Notice2021-23056
Agency Information Collection Activities: Information Collection Renewal; Comment Request; Libor Self-Assessment
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
October 22, 2021
Issuing agencies
Treasury DepartmentComptroller of the Currency
Abstract
The OCC, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on a new information collection as required by the Paperwork Reduction Act of 1995 (PRA). In accordance with the requirements of the PRA, the OCC may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The OCC is soliciting comment concerning renewal of a collection of information titled, "Libor Self- Assessment."
Full Text
<html>
<head>
<title>Federal Register, Volume 86 Issue 202 (Friday, October 22, 2021)</title>
</head>
<body><pre>
[Federal Register Volume 86, Number 202 (Friday, October 22, 2021)]
[Notices]
[Pages 58723-58725]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-23056]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
Agency Information Collection Activities: Information Collection
Renewal; Comment Request; Libor Self-Assessment
AGENCY: Office of the Comptroller of the Currency (OCC), Treasury.
ACTION: Notice and request for comment.
SUMMARY: The OCC, as part of its continuing effort to reduce paperwork
and respondent burden, invites the general public and other Federal
agencies to take this opportunity to comment on a new information
collection as required by the Paperwork Reduction Act of 1995 (PRA). In
accordance with the requirements of the PRA, the OCC may not conduct or
sponsor, and the respondent is not required to respond to, an
information
[[Page 58724]]
collection unless it displays a currently valid Office of Management
and Budget (OMB) control number. The OCC is soliciting comment
concerning renewal of a collection of information titled, ``Libor Self-
Assessment.''
DATES: Comments must be submitted on or before December 21, 2021.
ADDRESSES: Commenters are encouraged to submit comments by email, if
possible. You may submit comments by any of the following methods:
<bullet> Email: <a href="/cdn-cgi/l/email-protection#cabab8aba3a4aca58aa5a9a9e4beb8afabb9e4ada5bc"><span class="__cf_email__" data-cfemail="2c5c5e4d45424a436c434f4f02585e494d5f024b435a">[email protected]</span></a>.
<bullet> Mail: Chief Counsel's Office, Attention: Comment
Processing, Office of the Comptroller of the Currency, Attention: 1557-
0349, 400 7th Street SW, Suite 3E-218, Washington, DC 20219.
<bullet> Hand Delivery/Courier: 400 7th Street SW, Suite 3E-218,
Washington, DC 20219.
<bullet> Fax: (571) 465-4326.
Instructions: You must include ``OCC'' as the agency name and
``1557-0349'' in your comment. In general, the OCC will publish
comments on <a href="http://www.reginfo.gov">www.reginfo.gov</a> without change, including any business or
personal information provided, such as name and address information,
email addresses, or phone numbers. Comments received, including
attachments and other supporting materials, are part of the public
record and subject to public disclosure. Do not include any information
in your comment or supporting materials that you consider confidential
or inappropriate for public disclosure.
Following the close of this notice's 60-day comment period, the OCC
will publish a second notice with a 30-day comment period. You may
review comments and other related materials that pertain to this
information collection beginning on the date of publication of the
second notice for this collection by the method set forth in the next
bullet.
<bullet> Viewing Comments Electronically: Go to <a href="http://www.reginfo.gov">www.reginfo.gov</a>.
Hover over the ``Information Collection Review'' tab. Underneath the
``Currently under Review'' section heading, from the drop-down menu
select ``Department of Treasury'' and then click ``submit.'' This
information collection can be located by searching by OMB control
number ``1557-0349'' or ``Libor Self-Assessment.'' Upon finding the
appropriate information collection, click on the related ``ICR
Reference Number.'' On the next screen, select ``View Supporting
Statement and Other Documents'' and then click on the link to any
comment listed at the bottom of the screen.
<bullet> For assistance in navigating <a href="http://www.reginfo.gov">www.reginfo.gov</a>, please
contact the Regulatory Information Service Center at (202) 482-7340.
FOR FURTHER INFORMATION CONTACT: Shaquita Merritt, Clearance Officer,
(202) 649-5490, Chief Counsel's Office, Office of the Comptroller of
the Currency, 400 7th Street SW, Washington, DC 20219.
SUPPLEMENTARY INFORMATION: Under the PRA (44 U.S.C. 3501-3520), Federal
agencies must obtain approval from the OMB for each collection of
information that they conduct or sponsor. ``Collection of information''
is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) to include agency
requests or requirements that members of the public submit reports,
keep records, or provide information to a third party. Section
3506(c)(2)(A) of title 44 requires Federal agencies to provide a 60-day
notice in the Federal Register concerning each proposed collection of
information, including each renewal of an existing collection of
information, before submitting the collection to OMB for approval. To
comply with this requirement, the OCC is publishing notice of the
renewal of the collection of information set forth in this document,
which was approved on an emergency basis.
Title: Libor Self-Assessment.
OMB Control No.: 1557-0349.
Type of Review: Regular.
Description: The expected cessation of the London InterBank Offered
Rate (Libor) prompted the OCC to create a self-assessment tool for
banks to use in preparing for the expected Libor cessation. The self-
assessment tool may be used in assessing the appropriateness of a
bank's Libor transition plan, the execution of the plan by its
management, and related matters.
The Intercontinental Exchange Libor is a reference rate that is
intended to reflect the cost of unsecured interbank borrowing. Libor is
published daily in five currencies with seven maturities ranging from
overnight to 12 months. It is used globally in the over-the-counter
derivatives market, bonds, loan products, and securitizations. As of
the end of 2020, $223 trillion of financial instruments were exposed to
U.S. dollar (USD) Libor as the primary reference rate.\1\
---------------------------------------------------------------------------
\1\ <a href="https://www.newyorkfed.org/medialibrary/Microsites/arrc/files/2021/USD-LIBOR-transition-progress-report-mar-21.pdf">https://www.newyorkfed.org/medialibrary/Microsites/arrc/files/2021/USD-LIBOR-transition-progress-report-mar-21.pdf</a>.
---------------------------------------------------------------------------
While certain reference rates have ceased to be reported in the
past, the significant exposure of the financial markets to Libor
creates the need for banks to assess whether they are identifying
applicable risks, preparing for Libor cessation, and successfully
transitioning to replacement reference rates. Libor is referenced
globally, and its cessation could affect banks of all sizes through
direct or indirect exposure.
There is risk of market disruptions, litigation, and destabilized
balance sheets if acceptable replacement rates do not attract
sufficient market-wide acceptance or if contracts cannot seamlessly
transition to new rates. A bank's risk exposure from expected Libor
cessation depends on the bank's specific circumstances. Many community
banks may not offer products or services that use Libor. However,
community banks could have Libor exposure in positions such as Federal
Home Loan Bank (FHLB) borrowings, mortgage-backed securities, or bonds
in the banks' investment portfolios.
Libor exposure can exist in all product categories and lines of
business, both on or off the balance sheet, and in asset management
activities. Risk can also emanate from third-party relationships
because Libor is often used in pricing models, financial models, and in
other parts of banks' infrastructure, such as core processing.
The ubiquity of Libor, present in over $200 trillion notional
contracts, makes moving off the rate incredibly complicated. Many
existing contracts do not include sufficient provisions if Libor
becomes unavailable (known as fallback provisions). Without adequate
preparation, Libor cessation could cause market disruption and present
risks to banks and their customers. In addition, fallback provision
language does not sufficiently account for a permanent cessation of
Libor. The Federal banking agencies published a statement communicating
that banks should discontinue entering into contracts that use USD
Libor as a reference rate as soon as practicable and in any event by
the end of 2021 (with a few exceptions for orderly market support).\2\
---------------------------------------------------------------------------
\2\ <a href="https://www.occ.gov/news-issuances/bulletins/2020/bulletin-2020-104.html#ft1">https://www.occ.gov/news-issuances/bulletins/2020/bulletin-2020-104.html#ft1</a>.
---------------------------------------------------------------------------
Given that the OCC expects banks to discontinue making Libor loans
by the end of 2021, the prevalence of Libor, and the remaining work to
be done within the timeframe described above, the OCC is making this
self-assessment tool available to banks, due to the immediate need and
the brief duration of use, to help banks prepare for Libor-related
risk.
Banks may use the self-assessment to determine whether they have
risk management processes in place to
[[Page 58725]]
identify and mitigate their Libor transition risks. Not all sections or
questions will apply to all banks. Applicable risks (e.g., operational,
compliance, strategic, and reputation) can be identified when scoping
and completing Libor cessation preparedness assessments.
Affected Public: Businesses or other for-profit.
Burden Estimates:
Estimated Number of Respondents: 1,096. Estimated Annual Burden:
8,768 hours.
Frequency of Response: On occasion.
Comments: Comments submitted in response to this notice will be
summarized and included in the request for OMB approval. All comments
will become a matter of public record. Comments are invited on:
(a) Whether the collections of information are necessary for the
proper performance of the OCC's functions, including whether the
information has practical utility;
(b) The accuracy of the OCC's estimates of the burden of the
information collections, 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 information collections on
respondents, including through the use of automated collection
techniques or other forms of information technology.
(e) Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
Theodore J. Dowd,
Deputy Chief Counsel, Office of the Comptroller of the Currency.
[FR Doc. 2021-23056 Filed 10-21-21; 8:45 am]
BILLING CODE P
</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>Indexed from Federal Register on October 22, 2021.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.