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Home - Resource Centers and FAQs - Frequently Asked Questions (FAQs) -
- Common Two-Week Maintenance Period Frequently Asked Questions
Common Two-Week Maintenance Period Frequently Asked Questions
Frequently Asked Questions
Click on the topic below to view the Frequently Asked Question for that particular topic.
- What is a maintenance period?
- What is a reserve balance requirement?
- What is a common two-week maintenance period?
- Why is the Federal Reserve creating a common two-week maintenance period?
- Does the creation of a common two-week maintenance period affect the reporting of deposits data?
- Does the creation of a common two-week maintenance period affect the relationship between reporting periods and maintenance periods for weekly reporters?
- Does the creation of a common two-week maintenance period affect the relationship between reporting periods and maintenance periods for quarterly reporters?
- Will the existing Reserve Maintenance Calendars be updated to reflect the relationship between reporting periods and two-week maintenance periods?
- Does the creation of a common two-week maintenance period affect annual reporters and nonreporters?
- Does the creation of a common two-week maintenance period affect the calculation of interest for excess balance accounts?
- When will the first, common two-week maintenance period begin?
- When will the Federal Reserve provide information on reserve balance requirements for a given maintenance period?
- Where will the Federal Reserve provide information on a depository institution's reserve balance requirement?
- Did the Board of Governors seek comment on the rule to create a common two-week maintenance period?
- Whom do I contact for additional information?
Q: What is a maintenance period?
A: The time span during which a depository institution holds balances at the Federal Reserve to satisfy its reserve balance requirement.
Q: What is a reserve balance requirement?
A: A reserve balance requirement is the amount of funds that a depository institution must hold in reserve against specified deposit liabilities that is not satisfied by its vault cash and therefore must be maintained either directly with a Reserve Bank or in a pass-through arrangement.
Q: What is a common two-week maintenance period?
A: A common two-week maintenance period consists of 14 consecutive days beginning on a Thursday and ending on the second Wednesday thereafter that will be the same period for all institutions with reserve balance requirements.
Q: Why is the Federal Reserve creating a common two-week maintenance period?
A: The Federal Reserve is creating a common two-week maintenance period to simplify the existing maintenance period structure. The existing maintenance period structure is unnecessarily complex for the implementation of monetary policy. In addition, a common maintenance period of two weeks was selected so that depository institutions would at least retain, if not increase, the current amount of flexibility in meeting their reserve balance requirements.
Q: Does the creation of a common two-week maintenance period affect the reporting of deposits data?
A: No. The common two-week maintenance period does not change the frequency or the amount of data an institution must report to the Federal Reserve.
Q: Does the creation of a common two-week maintenance period affect the relationship between reporting periods and maintenance periods for weekly reporters?
A: No. For depository institutions that report their deposits weekly, the relationship between the weekly reporting periods and two-week maintenance periods will not change.
Q: Does the creation of a common two-week maintenance period affect the relationship between reporting periods and maintenance periods for quarterly reporters?
A: Yes. For depository institutions that report their deposits quarterly, the quarterly reporting periods will not change, but a new relationship will be established between quarterly reporting periods and two-week maintenance periods. Each quarterly report will be used to calculate a depository institution’s reserve balance requirement for an interval of either six or seven consecutive two-week maintenance periods, depending on when the interval begins or ends. More information on interval lengths is available in the Press Release (Off-site Link) dated April 5, 2012.
Q: Will the existing Reserve Maintenance Calendars be updated to reflect the relationship between reporting periods and two-week maintenance periods?
A: Yes. An updated version of the Reserve Maintenance Calendars will be available closer to the implementation of the common two-week maintenance period.
Q: Does the creation of a common two-week maintenance period affect annual reporters and nonreporters?
A: Yes. Annual reporters and nonreporters with an account at a Federal Reserve Bank will be paid interest on the average balances maintained over a two-week period, instead of a one-week period, at the interest rate on excess balances.
Q: Does the creation of a common two-week maintenance period affect the calculation of interest for excess balance accounts?
A: Yes. The average balances maintained in an excess balance account will be paid interest over a two-week period, instead of a one-week period, at the interest rate on excess balances.
Q: When will the first, common two-week maintenance period begin?
A: The first common two-week maintenance period will begin on June 27, 2013.
Q: When will the Federal Reserve provide information on reserve balance requirements for a given maintenance period?
A: Reserve balance requirements for all depository institutions that report their deposits weekly and quarterly will be calculated roughly one week before the start of a maintenance period.
Q: Where will the Federal Reserve provide information on a depository institution’s reserve balance requirement?
A: Information on a depository institution’s reserve balance requirement will be available through the Reserves Central—Reserve Account Administration application. Details on how to access to Reserves Central—Reserve Account Administration are available on the Reserves Administration Enhancements Resource Center.
Q: Did the Board of Governors seek comment on the rule to create a common two-week maintenance period?
A: Yes. The Board of Governors sought comment on the proposed rule to create a common two-week maintenance period. More information is available in the Press Release (Off-site Link) dated October 11, 2011.
Q: Whom do I contact for additional information?
A: If you need additional information, please contact your Reserves Central District Contact.
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