To Whom It May Concern:
The undersigned trade associations[1] appreciate the opportunity to comment on the Board of Governors of the Federal Reserve System’s updated guidelines[2] for evaluating accounts and services requests. The question of which institutions should be permitted to open master accounts with a Federal Reserve Bank and obtain related services remains a critical one, particularly in light of the recent increase in the availability of novel charters[3] at a federal and state level that may seek such accounts and services and the potential unique risks of their obtaining such accounts and services to the U.S. payments and financial systems.
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[1] Please see Annex A for a description of the associations.
[2] Board of Governors of the Federal Reserve System, Guidelines for Evaluating Account and Services Requests, 87 Fed. Reg. 12957 (Mar. 8, 2022).
[3] Throughout this comment letter, we use the term “novel charters” to describe potential applicants for Reserve Bank accounts and services that are neither (i) insured depository institutions subject to federal prudential oversight under the Federal Deposit Insurance Act (or other applicable Federal law regarding deposit insurance, such as the Federal Credit Union Act) nor (ii) uninsured institutions that are part of a bank holding company (for example, an uninsured national trust bank that is a subsidiary of a bank holding company), and thus subject to consolidated federal prudential oversight by the Board. Under the reproposal’s tiered framework, these novel charters would qualify as either Tier 2 or Tier 3 applicants.
