Fed, CFPB Issue Final Rule for Reg CC Inflation Adjustment Calculation

The Federal Reserve and the Consumer Financial Protection Bureau today finalized changes to Regulation CC (the Expedited Funds Availability Act) to adopt a method for making inflationary adjustments to the dollar amounts in Regulation CC every five years pursuant to the Dodd-Frank Act. The adjustments include, for example, an increase in the large dollar exception amount from $5,000 to $5,525. As recommended by the American Bankers Association, the first adjustments will be effective July 1, 2020.

In its previous comments, ABA also recommended that the agencies tie the inflation adjustments to any other disclosure changes. The agencies declined to include any of the disclosure changes previously proposed, but noted that they “recognize the benefit of making efforts…to coordinate the effective date of future rulemakings effecting changes to disclosures required by the funds-availability provisions” with the inflationary adjustments.

Under the final rule, the agencies based the first set of inflation adjustments on CPI-W data from July 2011 to July 2018. As originally proposed, adjustments to the dollar amounts will always be zero or upward, never downward, and would be rounded to the nearest multiple of $25.

In addition, the final rule implements a provision of S. 2155 to extend coverage of Reg CC to American Samoa, the Northern Mariana Islands, and Guam. The final rule did not address the Fed’s 2011 proposal regarding funds availability under Reg CC, which was reopened for comment in November. Read the final rule.