For release: 12:20 pm, May 25, 2005
Contacts: Marilyn Wimp, media advisor, 215-574-4197; Kathy Dibling, assistant media advisor 215-574-4119
Philadelphia, Pa. — The Federal Reserve Bank of Philadelphia has been selected to process checks now handled by the Federal Reserve Bank of New York’s East Rutherford Operations Center. This action is an effort to increase the efficiency of the Reserve Banks’ check processing function due to the continuing shift in consumer and business preferences for electronic payments.
“The Federal Reserve System chose Philadelphia based on its overall productivity and efficiency, its ability to handle the total check volume of both Districts, and its proximity to the New York District’s financial institutions,” said Philadelphia Federal Reserve President Anthony M. Santomero. “The Federal Reserve Bank of Philadelphia has long been a leader in the System with a premier check operation,” he added.
Currently, Philadelphia has 270 employees who process commercial and government checks and handle check adjustments for customers nationwide. Additional employees, equipment, and space renovations will be needed to accommodate the increased workload. Approximately 60 positions are expected to be created in Philadelphia to help process the additional volume. While no firm date for the transition has yet been determined, it is expected to take place in the second half of 2006.
Since 2003, the Reserve Banks have reduced the locations where they process checks from 45 to 29 as of today. When the New York closing is completed, including the six additional locations that were previously announced, the Reserve Banks will process checks from 22 sites nationwide. The Federal Reserve System will continue to evaluate its check processing infrastructure annually to ensure that the needs of the nation’s payment system are being met. For more information about the Federal Reserve’s check processing strategy.
The Federal Reserve Banks’ long-term check processing strategy will allow it to better meet the 1980 Monetary Control Act. That act requires the Federal Reserve to recover its total operating costs of providing payment services to financial institutions, and the costs it would have incurred and the profits it would have earned had the services been provided by a private firm.
The Federal Reserve Bank of Philadelphia helps formulate and implement monetary policy, supervises banks and bank holding companies, and provides financial services to depository institutions and the federal government. The Philadelphia Fed serves the Third District, which is composed of eastern Pennsylvania, southern New Jersey, and Delaware.