On December 1, 2014, the US Board of Governors of the Federal Reserve System (“Federal Reserve Board”) issued changes to part II of the Federal Reserve Policy on Payment System Risk (“PSR policy”) which are intended to improve the efficiency of the payment system. The majority of the changes address posting rules for automated clearing house (“ACH”) and commercial check transactions.

Regarding ACH debit transactions, the Federal Reserve Board approved moving their posting to align with the posting of ACH credit transactions. For commercial check transactions, the Federal Reserve Board adopted moving the posting time for receiving most credits for deposits and debits for presentments to 8:30 a.m. Eastern Time (“ET”), and establishing two other posting times at 1:00 p.m. ET and 5:30 p.m. ET. The posting rule changes for ACH debit and commercial check transactions will become effective July 23, 2015

Additionally, the Federal Reserve Board also adopted companion amendments to subpart A of its Regulation J titled Collection of Checks and Other Items by Federal Reserve Banks and Funds Transfers through Fedwire. The amendments will permit Reserve Banks to obtain settlement from paying banks by as early as 8:30 a.m. ET for checks that the Reserve Banks present and require paying banks that receive presentment of checks from the Reserve Banks to make the proceeds of settlement for those checks available to the Reserve Banks as soon as one half-hour after receipt of the checks. Regulation J changes will become effective July 23, 2015.

The Federal Reserve Policy on Payment System Risk is available at:

http://www.federalreserve.gov/newsevents/press/other/fr-notice-psr-daylight-overdrafts-20141201.pdf.

Amendments to Regulation J are available at:

http://www.federalreserve.gov/newsevents/press/other/fr-notice-reg-j-20141201.pdf.