Partners, Volume 15, Number 1, 2005

In Step with the Changing Marketplace

As the nation’s central bank, the Fed is responsible for three main functions that help ensure economic stability: monetary policy, supervision and regulation, and payments system services. As I noted in the last issue of Partners, the nation’s volume of paper checks continues to decline as electronic payments increase. This shift in payments practices has been reinforced by The Check Clearing for the 21st Century Act (Check 21). Recently passed by Congress, the new legislation allows an electronic image to serve as a substitute for the original paper instrument.

In response to this changing marketplace, the Federal Reserve System has streamlined its operations and consolidated its functions to enhance efficiency. As a result, many of our branch offices have reduced staff and overhead. Several Fed branches throughout the System have also relocated to smaller facilities and are considering selling or subleasing existing buildings.

Even though the Fed has downsized its physical operations to remain in step with the marketplace, branch offices will continue to play a vital role in their communities. Local boards of directors identify, interpret, and address regional economic issues, and thus are a crucial source of valuable information for the District’s board and president.

Recognizing new opportunities to increase effectiveness, many Reserve Banks are now expanding the role of the branches in community outreach, financial literacy, and economic education training. Such initiatives not only improve consumer awareness and inform the public about the Fed, but they also present the Fed with additional insights into local economies.

In the Sixth District, we have already added positions devoted to the delivery of effective economic education programs in key branches. Although these positions do not report to Community Affairs, they provide a great complement to existing Community Affairs programs.

Since 2001, we have designated a Regional Community Development Manager in each of FRB Atlanta’s six locations to meet local needs more effectively. While these positions focus mainly on financial and regulatory issues specific to low- and moderate-income families and markets, they also present many opportunities to collaborate with community leaders on a variety of projects.

No one can predict the future. However, I can say with confidence that even though the Fed remains committed to adaptive change in fulfilling its mission, strong local community involvement will always remain significant in ensuring a safe and sound banking system.

Juan C. Sanchez
Community Affairs Officer


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