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Inactive Financial Institution Letters
The Board of Governors of the Federal Reserve System has adopted final revisions to Regulation Z, which implements the Truth in Lending Act. The final rule, which is attached, took effect on November 21, 1997, but compliance is optional until October 1, 1998 (not December 22, 1997, as reported in FIL-127-97 dated December 10, 1997).
The revisions implement an amendment to the Truth in Lending Act contained in the Economic Growth and Regulatory Paperwork Reduction Act of 1996. The amendment permits creditors to provide a statement that the periodic payment on certain variable-rate loans may substantially increase or decrease together with a maximum interest rate and payment based on a $10,000 loan amount, instead of having to provide a 15-year historical example of index values. The Federal Reserve issued a proposed rule to implement the statutory changes in January 1997.
The changes to the regulation include:
For further information about the new rule, please call:
Attachment: Dec. 1 Federal Register, pages 63441-63447, available on the FDIC web site for FILs, www.fdic.gov/banknews
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).
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