Notice2024-07950
Agency Information Collection Activities: Revision of an Approved Information Collection; Comment Request; Reporting and Recordkeeping Requirements Associated With Liquidity Coverage Ratio: Liquidity Risk Measurement, Standards, and Monitoring
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
April 16, 2024
Issuing agencies
Treasury DepartmentComptroller of the Currency
Abstract
The OCC, as part of its continuing effort to reduce paperwork and respondent burden, invites comment on a continuing 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 a revision to its information collection titled, "Reporting and Recordkeeping Requirements Associated with Liquidity Coverage Ratio: Liquidity Risk Measurement, Standards, and Monitoring."
Full Text
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<title>Federal Register, Volume 89 Issue 74 (Tuesday, April 16, 2024)</title>
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[Federal Register Volume 89, Number 74 (Tuesday, April 16, 2024)]
[Notices]
[Pages 27001-27003]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-07950]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
Agency Information Collection Activities: Revision of an Approved
Information Collection; Comment Request; Reporting and Recordkeeping
Requirements Associated With Liquidity Coverage Ratio: Liquidity Risk
Measurement, Standards, and Monitoring
AGENCY: Office of the Comptroller of the Currency (OCC), Treasury.
ACTION: Notice and request for comment.
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SUMMARY: The OCC, as part of its continuing effort to reduce paperwork
and respondent burden, invites comment on a continuing 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 a revision to its information collection titled,
``Reporting and Recordkeeping Requirements Associated with Liquidity
Coverage Ratio: Liquidity Risk Measurement, Standards, and
Monitoring.''
DATES: Comments must be received by June 17, 2024.
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#631311020a0d050c230c00004d17110602104d040c15"><span class="__cf_email__" data-cfemail="720200131b1c141d321d11115c06001713015c151d04">[email protected]</span></a>.
<bullet> Mail: Chief Counsel's Office, Attention: Comment
Processing, Office of the Comptroller of the Currency, Attention: 1557-
0323, 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) 293-4835.
Instructions: You must include ``OCC'' as the agency name and
``1557-0323'' 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 and click on
``Information Collection Review'' from the drop-down menu. From the
``Currently under Review'' drop-down menu, select ``Department of
Treasury'' and then click ``submit.'' This information collection can
be located by searching OMB control number ``1557-0323'' or ``Reporting
and Recordkeeping Requirements Associated with Liquidity Coverage
Ratio: Liquidity Risk Measurement, Standards, and Monitoring.'' 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. If you are deaf,
hard of hearing, or have a speech disability, please dial 7-1-1 to
access telecommunications relay services.
SUPPLEMENTARY INFORMATION: Under the PRA (44 U.S.C. 3501 et seq.),
Federal agencies must obtain approval from the OMB for each collection
of information that they conduct or sponsor.
[[Page 27002]]
``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 generally requires
Federal agencies to provide a 60-day notice in the Federal Register
concerning each proposed collection of information, including each
proposed extension 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 revision of this
collection.
Title: Reporting and Recordkeeping Requirements Associated with
Liquidity Coverage Ratio: Liquidity Risk Measurement, Standards, and
Monitoring. OMB Control No.: 1557-0323.
Type of Review: Regular.
Affected Public: Businesses or other for-profit.
Description: The Office of the Comptroller of the Currency (OCC),
the Board of Governors of the Federal Reserve System (the Board), and
the Federal Deposit Insurance Corporation (FDIC) (collectively, the
agencies) implemented a quantitative liquidity requirement, known as
the liquidity coverage ratio (LCR), and a stable funding requirement,
known as the net stable funding ratio (NSFR), that apply to certain
large banking organizations. For the OCC, these standards are
implemented through 12 CFR part 50, Liquidity Risk Measurement
Standards. The LCR is designed to promote the short-term resilience of
the liquidity risk profile of covered banking organizations and promote
improvements in the measurement and management of liquidity risk. The
NSFR is designed to reduce the likelihood that disruptions to a banking
organization's regular sources of funding will compromise its liquidity
position, promote effective liquidity risk management, and support the
ability of banking organizations to provide financial intermediation to
businesses and households across a range of market conditions.
Twelve CFR part 50 applies to large national banks and Federal
savings associations. Banks that must comply with part 50 (covered
banks) generally include GSIB depository institutions (i.e., depository
institutions of global systemically important bank holding companies)
supervised by the OCC; Category II national banks and Federal savings
associations ; Category III national banks and Federal savings
associations; \1\ and any national bank or Federal savings association
for which the OCC has determined that application of part 50 is
appropriate in light of certain risk factors. The reporting and
recordkeeping requirements contained in this collection are used to
monitor covered banks' compliance with the LCR and NSFR.
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\1\ Category II and III national banks and Federal savings
associations are defined in 12 CFR 50.3.
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The OCC proposes to revise the ``Reporting and Recordkeeping
Requirements Associated with the Liquidity Coverage Ratio: Liquidity
Risk Measurement, Standards, and Monitoring'' information collection to
account for three recordkeeping requirements in part 50, contained in
sections 50.4(a), 50.22(a)(1) and (a)(4), that had not been previously
cleared by the OCC under the Paperwork Reduction Act (PRA).
Section-by-Section Analysis
The reporting and recordkeeping requirements are found in sections
50.4, 50.22, 50.40, 50.109, and 50.110.
Reporting Requirements
Section 50.40(a) requires a covered bank to notify the OCC on any
business day when its LCR is calculated to be less than the minimum
requirement set by section 50.10.
Section 50.40(b) provides that if a covered bank is required to
calculate its LCR on the last business day of each calendar month and
its LCR is below the minimum requirement in section 50.10 on the last
business day of the applicable calendar month, or if the OCC has
determined that the covered bank is otherwise materially noncompliant,
then the covered bank must promptly consult with the OCC to determine
whether the covered bank must provide to the OCC a plan for achieving
compliance with the minimum liquidity requirement in section 50.10 and
all other requirements of part 50. Section 50.40(b) further provides
that if a covered bank is required to calculate its LCR each business
day and its LCR is below the minimum requirement in section 50.10 for
three consecutive business days, or if the OCC has determined that the
covered bank is otherwise materially noncompliant, the covered bank
must promptly provide to the OCC a plan for achieving compliance with
the minimum liquidity requirement in section 50.10 and all other
requirements of part 50.
The liquidity plan must include, as applicable, (1) an assessment
of the covered bank's liquidity position; (2) the actions the covered
bank has taken and will take to achieve full compliance, including a
plan for adjusting the covered bank's risk profile, risk management,
and funding sources in order to achieve full compliance and a plan for
remediating any operational or management issues that contributed to
noncompliance; (3) an estimated time frame for achieving full
compliance; and (4) a commitment to provide a progress report to the
OCC at least weekly until full compliance is achieved.
Section 50.110 requires a covered bank to take certain actions
following any NSFR shortfall. Section 50.110(a) requires a covered bank
to notify the OCC of the shortfall no later than 10 business days (or
such other period as the OCC may otherwise require by written notice)
following the date that any event has occurred that would cause or has
caused the covered bank's NSFR to be less than 1.0.
Section 50.110(b) requires a covered bank to submit to the OCC,
within 10 business days of certain triggering events (or such other
period as the OCC may otherwise require by written notice), its plan
for remediation of its NSFR to at least 1.0. This submission is
required if the covered bank has or should have provided notice to the
OCC that its NSFR is or will become less than 1.0, the covered bank's
reports or disclosures to the OCC indicate that the NSFR is less than
1.0, or the OCC notifies the covered bank that a plan is required and
provides a reason for requiring such a plan. Section 50.110(b) also
requires a covered bank that has submitted such a plan to report to the
OCC at least monthly, or at such other frequency as required by the
OCC, on its progress to achieve compliance.
The NSFR remediation plan must include, as applicable, (1) an
assessment of the covered bank's liquidity profile; (2) the actions the
covered bank has taken and will take to achieve a net stable funding
ratio equal to or greater than 1.0 as required under section 50.100,
including (a) a plan for adjusting the covered bank's liquidity
profile; (b) a plan for remediating any operational or management
issues that contributed to noncompliance with the NSFR requirement; and
(3) an estimated time frame for achieving full compliance with section
50.100.
Recordkeeping Requirements
Section 50.4(a)(1) provides that in order for a covered bank to
recognize an agreement as a qualifying master netting agreement for the
purpose of section 50.3, the covered bank must conduct a sufficient
legal review to conclude with
[[Page 27003]]
a well-founded basis (and maintain sufficient written documentation of
that legal review) that: (i) the agreement meets the requirements of
the definition of qualifying master netting agreement in section 50.3
and (ii) in the event of a legal challenge, the relevant judicial and
administrative authorities would find the agreement to be legal, valid,
binding, and enforceable under the law of the relevant jurisdictions.
Section 50.4(a)(2) also requires a covered bank to establish and
maintain written procedures to monitor possible changes in relevant law
and to ensure that the agreement continues to satisfy the requirements
of the definition of qualifying master netting agreement in section
50.3.
Section 50.22(a)(1) requires a covered bank to demonstrate the
operational capability to monetize the bank's HQLA (i.e., high-quality
liquid assets) by implementing and maintaining procedures and systems
to monetize any HQLA at any time in accordance with relevant standard
settlement periods and procedures and periodically monetizing a sample
of the HQLA that reflects the composition of the covered bank's
eligible HQLA.
Section 50.22(a)(2) requires a covered bank to implement policies
that require the eligible HQLA to be under the control of the
management function in the covered bank that is charged with managing
liquidity risk. The management function must evidence its control over
the HQLA by segregating the HQLA from other assets, with the sole
intent to use the HQLA as a source of liquidity, or by demonstrating
the ability to monetize the assets and making the proceeds available to
the liquidity management function without conflicting with a business
or risk management strategy of the covered bank.
Section 50.22(a)(4) requires a covered bank to implement and
maintain policies and procedures that determine the composition of its
eligible HQLA on each calculation date by identifying, determining, and
ensuring certain required steps.
Section 50.22(a)(5) requires a covered bank to have a documented
methodology that results in a consistent treatment for determining that
the covered bank's eligible HQLA meets the requirements of section
50.22.
Section 50.109(b) provides that if a covered bank includes an ASF
(i.e., available stable funding) amount in excess of the RSF (i.e.,
required stable funding) amount of the consolidated subsidiary, it must
implement and maintain written procedures to identify and monitor
applicable statutory, regulatory, contractual, supervisory, or other
restrictions on transferring assets from the consolidated subsidiaries.
These procedures must document which types of transactions the
institution could use to transfer assets from a consolidated subsidiary
to the institution and how these types of transactions comply with
applicable statutory, regulatory, contractual, supervisory, or other
restrictions.
Estimated Burden
Estimated Frequency of Response: On occasion, annual.
Estimated Number of Respondents: 15.
Estimated Total Annual Burden: 735 hours.
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 collection of information is necessary for the
proper performance of the functions of the OCC, including whether the
information has practical utility;
(b) The accuracy of the OCC's estimate of the burden of the
collection of information;
(c) Ways to enhance the quality, utility, and clarity of the
information to be collected;
(d) Ways to minimize the burden of the collection on respondents,
including through the use of automated collection techniques or other
forms of information technology; and
(e) Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
Patrick T. Tierney,
Assistant Director,Office of the Comptroller of the Currency.
[FR Doc. 2024-07950 Filed 4-15-24; 8:45 am]
BILLING CODE P
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</html>Indexed from Federal Register on April 16, 2024.
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