Rule2021-27899
Home Mortgage Disclosure (Regulation C) Adjustment to Asset-Size Exemption Threshold
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
December 23, 2021
Effective
January 1, 2022
Issuing agencies
Consumer Financial Protection Bureau
Abstract
The Bureau of Consumer Financial Protection (Bureau) is amending the official commentary that interprets the requirements of the Bureau's Regulation C (Home Mortgage Disclosure) to reflect the asset-size exemption threshold for banks, savings associations, and credit unions based on the annual percentage change in the average of the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Based on the 4.7 percent increase in the average of the CPI-W for the 12-month period ending in November 2021, the exemption threshold is adjusted to $50 million from $48 million. Therefore, banks, savings associations, and credit unions with assets of $50 million or less as of December 31, 2021, are exempt from collecting data in 2022.
Full Text
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<title>Federal Register, Volume 86 Issue 244 (Thursday, December 23, 2021)</title>
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[Federal Register Volume 86, Number 244 (Thursday, December 23, 2021)]
[Rules and Regulations]
[Pages 72818-72820]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-27899]
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BUREAU OF CONSUMER FINANCIAL PROTECTION
12 CFR Part 1003
Home Mortgage Disclosure (Regulation C) Adjustment to Asset-Size
Exemption Threshold
AGENCY: Bureau of Consumer Financial Protection.
ACTION: Final rule; official interpretation.
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SUMMARY: The Bureau of Consumer Financial Protection (Bureau) is
amending the official commentary that interprets the requirements of
the Bureau's Regulation C (Home Mortgage Disclosure) to reflect the
asset-size exemption threshold for banks, savings associations, and
credit unions based on the annual percentage change in the average of
the Consumer Price Index for Urban Wage Earners and Clerical Workers
(CPI-W). Based on the 4.7 percent increase in the average of the CPI-W
for the 12-month period ending in November 2021, the exemption
threshold is adjusted to $50 million from $48 million. Therefore,
banks, savings associations, and credit unions with assets of $50
million or less as of December 31, 2021, are exempt from collecting
data in 2022.
DATES: This rule is effective on January 1, 2022.
FOR FURTHER INFORMATION CONTACT: Willie Williams, Paralegal Specialist;
Lanique Eubanks, Senior Counsel; Office of Regulations, at (202) 435-
7700. If you require this document in an alternative electronic format,
please contact <a href="/cdn-cgi/l/email-protection#22616472607d6341414751514b404b4e4b565b62414452400c454d54"><span class="__cf_email__" data-cfemail="f8bbbea8baa7b99b9b9d8b8b919a9194918c81b89b9e889ad69f978e">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: The Bureau is amending Regulation C,
[[Page 72819]]
which implements the HMDA asset thresholds, to establish the asset-
sized exemption threshold for depository financial institution for
2022. The asset threshold will be $50 million for 2022.
I. Background
The Home Mortgage Disclosure Act of 1975 (HMDA) \1\ requires most
mortgage lenders located in metropolitan areas to collect data about
their housing related lending activity. Annually, lenders must report
their data to the appropriate Federal agencies and make the data
available to the public. The Bureau's Regulation C \2\ implements HMDA.
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\1\ 12 U.S.C. 2801-2810.
\2\ 12 CFR part 1003.
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Prior to 1997, HMDA exempted certain depository institutions as
defined in HMDA (i.e., banks, savings associations, and credit unions)
with assets totaling $10 million or less as of the preceding year-end.
In 1996, HMDA was amended to expand the asset-size exemption for these
depository institutions.\3\ The amendment increased the dollar amount
of the asset-size exemption threshold by requiring a one-time
adjustment of the $10 million figure based on the percentage by which
the CPI-W for 1996 exceeded the CPI-W for 1975, and it provided for
annual adjustments thereafter based on the annual percentage increase
in the CPI-W, rounded to the nearest multiple of $1 million.
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\3\ 12 U.S.C. 2808(b).
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The definition of ``financial institution'' in Sec. 1003.2(g)
provides that the Bureau will adjust the asset threshold based on the
year-to-year change in the average of the CPI-W, not seasonally
adjusted, for each 12-month period ending in November, rounded to the
nearest $1 million. For 2021, the threshold was $48 million. During the
12-month period ending in November 2021, the average of the CPI-W
increased by 4.7 percent. As a result, the exemption threshold is
increased to $50 million for 2022. Thus, banks, savings associations,
and credit unions with assets of $50 million or less as of December 31,
2021, are exempt from collecting data in 2022. An institution's
exemption from collecting data in 2022 does not affect its
responsibility to report data it was required to collect in 2021.
II. Procedural Requirements
A. Administrative Procedure Act
Under the Administrative Procedure Act (APA), notice and
opportunity for public comment are not required if the Bureau finds
that notice and public comment are impracticable, unnecessary, or
contrary to the public interest.\4\ Pursuant to this final rule,
comment 2(g)-2 in Regulation C, supplement I, is amended to update the
exemption threshold. The amendment in this final rule is technical and
non-discretionary, and it merely applies the formula established by
Regulation C for determining any adjustments to the exemption
threshold. For these reasons, the Bureau has determined that publishing
a notice of proposed rulemaking and providing opportunity for public
comment are unnecessary. Therefore, the amendment is adopted in final
form.
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\4\ 5 U.S.C. 553(b)(B).
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Section 553(d) of the APA generally requires publication of a final
rule not less than 30 days before its effective date, except (1) a
substantive rule which grants or recognizes an exemption or relieves a
restriction; (2) interpretive rules and statements of policy; or (3) as
otherwise provided by the agency for good cause found and published
with the rule.\5\ At a minimum, the Bureau believes the amendments fall
under the third exception to section 553(d). The Bureau finds that
there is good cause to make the amendments effective on January 1,
2022. The amendment in this final rule is technical and non-
discretionary, and it applies the method previously established in the
agency's regulations for determining adjustments to the threshold.
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\5\ 5 U.S.C. 553(d).
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B. Regulatory Flexibility Act
Because no notice of proposed rulemaking is required, the
Regulatory Flexibility Act does not require an initial or final
regulatory flexibility analysis.\6\
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\6\ 5 U.S.C. 603(a), 604(a).
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C. Paperwork Reduction Act
The Bureau has determined that this final rule does not impose any
new or revise any existing recordkeeping, reporting, or disclosure
requirements on covered entities or members of the public that would be
collections of information requiring approval by the Office of
Management and Budget under the Paperwork Reduction Act.\7\
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\7\ 44 U.S.C. 3501-3521.
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D. Congressional Review Act
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Bureau will submit a report containing this rule and other required
information to the United States Senate, the United States House of
Representatives, and the Comptroller General of the United States prior
to the rule taking effect. The Office of Information and Regulatory
Affairs (OIRA) has designated this rule as not a ``major rule'' as
defined by 5 U.S.C. 804(2).
III. Signing Authority
The Associate Director of Research, Markets, and Regulations, Janis
K. Pappalardo, having reviewed and approved this document, is
delegating the authority to electronically sign this document to Laura
Galban, a Bureau Federal Register Liaison, for purposes of publication
in the Federal Register.
List of Subjects in 12 CFR Part 1003
Banks, Banking, Credit unions, Mortgages, National banks, Reporting
and recordkeeping requirements, Savings associations.
Authority and Issuance
For the reasons set forth above, the Bureau amends Regulation C, 12
CFR part 1003, as set forth below:[FEDREG][VOL]*[/VOL][NO]*[/
NO][DATE]*[/DATE][RULES][RULE][PREAMB][AGENCY]*[/AGENCY][SUBJECT]*[/
SUBJECT][/PREAMB][SUPLINF][HED]*[/HED]
PART 1003--HOME MORTGAGE DISCLOSURE (REGULATION C)
0
1. The authority citation for part 1003 continues to read as follows:
Authority: 12 U.S.C. 2803, 2804, 2805, 5512, 5581.
0
2. Amend supplement I to part 1003 by revising 2(g) Financial
Institution under the heading Section 1003.2--Definitions to read as
follows:
Supplement I to Part 1003--Official Interpretations
* * * * *
Section 1003.2--Definitions
* * * * *
2(g) Financial Institution
1. Preceding calendar year and preceding December 31. The
definition of financial institution refers both to the preceding
calendar year and the preceding December 31. These terms refer to
the calendar year and the December 31 preceding the current calendar
year. For example, in 2021, the preceding calendar year is 2020, and
the preceding December 31 is December 31, 2020. Accordingly, in
2021, Financial Institution A satisfies the asset-size threshold
described in Sec. 1003.2(g)(1)(i) if its assets exceeded the
threshold specified in comment 2(g)-2 on December 31, 2020.
Likewise, in 2021, Financial Institution A does not meet the loan-
volume test described in Sec. 1003.2(g)(1)(v)(A) if it originated
fewer than 100 closed-end mortgage loans during either 2019 or 2020.
2. Adjustment of exemption threshold for banks, savings
associations, and credit unions. For data collection in 2022, the
asset-size exemption threshold is $50 million. Banks, savings
associations, and credit unions with assets at or below $50 million
as of December 31, 2021, are exempt from collecting data for 2022.
[[Page 72820]]
3. Merger or acquisition--coverage of surviving or newly formed
institution. After a merger or acquisition, the surviving or newly
formed institution is a financial institution under Sec. 1003.2(g)
if it, considering the combined assets, location, and lending
activity of the surviving or newly formed institution and the merged
or acquired institutions or acquired branches, satisfies the
criteria included in Sec. 1003.2(g). For example, A and B merge.
The surviving or newly formed institution meets the loan threshold
described in Sec. 1003.2(g)(1)(v)(B) if the surviving or newly
formed institution, A, and B originated a combined total of at least
200 open-end lines of credit in each of the two preceding calendar
years. Likewise, the surviving or newly formed institution meets the
asset-size threshold in Sec. 1003.2(g)(1)(i) if its assets and the
combined assets of A and B on December 31 of the preceding calendar
year exceeded the threshold described in Sec. 1003.2(g)(1)(i).
Comment 2(g)-4 discusses a financial institution's responsibilities
during the calendar year of a merger.
4. Merger or acquisition--coverage for calendar year of merger
or acquisition. The scenarios described below illustrate a financial
institution's responsibilities for the calendar year of a merger or
acquisition. For purposes of these illustrations, a ``covered
institution'' means a financial institution, as defined in Sec.
1003.2(g), that is not exempt from reporting under Sec. 1003.3(a),
and ``an institution that is not covered'' means either an
institution that is not a financial institution, as defined in Sec.
1003.2(g), or an institution that is exempt from reporting under
Sec. 1003.3(a).
i. Two institutions that are not covered merge. The surviving or
newly formed institution meets all of the requirements necessary to
be a covered institution. No data collection is required for the
calendar year of the merger (even though the merger creates an
institution that meets all of the requirements necessary to be a
covered institution). When a branch office of an institution that is
not covered is acquired by another institution that is not covered,
and the acquisition results in a covered institution, no data
collection is required for the calendar year of the acquisition.
ii. A covered institution and an institution that is not covered
merge. The covered institution is the surviving institution, or a
new covered institution is formed. For the calendar year of the
merger, data collection is required for covered loans and
applications handled in the offices of the merged institution that
was previously covered and is optional for covered loans and
applications handled in offices of the merged institution that was
previously not covered. When a covered institution acquires a branch
office of an institution that is not covered, data collection is
optional for covered loans and applications handled by the acquired
branch office for the calendar year of the acquisition.
iii. A covered institution and an institution that is not
covered merge. The institution that is not covered is the surviving
institution, or a new institution that is not covered is formed. For
the calendar year of the merger, data collection is required for
covered loans and applications handled in offices of the previously
covered institution that took place prior to the merger. After the
merger date, data collection is optional for covered loans and
applications handled in the offices of the institution that was
previously covered. When an institution remains not covered after
acquiring a branch office of a covered institution, data collection
is required for transactions of the acquired branch office that take
place prior to the acquisition. Data collection by the acquired
branch office is optional for transactions taking place in the
remainder of the calendar year after the acquisition.
iv. Two covered institutions merge. The surviving or newly
formed institution is a covered institution. Data collection is
required for the entire calendar year of the merger. The surviving
or newly formed institution files either a consolidated submission
or separate submissions for that calendar year. When a covered
institution acquires a branch office of a covered institution, data
collection is required for the entire calendar year of the merger.
Data for the acquired branch office may be submitted by either
institution.
5. Originations. Whether an institution is a financial
institution depends in part on whether the institution originated at
least 100 closed-end mortgage loans in each of the two preceding
calendar years or at least 200 open-end lines of credit in each of
the two preceding calendar years. Comments 4(a)-2 through -4 discuss
whether activities with respect to a particular closed-end mortgage
loan or open-end line of credit constitute an origination for
purposes of Sec. 1003.2(g).
6. Branches of foreign banks--treated as banks. A Federal branch
or a State-licensed or insured branch of a foreign bank that meets
the definition of a ``bank'' under section 3(a)(1) of the Federal
Deposit Insurance Act (12 U.S.C. 1813(a)) is a bank for the purposes
of Sec. 1003.2(g).
7. Branches and offices of foreign banks and other entities--
treated as nondepository financial institutions. A Federal agency,
State-licensed agency, State-licensed uninsured branch of a foreign
bank, commercial lending company owned or controlled by a foreign
bank, or entity operating under section 25 or 25A of the Federal
Reserve Act, 12 U.S.C. 601 and 611 (Edge Act and agreement
corporations) may not meet the definition of ``bank'' under the
Federal Deposit Insurance Act and may thereby fail to satisfy the
definition of a depository financial institution under Sec.
1003.2(g)(1). An entity is nonetheless a financial institution if it
meets the definition of nondepository financial institution under
Sec. 1003.2(g)(2).
* * * * *
Laura Galban,
Federal Register Liaison, Bureau of Consumer Financial Protection.
[FR Doc. 2021-27899 Filed 12-22-21; 8:45 am]
BILLING CODE 4810-AM-P[FEDREG][VOL]*[/VOL][NO]*[/NO][DATE]*[/
DATE][RULES]
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</html>Indexed from Federal Register on December 23, 2021.
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