemental reserve under this section.
    (e) Reserve requirements. At present, there are no supplemental 
reserve requirements imposed under this section.

[45 FR 56018, Aug. 22, 1980, as amended at 45 FR 81537, Dec. 11, 1980]