[Federal Register Volume 63, Number 57 (Wednesday, March 25, 1998)]
[Proposed Rules]
[Pages 14533-14538]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-6989]
Federal Register / Vol. 63, No. 57 / Wednesday, March 25, 1998 /
Proposed Rules
[[Page 14533]]
FEDERAL RESERVE SYSTEM
12 CFR Part 230
[Regulation DD; Docket No. R-1003]
Truth in Savings
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Proposed rule.
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SUMMARY: The Board is publishing for comment a proposed rule amending
Regulation DD which implements the Truth in Savings Act. The proposed
rule would allow depository institutions to deliver by electronic
communication disclosures required by the act and regulation, if the
consumer agrees to such delivery. In addition, the Board is publishing
proposed amendments to implement amendments to the Truth in Savings Act
enacted as part of the Economic Growth and Regulatory Paperwork
Reduction Act of 1996. The law modifies the rules for indoor lobby
signs, eliminates subsequent disclosure requirements for automatically
renewable time accounts with terms less than one month, and repeals the
civil liability provisions as of September 30, 2001.
DATES: Comments must be received by May 15, 1998.
ADDRESSES: Comments should refer to Docket No. R-1003, and may be
mailed to William W. Wiles, Secretary, Board of Governors of the
Federal Reserve System, 20th Street and Constitution Avenue, N.W.,
Washington, DC 20551. Comments also may be delivered to Room B-2222 of
the Eccles Building between 8:45 a.m. and 5:15 p.m. weekdays, or to the
guard station in the Eccles Building courtyard on 20th Street, N.W.
(between Constitution Avenue and C Street) at any time. Comments may be
inspected in Room MP-500 of the Martin Building between 9:00 a.m. and
5:00 p.m. weekdays, except as provided in 12 CFR 261.12 of the Board's
Rules Regarding Availability of Information.
FOR FURTHER INFORMATION CONTACT: Michael Hentrel or Obrea Poindexter,
Staff Attorneys, Division of Consumer and Community Affairs, at (202)
452-3667 or 452-2412. For the hearing impaired only, Telecommunications
Device for the Deaf (TDD), contact Diane Jenkins, at (202) 452-3544.
SUPPLEMENTARY INFORMATION:
I. Background
The Truth in Savings Act (TISA) is implemented by the Board's
Regulation DD, issued September 21, 1992 (57 FR 43337) (correction
notice at 57 FR 46480, October 9, 1992). Compliance with the regulation
became mandatory in June 1993. The act and regulation require
depository institutions to disclose yields, fees, and other terms
concerning deposit accounts to consumers at account opening. The
regulation also includes rules about advertising of deposit accounts.
Credit unions are governed by a substantially similar regulation issued
by the National Credit Union Administration.
As part of the Regulatory Planning and Review Program and its
review of regulations under section 303 of the Riegle Community
Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4803),
the Board determined that the use of electronic communication for
delivery of information to consumers that is required by federal
consumer financial services and fair lending laws could effectively
reduce regulatory compliance burden without adversely affecting
consumer protections. Thus, the Board has been considering the issue
and closely following the development of electronic communication. For
example in May 1996, the Board proposed to amend Regulation E
(Electronic Fund Transfers) to permit disclosures to be provided
electronically. In March 1997, the Board issued an amendment to the
staff commentary to Regulation CC (Availability of Funds and Collection
of Checks) that allowed financial institutions to send notices
electronically. (62 FR 13801, March 18, 1997.)
Having considered the comments received on the Regulation E
proposal and other rulemakings, the Board now proposes to amend
Regulation DD to allow institutions to provide Regulation DD
disclosures electronically; such disclosures would remain subject to
any applicable timing, format, and other requirements of the act and
the regulation. Concurrently, the Board is issuing similar proposed
revisions to address electronic communication under Regulations B
(Equal Credit Opportunity), M (Consumer Leasing), and Z (Truth in
Lending), published elsewhere in today's Federal Register. In addition,
the Board has issued an interim rule under Regulation E also published
elsewhere in today's Federal Register, so that financial institutions
can implement systems to provide Electronic Fund Transfer Act
information electronically.
II. Proposed Regulatory Revisions
Electronic Communication
The TISA and Regulation DD require several disclosures to be
provided to consumers in writing. Under Regulation DD, the regulatory
requirement that disclosures be in writing has been presumed to require
institutions to provide paper documents. However, under many laws that
call for information to be in writing, information in electronic form
is considered to be ``written.'' Information produced, stored, or
communicated by computer is also generally considered to be a writing
at least where visual text is involved.
Therefore, pursuant to its authority under Section 269 of the TISA,
the Board proposes to amend Regulation DD to permit depository
institutions to use electronic communication where the regulation calls
for information to be provided in writing. The term ``electronic
communication'' is limited to a communication that can be displayed as
visual text. An example is an electronic visual text message that is
displayed on a screen (such as the consumer's computer monitor).
Communications by telephone voicemail systems do not meet the
definition of ``electronic communication'' for purposes of this
regulation because they do not have the feature generally associated
with a writing--visual text.
Statutory Amendments
The Economic Growth and Regulatory Paperwork Reduction Act of 1996
(1996 Act) contains amendments to the TISA. An amendment to section
266(a)(3) eliminates the requirement that institutions provide
disclosures in advance of maturity for automatically renewable
(rollover) time accounts with a term of 30 days or less. The Board
believes the Congressional intent was to eliminate any subsequent
disclosures for monthly time accounts. Accordingly, the proposed
amendments to Regulation DD delete Sec. 230.5(c), which requires that
institutions disclose (after the account is opened) any changes in
account terms for rollover time accounts with a maturity of one month
or less. Institutions will continue to provide disclosures when these
accounts are opened.
An amendment to section 263(c) of the act expands an exemption from
certain advertising provisions for signs on the premises of a
depository institution. The proposed amendments to Regulation DD apply
this exemption to all signs on the premises of an institution. Section
230.8(e) would be revised to exempt those signs that are inside the
premises of the depository institution, including those that face out.
Any sign posted outside the depository institution would remain
[[Page 14534]]
covered by the advertising provisions unless the sign is exempt by some
other provision (such as the electronic media exemption). The 1996 Act
repeals the TISA's civil liability provisions, effective September 30,
2001. This statutory amendment does not require a regulatory revision,
as the regulation generally does not address civil liability.
III. Section-by-Section Analysis
Section 230.3 General Disclosure Requirements
Section 230.3(a) would be revised to address electronic
communication. ``Electronic communication'' is a visual text message
electronically transmitted between a depository institution and a
consumer's home computer or other electronic device used by a consumer.
Agreements Between Institutions and Consumers
Section 230.3(a)(2) would permit depository institutions to send
electronic disclosures if the consumer agrees. There may be various
ways that a financial institution and a consumer could agree to the
electronic delivery of disclosures and other information. Whether such
an agreement exists between the parties would be determined by
applicable state law. The regulation would not preclude a depository
institution and a consumer from entering into an agreement
electronically, nor does it prescribe a formal mechanism for doing so.
The Board does believe, however, that consumers should be clearly
informed when they are consenting to the delivery of TISA disclosures
and other information electronically.
Delivery Requirements for Electronic Communication
Regulation DD provides that an institution must, for example,
``provide'' or ``deliver'' information to a consumer. Generally, the
delivery requirement anticipates that a depository institution will
deliver the information--typically by mail--to an address designated by
the consumer. For a paper communication, a depository institution would
not satisfy that requirement by making disclosures ``available'' to
consumers, for example, at a financial institution's office (or other
location). The Board believes that consumers receiving disclosures by
electronic communication should have protections regarding delivery
similar to those afforded consumers receiving disclosures in paper
form. Simply posting information on an Internet site without some
appropriate notice and instructions about how the consumer may obtain
the required information would not satisfy the requirement.
The requirement to send or deliver disclosures to a consumer would
be satisfied if the institution ensures that the disclosures will be
displayed in a timely manner. For example, under Regulation DD, account
disclosures must be provided before the consumer opens an account or a
service is provided, whichever is earlier. Assume that a consumer uses
a personal computer to open an account and consents to the electronic
delivery of account disclosures. If the disclosures automatically
appear on the computer screen before the account is opened or the
service is provided (in accordance with the format, timing, and any
other requirements of the act and regulation), the institution would
satisfy the requirement to send (or deliver or transmit) disclosures to
the consumer.
As a practical matter, there may be little distinction between
sending or delivering electronic disclosures and making them
``available.'' Depository institutions have flexibility in how they
deliver electronic disclosures to consumers including, but not limited
to, the following examples. They may send disclosures to a consumer-
designated electronic mail address, or they may designate a location on
a website where the consumer might enter a personal identification
number or other identifier to access required information. If a
consumer opens an account, receives the account disclosures at that
time, and agrees to receive all Regulation DD disclosures
electronically, subsequent disclosures, such as periodic statements or
change-in-terms notices, sent (or delivered) to the designated address
or placed at a designated location would generally satisfy the delivery
requirements of the regulation.
Electronic communication would remain subject to any timing or
other applicable requirements under Regulation DD. For example, a
depository institution that sends a change-in-terms notice required by
Sec. 230.5(a) of Regulation DD must satisfy the requirement to provide
the notice to a consumer at least 30 days in advance of the change. The
Board solicits comment on whether further guidance is needed on how to
comply wth the timing requirements when a notice is posted on an
Internet website.
Timing of Providing Account Opening Disclosures
Account opening disclosures, required under Sec. 230.4(a), set
forth the terms and conditions of the account. These disclosures inform
the consumers of the types and amount of any fees that may be imposed
and the interest rate and annual percentage yield (APY) that will be
paid on the account. Section 230.4(a)(1) requires that account
disclosures be provided before an account is opened or a service is
provided, whichever is earlier.
Section 266(b) of the TISA provides that if the consumer is not
present at the institution when an initial account is accepted (and the
disclosures have not been furnished previously) the institution shall
mail or deliver the disclosures no later than ten days after the
account is opened or the service is provided. The rationale underlying
the ten-day exception is that, in some instances (such as when an
account is opened by telephone), the institution cannot provide written
disclosures before an account is opened. Because this proposal would
permit disclosures to be provided electronically, the same difficulty
does not exist if an account is opened electronically. Thus, the Board
believes that this ten-day exception should not apply. One major
purpose of the TISA is to require clear and uniform disclosure so that
consumers can make meaningful comparisons of deposit accounts offered
by financial institutions before opening an account. The Board believes
that permitting a ten-day delay would seriously diminish the consumer's
ability to compare account terms and, therefore, hinder an explicit
purpose of the TISA. Thus, the proposed rule requires that account
opening disclosures be given before the account is opened or a service
is provided, when an account is opened using electronic communication.
Requirement That Information be ``Clear and Conspicuous''
Section 230.3(a) of Regulation DD requires depository institutions
to present required information ``clearly and conspicuously.'' Under
the proposed rule, the ``clear and conspicuous'' requirement applies to
electronic communication. The Board does not intend to discourage or
encourage specific types of technologies. Regardless of technology,
however, the disclosures provided by electronic communication must meet
the ``clear and conspicuous'' standard. While a depository institution
is generally not required to ensure that the consumer has the equipment
to read the disclosures, in some circumstances institutions would have
the responsibility of making sure the proper equipment is in place. For
example, if financial services are offered through terminals in an
institution's premises, or through kiosks located in public or other
places (such as grocery stores), the
[[Page 14535]]
institution must ensure that the equipment meets the clear and
conspicuous standard for TISA disclosures that are being provided
electronically.
Consumer Ability to Retain Disclosures
Section 230.3(a) of Regulation DD requires that written disclosures
be in a form the consumer may keep. This requirement would apply to
disclosures provided by electronic communication. Depository
institutions would satisfy the retention requirement if, for example,
disclosures can be printed or downloaded by the consumer. The
requirements for electronic delivery are similar to the current paper
requirements, where depository institutions generally must mail or
deliver the information to the consumer but need not ensure that the
consumer reads or retains it. Thus, depository institutions would not
be required to monitor an individual consumer's ability to retain the
information, nor to take steps to find out whether the consumer has in
fact retained it. The Board anticipates that a depository institution
would inform the consumer of any special technical specifications for
receiving or retaining information before or at the time a consumer
agrees to receive information electronically.
As in the case of the ``clear and conspicuous'' standard discussed
above, in circumstances where the financial institution (or a network
in which the institution is a member) controls the equipment to be used
for a service--such as terminals in institution lobbies or kiosks in
shopping centers--the institution would have the responsibility of
ensuring retainability. Methods for fulfilling this requirement could
include, for example, printers incorporated into terminals or a screen
message offering to transmit the disclosure to the consumer's
electronic mail or post office or other address provided that the
delivery requirements (discussed above) are satisfied.
Current Need for Safeguards Concerning the Electronic Delivery of
Disclosures
Today, most consumers receive federal disclosures in paper form. As
electronic commerce and electronic banking increase and technological
advances take place, obtaining disclosures by electronic communication
will likely become more commonplace. Currently, however, the use of
electronic communication in the delivery of financial services is still
evolving. In light of this evolution, it is difficult to fully predict
the extent to which additional safeguards, if any, may be needed to
ensure that consumers receive the same protections that exist for
disclosures in paper form. The Board expects that depository
institutions and other institutions subject to Regulation DD will
provide sufficient details about the delivery of disclosures. The Board
plans to closely monitor the development of electronic delivery of TISA
disclosures and other information, and will address compliance or other
issues that may arise as appropriate.
Section 230.5 Subsequent Disclosures
5(c) Notice for Time Accounts One Month or Less That Renew
Automatically
Section 266(a)(3) of the TISA requires institutions to provide
certain disclosures for rollover time accounts at least 30 days before
maturity. In implementing this provision in 1992, the Board looked to
the legislative history of the TISA, which suggested special rules for
short-term time accounts. The Board determined that the purposes of the
legislation would not be served by requiring advance disclosures for
rollover time accounts with maturities of one month or less. Regulation
DD therefore did not require disclosures to be provided in advance of
maturity for such time accounts. However, under Sec. 230.5(c) of the
regulation, if a term disclosed when the account was opened is changed
at renewal, institutions were required to send a notice describing the
change within a reasonable time after the renewal of the account.
The 1996 Act eliminates the requirement that institutions provide
disclosures in advance of maturity for automatically renewable time
accounts with a term of 30 days or less. (Institutions will continue to
provide disclosures when these accounts are opened.) Accordingly, the
Board proposes to delete Sec. 230.5(c) and the corresponding provision
in the official staff commentary, comment 5(c)-1.
The statute eliminates these disclosures for rollover time accounts
with a maturity of 30 days or less. Technically, the statute could be
read to require subsequent disclosures for rollover time accounts with
a maturity of 31 days. For ease of compliance, the Board proposes to
eliminate subsequent disclosures for rollover time accounts with a
maturity of ``one month or less.'' This approach would not require
subsequent disclosures for accounts with a maturity of 31 days and is
consistent with other provisions of Regulation DD that interpret one
month to include 31 days.
Section 230.8 Advertising
8(e) Exemption for Certain Advertisements
8(e)(2) Indoor Signs
Section 263(a) of the TISA provides that a reference to a specific
interest rate, yield, or rate of earnings in an advertisement triggers
a duty to state certain additional information, including the annual
percentage yield. In 1994, the Congress amended section 263(c) of the
advertising rules to provide that if a rate is displayed on a sign
(including a rate board) designed to be viewed only from the interior
of an institution, the disclosure requirements of section 263 do not
apply.
A further amendment to section 263(c) of the TISA contained in the
1996 Act expands the exemption for signs on the premises of the
depository institution. Under the Board's proposal, all signs inside
the premises of an institution would be exempt from certain advertising
disclosures (including signs that face outdoors and that are intended
to be viewed from outside the premises). The proposal would delete the
reference in Sec. 230.8(e) to signs that face outside and the
corresponding provision in the official staff commentary, comment
8(e)(2)(i)2. Any sign posted outside a depository institution remains
covered by the advertising provisions unless the sign qualifies for
some other exemption, such as the exemption for broadcast or electronic
media.
Section 230.8(e) of Regulation DD exempts advertisements made
through broadcast or electronic media from several of the mandatory
advertising disclosures. Questions have arisen about whether the
limited exception for broadcast media applies to computer or other
advertisements, such as those posted on the Internet. The Board
believes that such advertisements are not exempt under the broadcast or
electronic media provision. The rationale for broadcast and electronic
media exemptions is that these media have time or space constraints
that make it extremely burdensome to provide the required disclosures.
Advertisements posted on the Internet generally do not have the same
time and space constraints. Such advertisements would remain subject to
the general advertising rules and, therefore, must comply with the
requirements of Secs. 230.8(a), (b), (c), and (d) of this section.
Appendix B to Part 230--Model Clauses and Sample Forms
The Board is not proposing any amendments to the model forms and
[[Page 14536]]
clauses in Appendix B. The Board believes that financial institutions
can adapt the current forms and clauses in Appendix B for electronic
use.
IV. Form of Comment Letters
Comment letters should refer to Docket No. R-1003 and, when
possible, should use a standard typeface with a type size of 10 or 12
characters per inch. This will enable the Board to convert the text to
machine-readable form through electronic scanning, and will facilitate
automated retrieval of comments for review. Also, if accompanied by an
original document in paper form, comments may be submitted on 3 \1/2\
inch or 5 \1/4\ inch computer diskettes in any IBM-compatible DOS-based
format.
V. Regulatory Flexibility Analysis
In accordance with section 3(a) of the Regulatory Flexibility Act,
the Board's office of the Secretary has reviewed the proposed
amendments to Regulation DD. Overall, the proposed amendments are not
expected to have any significant impact on small entities. The proposed
rule would relieve compliance burden. The proposed rule would also give
depository institutions flexibility in providing disclosures. A final
regulatory flexibility analysis will be conducted after consideration
of comments received during the public comment period.
VI. Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3506; 5 CFR 1320 Appendix A.1), the Board reviewed the proposed rule
under the authority delegated to the Board by the Office of Management
and Budget.
The Federal Reserve has no data with which to estimate the change
in the burden that would be the result of the proposed acceptability of
electronic communications. Depository institutions would be able to use
electronic communication to provide disclosures and other information
required by this regulation rather than having to print and mail the
information in paper form. The use of electronic communication in home
banking and financial services may reduce the paperwork burden on
creditors and financial institutions or merely may reduce the dollar
cost.
The Federal Reserve requests comments from depository institutions,
especially state member banks, that will help to estimate the number
and burden of the various disclosures that would be made in the first
year this rule is effective. Comments are invited on: (a) whether the
proposed revised collection of information is necessary for the proper
performance of the Federal Reserve's functions; including whether the
information has practical utility; (b) the accuracy of the Federal
Reserve's estimate of the burden of the proposed revised information
collection, including the cost of compliance; (c) ways to enhance the
quality, utility, and clarity of the information to be collected; and
(d) ways to minimize the burden of information collection on
respondents, including through the use of automated collection
techniques or other forms of information technology. Comments on the
collections of information should be sent to the Office of Management
and Budget, Paperwork Reduction Project (7100-0271), Washington, DC
20503, with copies of such comments to be sent to Mary M. McLaughlin,
Chief, Financial Reports Section, Division of Research and Statistics,
Mail Stop 97, Board of Governors of the Federal Reserve System,
Washington, DC 20551.
The collection of information requirements in this proposed
regulation are found throughout 12 CFR part 230 and in Appendices A and
B. This information is mandatory (12 U.S.C. 4308) to assist consumers
in comparing deposit accounts offered by depository institutions,
principally through the disclosure of fees, annual percentage yield,
interest rate, and other account terms whenever a consumer requests the
information and before an account is opened. The regulation also
requires that fees and other information be provided on any periodic
statement the institution sends to the consumer. The respondents/
recordkeepers are for-profit financial institutions, including small
businesses. Records, required to evidence compliance with the
regulation, must be retained for twenty-four months.
The Board also proposes to extend the Recordkeeping and Disclosure
Requirements in Connection with Regulation DD (OMB No. 7100-0271) for
three years. The current estimated total annual burden for this
information collection is 1,478,395 hours, as shown in the top half of
the table below. These amounts reflect the burden estimate of the
Federal Reserve System for the 996 state member banks under its
supervision. This regulation applies to all types of depository
institutions (except credit unions), not just to state member banks.
However, under Paperwork Reduction Act regulations, the Federal Reserve
only accounts for the burden of the paperwork associated with state
member banks. Other agencies account for the paperwork burden for the
institutions they supervise.
Both the proposed rules for indoor lobby signs and elimination of
subsequent disclosure requirements for automatically renewable time
accounts with terms less than one month would decrease the frequency of
response slightly; these reductions are shown in the bottom half of the
table. It is estimated that the total amount of annual burden after
these two proposed revisions would be 1,476,071 hours. There is
estimated to be no associated capital or start up cost. The Federal
Reserve has not estimated there to be any annual cost burden over the
annual hour burden.
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Eestimated
Number of Estimated annual
respondents annual Estimated response time burden
frequency hours
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Current
Complete account disclosures (Upon 996 300 5 minutes 24,900
request and new accounts).
Subsequent notices:
Change in terms..................... 996 1,130 1 minute 18,757
Prematurity notices................. 996 1,095 1 minute 18,177
Periodic statements..................... 996 84,615 1 minute 1,404,609
Advertising............................. 996 12 1 hour 11,952
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Total............................... ........... ........... ............................... 1,478,395
Proposed
Complete account disclosures (Upon 996 300 5 minutes 24,900
request and new accounts).
Subsequent notices:
Change in terms..................... 996 1,130 1 minute 18,757
[[Page 14537]]
Prematurity notices................. 996 1,015 1 minute 16,849
Periodic statements..................... 996 84,615 1 minute 1,404,609
Advertising............................. 996 11 1 hour 10,956
------------
Total............................... ........... ........... ............................... 1,476,071
============
Change.............................. ........... ........... ............................... -2,324
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The initial disclosures concerning consumers' rights and
responsibilities for error resolution are available to the public.
Transaction- or account-specific disclosures are not publicly available
and are confidential between the depository institution and the
consumer. Since the Federal Reserve does not collect any information,
no issue of confidentiality normally arises. However, the information
may be protected from disclosure under the exemptions (b)(4), (6), and
(8) of the Freedom of Information Act (5 U.S.C. 552(b)). The Federal
Reserve may not conduct or sponsor, and an organization is not required
to respond to, this information collection unless it displays a
currently valid OMB control number. The OMB control number is 7100-
0271.
List of Subjects in 12 CFR Part 230
Advertising, Banks, Banking, Consumer protection, Federal Reserve
System, Reporting and recordkeeping requirements, Truth in savings.
Text of Proposed Revisions
Certain conventions have been used to highlight the proposed
changes to Regulation DD. New language is shown inside bold-faced
arrows, while language that would be removed is set off with brackets.
For the reasons set forth in the preamble, the Board proposes to
amend, 12 CFR part 230, as set forth below:
PART 230--TRUTH IN SAVINGS (REGULATION DD)
1. The authority citation for part 230 continues to read as
follows:
Authority: 12 U.S.C. 4301 et seq.
2. In Sec. 230.3, the following amendments would be made:
a. By designating the text of paragraph (a) as paragraph (a)(1) and
adding a heading to newly designated paragraph (a)(1);
b. A new paragraph (a)(2) would be added.
The addition and revisions would read as follows:
Sec. 230.3 General disclosure requirements.
(a) Form.--(1) General requirements. * * *
(2) Electronic communication. The term
electronic communication means a message transmitted electronically
between a consumer and a depository institution in a format that allows
visual text to be displayed on equipment such as a personal computer
monitor. A depository institution and a consumer may agree to send by
electronic communication any information required by Secs. 230.4
through 230.6 of this part. Information sent by electronic
communication to a consumer must comply with paragraph (a)(1) of this
section and any applicable timing requirements contained in this
part.
* * * * *
3. Section 230.5 would be amended by removing paragraph (c) and
redesignating paragraph (d) as new paragraph (c):
Sec. 230.5 Subsequent disclosures.
* * * * *
[(c) Notice for time accounts one month or less that renew
automatically. For time accounts with a maturity one month or less that
renew automatically at maturity, institutions shall disclose any
difference in the terms of the new account as compared to the terms
required to be disclosed under Sec. 230.4(b) of this part for the
existing account, other than a change in the interest rate and
corresponding change in the annual percentage yield. The notice shall
be mailed or delivered within a reasonable time after the renewal.]
4. Section 230.8 would be amended by revising paragraph (e)(2)(i)
to read as follows:
Sec. 230.8 Advertising.
* * * * *
(e) Exemption for certain advertisements. * * *
(2) Indoor signs. (i) Signs inside the premises of a depository
institution (or the premises of a deposit broker) are not subject to
paragraphs (b), (c), (d) or (e)(1) of this section [unless they face
outside the premises and can reasonably be viewed by a consumer only
from outside the premises].
* * * * *
5. In Supplement I to Part 230, in Sec. 230.5--Subsequent
disclosures, under paragraph (c), paragraph 1. would be removed:
Supplement I to Part 230--Official Staff Interpretations
* * * * *
Sec. 230.5 Subsequent disclosures
* * * * *
(c) Notice for time accounts one month or less that renew
automatically
[1. Providing disclosures within a reasonable time. Generally, 10
calendar days after an account renews is a reasonable time for
providing disclosures. For time accounts shorter than 10 days,
disclosures should be given prior to the next renewal date. For
example, if a time account automatically renews every 7 days,
disclosures about an account that renews on Wednesday, December 7,
1994, should be given prior to Wednesday, December 14.]
* * * * *
6. In Supplement I to Part 230, in Sec. 230.8--Advertising, under
paragraph (e)(2)(i), paragraph 2. would be removed.
* * * * *
Sec. 230.8 Advertising
* * * * *
(e)(2) Indoor signs.
(e)(2)(i)
* * * * *
[2. Consumers outside the premises. Advertisements may be ``indoor
signs'' even though they may be viewed by consumers from outside. An
example is a banner, in an institution's glass-enclosed branch office,
that is located behind a teller facing customers but is readable by
passersby.]
* * * * *
[[Page 14538]]
By order of the Board of Governors of the Federal Reserve
System, March 12, 1998.
William W. Wiles,
Secretary of the Board.
[FR Doc. 98-6989 Filed 3-24-98; 8:45 am]
BILLING CODE 6210-01-P