Notice2021-16963
Agency Information Collection Activities: Proposed Information Collection Renewal; Comment Request
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
August 10, 2021
Issuing agencies
Federal Deposit Insurance Corporation
Abstract
The FDIC, as part of its obligations under the Paperwork Reduction Act of 1995 (PRA), invites the general public and other Federal agencies to take this opportunity to comment on the renewal of the existing information collections described below (OMB Control No. 3064-0183; -0195; and -0200).
Full Text
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<title>Federal Register, Volume 86 Issue 151 (Tuesday, August 10, 2021)</title>
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[Federal Register Volume 86, Number 151 (Tuesday, August 10, 2021)]
[Notices]
[Pages 43652-43663]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-16963]
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FEDERAL DEPOSIT INSURANCE CORPORATION
[OMB No. 3064-0183; -0195; -0200]
Agency Information Collection Activities: Proposed Information
Collection Renewal; Comment Request
AGENCY: Federal Deposit Insurance Corporation (FDIC).
ACTION: Notice and request for comment.
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SUMMARY: The FDIC, as part of its obligations under the Paperwork
Reduction Act of 1995 (PRA), invites the general public and other
Federal agencies to take this opportunity to comment on the renewal of
the existing information collections described below (OMB Control No.
3064-0183; -0195; and -0200).
DATES: Comments must be submitted on or before October 12, 2021.
ADDRESSES: Interested parties are invited to submit written comments to
the FDIC by any of the following methods:
<bullet> Agency website: <a href="https://www.fdic.gov/resources/regulations/federal-register-publications/">https://www.fdic.gov/resources/regulations/federal-register-publications/</a>.
[[Page 43653]]
<bullet> Email: <a href="/cdn-cgi/l/email-protection#aecdc1c3c3cbc0daddeec8cac7cd80c9c1d8"><span class="__cf_email__" data-cfemail="82e1edefefe7ecf6f1c2e4e6ebe1ace5edf4">[email protected]</span></a>. Include the name and number of
the collection in the subject line of the message.
<bullet> Mail: Manny Cabeza (202-898-3767), Regulatory Counsel, MB-
3128, Federal Deposit Insurance Corporation, 550 17th Street NW,
Washington, DC 20429.
<bullet> Hand Delivery: Comments may be hand-delivered to the guard
station at the rear of the 17th Street building (located on F Street),
on business days between 7:00 a.m. and 5:00 p.m.
All comments should refer to the relevant OMB control number. A
copy of the comments may also be submitted to the OMB desk officer for
the FDIC: Office of Information and Regulatory Affairs, Office of
Management and Budget, New Executive Office Building, Washington, DC
20503.
FOR FURTHER INFORMATION CONTACT: Manny Cabeza, Regulatory Counsel, 202-
898-3767, <a href="/cdn-cgi/l/email-protection#bed3dddfdcdbc4dffed8dad7dd90d9d1c8"><span class="__cf_email__" data-cfemail="cfa2acaeadaab5ae8fa9aba6ace1a8a0b9">[email protected]</span></a>, MB-3128, Federal Deposit Insurance
Corporation, 550 17th Street NW, Washington, DC 20429.
SUPPLEMENTARY INFORMATION: Proposal to renew the following currently
approved collections of information:
1. Title: Credit Risk Retention.
OMB Number: 3064-0183.
Form Number: None.
Affected Public: Insured state nonmember banks, state savings
institutions, insured state branches of foreign banks, and any
subsidiary of the aforementioned entities.
General Description of Collection: This information collection
request comprises disclosure and recordkeeping requirements under the
credit risk retention rule issued pursuant to section 15G of the
Securities Exchange Act of 1934 (15 U.S.C. 78o-11), as added by Section
941 of the Dodd-Frank Wall Street Reform and Consumer Protection Act
(``Dodd-Frank'').\1\ The Credit Risk Retention rule (``the Rule'') was
jointly issued in 2015 by the Federal Deposit Insurance Corporation
(``FDIC''), the Office of the Comptroller of the Currency (``OCC''),
the Federal Reserve Board (``Board''), the Securities and Exchange
Commission (``SEC'') and, with respect to the portions of the Rule
addressing the securitization of residential mortgages, the Federal
Housing Finance Agency (``FHFA'') and the Department of Housing and
Urban Development (``HUD'').\2\ The FDIC regulations corresponding to
the Rule are found at 12 CFR part 373.\3\
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\1\ Public Law 111-2-3, 124 Stat. 1376 (2010).
\2\ 79 FR 77740.
\3\ Each agency adopted the same rule text but each agency's
version of its rule is codified in different parts of the Code of
Federal Regulations with substantially identical section numbers
(e.g.__.01;_.02, etc.) Rule citations herein are to FDIC's version
of the Rule which is codified at 12 CFR part 373.
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Section 941 of Dodd-Frank requires the Board, the FDIC, the OCC
(collectively, the ``Federal banking agencies''), the Commission and,
in the case of the securitization of any ``residential mortgage
asset,'' together with HUD and FHFA, to jointly prescribe regulations
that (i) require a an issuer of an asset-backed security or a person
who organizes and initiates an asset backed securities transaction by
selling or transferring assets, either directly or indirectly,
including through an affiliate, to the issuer (``issuer or organizer'')
to retain not less than five percent of the credit risk of any asset
that the issuer or organizer, through the issuance of an asset-backed
security (``ABS''), transfers, sells or conveys to a third party and
(ii) prohibit an issuer or organizer from directly or indirectly
hedging or otherwise transferring the credit risk that the issuer or
organizer is required to retain under section 941 and the agencies'
implementing rules. Exempted from the credit risk retention
requirements of section 941 are certain types of securitization
transactions, including ABS collateralized solely by qualified
residential mortgages (``QRMs''), as that term is defined in the Rule.
In addition, Section 941 provides that the agencies must permit an
issuer or organizer to retain less than five percent of the credit risk
of residential mortgage loans, commercial real estate (``CRE'') loans,
commercial loans and automobile loans that are transferred, sold or
conveyed through the issuance of ABS by the issuer or organizer, if the
loans meet underwriting standards established by the Federal banking
agencies.
The FDIC implemented Section 941 of Dodd-Frank through 12 CFR part
373 (the ``Rule''). The Rule defines a securitizer as (1) The depositor
of the asset-backed securities (if the depositor is not the sponsor);
or (2) The sponsor of the asset-backed securities.\4\ The Rule provides
a menu of credit risk retention options from which securitizers can
choose and sets out the standards, including disclosure, recordkeeping,
and reporting requirements, for each option; identifies the eligibility
criteria, including certification and disclosure requirements, that
must be met for ABS offerings to qualify for the QRM and other
exemptions; specifies the underwriting standards for CRE loans,
commercial loans and automobile loans, as well as disclosure,
certification and recordkeeping requirements, that must be met for ABS
issuances collateralized by such loans to qualify for reduced credit
risk retention; and sets forth the circumstances under which retention
obligations may be allocated by sponsors to originators, including
disclosure and monitoring requirements.
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\4\ 12 CFR 373.2.
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Part 373 contains several requirements that qualify as information
collections under the Paperwork Reduction Act of 1995 (``PRA''). The
information collection requirements are found in sections 373.4; 373.5;
373.6; 373.7; 373.8; 373.9; 373.10; 373.11; 373.13; 373.15; 373.16;
373.17; 373.18; and 373.19(g). The recordkeeping requirements relate
primarily to (i) the adoption and maintenance of various policies and
procedures to ensure and monitor compliance with regulatory
requirements and (ii) certifications, including as to the effectiveness
of internal supervisory controls. The required disclosures for each
risk retention option are intended to provide investors with material
information concerning the sponsor's retained interest in a
securitization transaction (e.g., the amount, form and nature of the
retained interest, material assumptions and methodology,
representations and warranties). Compliance with the information
collection requirements is mandatory, responses to the information
collections will not be kept confidential and, with the exception of
the recordkeeping requirements in sections 373.4(d), 373.5(k)(3) and
373.15(d), the Rule does not specify a mandatory retention period for
the information.
Burden Estimate:
Change Is Burden Estimation Methodology
(1) Prior Methodology
To determine the total paperwork burden for the requirements
contained in the Credit Risk Retention Rule, FDIC first estimated the
universe of sponsors that would be required to comply with the
disclosure and recordkeeping requirements. FDIC estimated that
approximately 270 unique sponsors conduct ABS offerings each year.\5\
This estimate was based on the average number of ABS offerings from
2007 through 2017 reported by the ABS database Asset-Backed Alert for
all non-CMBS transactions and by Commercial Mortgage Alert for all CMBS
[[Page 43654]]
transactions.\6\ Of the 270 sponsors, the agencies assigned 8 percent
of these sponsors to the Board, 12 percent to FDIC, 13 percent to the
OCC, and 67 percent to the Commission.\7\
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\5\ By agreement among the agencies, the FDIC's Division of
Insurance Research, in consultation with its counterparts at the
other agencies, prepared and documented the burden estimation
methodology used by all agencies in their respective ICRs.
\6\ Data was provided by the Securities and Exchange Commission.
See SEC supporting statement for its information collection for the
Credit Risk Retention rule (3235-0712) available at <a href="https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201803-3235-014">https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=201803-3235-014</a>.
\7\ The allocation percentages among the agencies were based on
the agencies' latest assessment of data as of August 13, 2018,
including the securitization activity reported by FDIC-insured
depository institutions in the June 30, 2017 Consolidated Reports of
Condition.
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Next, FDIC estimated how many respondents keep records and make
required disclosures by estimating the proportionate amount of
offerings per year for each agency. The estimate was based on the
average number of ABS offerings from 2007 through 2017. The agencies
estimated the total number of annual offerings per year to be 1,400 \8\
which resulted in the following:
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\8\ Based on ABS issuance data from Asset-Backed Alert on the
initial terms of offerings, supplemented with information from
Commercial Mortgage Alert. This estimate included registered
offerings, offerings made under Securities Act Rule 144A, and
traditional private placements. This estimate was for offerings not
exempted under Sec. Sec. _.19(a)-(f) and _.20 of the Rule.
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(a) 13 offerings per year will be subject to disclosure and
recordkeeping requirements under Sec. 373.11, which are divided
equally among the four agencies (i.e., 3.25 offerings per year per
agency);
(b) 110 offerings per year were estimated to be subject to
disclosure and recordkeeping requirements under Sec. Sec. 373.13 and
373.19(g), which were divided proportionately among the agencies based
on the entity percentages described above:
(i) Nine (9) offerings per year for the Board (8%);
(ii) 13 offerings per year for the FDIC (12%);
(iii) 14 offerings per year for the OCC (13%);
(iv) 74 offerings per year for the Commission (67%).
(c) 132 offerings per year were estimated to be subject to the
disclosure requirements under Sec. 373.15, which were divided
proportionately among the agencies based on the entity percentages
described above:
(i) 11 offerings per year for the Board (8%);
(ii) 16 offerings per year for the FDIC (12%);
(iii) 17 offerings per year for the OCC (13%);
(iv) 88 offerings per year for the Commission (67%).
(d) Of these 132 offerings per year, 44 offerings per year were
estimated to be subject to disclosure and recordkeeping requirements
under Sec. Sec. 373.16, 373.17, and 373.18, respectively, which were
divided proportionately among the agencies based on the entity
percentages described above:
(i) 4 offerings per year for each section for the Board (8%);
(ii) 6 offerings per year for each section for the FDIC (12%);
(iii) 6 offerings per year for each section for the OCC (13%);
(iv) 29 offerings per year for each section for the Commission
(67%).
To obtain the estimated number of responses (equal to the number of
offerings) for each option in subpart B of the rule, FDIC multiplied
the number of offerings estimated to be subject to the base risk
retention requirements (i.e., 1,158) \9\ by the sponsor percentages
described above. The result was the number of base risk retention
offerings per year per agency. For the FDIC, this was calculated by
multiplying 1,158 offerings per year by 12 percent, which equals 139
offerings per year. This number was then divided by the number of base
risk retention options under subpart B of the rule (i.e., nine) \10\ to
arrive at the estimate of the number of offerings per year per agency
per base risk retention option. For the FDIC, this was calculated by
dividing 139 offerings per year by nine options, resulting in 15
offerings per year per base risk retention option.
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\9\ Estimate of 1,400 offerings per year, minus the estimate of
the number of offerings qualifying for an exemption under Sec. Sec.
373.13, 373.15, and 19(g) as described in (b) and (c) above (i.e.
1,400 minus (b) 110 minus (c) 132 equals 1,158).
\10\ For purposes of this calculation, the horizontal, vertical,
and combined horizontal and vertical risk retention methods under
the standard risk retention option (Sec. 373.4) are each counted as
a separate option under subpart B of the rule. The other six are:
Sec. 373.5; Sec. 373.6; Sec. 373.7; Sec. 373.8; Sec. 373.9; and
Sec. 373.10.
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The agencies assumed that 90% of institutions use the vertical
interest form of risk retention while the remaining 10% use the
combined vertical and horizontal form of risk retention. The burden
tables above use this allocation and of the 45 responses attributed to
Sec. 373.4, we allocated 40 (90%) to the vertical form of risk
retention and 5 (10%) to the other two options (1 response to the
horizontal form of risk retention and 4 responses to the combined
vertical and horizontal form of risk retention.
FDIC believes that the burden estimation methodology previously
used overestimates the number of ABS offerings by FDIC-supervised
institutions. Furthermore, the OCC has confirmed that the estimates it
used for its 2021 renewal of OCC's Credit Risk Retention information
collection are based on the expertise of the OCC's subject matter
experts rather than the 2015 interagency methodology.\11\ As a result
of these two factors, the FDIC has decided to diverge from the
interagency methodology used in 2015 and 2018 and instead use the new
methodology described below to estimate burden for this information
collection.
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\11\ The supporting statement for the OCC's 2021 renewal is
titled ``1557-0249 Credit Risk Retention Supporting Statement 5-18-
21 1244.docx''and can be found at <a href="https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=202101-1557-003">https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=202101-1557-003</a>.
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(2) New Methodology
Potential respondents to this information collection (IC) are FDIC-
supervised insured depository institutions (``IDIs'') including state
nonmember banks, state savings institutions, insured state branches of
foreign banks, and any subsidiary of the aforementioned entities. As of
December 31, 2020, the FDIC supervised 3,227 state nonmember banks,
state savings institutions, and insured state branches of foreign
banks. Of these 3,227 IDIs, 2,382 are small for the purposes of the
Regulatory Flexibility Act (RFA).\12\
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\12\ The SBA defines a small banking organization as having $600
million or less in assets, where an organization's ``assets are
determined by averaging the assets reported on its four quarterly
financial statements for the preceding year.'' See 13 CFR 121.201
(as amended by 84 FR 34261, effective August 19, 2019). In its
determination, the ``SBA counts the receipts, employees, or other
measure of size of the concern whose size is at issue and all of its
domestic and foreign affiliates.'' See 13 CFR 121.103. Following
these regulations, the FDIC uses a respondent's affiliated and
acquired assets, averaged over the preceding four quarters, to
determine whether the respondent is ``small'' for the purposes of
RFA.
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Respondents to this information collection are FDIC-supervised IDIs
that are securitizers of ABS. To generate a universe of potential
securitizers, FDIC obtained data from Call Reports for the quarter
ending on December 31 for the years 2018, 2019, and 2020, for all FDIC-
supervised IDIs that reported a non-zero amount in either: (a)
Outstanding principal balance of assets sold and securitized with
servicing retained or with recourse or other seller-provided credit
enhancements; \13\ or (b) amount of loans and leases held for
investment, net of allowance, and held for sale held by consolidated
variable interest entities (VIEs).\14\ This search resulted in a list
of 79 IDIs that were potential securitizers. Using this list, FDIC
searched for each IDI's name in FitchConnect's repository
[[Page 43655]]
of ABS offerings (``deals'') \15\ and compiled a list of deals for
which an IDI was listed as the issuer, sponsor, originator, or servicer
of the offering. For IDIs for which deals were not found on
FitchConnect, the following method was followed: The queried Call
Report item labeled ``(a)'' above includes assets sold with recourse or
other seller-provided credit enhancements, which are outside the scope
of the Credit Risk Retention rule. To identify IDIs which securitized
from those that did not, a $75 million threshold of year over year
growth in that item is used to identify new securitizations in 2018,
2019, and 2020, as FDIC assumes that growth of less than $75 million
would be unlikely to reflect sponsorship or issuance of new term ABS
offerings during that period. This method yielded a list of 20
institutions. FDIC reviewed examination records for the 20 IDIs
identified as potential securitizers to determine which institutions
actually securitize. FDIC cross-referenced the list of securitizing
IDIs and the list of aforementioned ABS offering naming conventions
found using FitchConnect with Intex's database of prospectuses.\16\
From this cross-referencing, FDIC found a count of deals associated
with each deal name. Finally, FDIC determined whether the sponsor or
depositor for each deal was an FDIC-supervised IDI or subsidiary of an
FDIC-supervised institution by reading the prospectus of each deal.
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\13\ Schedule RC-S, item 1 on forms 031 and 041; Supplemental
Info, item 4(a) on form 051.
\14\ Schedule RC-V, item 1(c) on forms 031 and 041.
\15\ <a href="http://app.fitchconnect.com">http://app.fitchconnect.com</a>, using ``ABS'', ``CMBS'', and
``RMBS'' sections under the ``Sectors'' tab, last accessed on June
11, 2021.
\16\ <a href="https://www.intex.com/main/">https://www.intex.com/main/</a>.
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Once the set of deals, with corresponding FDIC-supervised
securitizers, was constructed, FDIC matched each deal with the sections
in Part 373 that imposed one or more PRA requirements on that deal.
Most sections impose both disclosure and recordkeeping
requirements.\17\ For those sections, FDIC separately estimated the
burdens for each of the two types of PRA requirements. The following
details the estimated respondent counts for each of these sections:
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\17\ With the noted exception of Sec. 373.10 Qualified Tender
Option Bonds, which has no recordkeeping burden associated with it.
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(a) Two FDIC-supervised IDIs were involved in deals in which credit
risk was retained through horizontal interest (Sec. 373.4(a)(2)
Standard Risk Retention--Horizontal Interest). These two IDIs were
involved in four, three, and four such deals in 2018, 2019, and 2020,
respectively. FDIC therefore estimates two annual respondents, with an
average annual response rate of two responses per respondent, for the
disclosure requirement associated with Sec. 373.4(a)(2) and the
corresponding reporting requirement in Sec. 373.4(d).\18\
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\18\ 4+3+4=11 total deals. 11/(3 years*2 respondents)=1.83
responses per respondent annually.
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(b) Two FDIC-supervised IDIs were involved in deals in which credit
risk was retained through vertical interest (Sec. 373.4(a)(1) Standard
Risk Retention--Vertical Interest). These two IDIs were involved in 0,
0, and 13 such deals in 2018, 2019, and 2020, respectively. FDIC
therefore estimates two annual respondents, with an average annual
response rate of two responses per respondent, for the disclosure
requirement associated with Sec. 373.4(a)(1) and the corresponding
reporting requirement in Sec. 373.4(d).\19\
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\19\ 0+0+13=13 total deals. 13/(3 years*2 respondents)=2.17
responses per respondent annually.
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(c) Three FDIC-supervised IDIs were involved in deals in which
credit risk was retained through revolving master trusts (Sec. 373.5
Revolving Master Trusts). These three IDIs were involved in eight, six,
and zero such deals in 2018, 2019, and 2020, respectively. FDIC
therefore estimates three annual respondents, with an average annual
response rate of two responses per respondent, for the disclosure
requirement associated with Sec. 373.5 and the corresponding reporting
requirement in Sec. 373.5(k)(3).\20\
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\20\ 8+6+0=14 total deals. 14/(3 years*3 respondents)=1.56
responses per respondent annually.
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Using the above methodology, FDIC could not find any ABS offerings
that (1) involved an FDIC-supervised IDI or subsidiary of an FDIC-
supervised IDI as a securitizer and (2) were subject to the PRA
requirements listed in one or more of the following ten sections:
Sec. Sec. 373.4(a)(3); 373.6; 373.7; 373.10; 373.11; 373.13; 373.15;
373.16; 373.17; and 373.18. It is possible that an FDIC-supervised IDI
or subsidiary of an FDIC-supervised IDI would be a respondent to burden
items related to these sections in the next three years. As such, FDIC
is using one respondent and one annual response per respondent for the
disclosure and recordkeeping requirements related to each of these ten
sections to preserve the associated burden estimate.
Of the seven unique institutions with securitizations between 2018
and 2020, none are considered small for the purposes of the RFA.\21\
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\21\ As of December 31, 2020.
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The estimated time per response varies by burden item, and these
estimates are unchanged from the previous renewal which remains in line
with the burden estimated adopted by the agencies.
Two burden items included in the 2018 information collection
request have been removed from this renewal request. The disclosure
burden related to Sec. 373.8 Fannie Mae and Freddie Mac was removed as
FDIC has determined that it is not possible for FDIC-supervised IDIs or
subsidiaries of FDIC-supervised IDIs to be respondents to this burden
item. The disclosure burden related to Sec. 373.9 Open Market
Collateralized Loan Obligations (``CLOs'') was removed because the D.C.
Circuit Court invalidated section 941 of Dodd-Frank as it applies to
CLOs.\22\
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\22\ The Loan Syndication and Trading Association v. Securities
and Exchange Commission and Board of Governors of the Federal
Reserve System (No. 17-5004).
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The estimated annual burden, in hours, is the product of the
estimated number of respondents, number of responses per respondent,
and time per response, as summarized in the table below. The total
estimated annual burden for this information collection is 376 hours, a
3,075-hour reduction from the 2018 burden estimate, which reflects the
aforementioned change in methodology.
Summary of Estimated Annual Burden
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Estimated Number of Total annual
IC description Type of burden Frequency of response number of responses/ Hours per estimated
(obligation to respond) respondents respondent response burden
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Disclosure Burdens
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Sec. 373.4(a)(2) Standard Risk Disclosure (Mandatory).. On Occasion............ 2 2 5.5 22
Retention--Horizontal Interest.
[[Page 43656]]
Sec. 373.4(a)(1) Standard Risk Disclosure (Mandatory).. On Occasion............ 2 2 2.0 8
Retention--Vertical Interest.
Sec. 373.4(a)(3) Standard Risk Disclosure (Mandatory).. On Occasion............ 1 1 7.5 8
Retention--Combined Interest *.
Sec. 373.5 Revolving Master Trusts. Disclosure (Mandatory).. On Occasion............ 3 2 7.0 42
Sec. 373.6 Eligible ABCP Conduits * Disclosure (Mandatory).. On Occasion............ 1 1 3.0 3
Sec. 373.7 Commercial MBS *........ Disclosure (Mandatory).. On Occasion............ 1 1 20.75 21
Sec. 373.10 Qualified Tender Option Disclosure (Mandatory).. On Occasion............ 1 1 6.0 6
Bonds *.
Sec. 373.11 Allocation of Risk Disclosure (Mandatory).. On Occasion............ 1 1 2.5 3
Retention to an Originator *.
Sec. 373.13 Exemption for Qualified Disclosure (Mandatory).. On Occasion............ 1 1 1.25 1
Residential Mortgages *.
Sec. 373.15 Exemption for Disclosure (Mandatory).. On Occasion............ 1 1 20.0 20
Qualifying Commercial Loans,
Commercial Real Estate and
Automobile Loans *.
Sec. 373.16 Underwriting Standards Disclosure (Mandatory).. On Occasion............ 1 1 1.25 1
for Qualifying Commercial Loans *.
Sec. 373.17 Underwriting Standards Disclosure (Mandatory).. On Occasion............ 1 1 1.25 1
for Qualifying Commercial Real
Estate Loans *.
Sec. 373.18 Underwriting Standards Disclosure (Mandatory).. On Occasion............ 1 1 1.25 1
for Qualifying Automobile Loans *.
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Disclosure Subtotal.............. ........................ ....................... .............. .............. .............. 137
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Recordkeeping Burdens
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Sec. 373.4(a)(2) Standard Risk Recordkeeping On Occasion............ 2 2 0.5 2
Retention--Horizontal Interest. (Mandatory).
Sec. 373.4(a)(1) Standard Risk Recordkeeping On Occasion............ 2 2 0.5 2
Retention--Vertical Interest. (Mandatory).
Sec. 373.4(a)(3) Standard Risk Recordkeeping On Occasion............ 1 1 0.5 1
Retention--Combined Interest *. (Mandatory).
Sec. 373.5 Revolving Master Trusts. Recordkeeping On Occasion............ 3 2 0.5 3
(Mandatory).
Sec. 373.6 Eligible ABCP Conduits * Recordkeeping On Occasion............ 1 1 20.0 20
(Mandatory).
Sec. 373.7 Commercial MBS *........ Recordkeeping On Occasion............ 1 1 30.0 30
(Mandatory).
Sec. 373.11 Allocation of Risk Recordkeeping On Occasion............ 1 1 20.0 20
Retention to an Originator *. (Mandatory).
Sec. 373.13 Exemption for Qualified Recordkeeping On Occasion............ 1 1 40.0 40
Residential Mortgages *. (Mandatory).
Sec. 373.15 Exemption for Recordkeeping On Occasion............ 1 1 0.5 1
Qualifying Commercial Loans, (Mandatory).
Commercial Real Estate and
Automobile Loans *.
Sec. 373.16 Underwriting Standards Recordkeeping On Occasion............ 1 1 40.0 40
for Qualifying Commercial Loans *. (Mandatory).
Sec. 373.17 Underwriting Standards Recordkeeping On Occasion............ 1 1 40.0 40
for Qualifying Commercial Real (Mandatory).
Estate Loans *.
Sec. 373.18 Underwriting Standards Recordkeeping On Occasion............ 1 1 40.0 40
for Qualifying Automobile Loans *. (Mandatory).
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Recordkeeping Subtotal........... ........................ ....................... .............. .............. .............. 239
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Total Annual Burden Hours.... ........................ ....................... .............. .............. .............. 376
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Source: FDIC.
* There are currently zero estimated respondents for these items however, FDIC is using 1 as a placeholder to preserve the burden estimate in case an
institution becomes subject to these provisions.
[[Page 43657]]
2. Title: Minimum Requirements for Appraisal Management Companies
OMB Number: 3064-0195.
Form Number: None.
Affected Public: Individuals or households; business or other for
profit.
General Description of Collection: This information collection
comprises recordkeeping and disclosure requirements under regulations
issued by the Federal Deposit Insurance Corporation (FDIC), jointly
with the Office of the Comptroller of the Currency (OCC), the Board of
Governors of the Federal Reserve System (FRB), the National Credit
Union Administration (NCUA), the Bureau of Consumer Financial
Protection (CFPB), and the Federal Home Finance Agency (FHFA)
(collectively, ``the agencies'') that implement the minimum
requirements in Section 1473 of the Dodd-Frank Wall Street Reform and
Consumer Protection Act (Dodd-Frank Act or the Act) to be applied by
states \23\ in the registration and supervision of appraisal management
companies (AMCs). The regulations also implement the requirement in
Section 1473 of the Dodd-Frank Act for states to report to the
Appraisal Subcommittee (ASC) of the Federal Financial Institutions
Examination Council (FFIEC) the information required by the ASC to
administer the new national registry of appraisal management companies
(AMC National Registry or Registry). The information collection (IC)
requirements are established in Part 323 of the FDIC's codified
regulations.
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\23\ States include the 50 U.S. states, the District of
Columbia, and the territories of Guam, Mariana Islands, Puerto Rico,
and the U.S. Virgin Islands. See 12 CFR 323.9.
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This information collection was last approved for renewal on
October 16, 2018 (``2018 ICR'') with a total annual burden estimate of
421 hours. The 2018 ICR contains two recordkeeping and two reporting IC
requirements. The FDIC notes that the ASC has issued its own
regulations or guidance implementing the requirements from the Act
related to the information to be presented to the ASC by the
participating states, and submitted an IC related to this reporting
requirement.\24\ Accordingly, the FDIC is not taking PRA burden for the
associated IC (previously included as ``State Reporting Requirements to
Appraisal Subcommittee'') and has removed it from its current ICR
submission.
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\24\ See OMB No. 3139-0009 and the accompanying Supporting
Statement submitted by the ASC in 2021, available at <a href="https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202102-3139-001">https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202102-3139-001</a>
(accessed June 2, 2021).
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For each of the remaining ICs, FDIC's estimation methodology is to
compute the total estimated burden hours for that IC and then assign an
agreed-upon share of the burden hours to each of the regulatory
agencies (FDIC, FRB, OCC, and FHFA).\25\ The FDIC's estimated annual
burden is calculated by finding the product of the estimated annual
number of respondents, the estimated annual number of responses per
respondent, the estimated burden hours per response and the share of
the burden attributable to the FDIC.
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\25\ The agencies agreed to this burden-sharing methodology in
2018.
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Burden Estimate:
Estimated Number of Respondents
IC #1: Written Notice of Appraiser Removal From Network or Panel
This IC relates to the written notice of appraiser removal from the
network or panel pursuant to Sec. 323.10. The number of respondents is
estimated to be equal to the number of appraisers who leave the
profession each year multiplied by the estimated percentage of
appraisers who work for AMCs. The number of appraisers who leave is
calculated by adding the number of appraisers who are laid off or
resign to the number of appraisers that have had their licenses revoked
or surrendered. This estimation methodology is similar to the
methodology used in the 2018 ICR.
The number of appraisers who are laid off or resign each year is
estimated by multiplying the annual rate of ``Total separations'' by
the number of appraisers for each year. Using data from the Bureau of
Labor Statistics (BLS) for the finance and insurance industry, shown in
Table 1 below, the annual rate of ``Total separations'' in 2020 is 25.1
percent.\26\ The rate for 2020 is within the range of annual rates
between 2011 and 2020 (20.4 to 26.0 percent, with a median of 24.8
percent) and is a reasonable estimate for future periods.
---------------------------------------------------------------------------
\26\ Bureau of Labor Statistics (BLS), ``Job Openings and Labor
Turnover Survey: Finance and Insurance'' (Series ID:
JTU520000000000000TSR), available at <a href="https://www.bls.gov/data/">https://www.bls.gov/data/</a>
(accessed June 4, 2021).
Table 1--Annual Rate of Total Separations for the Finance and Insurance
Industry in the United States
------------------------------------------------------------------------
Value (in
Year %)
------------------------------------------------------------------------
2011....................................................... 20.4
2012....................................................... 23.6
2013....................................................... 26.0
2014....................................................... 25.0
2015....................................................... 24.5
2016....................................................... 23.9
2017....................................................... 25.2
2018....................................................... 24.2
2019....................................................... 24.6
2020....................................................... 25.1
------------------------------------------------------------------------
Source: BLS, ``Job Openings and Labor Turnover Survey: Finance and
Insurance'' (Series ID: JTU520000000000000TSR), available at <a href="https://www.bls.gov/data/">https://www.bls.gov/data/</a> (accessed June 4, 2021).
The number of appraisers is estimated by using the number of
appraisers in 2020 as a proxy for the level of appraiser employment
over the next three years.\27\ In 2020, the total number of appraisers
was 86,000 and is similar to the annual average of 87,000 appraisers
between 2011 and 2020. Table 2 contains data on annual employment level
for appraisers in the U.S. between 2011 and 2020:
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\27\ BLS, ``Employed--Appraisers and assessors of real estate''
(Series ID: LNU02038218), available at <a href="https://beta.bls.gov/dataViewer/view/timeseries/LNU02038218">https://beta.bls.gov/dataViewer/view/timeseries/LNU02038218</a> (accessed June 2, 2021).
Table 2--Annual Level of Employment for Appraisers in the United States
------------------------------------------------------------------------
Value (in
Year thousands)
------------------------------------------------------------------------
2011................................................. 88
2012................................................. 93
2013................................................. 98
2014................................................. 95
2015................................................. 76
2016................................................. 73
2017................................................. 97
2018................................................. 84
2019................................................. 84
2020................................................. 86
------------------------------------------------------------------------
Source: BLS, ``Employed--Appraisers and assessors of real estate''
(Series ID: LNU02038218), available at <a href="https://beta.bls.gov/dataViewer/view/timeseries/LNU02038218">https://beta.bls.gov/dataViewer/view/timeseries/LNU02038218</a> view/timeseries/LNU02038218 (accessed June 2, 2021).
Given the data summarized above, the number of appraisers who are
laid off or resign is estimated by multiplying the annual number of
appraisers by the annual separation rate 86,000 x 25.1 percent =
21,586.
As stated above, respondents to this IC also include appraisers who
have their license revoked or surrendered each year. According to the
ASC, between January 1, 2010 and December 31, 2019, the counts of
appraisers who have had their license revoked or surrendered are 804
and 576,
[[Page 43658]]
respectively.\28\ Therefore, the annual average over the ten-year span
is 138 licenses revoked or surrendered per year.\29\
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\28\ Federal Financial Institution Examination Council:
Appraisal Subcommittee, ``Annual Report 2019: Appendix E Appraiser
Disciplinary Actions Reported by State,'' available at <a href="https://www.asc.gov/About-the-ASC/AnnualReports.aspx">https://www.asc.gov/About-the-ASC/AnnualReports.aspx</a> (accessed June 2,
2021).
\29\ The average over the ten years is calculated as (1,380, or
804 + 576) divided by 10.
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The number of appraisal removal notices for AMCs is then calculated
by adding the estimate of appraisers who are laid off or resign to the
number of appraisers who have their licenses revoked or surrendered,
and multiplying by the estimated percent of total appraisers who work
for AMCs. According the Appraisal Institute, approximately 81 percent
of appraisers are sole proprietors, executives in a firm, or are listed
as having other forms of employment status.\30\ The remaining 19
percent of appraisers are employees or staff members in firms such as
AMCs, appraisal services companies, or other companies. Using 19
percent as the estimate of the percentage of appraisers who work for
AMCs, the estimated total number of appraiser removal notices for AMCs
is 4,130 notices per year, rounded to the nearest ten.\31\ Thus, the
estimated number of annual respondents for this information collection
is 4,130. The respondents to this IC are either natural persons or
AMCs. There are no data available currently on the number of AMCs that
are considered ``small,'' for the purposes of the Regulatory
Flexibility Act (RFA), and none of the respondents who are natural
persons are small for the purposes of the RFA. As a rough
approximation, to estimate the number of small respondents to this IC
FDIC uses the percentage of insured depository institutions that are
small (70 percent) for purposes of the RFA,\32\ and assume that all
respondents are AMCs. Thus, FDIC estimates that 2,891 respondents to
this IC are small for purposes of the RFA.\33\ This is likely a
conservative estimate of small respondents for this information
collection because not all respondents to this IC are AMCs.
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\30\ Appraisal Institute, ``U.S. VALUATION PROFESSION FACT SHEET
Q1 2019,'' available at <a href="https://www.appraisalinstitute.org/file.aspx?DocumentId=2342">https://www.appraisalinstitute.org/file.aspx?DocumentId=2342</a>, (accessed June 2, 2021).
\31\ The estimated total number of appraiser removal notices for
AMCs is calculated as (21,586 + 138) x 19 percent, which yields
4,127.56 notices, or 4,130 after rounding to the nearest ten. The
estimate is rounded to the nearest ten because 10 percent of the
respondents will be allocated to FHFA, and OMB systems require whole
number inputs.
\32\ December 31, 2020, Call Report data. The Small Business
Administration (SBA) defines a small banking organization as having
$600 million or less in assets, where an organization's ``assets are
determined by averaging the assets reported on its four quarterly
financial statements for the preceding year.'' See 13 CFR 121.201
(as amended by 84 FR 34261, effective August 19, 2019). In its
determination, the ``SBA counts the receipts, employees, or other
measure of size of the concern whose size is at issue and all of its
domestic and foreign affiliates.'' See 13 CFR 121.103. Following
these regulations, the FDIC uses a covered entity's affiliated and
acquired assets, averaged over the preceding four quarters, to
determine whether the covered entity is ``small'' for the purposes
of RFA.
\33\ The estimated number of small respondents to this IC is
calculated by multiplying the estimated number of respondents
(4,130) by 70 percent.
---------------------------------------------------------------------------
The estimated number of notices per year is lower than the 2018 ICR
estimate by 5,751 notices.\34\ Two factors contributed to the drop in
estimated notices: First, the number of appraisers who are laid off or
resign, and the number that have had their licenses revoked or
surrendered (138 and 21,586, respectively) are lower than the estimates
in the 2018 ICR (245 and 23,280); second, there is more granular data
available to calculate the share of appraisers employed by AMCs,
appraisal services companies, or other companies. The most recent data
from the Appraisal Institute contains nine separate categories for
Appraiser Employment Status, whereas the data available for the 2018
ICR contained only four categories.\35\ Given the level of aggregation
available in 2018, the estimate of the share of appraisers in the 2018
ICR likely included appraisers who are employees or staff members in a
government or regulatory agency, and individuals with employment
statuses such as valuation consultant, professor or other academic
professional, semi-retired or retired, or student. The FDIC notes that
appraisers or individuals with the five employment statuses listed
above would not be subject to this IC. Consequently, the share (19
percent) is much lower than the share (42 percent) used in the 2018
ICR.
---------------------------------------------------------------------------
\34\ See OMB No. 3064-0195 and the accompanying Supporting
Statement submitted by the FDIC in 2018, available at <a href="https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201804-3064-013">https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201804-3064-013</a>
(accessed June 2, 2021).
\35\ The most recent data available from the Appraisal Institute
includes five new categories (employee or staff member in a
government or regulatory agency, valuation consultant, professor or
other academic professional, semi-retired or retired, and student),
in addition to the four categories that match closely to the data in
the 2018 ICR (employee or staff member of a firm, sole proprietor of
own business (no employees/partners), executive in a firm, and
other).
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IC #2: Develop and Maintain a State Licensing Program
The second information collection pertains to developing and
maintaining a state licensing program for AMCs pursuant to Section
323.14. Section 323.14 requires that each state electing to register
AMCs for purposes of permitting AMCs to provide appraisal management
services relating to covered transactions in the state must submit to
the ASC certain information required under the Rule and any additional
information required by the ASC concerning AMCs. Thus, this burden
falls on the states, especially those that have not developed a system
to register and oversee AMCs. According to the ASC there are four
states (the territories of Guam, Mariana Islands, Puerto Rico, and the
U.S. Virgin Islands) that have not developed a system to register and
oversee AMCs.\36\ Thus, the estimated number of annual respondents for
this burden is four. Since respondents to this IC are states, none of
the respondents are considered ``small'' for purposes of the RFA.
---------------------------------------------------------------------------
\36\ ASC, ``States' Status on Implementation of AMC Programs,''
available at <a href="https://www.asc.gov/National-Registries/StatesStatus.aspx">https://www.asc.gov/National-Registries/StatesStatus.aspx</a> (accessed June 2, 2021).
---------------------------------------------------------------------------
IC #3: AMC Disclosure Requirements (State-Regulated AMCs) 37
---------------------------------------------------------------------------
\37\ Based on conversations between the SMEs at the FDIC, FRB,
OCC, and FHFA, the current ICR splits the IC #3 from the 2018 ICR
(titled ``AMC Reporting Requirements (State and Federal AMCs)
(323.12 & 13(c))'') in to two separate ICs, one each for state-
regulated AMCs, and federally regulated AMCs.
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The third information collection relates to disclosure requirements
for AMCs that are not federally regulated AMCs \38\ (``state-regulated
AMCs'') pursuant to Section 323.12, which involves information sent by
AMCs to third parties, including states and the AMC National Registry.
The disclosure requirement for this IC includes registration
limitations/requirements. According to the National Registry, accessed
on June 2, 2021, there are 3,854 active AMCs, of which 3,817 are state-
regulated AMCs.\39\ FDIC does not have the data to estimate the change
in the number of active state-regulated AMCs using historical
information because the National Registry became available for the
states to populate in July 2018, and the states' reporting
characteristics vary over time.\40\ For the
[[Page 43659]]
purposes of this analysis FDIC assumes the number of state-regulated
AMCs to remain approximately the same over the next three years. Thus,
the estimated number of annual respondents for this burden is 3,820,
after rounding up to the nearest ten.\41\ There are no data available
currently on the number of AMCs that are small. As a rough
approximation, FDIC uses the percentage of insured depository
institutions that are small (70 percent) for purposes of the RFA to
estimate the number of small respondents to this IC. Using this
methodology FDIC estimates that 2,674 respondents to this IC are small
for purposes of the RFA.\42\
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\38\ Section 323.9 defines a federally regulated AMC as ``an AMC
that is owned and controlled by an insured depository institution,
as defined in 12 U.S.C. 1813 and regulated by [the OCC, FRB, or
FDIC].''
\39\ ASC nonpublic data, obtained as of June 3, 2021, stored
under this memo's workpapers on FDIC SharePoint.
\40\ The most recent Annual Report of the ASC notes that as of
December 31, 2019, the National Registry contained 1,374 AMCs
registered from 14 states. As of June 2, 2021, the date I accessed
the ASC's website, there are 40 states currently populating the
National Registry. See Federal Financial Institution Examination
Council: Appraisal Subcommittee, ``Annual Report 2019: Appendix E
Appraiser Disciplinary Actions Reported by State,'' available at
<a href="https://www.asc.gov/About-the-ASC/AnnualReports.aspx">https://www.asc.gov/About-the-ASC/AnnualReports.aspx</a> (accessed June
2, 2021); and ASC, ``States' Status on Implementation of AMC
Programs,'' available at <a href="https://www.asc.gov/National-Registries/StatesStatus.aspx">https://www.asc.gov/National-Registries/StatesStatus.aspx</a> (accessed June 2, 2021).
\41\ The estimate is rounded to the nearest ten because 10
percent of the respondents will be allocated to FHFA, and OMB
systems require whole number inputs.
\42\ The estimated number of small respondents to this IC is
calculated by multiplying the estimated number of respondents
(3,820) by 70 percent.
---------------------------------------------------------------------------
IC #4: AMC Disclosure Requirements (Federally Regulated AMCs)
The fourth information collection relates to AMC disclosure
requirements for federally regulated AMCs pursuant to Section
323.13(c). The disclosure requirements for this IC include registration
limitations/requirements as well as information regarding the
determination of the AMC National Registry fee. Of the 3,854 active
AMCs, 37 are federally regulated AMCs.\43\ FDIC does not have the data
to estimate the change in the number of active federally regulated AMCs
using historical information because the National Registry became
available for the states to populate in July 2018, and the states'
reporting characteristics vary over time.\44\ For the purposes of this
analysis FDIC assumes the number of federally regulated AMCs to remain
approximately the same over the next three years. Thus, the estimated
number of annual respondents for this burden is 39, after rounding up
to the nearest multiple of three.\45\ There are no data available
currently on the number of AMCs that are small. As a rough
approximation, FDIC uses the percentage of insured depository
institutions that are small (70 percent) for purposes of the RFA to
estimate the number of small respondents to this IC. Accordingly, FDIC
estimates that 27 respondents to this IC are small for purposes of the
RFA.\46\
---------------------------------------------------------------------------
\43\ ASC nonpublic data, obtained as of June 3, 2021.
\44\ See footnote 40.
\45\ The estimate is rounded to the nearest multiple of three
because the estimated respondents will be allocated equally to the
FDIC, FRB, and OCC, and OMB systems require whole number inputs. The
aggregate estimated number of respondents for IC #3 and IC #4 in the
current ICR (state-regulated and federally regulated AMCs) is higher
than the corresponding estimate in the 2018 ICR by 3,659. The
increase in the number of respondents in the current ICR is
attributable to the definitive information available from the
National Registry after 2018, when AMC registration requirements
became effective.
\46\ The estimated number of small respondents to this IC is
calculated by multiplying the estimated number of respondents (39)
by 70 percent.
---------------------------------------------------------------------------
Estimated Number of Responses
For IC #1, FDIC assumes an AMC receives one written notice from
each appraiser \47\ asking to be removed from the appraiser panel, or
sends one notice to each appraiser removing him/her from the panel.
Thus, the estimated number of responses per respondent is one.
---------------------------------------------------------------------------
\47\ In the event of an appraiser's death or incapacitation, the
AMC receives notice of death or incapacity. See 12 CFR 323.10.
---------------------------------------------------------------------------
For IC #2, FDIC assumes that states without a registration and
licensing program would develop and maintain a single program for each
state. Thus, the estimated number of responses per respondent is one.
For IC #3 and IC #4, FDIC estimates the number of responses per
respondent as the number of states that do not have an AMC registration
program in which the average state-regulated or federally regulated AMC
operates. As discussed previously, there are four states that currently
do not have an AMC registration program. As noted in the Supporting
Statement accompanying the 2018 ICR, a 2013 survey conducted by the
CFPB found that the average AMC operates in 19.56 states.\48\ Thus, the
average state-regulated or federally regulated AMC operates in
approximately 2 states that do not have AMC registration systems: (4
states/55 states) x 19.56 states = 1.422 states ~ rounded up to 2
states.
---------------------------------------------------------------------------
\48\ See OMB No. 3064-0195 and the accompanying Supporting
Statement submitted by the FDIC in 2018, available at <a href="https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201804-3064-013">https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201804-3064-013</a>
(accessed June 2, 2021). Additional details on the survey can be
found in the text accompanying the final rule. See Minimum
Requirements for Appraisal Management Companies, 80 FR 32,677 (June
9, 2015).
---------------------------------------------------------------------------
Frequency of Responses
For IC #1, as discussed above, the AMC receives (or sends) a
written notice in the event an appraiser no longer serves on the panel.
Since this event occurs on occasion, FDIC uses ``On Occasion'' as the
Frequency of Reponses for this IC and assumes a frequency of one.
For IC #2, FDIC assumes the states that have currently elected not
to register and oversee AMCs could choose to do so at any time. Since
this event occurs on occasion, FDIC uses ``On Occasion'' as the
Frequency of Reponses for this IC and assumes a frequency of one.
For IC #3 and IC #4, FDIC assumes the state-regulated or federally
regulated AMCs that are currently operating in a state but have not yet
registered with that state could choose to do so any time. Since this
event occurs on occasion, FDIC uses ``On Occasion'' as the Frequency of
Reponses for this IC and assumes a frequency of one.
Estimated Time per Response
The 2018 ICR estimate of the hour burden per written notice of
appraiser removal was 0.08 hours. The FDIC believes this estimate
remains reasonable and appropriate for this IC and uses 0.08 hours as
the estimated time per response for IC #1.
The 2018 ICR estimate of the hour burden for a state without a
registration program or system to establish one was 40 hours. The FDIC
believes this estimate remains reasonable and appropriate for this IC
and uses 40 hours as the estimated time per response for IC #2.
The 2018 ICR estimate of the hour burden for a state-regulated or
federally regulated AMC to register in a state in which it operates was
one hour. The FDIC believes this estimate remains reasonable and
appropriate for IC #3 and IC #4 and uses one hour each as the estimated
time per response for IC #3 and IC #4.
The estimated annual burden, in hours, for the four agencies (FDIC,
FRB, OCC, and FHFA) is the product of the estimated number of
respondents per year allocated to each agency, the number of responses
per respondent per year, and the hours per response, as summarized in
Tables 3 and 4 below. For IC #1, and IC #3, the estimated respondents
are split between the four agencies the FDIC, FRB, OCC, and FHFA, at a
ratio of 3:3:3:1.\49\ Thus, the
[[Page 43660]]
estimated number of annual respondents attributable to the FDIC, FRB,
and OCC for IC #1, and IC #3 are 1,239, and 1,146 each, respectively.
Similarly, the estimated number of annual respondents attributable to
the FHFA for IC #1, and IC #3 are 413, and 382, respectively. For IC
#2, the estimated number of respondents is split equally amongst the
four agencies which amounts to one respondent each.\50\ For IC #4, the
estimated number of respondents (39) is split equally amongst the three
banking agencies (13 each) as Section 323.9 defines a federally
regulated AMC as an AMC owned and controlled by an insured depository
institution, which is regulated by the FDIC, FRB, or OCC. The total
estimated annual burden for this information collection is 8,208
hours.\51\ The FDIC, FRB, and OCC will each have equally-sized shares
of the total estimated burden, with each agency responsible for 2,457
hours. The FHFA is responsible for the remaining 837 hours.
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\49\ The assumption to divide the burden hours between the
agencies is based on conversations between the subject matter
experts at the FDIC, FRB, OCC, and FHFA and is based on the
approximate proportion of AMCs supervised by the three banking
agencies and evenly split among the three banking agencies. The
burden hours are shared using the same ratio as the 2018 ICR. The
ratio does not affect the total amount of burden imposed by the
collections of information under the joint AMC regulations, and
relates only to the appropriate distribution among the rulemaking
agencies of responsibility (under the PRA) for a portion of the
total estimated burden. See OMB No. 2590-0013 and the accompanying
Supporting Statement submitted by the FHFA in 2018, available at
<a href="https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201807-2590-002">https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=201807-2590-002</a>
(accessed June 16, 2021).
\50\ For IC #2, the assumption to divide the burden hours
equally between the agencies is based on conversations between the
SMEs at the FDIC, FRB, OCC, and FHFA. The burden hours are shared
using the same ratio as the 2018 ICR.
\51\ The estimated total annual burden hours of 8,208 is
obtained by aggregating the estimated total annual burden hours for
the FDIC, FRB, and OCC in Table 3 (7,371, or 2,457 x 3) with the
corresponding value for the FHFA in Table 4 (837).
The estimated hour burden in the current ICR (8,208) higher than
the 2018 ICR estimate by 6,763 hours. The increase is predominantly
driven by the increase in the aggregate estimated number of
respondents to IC #3 and IC #4. As discussed previously, the
estimated number of respondents in higher than the estimate in the
2018 ICR due to the definitive information available from the
National Registry after 2018.
Table 3--Summary of Estimated Annual Burdens--FDIC, FRB, and OCC Share
[OMB No. 3064-0195]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Number of Annual
IC description Type of burden (obligation Frequency of response Number of responses per Hours per burden
to respond) respondents respondent response (hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
IC #1--Written Notice of Appraiser Disclosure \52\ On occasion................. 1,239 1 0.08 99
Removal From Network or Panel (12 CFR (Mandatory).
part 323.10).
IC #2--State Recordkeeping Requirements Recordkeeping (Mandatory). On occasion................. 1 1 40 40
(12 CFR parts 323.11(a) and 323.11(b)).
IC #3--AMC Disclosure Requirements Disclosure \53\ On occasion................. 1,146 2 1 2,292
(State-regulated AMCs) (12 CFR part (Mandatory).
323.12).
IC #4--AMC Disclosure Requirements Disclosure (Mandatory).... On occasion................. 13 2 1 26
(Federally regulated AMCs) (12 CFR
parts 323.12 and 323.13(c)).
------------------------------------------------------
Total Annual Burden Hours (FDIC, .......................... ............................ ........... .............. ........... 2,457
FRB, and OCC Share).
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: FDIC.
3. Title: Joint Standards for Assessing Diversity Policies and
Practices.
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\52\ The 2018 ICR erroneously classified IC #1 as a
Recordkeeping requirement. The burden for this IC has been changed
to a Disclosure requirement.
\53\ The 2018 ICR erroneously classified IC #3 as a Reporting
requirement. The burden for this IC has been changed to a Disclosure
requirement.
---------------------------------------------------------------------------
OMB Number: 3064-00200.
Form Number: 2710/05--Diversity Self-Assessment (paper form).
2710/06--Diversity Self-Assessment (electronic form).
Affected Public: Insured state nonmember banks, and insured state
savings associations.
Burden Estimate: FDIC is revising the burden estimates associated
with this information collection as a result of the update of the
electronic version of the reporting form. The update will allow
respondents who have previously completed a diversity self-assessment
(DSA) to copy and clone their previous submission. This copy/clone
capability reduces the reporting burden for returning respondents.
However, it does not change the burden for respondents who fill out the
electronic form for the first time or respondents who choose an
alternative method of assessing their diversity policies and practices.
As such, this ICR revises the IC line items to distinguish between the
implementation burden incurred by first time respondents from the
ongoing burden incurred by returning respondents. This ICR also updates
the respondent count estimates for the other line items in this IC.
Finally, this ICR adds a line to cover the burdens of non-material (not
responsive) submissions.
In October 2020, the FDIC implemented a copy/clone feature in FID-
SA for submissions covering the 2020 reporting period and beyond. This
feature allows the respondent to pre-populate a new diversity self-
assessment with the information that was previously completed and
submitted. In addition, the FDIC Office of Minority and Women Inclusion
(OMWI) have identified several submissions that complete the pro forma
form but do not provide the FDIC with any material self-assessments.
With the addition of these two submission types, there are now five
distinct submission types for this IC:
1. Paper Form Submissions, which are DSA submissions that use the
``Diversity Self-Assessment of Financial Institutions Regulated by the
FDIC'' form and submit the form as an email attachment or via the
United States Postal Service;
2. Electronic Form (Implementation) Submissions, which are DSA
submissions that utilize the online FID-SA application, and the
financial institution has not previously submitted a DSA;
3. Electronic Form (Ongoing) Submissions, which are DSA submissions
that utilize the online FID-
[[Page 43661]]
SA application and are able to use the copy/clone feature in FID-SA;
4. Free-Form Submissions, which are submissions that do not use the
``Diversity Self-Assessment of Financial Institutions Regulated by the
FDIC'' form; and
5. Non-Material Submissions, which are pro forma submissions that
do not provide any material self-assessments.
Estimated Number of Respondents and Responses
Responses to this information collection are voluntary and may be
submitted by any FDIC-regulated financial institution. As such,
potential respondents to this IC are all FDIC-regulated financial
institutions. As of December 31, 2020, the FDIC regulates 3,227 insured
depository institutions (IDIs). Of these institutions, 2,380 are
considered small for the purposes of the Regulatory Flexibility Act
(RFA).
Respondents submit a single response per year. To estimate the
number of respondents for this ICR, FDIC reviewed and summarized data
from historical submissions by FDIC-regulated IDIs covering diversity
activities in the reporting periods 2016-2019. Submissions were
categorized as a first-time submission if no prior submission was made
by the same IDI. Otherwise, the submission was categorized as a repeat
submission. FDIC did not categorize 2016 submissions since 2016 was the
first year for which the agency has submission data. A summary of these
results is provided in Table 1 below:
Table 1--OMWI Submission Counts, by Submission Type and Reporting
Period
------------------------------------------------------------------------
Submission type 2016 2017 2018 2019
------------------------------------------------------------------------
All submissions *................... 95 137 133 152
All submissions, small IDIs **...... 17 26 26 33
First-time submissions.............. ....... 81 42 38
First-time submissions, small IDIs ....... 18 13 16
**.................................
Repeat submissions.................. ....... 56 91 113
Repeat submissions, small IDIs **... ....... 8 13 17
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Source: FDIC OMWI.
* These counts include two financial institutions (CERTs 20399 in 2016
and 29845 in 2019) that were later found to not be regulated by the
FDIC during their respective reporting periods. We include them here
to align the table with other OMWI published analyses (available at
<a href="https://www.fdic.gov/about/diversity/analysisdsa.html">https://www.fdic.gov/about/diversity/analysisdsa.html</a>).
** IDIs are counted as small if they meet the SBA's definition of
``small'' for purposes of RFA as of December 31st in each reporting
period.
As Table 1 shows, there were 152 total submissions in 2019, the
most recent reporting year. This is an increase of approximately 20
submissions from the previous year. This increase is due to the
introduction of the online FID-SA application and an expanded outreach
effort by the FDIC to educate and increase awareness about the DSA. The
FDIC expects that submission counts will continue to climb upwards due
to continued expanded outreach efforts as well as the introduction of
the copy/clone feature to facilitate responses. Based on the historical
submission counts and the expected rise in submissions, the FDIC
expects it will receive 195 submissions per year with the majority of
these submissions using the online FID-SA application. Based on the
historical trends of first-time and repeating submissions future
expectations, the FDIC anticipates annual respondent counts of 45
Electronic Form (Implementation) and 130 Electronic Form (Ongoing)
submissions.\54\ In addition, the FDIC anticipates annual counts of
five Free-Form Submissions and ten Non-material Submissions.\55\
Finally, FDIC recognizes that some IDIs may prefer to continue
providing Paper Submissions and anticipate five such submissions per
year.
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\54\ Steady state averages of 25 percent for Electronic Form
(Implementation) and 75 percent for Electronic Form (Ongoing)
submissions were estimated from historical submissions by FDIC-
regulated IDIs covering diversity activities in 2019, the first
reporting period for which the online submission was available, and
multiplied by 175, the anticipated number of annual Electronic Form
submissions, to arrive at estimates of 45 Electronic Form
(Implementation) and 130 Electronic Form (Ongoing) submissions. For
the purposes of annualizing the estimated number of respondents, it
is assumed that the estimated annual count of respondents for
Electronic Form (Ongoing) Submissions includes returning Electronic
Form (Implementation) Submissions from the previous year.
\55\ The FDIC found 0, 0, and 4 Free-Form submissions and 3, 3,
and 12 Non-material submissions in 2017, 2018, and 2019,
respectively. Based on these historical numbers and their
supervisory experience, the FDIC anticipates approximately 5 Free-
Form and 10 Non-material Submissions going forward.
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Estimated Hourly Burden
The FDIC estimates that Electronic Form (Implementation)
Submissions will take seven hours, the same burden that was recorded in
the Electronic Form line item in the 2020 ICR. For Electronic Form
(Ongoing) Submissions, the FDIC estimates that the copy/clone feature
will save respondents an average of four hours per submission, for a
net burden of three hours per response. For Non-material Submissions,
the FDIC estimates that the pro forma completion of the submission
application will take six minutes, or 0.1 hours. The FDIC has reviewed
the hourly burden estimates for Paper Submissions and for Free-Form
Submissions and found that the estimates from the 2020 ICR remain
reasonable and appropriate. Finally, the FDIC estimates that each
respondent will incur one hour of burden per year, on average, to
disclose a portion of its submission to the public, in a manner
reflective of the entity's size and other characteristics.
The estimated annual burden for each submission type, in hours, is
the product of the estimated number of respondents, number of responses
per respondent per year, and time per response, as summarized in Table
2 below. The total estimated annual burden for this information
collection is 100, 106 hours, a reduction of 559 hours from the
previously approved ICR. \56\
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\56\ The average burden hour estimate across all submission
types is 4 hours and 8 minutes per response.
[[Page 43662]]
Table 2--Summary of Estimated Annual Burden
[OMB No. 3064-0006]
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Number of
Information collection Type of burden (obligation to Frequency of Number of responses per Hours per Annual burden
description--submission type respond) response respondents respondent response (hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Joint Standards for Assessing Reporting (Voluntary)............ Annual.............. 5 1 8 40
Diversity Policies and
Practices--Paper Form.
Joint Standards for Assessing Reporting (Voluntary)............ Annual.............. 45 1 7 315
Diversity Policies and
Practices--Electronic Form
(Implementation).
Joint Standards for Assessing Reporting (Voluntary)............ Annual.............. 130 1 3 390
Diversity Policies and
Practices--Electronic Form
(Ongoing).
Joint Standards for Assessing Reporting (Voluntary)............ Annual.............. 5 1 12 60
Diversity Policies and
Practices--Free-Form.
Joint Standards for Assessing Reporting (Voluntary)............ Annual.............. 10 1 0.1 1
Diversity Policies and
Practices--Non-material.
Joint Standards for Assessing Disclosure (Voluntary)........... Annual.............. 195 1 1 195
Diversity Policies and
Practices--Public Disclosure.
---------------
Total Annual Burden ................................. .................... .............. .............. .............. 1,001
(Hours):.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: FDIC.
General Description of Collection
Section 342 of the Dodd-Frank Wall Street Reform and Consumer
Protection Act of 2010 (the Act) required the Office of the Comptroller
of the Currency (OCC), Board of Governors of the Federal Reserve System
(Board), Federal Deposit Insurance Corporation (FDIC), Bureau of
Consumer Financial Protection (CFPB), National Credit Union
Administration (NCUA), and Securities and Exchange Commission (SEC)
(together, Agencies and separately, Agency) each to establish an Office
of Minority and Women Inclusion (OMWI) to be responsible for all
matters of the Agency relating to diversity in management, employment,
and business activities. The Act also instructed each OMWI Director to
develop standards for assessing the diversity policies and practices of
entities regulated by the Agency. The Agencies worked together to
develop joint standards and, on June 10, 2015, they jointly published
in the Federal Register \57\ the ``Final Interagency Policy Statement
Establishing Joint Standards for Assessing the Diversity Policies and
Practices of Entities Regulated by the Agencies'' (Policy Statement).
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\57\ 80 FR 33016.
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The Policy Statement contains a ``collection of information''
within the meaning of the Paperwork Reduction Act of 1995 (PRA). The
Policy Statement includes Joint Standards that cover ``Practices to
Promote Transparency of Organizational Diversity and Inclusion.'' These
Joint Standards contemplate that a regulated entity is transparent
about its diversity and inclusion activities by making certain
information available to the public annually on its website or through
other appropriate communications methods, in a manner reflective of the
entity's size and other characteristics. The specific information
referenced in these standards is: (a) Leadership commitment to
diversity and inclusion; (b) workforce diversity and employment
practices; (c) progress toward achieving diversity and inclusion in its
procurement activities; and (d) opportunities available at the entity
that promote diversity.
In addition, the Policy Statement includes Joint Standards that
address ``Entities' Self-Assessment.'' The Joint Standards for
Entities' Self-Assessment envision that a regulated entity, in a manner
reflective of its size and other characteristics, (a) conducts annually
a voluntary self-assessment of its diversity policies and practices;
(b) monitors and evaluates its performance under its diversity policies
and practices on an ongoing basis; (c) provides information pertaining
to its self-assessment to the OMWI Director of its primary federal
financial regulator; and (d) publishes information pertaining to its
efforts with respect to the Joint Standards.
The collection of information described above is reported to the
FDIC via the form entitled ``Diversity Self-Assessment of Financial
Institutions Regulated by the FDIC,'' which can be submitted in paper
\58\ or electronic format.\59\ To facilitate DSA submissions, the FDIC
has developed the automated Financial Institution Diversity Self-
Assessment (FID-SA) application. FID-SA provides FDIC-regulated
financial institutions an easy and efficient way to electronically
complete the diversity self-assessment; work with multiple users; view
previous submissions; attach supporting material; and print and save in
pdf format.\60\
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\58\ The paper version of the ``Diversity Self-Assessment of
Financial Institutions Regulated by the FDIC'' form (form number
2710/05) can be viewed at the following location: <a href="https://www.fdic.gov/resources/regulations/federal-register-publications/2021/2021-form-2710-05-diversity-self-assessment-paper-form.pdf">https://www.fdic.gov/resources/regulations/federal-register-publications/2021/2021-form-2710-05-diversity-self-assessment-paper-form.pdf</a>.
\59\ The electronic version of the ``Diversity Self-Assessment
of Financial Institutions Regulated by the FDIC'' form (form number
2710/06) can be viewed at the following location: <a href="https://www.fdic.gov/resources/regulations/federal-register-publications/2021/2021-form-2710-06-diversity-self-assessment-screen-shots.docx">https://www.fdic.gov/resources/regulations/federal-register-publications/2021/2021-form-2710-06-diversity-self-assessment-screen-shots.docx</a>.
\60\ As described in the FID-SA portal, available at <a href="https://www.fdic.gov/about/diversity/fidsaportal.html">https://www.fdic.gov/about/diversity/fidsaportal.html</a> (accessed May 1,
2021).
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Request for Comment
Comments are invited on: (a) Whether the collection of information
is necessary for the proper performance of the FDIC's functions,
including whether
[[Page 43663]]
the information has practical utility; (b) the accuracy of the
estimates of the burden of the information collection, including the
validity of the methodology and assumptions used; (c) ways to enhance
the quality, utility, and clarity of the information to be collected;
and (d) ways to minimize the burden of the collection of information on
respondents, including through the use of automated collection
techniques or other forms of information technology. All comments will
become a matter of public record.
Federal Deposit Insurance Corporation.
Dated at Washington, DC, on August 4, 2021.
James P. Sheesley,
Assistant Executive Secretary.
[FR Doc. 2021-16963 Filed 8-9-21; 8:45 am]
BILLING CODE 6714-01-P
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