Deposit Reclassification

Regulation D Retail Sweep Program

Deposit Reclassification, also known as a retail sweep program, is a Federal Reserve Board acknowledged practice that reduces your reserve requirement through classifying your institution’s checking accounts as savings, which are not subject to reserve requirements.

Federal Reserve Balances behave as an illiquid asset, earning minimal interest (Fed Funds). Your institution can convert these assets with Deposit Reclassification into earning assets with a much better rate of return – perhaps with commercial, mortgage, and consumer loans, or higher yielding securities in your investment portfolio.

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How does Deposit Reclassification work?

Deposit Reclassification works within the FRB’s approved processes and regulations to sweep between checking accounts (subject to reserve requirements) and savings deposit accounts (not subject to reserve requirements). Deposit Reclassification implements sweeps by creating a checking and savings sub-account for each transaction account holder. Daily sweeps are performed between each account holder’s checking and savings sub-account to significantly reduce reserve requirements; often to amounts that are well below vault cash, and eliminates the need for reserve balances.
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Deposit Reclassification will:

  • Permanently recover your Federal Reserve Bank balance
  • Increase income on your earning assets
  • Requires only 60 days to implement
  • Immediately impacts your bottom line
  • Compliant with Regulation D
  • Compliant with Federal Reserve requirements
  • Invisible to customers
  • No adverse effect on the account holder
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Recover Reserve Balances with Ease

Deposit Reclassification Brochure

Learn more about how Deposit Reclassification works and can help your financial institution recover reserve balances.

Download Brochure