On October 26, the Board of Governors of the Federal Reserve System (Federal Reserve) announced a five-month delay in the implementation of the second phase of its program to simplify the administration of reserve requirements. The Federal Reserve issued a final rule on April 4, 2012, amending its Regulation D to simplify the reserve administration program in two phases. The first phase, which took effect on July 12, 2012, discontinued as-of adjustments related to deposit report revisions and eliminated clearing balance requirements. The second phase of the amendments will introduce a common two-week maintenance period and a penalty-free band around reserve balance requirements to eliminate carryover and routine penalty waivers, and was originally scheduled to take effect on January 24, 2013. The new effective date is June 27, 2013. The Federal Reserve authorized the delay
to allow the Federal Reserve to further develop and test the automated systems necessary to support the common two week maintenance period, the penalty-free band, and the elimination of carry-over and routine penalty waivers. Further development and testing are necessary to ensure the effective operation of the automated systems. This delay will also facilitate a smooth transition for affected institutions by allowing them more time to develop their internal systems and prepare for implementation of these revisions. Moreover, the delay will not prejudice or create additional burden for affected institutions or Federal Reserve Banks.