Capital Briefs: Fed Urges Year-2000 Regulatory Slowdown

The Federal Reserve Board on Tuesday urged Congress and the other banking agencies to limit legal and regulatory changes that require computer reprogramming during the months immediately preceding the year 2000.

The Fed said it would consider the effect of the millennium computer bug on any regulatory changes it proposes after July 1. The central bank also imposed a moratorium on changes to its computer systems from Oct. 1, 1999, to March 31, 2000. The only exemptions will be for emergency fixes that are authorized by senior Fed officials, year-2000 compliant software updates released by vendors, and changes mandated by new laws and regulations.

Starting in April, the Fed will impose less onerous restrictions on computer system changes. For the second quarter, the Fed will postpone discretionary improvements to computer systems, but will make other changes. In the third quarter, it will stop rolling out new computer systems unless approved by senior managers.

Copies of the policy may be obtained at www.bog.frb.fed.us/y2k/.