Notice2024-11221
Agency Information Collection Activities; Submission for OMB Review; 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
May 22, 2024
Issuing agencies
Treasury DepartmentComptroller of the CurrencyFederal Reserve SystemFederal Deposit Insurance Corporation
Abstract
In accordance with the requirements of the Paperwork Reduction Act of 1995 (PRA), the OCC, the Board, and the FDIC (the agencies) may not conduct or sponsor, and a respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. On September 28, 2023, and on December 27, 2023, the agencies, under the auspices of the federal Financial Institutions Examination Council (FFIEC), requested public comment for 60 days on each of two proposals (respectively, the September 2023 notice and the December 2023 notice) to revise and extend the Consolidated Reports of Condition and Income (Call Report) (FFIEC 031, FFIEC 041, and FFIEC 051), which are currently approved collections of information. Included in these notices, the Board, under the auspices of the FFIEC, requested public comment for 60 days on each of two proposals to revise and extend the Report of Assets and Liabilities of U.S. Branches and Agencies of Foreign Banks (FFIEC 002) and the Report of Assets and Liabilities of a Non-U.S. Branch that is Managed or Controlled by a U.S. Branch or Agency of a Foreign (Non- U.S.) Bank (FFIEC 002S), which also are currently approved collections of information. The September 2023 notice proposed revisions to the Call Report and the FFIEC 002 that relate to the Financial Accounting Standards Board's (FASB) Accounting Standards Update (ASU) 2022-02, "Financial Instruments--Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures" (ASU 2022-02); reporting of past due loans; and reporting of internet website addresses of depository institution trade names. The December 2023 notice proposed revisions to the Call Report and the FFIEC 002 that included the revision and addition of certain new data items related to the reporting of loans to nondepository financial institutions (NDFIs) and other loans; guaranteed structured financial products; and proposed long-term debt requirements. In addition, the December 2023 notice included a proposal to adopt ongoing standards for electronic signatures to comply with the Call Report signature and attestation requirement. The agencies are finalizing certain aspects of these two proposals as described in this notice.
Full Text
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<title>Federal Register, Volume 89 Issue 100 (Wednesday, May 22, 2024)</title>
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[Federal Register Volume 89, Number 100 (Wednesday, May 22, 2024)]
[Notices]
[Pages 45046-45052]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-11221]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
FEDERAL RESERVE SYSTEM
FEDERAL DEPOSIT INSURANCE CORPORATION
Agency Information Collection Activities; Submission for OMB
Review; Comment Request
AGENCY: Office of the Comptroller of the Currency (OCC), Treasury;
Board of
[[Page 45047]]
Governors of the Federal Reserve System (Board); and Federal Deposit
Insurance Corporation (FDIC).
ACTION: Joint notice and request for comment.
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SUMMARY: In accordance with the requirements of the Paperwork Reduction
Act of 1995 (PRA), the OCC, the Board, and the FDIC (the agencies) may
not conduct or sponsor, and a respondent is not required to respond to,
an information collection unless it displays a currently valid Office
of Management and Budget (OMB) control number. On September 28, 2023,
and on December 27, 2023, the agencies, under the auspices of the
federal Financial Institutions Examination Council (FFIEC), requested
public comment for 60 days on each of two proposals (respectively, the
September 2023 notice and the December 2023 notice) to revise and
extend the Consolidated Reports of Condition and Income (Call Report)
(FFIEC 031, FFIEC 041, and FFIEC 051), which are currently approved
collections of information. Included in these notices, the Board, under
the auspices of the FFIEC, requested public comment for 60 days on each
of two proposals to revise and extend the Report of Assets and
Liabilities of U.S. Branches and Agencies of Foreign Banks (FFIEC 002)
and the Report of Assets and Liabilities of a Non-U.S. Branch that is
Managed or Controlled by a U.S. Branch or Agency of a Foreign (Non-
U.S.) Bank (FFIEC 002S), which also are currently approved collections
of information. The September 2023 notice proposed revisions to the
Call Report and the FFIEC 002 that relate to the Financial Accounting
Standards Board's (FASB) Accounting Standards Update (ASU) 2022-02,
``Financial Instruments--Credit Losses (Topic 326): Troubled Debt
Restructurings and Vintage Disclosures'' (ASU 2022-02); reporting of
past due loans; and reporting of internet website addresses of
depository institution trade names. The December 2023 notice proposed
revisions to the Call Report and the FFIEC 002 that included the
revision and addition of certain new data items related to the
reporting of loans to nondepository financial institutions (NDFIs) and
other loans; guaranteed structured financial products; and proposed
long-term debt requirements. In addition, the December 2023 notice
included a proposal to adopt ongoing standards for electronic
signatures to comply with the Call Report signature and attestation
requirement. The agencies are finalizing certain aspects of these two
proposals as described in this notice.
DATES: Comments must be submitted on or before June 21, 2024.
ADDRESSES: Interested parties are invited to submit written comments to
any or all of the agencies. All comments will be shared among the
agencies.
OCC: You may submit comments, which should refer to ``Call Report
and FFIEC 002 Revisions,'' by any of the following methods:
<bullet> Email: <a href="/cdn-cgi/l/email-protection#e69694878f888089a6898585c89294838795c8818990"><span class="__cf_email__" data-cfemail="98e8eaf9f1f6fef7d8f7fbfbb6eceafdf9ebb6fff7ee">[email protected]</span></a>.
<bullet> Mail: Chief Counsel's Office, Office of the Comptroller of
the Currency, Attention: 1557-0081, 400 7th Street SW, Suite 3E-218,
Washington, DC 20219.
<bullet> Hand Delivery/Courier: 400 7th Street SW, Suite 3E-218,
Washington, DC 20219.
Instructions: You must include ``OCC'' as the agency name and
``1557-0081'' 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.
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 following method:
<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.'' Underneath the ``Currently under
Review'' section heading, from the drop-down menu select ``Department
of the Treasury'' and then click ``submit.'' This information
collection can be located by searching by OMB control number ``1557-
0081.'' 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.
Board: You may submit comments, which should refer to ``Call Report
and FFIEC 002 Revisions,'' by any of the following methods:
<bullet> Agency Website: <a href="https://www.federalreserve.gov">https://www.federalreserve.gov</a>. Follow the
instructions for submitting comments at: <a href="https://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm">https://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm</a>.
<bullet> Email: <a href="/cdn-cgi/l/email-protection#196b7c7e6a377a7674747c776d6a597f7c7d7c6b78756b7c6a7c6b6f7c377e766f"><span class="__cf_email__" data-cfemail="a9dbccceda87cac6c4c4ccc7dddae9cfcccdccdbc8c5dbccdaccdbdfcc87cec6df">[email protected]</span></a>. Include ``Call
Report and FFIEC 002 Revisions'' in the subject line of the message.
<bullet> Fax: (202) 395-6974.
<bullet> Mail: Ann E. Misback, Secretary, Board of Governors of the
Federal Reserve System, 20th Street and Constitution Avenue NW,
Washington, DC 20551.
In general, all public comments will be made available on the
Board's website at <a href="http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm">www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm</a> as submitted, and will not be modified to remove
confidential, contact or any identifiable information.
FDIC: You may submit comments, which should refer to ``Call Report
and FFIEC 002 Revisions,'' 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>. Follow the instructions for
submitting comments on the FDIC's website.
<bullet> Email: <a href="/cdn-cgi/l/email-protection#6605090b0b030812152620222f2548010910"><span class="__cf_email__" data-cfemail="93f0fcfefef6fde7e0d3d5d7dad0bdf4fce5">[email protected]</span></a>. Include ``Call Report (FFIEC
002) Revisions'' in the subject line of the message.
<bullet> Mail: Manuel E. Cabeza, Counsel, Attn: Comments, Room 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 550 17th Street NW building (located on F
Street NW) on business days between 7 a.m. and 5 p.m.
<bullet> Public Inspection: All comments received will be posted
without change to <a href="https://www.fdic.gov/resources/regulations/federal-register-publications/">https://www.fdic.gov/resources/regulations/federal-register-publications/</a>, including any personal information provided.
Paper copies of public comments may be requested from the FDIC Public
Information Center by telephone at (877) 275-3342 or (703) 562-2200.
Additionally, commenters may send a copy of their comments to the
OMB desk officer for the agencies by mail to the Office of Information
and Regulatory Affairs, U.S. Office of Management and Budget, New
Executive Office Building, Room 10235, 725 17th Street NW, Washington,
DC 20503; by fax to (202) 395-6974; or by email to
<a href="/cdn-cgi/l/email-protection#c4abadb6a59bb7b1a6a9adb7b7adabaa84aba9a6eaa1abb4eaa3abb2"><span class="__cf_email__" data-cfemail="c0afa9b2a19fb3b5a2ada9b3b3a9afae80afada2eea5afb0eea7afb6">[email protected]</span></a>.
FOR FURTHER INFORMATION CONTACT: For further information about the
proposed revisions to the information collections
[[Page 45048]]
discussed in this notice, please contact any of the agency staff whose
names appear below. In addition, copies of the report forms for the
Call Report can be obtained at the FFIEC's website (<a href="https://www.ffiec.gov/ffiec_report_forms.htm">https://www.ffiec.gov/ffiec_report_forms.htm</a>).
OCC: Kevin Korzeniewski, Counsel, Chief Counsel's Office, (202)
649-5490. If you are deaf, hard of hearing, or have a speech
disability, please dial 7-1-1 to access telecommunications relay
services.
Board: Nuha Elmaghrabi, Federal Reserve Board Clearance Officer,
(202) 452-3884, Office of the Chief Data Officer, Board of Governors of
the Federal Reserve System, 20th and C Streets NW, Washington, DC
20551. For users of telephone systems via text telephone (TTY) or any
TTY-based Telecommunications Relay Services (TRS), please call 711 from
any telephone, anywhere in the United States.
FDIC: Manuel E. Cabeza, Counsel, (202) 898-3767, Legal Division,
Federal Deposit Insurance Corporation, 550 17th Street NW, Washington,
DC 20429.
SUPPLEMENTARY INFORMATION: The comment period for the September 2023
notice ended on November 27, 2023. After considering the comments
received on the proposal, the FFIEC and the agencies are proceeding
with certain of the proposed revisions related to ASU 2022-02, with
modifications as discussed further in section II.B, ``Proposed Changes
and Comments Received: September 2023 Notice''. The revisions replace,
as appropriate, references to ``troubled debt restructurings'' with
``modifications to borrowers experiencing financial difficulty'' in the
Call Report forms and instructions, including updates to the Glossary,
to reflect the change in accounting for modifications to borrowers
experiencing financial difficulty. These revisions would take effect
for the June 30, 2024, report date, rather than as of the March 31,
2024, report date, as originally proposed. Similar revisions to the
FFIEC 002 forms and instructions also would be effective June 30, 2024.
The agencies are continuing to review the revisions related to the
length of time that loan modifications to borrowers experiencing
financial difficulty would be reported in the Call Report and FFIEC 002
forms as well as the reporting of past due loans. The agencies are
moving forward with revisions to the reporting of internet website
addresses of depository institution trade names that will be effective
as of the June 30, 2024, report date.
The comment period for the December 2023 notice ended on February
26, 2024. After considering the comments received on this proposal, the
FFIEC and the agencies are proceeding with the revision and addition of
certain new data items related to the reporting of loans to NDFIs and
other loans, with certain modifications, as discussed further in
section II.C, ``Proposed Changes and Comments Received: December 2023
Notice''. These revisions to the Call Report and the FFIEC 002 would be
effective as of the December 31, 2024, report date, rather than as of
the June 30, 2024, report date, as originally proposed. In addition,
the agencies are revising the Call Report for the proposed changes to
Schedule RC-B, Securities, related to the reporting of guaranteed
structured financial products, as proposed, effective as of the
December 31, 2024, report date, rather than as of the June 30, 2024,
report date, as originally proposed. The agencies are continuing to
consider the comments received on the proposed revisions related to the
long-term debt requirements. Finally, the agencies are moving forward
with the proposal to adopt ongoing standards for electronic signatures
to comply with the Call Report signature and attestation requirement,
as proposed, with a June 30, 2024, effective date.
The agencies hereby give notice of their plan to submit to OMB a
request to approve the revision and extension of these information
collections, and again invite comment on the renewal.
Table of Contents
IV. Report Summary
A. Call Report
B. FFIEC 002 and FFIEC 002S
II. Current Actions
B. Background
C. Proposed Changes and Comments Received: September 2023 Notice
1. ASU 2022-02, ``Financial Instruments--Credit Losses (Topic
326): Troubled Debt Restructurings and Vintage Disclosures''
2. Past Due Definition
3. Depository Institution Trade Names and Deposit Accepting URLs
4. Other Comments Received
D. Proposed Changes and Comments Received: December 2023 Notice
1. Loans to NDFIs and Other Loans
2. Guaranteed Structured Financial Products
3. Long-Term Debt Requirements
4. Electronic Signatures
III. Timing
IV. Request for Comment
I. Report Summary
A. Call Report
The agencies propose to extend for three years, with revision,
their information collections associated with the FFIEC 031, FFIEC 041,
and FFIEC 051 Call Reports.
Report Title: Consolidated Reports of Condition and Income (Call
Report).
Form Number: FFIEC 031 (Consolidated Reports of Condition and
Income for a Bank with Domestic and Foreign Offices), FFIEC 041
(Consolidated Reports of Condition and Income for a Bank with Domestic
Offices Only), and FFIEC 051 (Consolidated Reports of Condition and
Income for a Bank with Domestic Offices Only and Total Assets Less Than
$5 Billion).
Frequency of Response: Quarterly.
Affected Public: Business or other for-profit.
Type of Review: Revision and extension of currently approved
collections.
OCC
OMB Control No.: 1557-0081.
Estimated Number of Respondents: 1,004 national banks and federal
savings associations.
Estimated Average Burden per Response: 41.41 burden hours per
quarter to file.
Estimated Total Annual Burden: 166,303 burden hours to file.
Board
OMB Control No.: 7100-0036.
Estimated Number of Respondents: 707 state member banks.
Estimated Average Burden per Response: 45.23 burden hours per
quarter to file.
Estimated Total Annual Burden: 127,910 burden hours to file.
FDIC
OMB Control No.: 3064-0052.
Estimated Number of Respondents: 2,929 insured state nonmember
banks and state savings associations.
Estimated Average Burden per Response: 39.43 burden hours per
quarter to file.
Estimated Total Annual Burden: 461,962 burden hours to file.
The estimated average burden hours collectively reflect the
estimates for the FFIEC 031, the FFIEC 041, and the FFIEC 051 reports
for each agency. When the estimates are calculated by type of report
across the agencies, the estimated average burden hours per quarter are
86.12 (FFIEC 031), 55.56 (FFIEC 041), and 34.99 (FFIEC 051). These
estimates represent an increase of 1.59 hours (FFIEC 031), 0.96 (FFIEC
041) and 0.58 hours (FFIEC 051) per quarter compared with the prior
estimates approved by OMB. The changes are due to the revisions
proposed in this notice, change in the number of institutions filing
each type of report, and change to the amount of
[[Page 45049]]
data items reported in each report. The estimated burden per response
for the quarterly filings of the Call Report is an average that varies
by agency because of differences in the composition of the institutions
under each agency's supervision (e.g., size distribution of
institutions, types of activities in which they are engaged, and
existence of foreign offices).
Type of Review: Extension and revision of currently approved
collections. In addition to the proposed revisions discussed below,
Call Reports are periodically updated to clarify instructional guidance
and correct grammatical and typographical errors on the forms and
instructions, which are published on the FFIEC website.\1\ These non-
substantive updates may also be commented upon.
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\1\ <a href="http://www.ffiec.gov/forms031.htm">www.ffiec.gov/forms031.htm</a>; <a href="http://www.ffiec.gov/forms041.htm">www.ffiec.gov/forms041.htm</a>;
<a href="http://www.ffiec.gov/forms051.htm">www.ffiec.gov/forms051.htm</a>.
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Legal Basis and Need for Collections
The Call Report information collections are mandatory: 12 U.S.C.
161 (national banks), 12 U.S.C. 324 (state member banks), 12 U.S.C.
1817 (insured state nonmember commercial and savings banks), and 12
U.S.C. 1464 (federal and state savings associations). At present,
except for selected data items and text, these information collections
are not given confidential treatment.
Banks and savings associations submit Call Report data to the
agencies each quarter for the agencies' use in monitoring the
condition, performance, and risk profile of individual institutions and
the industry as a whole. Call Report data serve a regulatory or public
policy purpose by assisting the agencies in fulfilling their shared
missions of ensuring the safety and soundness of financial institutions
and the financial system and protecting consumer financial rights, as
well as agency-specific missions affecting federal and state-chartered
institutions, such as conducting monetary policy, ensuring financial
stability, and administering federal deposit insurance. Call Reports
are the source of the most current statistical data available for
identifying areas of focus for on-site and off-site examinations. Among
other purposes, the agencies use Call Report data in evaluating
institutions' corporate applications, including interstate merger and
acquisition applications for which the agencies are required by law to
determine whether the resulting institution would control more than 10
percent of the total amount of deposits of insured depository
institutions in the United States. Call Report data also are used to
calculate the risk-based assessments for insured depository
institutions.
B. FFIEC 002 and 002S
The Board proposes to extend for three years, with revision, the
FFIEC 002 and FFIEC 002S reports.
Report Titles: Report of Assets and Liabilities of U.S. Branches
and Agencies of Foreign Banks; Report of Assets and Liabilities of a
Non-U.S. Branch that is Managed or Controlled by a U.S. Branch or
Agency of a Foreign (Non-U.S.) Bank.
Form Numbers: FFIEC 002; FFIEC 002S.
OMB Control Number: 7100-0032.
Frequency of Response: Quarterly.
Affected Public: Business or other for-profit.
Respondents: All state-chartered or federally-licensed U.S.
branches and agencies of foreign banking organizations, and all non-
U.S. branches managed or controlled by a U.S. branch or agency of a
foreign banking organization.
Estimated Number of Respondents: FFIEC 002--183; FFIEC 002S--16.
Estimated Average Burden per Response: FFIEC 002--24.67 hours;
FFIEC 002S--6.0 hours.
Estimated Total Annual Burden: FFIEC 002--18,058 hours; FFIEC
002S--384 hours.
Type of Review: Extension and revision of currently approved
collections.
The proposed revisions to the FFIEC 002 instructions in this notice
would not have a material impact on the existing burden estimates.
Legal Basis and Need for Collection
On a quarterly basis, all U.S. branches and agencies of foreign
banks are required to file the FFIEC 002, which is a detailed report of
condition with a variety of supporting schedules. This information is
used to fulfill the supervisory and regulatory requirements of the
International Banking Act of 1978. The data also are used to augment
the bank credit, loan, and deposit information needed for monetary
policy and other public policy purposes. In addition, FFIEC 002 data
are used to calculate the risk-based assessments for FDIC-insured U.S.
branches of foreign banks. The FFIEC 002S is a supplement to the FFIEC
002 that collects information on assets and liabilities of any non-U.S.
branch that is managed or controlled by a U.S. branch or agency of the
foreign bank. A non-U.S. branch is managed or controlled by a U.S.
branch or agency if a majority of the responsibility for business
decisions, including but not limited to decisions with regard to
lending or asset management or funding or liability management, or the
responsibility for recordkeeping in respect of assets or liabilities
for that foreign branch resides at the U.S. branch or agency. A
separate FFIEC 002S must be completed for each managed or controlled
non-U.S. branch. The FFIEC 002S must be filed quarterly along with the
U.S. branch or agency's FFIEC 002.
These information collections are mandatory (12 U.S.C. 3105(c)(2),
1817(a)(1) and (3), and 3102(b)). Except for select sensitive items,
the FFIEC 002 is not given confidential treatment; the FFIEC 002S is
given confidential treatment pursuant to 5 U.S.C. 552(b)(4) and (8).
The data from both reports are used for (1) monitoring deposit and
credit transactions of U.S. residents; (2) monitoring the impact of
policy changes; (3) analyzing structural issues concerning foreign bank
activity in U.S. markets; (4) understanding flows of banking funds and
indebtedness of developing countries in connection with data collected
by the International Monetary Fund and the Bank for International
Settlements that are used in economic analysis; and (5) assisting in
the supervision of U.S. offices of foreign banks. The Federal Reserve
System collects and processes these reports on behalf of all three
agencies.
II. Current Actions
A. Background
In the September 2023 notice,\2\ the agencies proposed revisions to
all three versions of the Call Report (FFIEC 031, FFIEC 041 and FFIEC
051), and the Board proposed revisions, as applicable, to the FFIEC 002
related to FASB's ASU 2022-02, reporting on past due loans and
reporting on internet website addresses of depository institution trade
names. The comment period for the September 2023 notice ended on
November 27, 2023. The agencies received six comment letters on the
September 2023 notice.
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\2\ 88 FR 66933 (Sept. 28, 2023).
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In the December 2023 notice,\3\ the agencies proposed revisions to
all three versions of the Call Report (FFIEC 031, FFIEC 041 and FFIEC
051), and the Board proposed revisions, as applicable, to the FFIEC 002
that included the revision and addition of certain new data items
related to the reporting of loans to NDFIs and other loans, guaranteed
structured financial products, and proposed long-term debt
requirements. In addition, this proposal
[[Page 45050]]
included a proposal to adopt ongoing standards for electronic
signatures to comply with the Call Report signature and attestation
requirement. The comment period for the December 2023 notice ended on
February 26, 2024. The agencies received thirty-nine comment letters on
the December notice.
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\3\ 88 FR 89489 (Dec. 27, 2023).
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B. Proposed Changes and Comments Received: September 2023 Notice
1. ASU 2022-02, ``Financial Instruments--Credit Losses (Topic 326):
Troubled Debt Restructurings and Vintage Disclosures''
In response to FASB's issuance of ASU 2022-02 on March 31, 2022,
the agencies proposed revisions to line items and related instructions
that are impacted by this new standard. In general, these revisions
eliminate reporting of troubled debt restructurings and align the data
collected in the Call Report forms and instructions with the definition
of loan modifications to borrowers experiencing financial difficulty
that is used in U.S. generally accepted accounting principles (GAAP).
The banking agencies are replacing, as appropriate, references to
``loans restructured in troubled debt restructurings'' with ``loan
modifications to borrowers experiencing financial difficulty'' in the
Call Report forms and instructions and are updating the Glossary to
reflect the change in accounting for modifications to borrowers
experiencing financial difficulty. The agencies are also updating the
General Instructions, Schedule RC-C, Loans and Lease Financing
Receivables, Schedule RC-M, Memoranda, Schedule RC-N, Past Due and
Nonaccrual Loans, Leases and Other Assets, and Schedule RC-O, Other
Data for Deposit Insurance Assessments, to reflect these changes.
Additional detail about the specific line items impacted is included in
the September 2023 notice.
No commenters objected to the adoption in the Call Report and FFIEC
002 of the revised GAAP terminology or to the change in accounting for
modifications to borrowers experiencing financial difficulty. These
updates to the Call Report and FFIEC 002 report forms and instructions
will be effective as of the June 30, 2024, report date.
The September 2023 proposal also included instruction revisions
related to the length of time for reporting modifications. Four
commenters objected to the length of time for which these modifications
would be reported on the Call Report. As proposed, institutions would
report these modifications for a minimum period of 12 months after
modification and until an institution performs a current, well
documented credit evaluation to support that the borrower is no longer
experiencing financial difficulty, unless the loan is paid off,
charged-off, sold, or otherwise settled, which may be for a period
longer than disclosures required by ASU 2022-02. ASU 2022-02 requires
financial statement disclosures on loan modifications to borrowers
experiencing financial difficulty made ``within the previous 12 months
preceding the payment default when the debtor was experiencing
financial difficulty at the time of the modification.'' \4\ These
commenters indicated that the divergence from GAAP disclosure
requirements in accordance with ASU 2022-02 would create additional
costs, complexity and operational challenges without any substantial
corresponding benefit to either the institutions or the agencies.
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\4\ See ASC 310-10-50-44.
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The agencies are continuing to evaluate these comments.
Institutions should continue to reference the quarterly Supplemental
Instructions regarding reporting these modifications on the Call
Report. Upon the conclusion of their review, the agencies will adopt a
standard through a subsequent Paperwork Reduction Act notice with a
public comment period and provide adequate lead time for implementation
of that standard.
2. Past Due Definition
In the September 2023 notice, the agencies had proposed changes to
clarify the definition used to report loans as ``past due'' on Schedule
RC-N, Past Due and Nonaccrual Loans, Leases, and Other Assets. The
agencies received two comments on this clarification. Both comments
sought additional clarification on treatment of loans in various
programs, such as loans in forbearance or loans on payment deferrals.
After taking these comments into consideration, the agencies have
deferred any proposed changes in order to conduct further review. Upon
the conclusion of their review, the agencies will propose any
additional revisions for public comment consistent with the Paperwork
Reduction Act.
3. Depository Institution Trade Names and Deposit Accepting URLs
In the September 2023 notice, the agencies had proposed to clarify
the instructions for Schedule RC-M, Memoranda, items 8.a. through 8.c.,
which collect information on institutions' websites and trade names,
particularly those used to solicit deposits. In addition, the agencies
proposed to increase the frequency of reporting of these items on the
FFIEC 051 from semi-annually to quarterly. No comments were received on
this clarification and revision. The agencies are moving forward with
these changes effective as of the June 30, 2024, report date.
4. Other Comments Received
The agencies also received recommendations from one commenter on
the Call Report and other FFIEC reports that were not specifically
related to any of the proposed changes from the September 2023 notice.
These recommendations were related to FASB's Accounting Standards
Codification (ASC) Topic 326, Financial Instruments--Credit Losses
(Topic 326) and ASU No. 2016-02, Leases (Topic 842). The proposed
changes on ASC Topic 326 and ASC Topic 842 were related to the proposed
changes in the notices published in February 2019 \5\ and January
2020,\6\ respectively.
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\5\ 84 FR 4131 (Feb. 14, 2019).
\6\ 85 FR 4780 (Jan. 27, 2020).
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As of the December 31, 2023, report date, all institutions were
required to adopt these standards. As such, the commenter requested the
agencies update or remove outdated references related to the transition
period for these standards from the Call Report and the FFIEC 002
report forms and instructions. The agencies had planned to incorporate
and have incorporated these changes to the Call Report and FFIEC 002 as
nonsubstantive revisions as of the March 31, 2024, report date, which
aligns with the commenter's request.
The recommendations also included similar updates related to ASC
Topic 326 to be made to the Foreign Branch Report of Condition (FFIEC
030) and the Abbreviated Foreign Branch Report of Condition (FFIEC
030S), which are not in the scope of this proposal. These changes also
are considered nonsubstantive and technical in nature, and the agencies
had planned to update the FFIEC 030 and FFIEC 030S report forms and
instructions, as of the March 31, 2024, report date. The agencies have
made these changes as of the March 31, 2024, report date, which is
consistent with the commenter's request.
C. Proposed Changes and Comments Received: December 2023 Notice
1. Loans to NDFIs and Other Loans
In the December 2023 notice, the agencies proposed to update the
Call Report and FFIEC 002 report forms and instructions to increase the
granularity
[[Page 45051]]
in reporting exposure to NDFIs and to improve reporting consistency.
These revisions would enhance the understanding of NDFI exposure,
risks, and performance trends. The revisions would group together loan
exposures that exhibit similar underlying risk characteristics while
addressing the diversity in practice on the reporting of these loans
that exists today. In addition, the granular reporting allows for more
accurate analysis of bank financial statements for applicable
institutions and performance metrics. These revisions and
clarifications were proposed to be effective as of the June 30, 2024,
report date.
The agencies received comments from four trade groups and thirty-
two individuals. These comments generally supported the proposed new
line items. There were four commenters that requested additional
instructions on how to report certain types of NDFIs. Two commenters
highlighted the need to ensure consistency in reporting these types of
financial assets across other regulatory reports, both in the level of
disaggregation and by definition. Thirty-one commenters indicated this
proposal is a good starting point, but consideration of further
disaggregation could be necessary for users outside the agencies to
better understand the NDFI exposure, risks, and performance trends.
Finally, two commenters indicated more lead time was necessary for the
institutions to properly implement these changes.
After reviewing these comments, the agencies are moving forward
with these revisions to the Call Report forms and the FFIEC 002 form,
as proposed, with the modifications that follow.
The agencies received comments about what types of NDFI exposures
would fall under the scope of the proposal and under what items certain
types of loans that involve NDFIs would be reported. In response, the
agencies are revising the instructions to more broadly define NDFIs and
acknowledge that they encompass a wide range of financial entities. In
addition, the agencies are revising the instructions to indicate that
NDFIs include securitization vehicles, so that loans to these entities
would be included in Memorandum item 10.e, ``Other loans to
nondepository financial institutions.'' The agencies are also
clarifying that Schedule RC-C, Memorandum item 3, ``Loans to finance
commercial real estate, construction, and land development activities
(not secured by real estate) included in Schedule RC-C, part I, items 4
and 9,'' would also include amounts reported in item 9.a, ``Loans to
nondepository financial institutions,'' and item 9.b, ``Other loans,''
as applicable.
As originally proposed, loans to broker-dealers would be reported
as loans to NDFIs in line 9.a. However, one commenter recommended that
loans to brokers and dealers in securities that are for the purpose of
purchasing or carrying securities or secured by securities be reported
in Schedule RC-C, item 9.b.(1), ``Loans for purchasing or carrying
securities, including margin loans,'' consistent with loans to other
types of NDFIs and other borrowers, for the same purpose. After
considering this comment, the agencies are revising the instructions to
include in item 9.b.(1) all purpose and non-purpose securities-based
margin loans, regardless of borrower type, that are predominately
secured (greater than 50 percent of the underlying collateral) by
securities with readily determinable fair values. This revision would
address comments about how certain margin loans fall under the scope of
the proposal, better clarify what constitutes margin-lending, and allow
for certain loans to broker dealers that meet the definition of
securities-based margin loans to be reported in 9.b.1. In addition, the
revised instructions would provide a threshold for a loan to be
considered secured by securities, which was mentioned by another
commenter.
With regard to the new Schedule RC-N, Memorandum item 9, ``Loans to
nondepository financial institutions, included in Schedule RC-N, item
7,'' the agencies have determined that separate line items for loans to
U.S. and to foreign NDFIs are not necessary, and this information would
be collected in a single line item on a consolidated level. The
agencies will continue to review the data collected related to NDFIs.
If further disaggregation of these line items is determined to be
necessary for the agencies' use at a future date, the agencies will
publish a proposal for comment at that time.
To provide additional time for institutions to implement these
changes, the effective date for these new items will be as of the
December 31, 2024, report date.
Finally, commenters raised issues of consistency with other reports
and definitions not included in the proposals. One commenter stated
that the proposal raised questions regarding consistency of reporting
similar exposures on certain information collections made by the Board
including the Board's Consolidated Financial Statements for Holding
Companies (FR Y-9C) and Capital Assessments and Stress Testing (FR Y-
14Q/A). If the Board proposes to revise certain information collections
related to loans to NDFIs, it will publish such proposal(s) for public
comment. One commenter encouraged the banking agencies to consider
further alignment between the Call Report and the Country Exposure
Report (FFIEC 009). Specifically, the commenter noted that while the
banking agencies are proposing an expanded definition of NDFIs for the
Call Report, it still would not be aligned with the definition of
``Non-Bank Financial Institutions (NBFIs)'' for the FFIEC 009. Approval
of the FFIEC 009 expires August 31, 2025, and the agencies will
consider any possible revisions, including further alignment between
reports, when they extend the FFIEC 009. A commenter also encouraged
the agencies to develop a uniform set of categories of nonbank lending
to ensure that the definitions and categories are inclusive and
comparable. The agencies review reporting instructions, and included
definitions, on a regular basis and seek to incorporate consistency
where applicable.
2. Guaranteed Structured Financial Products
In February 2023, a proposal for revisions to the Call Reports \7\
included a question on the reporting on Schedule RC-B, Securities, of
certain Federal Home Loan Mortgage Corporation (FHLMC) and similar
securitization structures that have government guarantees. Two
commenters on the February 2023 proposal raised the issue that it was
not possible to determine what is guaranteed by U.S. Government
agencies or sponsored agencies in the amounts reported in Schedule RC-B
item 5.b, columns A through D. In response to these comments, the
agencies included in the December 2023 notice a proposal for a new
Memorandum item on Schedule RC-B that would identify the amounts
reported in item 5.b that are guaranteed by U.S. Government or
sponsored agencies.
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\7\ 85 FR 10644 (Feb. 21, 2023).
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The agencies received comment letters from one trade organization
and thirty individuals supporting the addition of this new Memorandum
item. The agencies are moving forward with the addition of Memorandum
item 7, ``Guaranteed by U.S. Government agencies or sponsored agencies
included in Schedule RC-B, item 5.b'', columns A through D, on Schedule
RC-B, as proposed. However, to allow additional time to implement these
changes, the effective date for these revisions will be as of the
December 31, 2024, report date.
[[Page 45052]]
An additional comment letter from one individual requested
clarification to the instructions to avoid double counting certain
FHLMC securities on Schedule RC-B, Securities. In addition, this
commenter did not agree that certain structured financial products
issued by FHLMC should be reported in item 5.b., but instead should be
reported in item 4.c.(1).
To address this comment letter, the agencies are clarifying in the
instructions that institutions should exclude from the amounts reported
in item 4.c.(1)(a) the structured financial products that are reported
in item 5.b. Clarification would be added to the instructions for item
5.b, to exclude pass-through securities that are reported in item
4.c.(1)(a). However, the agencies do not agree with the commenter that
certain structured financial products issued by FHLMC should be
reported in item 4.c.(1). Schedule RC-B, Securities, item 4.c.(1)
relates solely to commercial mortgage pass-through securities that
generally provide the holder with a pro rata share of all principal and
interest payments on a pool of mortgages. The amounts reported in item
4.c.(1)(a) should exclude securitizations that involve more than one
trust to structure principal and interest cash flows to investors or
that are collateralized by debt instruments, such as FHLMC K-deals and
Q-deals and similar securitizations. These securities should be
reported in item 5.b.
3. Long-Term Debt Requirements
On August 29, 2023, the federal banking regulatory agencies
requested comment on a proposal that would require large banks with
total assets of $100 billion or more to maintain a layer of long-term
debt (LTD), which would improve financial stability by increasing the
resolvability and resiliency of such institutions. This notice of
proposed rulemaking (NPR) was published in the Federal Register on
September 19, 2023.\8\ Consistent with the proposed requirements and
discussion in the NPR, in the December 2023 notice, the agencies
proposed to revise Schedule RC-R, Part I, Regulatory Capital Components
and Ratios, by adding five new items to the FFIEC 051 Call Report and
six new items to the FFIEC 041 and FFIEC 031 Call Report forms.
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\8\ 88 FR 64524 (Sept. 19, 2023).
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The federal banking regulatory agencies have not finalized the LTD
NPR. Therefore, the agencies are deferring report form and
instructional changes related to the LTD proposal. If the LTD NPR is
finalized, the agencies would finalize associated reporting changes in
a future Paperwork Reduction Act notice, which will also provide an
opportunity for additional comment on the revisions to the Call Report
forms and instructions. The agencies did receive three comment letters
on the proposed Call Report forms and instructional changes for the LTD
requirement, which will be considered when developing a future notice.
4. Electronic Signatures
Federal law requires that certain personnel and directors attest to
the accuracy of the data submitted in the bank's Call Report by
signature.\9\ In addition to being required by statute, review of the
Call Report in connection with signing the attestation supports
internal control over the bank's reporting. The Call Report
instructions permit a bank to satisfy the signature requirement by
obtaining physical signatures from the relevant parties attached to a
copy of the associated Call Report that is retained in the bank's
files.
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\9\ 12 U.S.C. 161(a) (national banks) and 1817(a)(3) (all
insured depository institutions).
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The onset of the COVID-19 pandemic in March 2020 and resulting bank
office closures presented challenges to complying with the physical
signature requirement. The agencies responded by permitting reasonable
alternative signature methods, including electronic signatures, to be
used for the duration of the pandemic.\10\
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\10\ Call Report Supplemental Instructions for March 2020,
available at: <a href="https://www.ffiec.gov/pdf/FFIEC_forms/FFIEC031_FFIEC041_FFIEC051_suppinst_202003.pdf">https://www.ffiec.gov/pdf/FFIEC_forms/FFIEC031_FFIEC041_FFIEC051_suppinst_202003.pdf</a>.
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In the December 2023 notice, the agencies sought comment on a
proposal to adopt ongoing standards for electronic signatures to comply
with the Call Report signature and attestation requirement. Thirty-one
commenters supported moving forward with this proposal. The agencies
are adopting this framework for electronic signatures, which will be
effective with the June 30, 2024, report date.
III. Timing
The following proposed changes would be effective with the June 30,
2024, report date: (1) the revisions and technical edits to the Call
Report and the FFIEC 002 related to ASU 2022-02, (2) the clarification
and revisions to the Call Report forms and instructions for the
depository institution trade names and deposit accepting URL items on
Schedule RC-M, and (3) the adoption of the electronic signatures
framework.
The following proposed changes would be effective with the December
31, 2024, report date: (1) the revisions to the Call Report and FFIEC
002 report forms and instructions related to loans to NDFIs and other
loans, and (2) the revisions to the Call Report forms and instructions
related to guaranteed structured financial products on Schedule RC-B.
IV. Request for Comment
Public comment is requested on all aspects of this joint notice.
Comment is specifically invited on:
(a) Whether the proposed revisions to the collections of
information that are the subject of this notice are necessary for the
proper performance of the agencies' functions, including whether the
information has practical utility;
(b) The accuracy of the agencies' estimates of the burden of the
information collections as they are proposed to be revised, including
the validity of the methodology and assumptions used;
(c) Ways to enhance the quality, utility, and clarity of the
information to be collected;
(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; and
(e) Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
Comments submitted in response to this joint notice will be shared
among the agencies.
Patrick T. Tierney,
Assistant Director, Bank Advisory, Office of the Comptroller of the
Currency.
Board of Governors of the Federal Reserve System.
Benjamin W. McDonough,
Deputy Secretary and Ombuds of the Board.
Federal Deposit Insurance Corporation.
Dated at Washington, DC, on April 29, 2024.
James P. Sheesley,
Assistant Executive Secretary.
[FR Doc. 2024-11221 Filed 5-21-24; 8:45 am]
BILLING CODE 4810-33-P, 6210-01-P, 6714-01-P
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