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ICBA Statement on Second Round of Fed Check Operations Closures

Washington, D.C. (Aug. 2, 2004) - Independent Community Bankers of America (ICBA) strongly encourages the Federal Reserve to take appropriate actions to ensure that its latest round of check operations closures is as seamless as possible for community banks and their customers. Based on experience from the first round of closings, ICBA urges Reserve Banks to pay close attention to deposit deadlines, transportation and funds availability to minimize any impact on bank customers.

"Over time, it will be interesting to see how Federal Reserve Banks and Branches further re-engineer in response to the payments paradigm shift to electronics," notes ICBA President and CEO Camden R. Fine. "As the Federal Reserve restructures in response to declining paper-check volumes, it is increasingly apparent that it has become a more nimble organization."

Growing consumer and business preferences for electronic payments and new paper-check conversion models will continue to reduce paper-check volumes. ICBA said it is imperative that the Federal Reserve System work closely with the industry to effectively manage the changing payments system.

ICBA commends the Federal Reserve System for recognizing the need to ensure that it remains a viable provider of check services for all financial institutions throughout the nation. ICBA is a longtime supporter of the Federal Reserve, which provides efficient, accessible, reliable and safe payment services.