Century Date Change

Fed Facts

Fed Asks Institutions to Review CDC Contingency Funding

As part of preparations for Century Date Change (CDC) compliance, the Federal Reserve is asking financial institutions to establish contingency funding arrangements. Institutions may wish to consider making the Fed's Discount Window one of their liquidity sources. The Fed encourages credit unions to contact their corporate credit unions first.

Most depository institutions are eligible to borrow from the Discount Window. Although loans must be fully secured, the Fed accepts a variety of assets as collateral. A small discount is applied to the assets pledged to determine collateral value. Most pledged assets can be held in book-entry form or remain in the borrower's possession.

Institutions that already have the required borrowing documentation in place should review the amount of collateral pledged in comparison to their potential needs. Those institutions that would like to borrow from the Discount Window must have an account with the Fed or with a correspondent that does. In addition, they will need to submit a letter of agreement, authorizing board resolution and certified copy of the minutes documenting approval of the resolution. For more information, call the Fed's Credit staff at (314) 444-8316 or (314) 444-8622.