Details regarding additional closing dates associated with specific services provided by U.S. Central Bridge emerged today in a second memo, signed by U.S. Central Bridge CEO Francois Henriquez. The Henriquez document is much more detailed than the earlier memosigned by NCUA executive Scott Hunt.
The following was excerpted from the memo and shows the dramatic changes that will be implemented at U.S. Central Bridge:
Overnight Deposit Balances - In order to maintain efficient clearing of Automated Settlement transactions, effective Jan. 12, 2012, U.S. Central Bridge will require that, at all times, each corporate maintain on deposit in its overnight account at U.S. Central Bridge a ‘minimum settlement balance’ (MSB). U.S. Central Bridge staff will advise each corporate of its MSB at the beginning of every month; each corporate’s MSB will be based on that corporate’s peak aggregate settlement amount during the immediately preceding calendar month.
Daylight Overdrafts – Also in conjunction with the implementation of the MSB and the increase in the overnight deposit rate, effective Jan. 12, 2012, U.S. Central Bridge will eliminate all ‘grace”’ daylight overdrafts. Thus, U.S. Central Bridge will impose a $1,000 penalty each time a corporate’s overnight share balances are not sufficient to cover settlement.
Advised Line of Credit – Effective Jan. 12, 2012, each corporate’s U.S. Central Bridge advised line of credit will be available only in connection with funding settlement liabilities to U.S. Central Bridge. Accordingly, the amount of each corporate’s available credit will be adjusted daily and will be equal to the sum of all of that corporate’s deposits (both overnight and term, if any) in U.S. Central Bridge that day, times 90%.
International Services Program – The International Services Program (which includes both international wires and international drafts and currency) will be discontinued. The last day that international wire requests, draft deposits, draft requests and currency requests will be accepted by U.S. Central Bridge will be March 30, 2012.
Automated Settlement – The Automated Settlement Program will be discontinued. The final day that U.S. Central Bridge will process automated settlement transactions is May 31, 2012. This week, U.S. Central management is sending notifications to this effect to each of the national originators currently participating in the Automated Settlement Program.
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