321.3—Procedure for qualifying and serving as paying agent.
(a) Execution of application-agreement.
An eligible organization wishing to act as a paying agent shall obtain from, execute, and file an application-agreement with the appropriate Federal Reserve Office referred to in § 321.25. The terms of each application-agreement shall include a reference to the following provisions to which paying agents are subject:
(1)
The provisions prescribed by section 202 of Executive Order 11246, entitled “Equal Employment Opportunity”, as amended (42 U.S.C. 2000e note); and
(2)
The provisions of the Privacy Act of 1974, as amended (5 U.S.C. 552a ), and regulations issued pursuant thereto ( 31 CFR part 1, subpart C).
For the purpose of these regulations, eligible institutions in Puerto Rico and the Virgin Islands shall make application to the Federal Reserve Bank Branch in Buffalo, New York and eligible institutions in Guam shall make application to the Federal Reserve Bank of Kansas City.
(b) Qualification.
Each Federal Reserve Bank referred to in § 321.25, as fiscal agent of the United States, is authorized to qualify any eligible organization, located in the Reserve Bank's geographical area, as shown in § 321.25, which possesses adequate authority under its charter to act as paying agent. Upon approval of an application-agreement, the Bank will issue a certificate of qualification to the organization. Such a certificate automatically qualifies the branches of the organization to redeem securities as provided in this part.
(c) Announcement of authority.
Upon receipt of a certificate of qualification from a Federal Reserve Bank referred to in § 321.25, a financial institution may announce or advertise its authority to redeem eligible securities for cash and to process eligible Series E and EE savings bonds and savings notes presented for redemption in exchange for Series HH savings bonds under the provisions of Department of the Treasury Circular, Public Debt Series No. 2-80 ( 31 CFR part 352 ).
(d) Adverse action.
An organization will be notified by the appropriate Federal Reserve Bank referred to in § 321.25, in writing, if its application-agreement to act as paying agent is not approved.