Six per month transaction limit on Savings accounts removed

[jim584672]

Federal Reserve Board announces interim final rule to delete the six-per-month limit on convenient transfers from the "savings deposit" definition in Regulation D

https://www.federalreserve.gov/newsevents/pressreleases/bcreg20200424a.htm

 

[clobber]

Woaah...

"The regulatory limit in Regulation D was the basis for distinguishing between reservable "transaction accounts" and non-reservable "savings deposits." The Board's recent action reducing all reserve requirement ratios to zero has rendered this regulatory distinction unnecessary."

 

[SnowballCamper]

And the pendulum swings...

 

[mrfeh]

Anybody know if this is a temporary change, or permanent? It would be nice to not have to monitor the number of transactions.

 

[gauss]

I didn't read the notice yet so it may address this directly, but in the past, banks could always have their own business policy built on top of Reg D that could be more restrictive.

I got zinged on fees once for transactions that were Reg D compliant, but that violated the banks terms/fee schedule.

Anybody know if this is a temporary change, or permanent? It would be nice to not have to monitor the number of transactions.

The short linked press release suggests that it is temporary.

 

[calmloki]

Woaah...

"The regulatory limit in Regulation D was the basis for distinguishing between reservable "transaction accounts" and non-reservable "savings deposits." The Board's recent action reducing all reserve requirement ratios to zero has rendered this regulatory distinction unnecessary."

Noticed the bolded section as well. Does that say banks are no longer required to have reserves? Isn't that something that has to do with the stability of a bank? Wasn't that lack of reserves a thing that exacerbated bank failures back in the eighties?
If banks aren't required to have reserves and can borrow fed money for very little then they can make loans for exceedingly low interest rates. If the government's spending is huge, due to Covid war spending then that can cause monetary inflation. If controlling inflation is done via increasing interest rates to the banks then the banks with no reserves are stuck with loans they've made that pay low interest. Is a new inflation/recession period heading our way?

 

[njhowie]

Noticed the bolded section as well. Does that say banks are no longer required to have reserves? Isn't that something that has to do with the stability of a bank? Wasn't that lack of reserves a thing that exacerbated bank failures back in the eighties?
If banks aren't required to have reserves and can borrow fed money for very little then they can make loans for exceedingly low interest rates. If the government's spending is huge, due to Covid war spending then that can cause monetary inflation. If controlling inflation is done via increasing interest rates to the banks then the banks with no reserves are stuck with loans they've made that pay low interest. Is a new inflation/recession period heading our way?

You are thinking too logically. That is more than the Fed and the administration can handle. How dare you!