Birmingham Branch to Convert to Cash Depot
Vol. 19, No. 3,
Third Quarter 2006
Birmingham Branch to
Depot to heighten efficiency
A cash depot is an alternative market presence for Federal Reserve currency services. With a cash depot, the Federal Reserve contracts with a company—Loomis Fargo, in this case—that acts as a secure collection point for currency deposits and a secure distribution center for currency orders that depository institutions place with a Reserve Bank, which is Atlanta in this instance.
The Federal Reserve pays for the transportation between the Birmingham depot and Atlanta. Credit for deposits is passed to depository institutions upon receipt and bulk verification at the depot, and the charge for orders does not occur until the day that orders are picked up from the depot. Depository institutions are assessed no additional fees for using the depot.
Atlanta cash office to count deposits, prepare orders
Loomis Fargo, a privately held company, will operate the depot under a contract with the Atlanta Fed. The Bank's Atlanta cash operations will assume the duties of counting deposits and preparing orders for Birmingham-area customers, which include depository institutions throughout Alabama, except for the southern counties that are served by the New Orleans Branch.
One of the only changes resulting from the transition to a depot is an adjustment in the time by which currency and coin orders must be placed. Financial institutions served by the Birmingham Branch have received information describing those changes.
In June 2005, the Reserve Banks' Financial Services Policy Committee approved the plan to convert the Birmingham cash operation to a third-party depot arrangement serviced out of Atlanta. The Federal Reserve already uses several cash depots in other parts of the country.