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Government Securities

Fiduciary / Asset Management
February 26, 1998
TO: CHIEF EXECUTIVE OFFICER 
SUBJECT: Electronic Confirmation of Transactions 
and Electronic Records Storage 

The Department of the Treasury has issued the attached interpretive letter affecting certain banks wishing to use electronic mail for confirming specific transactions, and to store records electronically. Banks affected are those engaged in repurchase agreement transactions, registered as government securities brokers or dealers, or holding government securities for customers.

  • The Treasury Department's interpretive letter permits banks to use electronic mail (e-mail) to transmit confirmations to overnight hold-in-custody repurchase agreement customers. This interpretation simplifies bank compliance with the Government Securities Act of 1986 (GSA) regulations requiring banks to send daily confirmations in writing to these customers (17 CFR 403.5(d)(1)(ii)).
  • The interpretive letter also provides that banks that are registered government securities brokers or dealers may store records electronically. This interpretation simplifies compliance with GSA regulations for the storage of records by banks that have registered as government securities brokers or dealers (17 CFR 404.4). For state nonmember banks, the provisions of 12 CFR part 344 also apply.
  • In addition, the interpretive letter permits banks that hold government securities as custodian for customers to transmit confirmations and safekeeping receipts electronically. The interpretation simplifies requirements under 17 CFR part 450.

Banks wishing to take advantage of the provisions of the attached interpretive letter should read it carefully as well as all applicable citations before proceeding.

For more information on:

  • The GSA and the interpretive letter, contact the Treasury Department's Government Securities Regulations staff at (202) 219-3632.
  • Recordkeeping and storage requirements of 12 CFR Part 344, contact John F. Harvey, Review Examiner (Trust) in the FDIC's Division of Supervision, at (202) 898-6762.

For other questions, please contact Kenton Fox, Senior Capital Markets Specialist in the FDIC's Division of Supervision, at (202) 808-7119.

Nicholas J. Ketcha Jr.

Director

Distribution

FDIC-Supervised Banks (Commercial and Savings)

Note

Paper copies of FDIC financial institution letters may be obtained through the FDIC's Public Information Center, 801 17th Street, N.W., Room 100, Washington, D.C. 20434 (800-276-6003 or (703) 562-2200).

Attachment(s)
http://www.publicdebt.treas.gov/gsr/gsr052if.htm

Last Updated: February 26, 1998