To the Chief Executive Officers of All State Member Banks, Bank Holding Companies,
Edge and Agreement Corporations, State-Licensed Branches and Agencies of Foreign
Banks, and Others Concerned, in the Second Federal Reserve District:
As you may know, the Federal Reserve and other U.S. bank supervisors recently developed a rating system to assess compliance efforts with regard to Year 2000 readiness. Consistent with this Bank's Circular No. 11002 regarding the handling of confidential supervisory information, and other longstanding guidance on this subject, the enclosed Federal Reserve Board staff supervisory letter (SR 98-21) re-emphasizes that examination findings and ratings, including those related to Year 2000 readiness, are strictly confidential and cannot be disclosed. Disclosure of confidential supervisory information constitutes a violation of the Board of Governors' regulations and could lead to a formal enforcement action.
Given the critical need for banking organizations to be ready for the century date change and to keep their customers, counterparties, and the public informed about the state of their readiness, boards of directors and senior management are encouraged to disclose the steps their organizations are taking to address their Year 2000 readiness and to comply with all applicable reporting obligations imposed by securities laws and regulations, including pronouncements issued by the Securities and Exchange Commission. However, no such disclosures may refer to Federal Reserve examination findings or Year 2000 compliance ratings. Further, such compliance ratings cannot be used in any manner to suggest that the Federal Reserve certifies or warrants an organization's readiness for the century date change.
Questions may be directed, at this Bank, to any member of the portfolio management team that supervises your organization, or to Fred Herriman, Senior Vice President.