The Clearing House Association L.L.C. (TCH), together with the Bank Policy Institute (BPI), American Bankers Association (ABA), Consumer Bankers Association (CBA), Independent Community Bankers of America (ICBA), and Mid-Size Bank Coalition of America (MBCA), submitted comments in response to the Federal Reserve Board of Governors’ (Board) supplemental notice and request for comment on updates to supplement the Board’s proposed guidelines for evaluating requests for access to Federal Reserve accounts and services. The comments note four fundamental issues that the Board’s recent proposal does not appropriately and transparently address, and call on the Board to: (1) clarify which institutions are legally eligible to apply for Reserve Bank accounts and services; (2) explain how applications will be reviewed and scrutinized, and what conditions and limitations may be imposed in connection with approval, at each tier; (3) explain how Reserve Banks will oversee and monitor institutions at each tier on an ongoing basis after granting an application for an account and/or services; and (4) clarify that any decision to grant Federal Reserve accounts or services to a Tier 2 or Tier 3 applicant shall be subject to review and approval (or, at a minimum, non-objection) by the Board. The comments also note that further clarity on each area is needed in the final guidelines to achieve the Board’s objective of the consistent application of a set of guidelines and factors when reviewing such access requests to promote consistent outcomes across Reserve Banks and to facilitate equitable treatment across institutions.
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