The Federal Reserve Board has revised the rules governing reserve requirements, eliminating several outdated and obsolete provisions.
The central bank dropped a series of transitional rules, adopted in 1980, that gave most banks up to two years to meet the Fed's reserve requirements. Before 1980, only Fed-member banks kept reserves with the central bank.
It also killed rules that gradually phased in reserve requirements for NOW accounts. The Fed noted in the Dec. 26 order that the rules were moot because the grace period for thrifts to add reserves for NOW accounts expired eight years ago.
"The amendments are designed to reduce regulatory burden and simplify and update the regulation," the Fed said.
Separately, the Fed proposed several changes to the definition of "savings deposit" in the reserve requirement rules. If adopted, the new rule would clarify that consumers may not withdraw money penalty-free from savings accounts to repay overdrafts.
The Fed plan also would clarify that consumers who use computers to bank from home may make up to six transfers a month penalty-free. Comments on these proposals are due by Feb. 4.