Proposed Agency Information Collection Activities; Comment Request-Thrift Financial Report: Schedules SC, SO, VA, PD, LD, CC, CF, DI, SI, FS, CCR, and VIE, 61563-61572 [2010-24883]

Download as PDF Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices Fillmore & Western Railroad Co. mstockstill on DSKH9S0YB1PROD with NOTICES [Waiver Petition Docket Number FRA–2010– 0139] The Fillmore & Western Railroad Company (FWRY) seeks a waiver of compliance from certain provisions of the Railroad Freight Car Safety Standards, 49 CFR 215.303, which requires stenciling of restricted cars; as well as 49 CFR 224.3, which requires Reflectorization for freight cars. FWRY owns sixteen rail cars that are older than 50 years from their date of original construction, and are restricted by the provision of 49 CFR 215.203(a). FWRY is concurrently seeking special approval to continue to use these cars under proceeding according to 49 CFR 215.203(b). To support its petition to seek relief from the stenciling and reflectorization requirements, FWRY states that the cars subject to this waiver are only used for tourist passengers, films, movies, props, still photos and the like. Although FWRY is considered a general system railroad, these subject cars are not interchanged in or with the general system, and are not freight revenue cars. FWRY asks for this waiver due to the fact that the movie and television companies, still photographers and the like want the cars to be authentic in their antiquated and historic look. Interested parties are invited to participate in these proceedings by submitting written views, data, or comments. FRA does not anticipate scheduling a public hearing in connection with these proceedings since the facts do not appear to warrant a hearing. If any interested party desires an opportunity for oral comment, they should notify FRA, in writing, before the end of the comment period and specify the basis for their request. All communications concerning these proceedings should identify the appropriate docket number (e.g., Waiver Petition Docket Number FRA–2010– 0139) and may be submitted by any of the following methods: • Web site: http:// www.regulations.gov. Follow the online instructions for submitting comments. • Fax: 202–493–2251. • Mail: Docket Operations Facility, U.S. Department of Transportation, 1200 New Jersey Avenue, SE., W12–140, Washington, DC 20590. • Hand Delivery: 1200 New Jersey Avenue, SE., Room W12–140, Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. Communications received within 45 days of the date of this notice will be considered by FRA before final action is VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 taken. Comments received after that date will be considered as far as practicable. All written communications concerning these proceedings are available for examination during regular business hours (9 a.m.–5 p.m.) at the above facility. All documents in the public docket are also available for inspection and copying on the Internet at the docket facility’s Web site at http:// www.regulations.gov. Anyone is able to search the electronic form of any written communications and comments received into any of our dockets by the name of the individual submitting the document (or signing the document, if submitted on behalf of an association, business, labor union, etc.). You may review DOT’s complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477) or at http://www.dot.gov/ privacy.html. Issued in Washington, DC, on September 28, 2010. Robert C. Lauby, Deputy Associate Administrator. [FR Doc. 2010–25002 Filed 10–4–10; 8:45 am] BILLING CODE 4910–06–P DEPARTMENT OF THE TREASURY Office of Thrift Supervision Proposed Agency Information Collection Activities; Comment Request—Thrift Financial Report: Schedules SC, SO, VA, PD, LD, CC, CF, DI, SI, FS, CCR, and VIE Office of Thrift Supervision (OTS), Treasury. ACTION: Notice and request for comment. AGENCY: The Department of the Treasury, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other federal agencies to comment on proposed and continuing information collections, as required by the Paperwork Reduction Act of 1995, 44 U.S.C. 3507. Today, the Office of Thrift Supervision within the Department of the Treasury solicits comments on proposed changes to the Thrift Financial Report (TFR), Schedule SC— Consolidated Statement of Condition, Schedule SO—Consolidated Statement of Operations, Schedule VA— Consolidated Valuation Allowances and Related Data, Schedule PD— Consolidated Past Due and Nonaccrual, Schedule LD—Loan Data, Schedule CC—Consolidated Commitments and Contingencies, Schedule CF— Consolidated Cash Flow Information, SUMMARY: PO 00000 Frm 00153 Fmt 4703 Sfmt 4703 61563 Schedule DI—Consolidated Deposit Information, Schedule SI—Consolidated Supplemental Information, Schedule FS—Fiduciary and Related Services, and Schedule CCR—Consolidated Capital Requirement, and on a proposed new Schedule VIE—Variable Interest Entities. The changes are proposed to become effective in March 2011. At the end of the comment period, OTS will analyze the comments and recommendations received to determine if it should modify the proposed revisions prior to giving its final approval. OTS will then submit the revisions to the Office of Management and Budget (OMB) for review and approval. DATES: Submit written comments on or before December 6, 2010. ADDRESSES: Send comments to Information Collection Comments, Chief Counsel’s Office, Office of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552; send facsimile transmissions to FAX number (202) 906–6518; send e-mails to infocollection.comments@ots.treas.gov; or hand deliver comments to the Guard’s Desk, east lobby entrance, 1700 G Street, NW., on business days between 9 a.m. and 4 p.m. All comments should refer to ‘‘TFR Revisions—2011, OMB No. 1550–0023.’’ OTS will post comments and the related index on the OTS Internet Site at http://www.ots.treas.gov. In addition, interested persons may inspect comments at the Public Reading Room, 1700 G Street, NW., by appointment. To make an appointment, call (202) 906– 5922, send an e-mail to publicinfo@ots.treas.gov, or send a facsimile transmission to (202) 906– 7755. FOR FURTHER INFORMATION: You can access sample copies of the proposed 2011 TFR forms on OTS’s Web site at http://www.ots.treas.gov or you may request them by electronic mail from tfr.instructions@ots.treas.gov. You can request additional information about this proposed information collection from James Caton, Acting Managing Director, Economic Policy and Financial Monitoring and Analysis Division, (202) 906–5680, Office of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552. SUPPLEMENTARY INFORMATION: Title: Thrift Financial Report. OMB Number: 1550–0023. Form Number: OTS 1313. Abstract: OTS is proposing to revise and extend for three years the TFR, which is currently an approved collection of information. E:\FR\FM\05OCN1.SGM 05OCN1 61564 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES All OTS-regulated savings associations must comply with the information collections described in this notice. OTS collects this information each calendar quarter or less frequently if so stated. OTS uses this information to monitor the condition, performance, and risk profile of individual institutions and systemic risk among groups of institutions and the industry as a whole. Except for selected items, these information collections are not given confidential treatment. Current Actions: I. Overview OTS last revised the form and content of the TFR in a manner that significantly affected a substantial percentage of institutions in March 2010. Since the beginning of 2010 OTS has evaluated its ongoing information needs. OTS recognizes that the TFR imposes reporting requirements, which are a component of the regulatory burden facing institutions. Another contributor to this regulatory burden is the examination process, particularly onsite examinations during which institution staff spends time and effort responding to inquiries and requests for information designed to assist examiners in evaluating the condition and risk profile of the institution. The amount of attention that examiners direct to risk areas of the institution under examination is, in large part, determined from TFR data. These data, and analytical reports, including the Uniform Thrift Performance Report, assist examiners in scoping and making their preliminary assessments of risks during the planning phase of the examination. A risk-focused review of the information from an institution’s TFR allows examiners to make preliminary risk assessments prior to onsite work. The degree of perceived risk determines the extent of the examination procedures that examiners initially plan for each risk area. If the outcome of these procedures reveals a different level of risk in a particular area, the examiner adjusts the examination scope and procedures accordingly. TFR data are also a vital source of information for the monitoring and regulatory activities of OTS. Among their benefits, these activities aid in determining whether the frequency of an institution’s examination cycle should remain at maximum allowed time intervals, thereby lessening overall regulatory burden. More risk-focused TFR data enhance the ability of OTS to assess whether an institution is experiencing changes in its risk profile that warrant immediate follow-up, VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 which may include accelerating the timing of an on-site examination. In developing this proposal, OTS considered a range of potential information needs, particularly in the areas of credit risk, liquidity, and liabilities, and identified those additions to the TFR that are most critical and relevant to OTS in fulfilling its supervisory responsibilities. OTS recognizes that increased reporting burden will result from the addition to the TFR of the new items discussed in this proposal. Nevertheless, when viewing these proposed revisions to the TFR within a larger context, they help to enhance the on- and off-site supervision capabilities of OTS, which assist with controlling the overall regulatory burden on institutions. OTS also considered the potential impacts from the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act (‘‘the DoddFrank Act’’) that the President signed into law on July 21. The Dodd-Frank Act provides for the combination of the OTS into the Office of the Comptroller of the Currency 12 to 18 months after the enactment date. Employees of the OTS on the transfer date will transfer to the OCC, the FDIC, or a new Consumer Financial Protection Bureau. At this point, no decision about a possible conversion, if any, from the TFR to the Call Report has been made. Nevertheless, effort was made to avoid increasing differences between the two reports. For this reason, the majority of the proposed changes mirror changes proposed for the Call Report. However, proposed are some changes that will further and enhance off-site monitoring and on-site examination efficiency. Thus, OTS is requesting comment on the following proposed revisions to the TFR that would take effect as of March 31, 2011, unless otherwise noted. These revisions would change the reporting frequency for the number and market value of collective investment funds and common trust funds data reported in Memorandum Item 3 of Schedule FS from annually to quarterly, revise several existing lines, add new lines to the TFR, and add a new Schedule VIE, Variable Interest Entities. For each of the proposed revisions or new items, OTS is particularly interested in comments from institutions on whether the information proposed to be collected is readily available from existing institution records. OTS also invites comment on whether there are particular proposed revisions for which the new data would be of limited relevance for purposes of assessing risks in a specific segment of the savings association industry. In such PO 00000 Frm 00154 Fmt 4703 Sfmt 4703 cases, OTS requests comments on what criteria, e.g., an asset size threshold or some other measure, we should establish for identifying the specific segment of the savings association industry that we should require to report the proposed information. Finally, OTS seeks comment on whether, for a particular proposed revision, there is an alternative information set that could satisfy OTS data needs and be less burdensome for institutions to report than the new or revised items that OTS has proposed. OTS will consider all of the comments it receives as it formulates a final set of revisions to the TFR for implementation in 2011. The proposed revisions include: • A breakdown by loan category of the existing troubled debt restructurings for amounts added in the current quarter and amounts included in Schedule SC in compliance with modified terms in Schedule VA, and for troubled debt restructurings that are past due 30 to 89 days, 90 days or more, or in nonaccrual status in Schedule PD; • Additional data for automobile loans, including securities backed by automobile loans in Schedule SC, interest income from automobile loans in Schedule SO, automobile loans closed, purchased, or sold during the quarter in Schedule CF, and the average daily balance for automobile loans during the quarter in Schedule SI; • A breakdown in Schedule SC of the existing items for mortgage-backed securities between residential and commercial securities issued or guaranteed by U.S. Government agencies and sponsored enterprises and those that are not; • New items for the amount and average daily deposits of nonbrokered deposits obtained through the use of deposit listing service companies in Schedule DI; • A breakdown of the existing items for deposits of individuals, partnerships, and corporations between deposits of individuals and deposits of partnerships and corporations in Schedule DI; • A new Schedule VIE, Variable Interest Entities, for reporting the categories of assets of consolidated variable interest entities (VIEs) that can be used only to settle the VIEs’ obligations, the categories of liabilities of consolidated VIEs without recourse to the savings association’s general credit, and the total assets and total liabilities of other consolidated VIEs included in the savings association’s total assets and total liabilities, with these data reported separately for securitization trusts, E:\FR\FM\05OCN1.SGM 05OCN1 mstockstill on DSKH9S0YB1PROD with NOTICES Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices asset-backed commercial paper conduits, and other VIEs; • Breakdowns of loans and repossessed assets covered by FDIC losssharing agreements by loan and repossessed asset category in Schedule SI, new line in Schedule SI for income received from or accrued on assets covered by the FDIC under loss-sharing agreements, and a breakdown in Schedule PD of loans past due 30 to 89 days, 90 days or more, or in nonaccrual status covered by FDIC loss-sharing agreements; • A breakdown of the existing items for key person life insurance in Schedule SC into items for general account and separate account life insurance assets; • New items for the total assets of captive insurance and reinsurance subsidiaries in Schedule SI; • A change in reporting frequency from annual to quarterly for the data reported in Schedule FS on collective investment funds and common trust funds for those savings associations that currently report fiduciary assets and income annually, i.e., banks with fiduciary assets greater than $250 million or gross fiduciary income greater than 10 percent of bank revenue; • A new item in Schedule SO for service charges on deposit accounts; • A new item in Schedule CCR for qualifying noncontrolling (minority) interests in consolidated subsidiaries; • Two new items in Schedule SC for trust preferred securities; • A more detailed breakdown by loan type in Schedule VA of general, specific, and total valuation allowances; • A breakdown by loan type in Schedule VA of classified assets; • A new line in Schedule DI for time deposits of $100,000 or more with a remaining maturity of one year or less; • A new line in Schedule DI for deposits in foreign offices, Edge and Agreement subsidiaries, and IBFs; • A breakdown in Schedule SI of the amortized cost of held-to-maturity securities and the fair value of availablefor-sale securities; • Two new lines in Schedule SI for farmland loans secured by real estate, and loans to finance agricultural production and other loans to farmers; • Two new lines in Schedule SI for Federal Home Loan Bank advances with a remaining maturity of one year or less, and other borrowings with a remaining maturity of one year or less; and • A new line in Schedule SI for the amount of liabilities from a savings association’s trading activities. The specific wording of the captions for the new or revised TFR data items discussed in this proposal and the VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 numbering of these data items should be regarded as preliminary. II. Discussion of Revisions Proposed for March 2011 A. Troubled Debt Restructurings OTS is proposing that savings associations report additional detail on loans that have undergone troubled debt restructurings in TFR Schedules VA and PD. More specifically, new items are proposed for Schedule VA under two columns for the amount of troubled debt restructured during the current quarter (odd-numbered lines) and the amount of troubled debt restructured that is included in Schedule SC in compliance with the modified terms (evennumbered lines): VA211, VA212 Construction Loans (Total of VA213–VA218): VA213, VA214 1–4 Dwelling Units; VA215, VA216 Multifamily (5 or more) Dwelling Units; VA217, VA218 Nonresidential Property. Permanent Loans, Secured by: VA221, VA222 1–4 Dwelling Units; VA223, VA224 Multifamily (5 or more) Dwelling Units; VA 225, VA226 Nonresidential Property (Except Land); VA227, VA228 Owner-Occupied Nonresidential Property; VA231, VA232 Other Nonresidential Property; VA233, VA234 Land; VA241, VA242 Nonmortgage Loans— Total; V243, VA244 Commercial Loans— Total; VA245, VA246 Secured; VA247, VA248 Unsecured; VA251, VA252 Credit Card Loans Outstanding—Business; VA253, VA254 Consumer Loans— Total. New items are proposed in Schedule PD to add detail to troubled debt restructuring amounts past due and still accruing, 30–89 days (500-series lines), past due and still accruing, 90 days or more (600-series lines), and nonaccrual (700-series lines): Construction Loans: PD516, PD616, PD716 1–4 Dwelling Units; PD517, PD617, PD717 Multifamily (5 or more) Dwelling Units; PD518, PD618, PD718 Nonresidential Property. Permanent Loans, Secured by: PD519, PD619, PD719 1–4 Dwelling Units; PD525, PD625, PD725 Multifamily (5 or more) Dwelling Units; PO 00000 Frm 00155 Fmt 4703 Sfmt 4703 61565 PD535, PD635, PD735 Nonresidential Property (Except Land); PD536, PD636, PD736 OwnerOccupied Nonresidential Property; PD537, PD637, PD737 Other Nonresidential Property; PD538, PD638, PD738 Land; PD539, PD639, PD739 Nonmortgage Loans—Total; PD540, PD640, PD740 Commercial Loans—Total; PD541, PD641, PD741 Secured; PD542, PD642, PD742 Unsecured; PD545, PD645, PD745 Credit Card Loans Outstanding—Business; PD560, PD660, PD760 Consumer Loans—Total. In the aggregate, troubled debt restructurings for all insured institutions have grown from $6.9 billion at year-end 2007, to $24.0 billion at year-end 2008, to $58.1 billion at year-end 2009, with a further increase to $64.0 billion as of March 31, 2010. The proposed additional detail on troubled debt restructurings in Schedules VA and PD would enable OTS to better understand the level of restructuring activity at savings associations, the categories of loans involved in this activity, and, therefore, whether savings associations are working with their borrowers to modify and restructure loans. In particular, to encourage banks and savings associations to work constructively with their commercial borrowers, the federal banking agencies recently issued guidance on commercial real estate loan workouts and small business lending. While this guidance has explained the agencies’ expectations for prudent workouts, the agencies do not have adequate and reliable data outside of the examination process to assess restructuring activity for commercial real estate loans and commercial and industrial loans. Further, it is important to separately identify commercial real estate loan restructurings from commercial and industrial loan restructurings given that the value of the real estate collateral is a consideration in an institution’s decision to modify the terms of a commercial real estate loan in a troubled debt restructuring, but such collateral protection would normally be absent from commercial and industrial loans for which a loan modification is being explored because of borrowers’ financial difficulties. It is also anticipated that other loan categories will experience continued workout activity in the coming months given that every asset class has been impacted by the recent recession (as evidenced by the increase in past due and nonaccrual assets across all asset E:\FR\FM\05OCN1.SGM 05OCN1 61566 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices classes). In addition, because credit availability has substantially decreased, borrowers experiencing financial difficulties are left with few alternatives for funding and their creditor institutions will need to evaluate whether to work with them by granting a concession when modifying the terms of their existing loans. The new data would provide the OTS with the level of information necessary to assess savings associations’ troubled debt restructurings to the same extent that other loan quality and performance indicators can be assessed. However, the OTS notes that, under generally accepted accounting principles, troubled debt restructurings do not include changes in lease agreements 1 and we therefore propose to exclude leases from the new items proposed. mstockstill on DSKH9S0YB1PROD with NOTICES B. Auto Loans OTS is proposing to collect additional information on automobile loans. More specifically, the following new lines are proposed: SC183 Securities Backed by Auto Loans; SO173 Auto Loans—Interest Income; CF401 Auto Loans Closed or Purchased During Quarter; CF402 Auto Loans Sold During Quarter; SI886 Auto Loans—Average Daily Balance During Quarter. Automobile loans are a significant consumer business for many large savings associations. The proposed additional lines will enhance supervisory evaluation and oversight of automobile lending performance and risks. C. Commercial Mortgage-Backed Securities Issued or Guaranteed by U.S. Government Agencies and Sponsored Agencies OTS is proposing to split the existing items on mortgage-backed securities (MBS) in Schedule SC to distinguish between residential and commercial MBS issued or guaranteed by U.S. Government agencies and sponsored agencies (collectively, U.S. Government agencies) and residential and commercial MBS issued by others. OTS proposes to revise the following existing lines to report data for residential MBS: Residential Pass-Through: SC210 Insured or Guaranteed by an Agency or Sponsored Enterprise of the U.S.; SC215 Other Pass-Through. Other Residential Mortgage-Backed Securities (Excluding Bonds): 1 Accounting Standards Codification paragraph 470–60–15–11. VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 SC217 Issued or Guaranteed by FNMA, FHLMC, or GNMA; SC219 Collateralized by MortgageBacked Securities Issued or Guaranteed by FNMA, FHLMC, or GNMA; SC222 Other. OTS proposes the following new lines to report data for commercial MBS: Commercial Pass-Through: SC211 Insured or Guaranteed by an Agency or Sponsored Enterprise of the U.S.; SC213 Other Pass-Through. Other Commercial Mortgage-Backed Securities (Excluding Bonds): SC223 Issued or Guaranteed by FNMA, FHLMC, or GNMA; SC224 Collateralized by MortgageBacked Securities Issued or Guaranteed by FNMA, FHLMC, or GNMA; SC225 Other. D. Nonbrokered Deposits Obtained Through the Use of Deposit Listing Service Companies Savings associations currently report information on their funding in the form of brokered deposits in Schedule DI. These data are an integral component of the regulatory analysis of individual institutions’ liquidity and funding, including their reliance on non-core sources to fund their activities. Deposit brokers have traditionally provided intermediary services for financial institutions and investors. However, the Internet, deposit listing services, and other automated services now enable investors who focus on yield to easily identify high-yielding deposit sources. Such customers are highly rate sensitive and can be a less stable source of funding than typical relationship deposit customers. Because they often have no other relationship with the financial institution, these customers may rapidly transfer funds to other institutions if more attractive returns become available. OTS expects each institution to establish and adhere to a sound liquidity and funds management policy. The institution’s board of directors, or a committee of the board, should also ensure that senior management takes the necessary steps to monitor and control liquidity risk. This process includes establishing procedures, guidelines, internal controls, and limits for managing and monitoring liquidity and reviewing the institution’s liquidity position, including its deposit structure, on a regular basis. A necessary prerequisite to sound liquidity and funds management decisions is a sound management information system, which PO 00000 Frm 00156 Fmt 4703 Sfmt 4703 provides certain basic information including data on non-relationship funding programs, such as brokered deposits, deposits obtained through the Internet or other types of advertising, and other similar rate sensitive deposits. Thus, an institution’s management should be aware of the number and magnitude of such deposits. To improve its ability to monitor potentially volatile funding sources, OTS is proposing two lines to Schedule DI in which savings associations would report the amount of deposits and average daily deposits obtained through the use of deposit listing services that are not brokered deposits: DI117 Total Amount of Deposits Obtained Through Deposit Listing Services That Are Not Brokered Deposits; DI547 Average Daily Deposits Totals: Deposits Obtained Through Deposit Listing Services That Are Not Brokered Deposits. A deposit listing service is a company that compiles information about the interest rates offered on deposits, such as certificates of deposit, by insured depository institutions. A particular company could be a deposit listing service (compiling information about certificates of deposits) as well as a deposit broker (facilitating the placement of certificates of deposit). A deposit listing service is not a deposit broker if all of the following four criteria are met: (1) The person or entity providing the listing service is compensated solely by means of subscription fees (i.e., the fees paid by subscribers as payment for their opportunity to see the rates gathered by the listing service) and/or listing fees (i.e., the fees paid by depository institutions as payment for their opportunity to list or ‘‘post’’ their rates). The listing service does not require a depository institution to pay for other services offered by the listing service or its affiliates as a condition precedent to being listed. (2) The fees paid by depository institutions are flat fees: They are not calculated on the basis of the number or dollar amount of deposits accepted by the depository institution as a result of the listing or ‘‘posting’’ of the depository institution’s rates. (3) In exchange for these fees, the listing service performs no services except (A) the gathering and transmission of information concerning the availability of deposits; and/or (B) the transmission of messages between depositors and depository institutions (including purchase orders and trade confirmations). In publishing or E:\FR\FM\05OCN1.SGM 05OCN1 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices displaying information about depository institutions, the listing service must not attempt to steer funds toward particular institutions (except that the listing service may rank institutions according to interest rates and also may exclude institutions that do not pay the listing fee). Similarly, in any communications with depositors or potential depositors, the listing service must not attempt to steer funds toward particular institutions. (4) The listing service is not involved in placing deposits. Any funds to be invested in deposit accounts are remitted directly by the depositor to the insured depository institution and not, directly or indirectly, by or through the listing service. E. Deposits of Individuals, Partnerships, and Corporations mstockstill on DSKH9S0YB1PROD with NOTICES Savings associations currently do not report separate breakdowns of their deposit accounts in the TFR by category of depositor. The recent crisis has demonstrated that business depositors’ behavioral characteristics are significantly different than the behavioral characteristics of individuals. Thus, separate reporting of deposits of individuals versus deposits of partnerships and corporations would enable the federal banking agencies to better assess the liquidity risk profile of institutions given differences in the relative stability of deposits from these two sources. OTS is proposing that the following two lines be added to Schedule DI: DI196 Deposits of Individuals; DI197 Deposits of Partnerships and Corporations. Under this proposal, accounts for which the depositor’s taxpayer identification number, as maintained on the account in the savings association’s records, is a Social Security Number (or an Individual Taxpayer Identification Number 2) should be treated as deposits of individuals. In general, all other accounts should be treated as deposits of partnerships and corporations. However, line SC710 currently includes all certified and official checks. To limit the reporting burden of this proposed change, official checks in the form of money orders and travelers checks would be reported as deposits of individuals. Certified checks and all other official checks would be reported 2 An Individual Taxpayer Identification Number is a tax processing number only available for certain nonresident and resident aliens, their spouses, and dependents who cannot get a Social Security Number. It is a 9-digit number, beginning with the number ‘‘9,’’ formatted like a Social Security Number. VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 as deposits of partnerships and corporations. OTS is requesting comment on this approach to reporting certified and official checks. F. Variable Interest Entities In June 2009, the Financial Accounting Standards Board (FASB) issued accounting standards that have changed the way entities account for securitizations and special purpose entities. ASU No. 2009–16 (formerly FAS 166) revised ASC Topic 860, Transfers and Servicing, by eliminating the concept of a ‘‘qualifying specialpurpose entity’’ (QSPE) and changing the requirements for derecognizing financial assets. ASU No. 2009–17 (formerly FAS 167) revised ASC Topic 810, Consolidations, by changing how a financial institution or other company determines when an entity that is insufficiently capitalized or is not controlled through voting or similar rights, i.e., a ‘‘variable interest entity’’ (VIE), should be consolidated. For most financial institutions, ASU Nos. 2009– 16 and 2009–17 took effect January 1, 2010. Under ASC Topic 810, as amended, determining whether a financial institution is required to consolidate a VIE depends on a qualitative analysis of whether that institution has a ‘‘controlling financial interest’’ in the VIE and is therefore the primary beneficiary of the VIE. The analysis focuses on the institution’s power over and interest in the VIE. With the removal of the QSPE concept from generally accepted accounting principles that was brought about in amended ASC Topic 860, an institution that transferred financial assets to an SPE that met the definition of a QSPE before the effective date of these amended accounting standards was required to evaluate whether, pursuant to amended ASC Topic 810, it must begin to consolidate the assets, liabilities, and equity of the SPE as of that effective date. Thus, when implementing amended ASC Topics 860 and 810 at the beginning of 2010, financial institutions began to consolidate certain previously offbalance securitization vehicles, assetbacked commercial paper conduits, and other structures. Going forward, financial institutions with variable interests in new VIEs must evaluate whether they have a controlling financial interest in these entities and, if so, consolidate them. In addition, institutions must continually reassess whether they are the primary beneficiary of VIEs in which they have variable interests. PO 00000 Frm 00157 Fmt 4703 Sfmt 4703 61567 For those VIEs that savings associations must consolidate, guidance advises institutions to report the assets and liabilities of these VIEs on Schedule SC in the balance sheet category appropriate to the asset or liability. However, ASC paragraph 810–10–45– 25 3 requires a reporting entity to present ‘‘separately on the face of the statement of financial position: a. Assets of a consolidated variable interest entity (VIE) that can be used only to settle obligations of the consolidated VIE [and] b. Liabilities of a consolidated VIE for which creditors (or beneficial interest holders) do not have recourse to the general credit of the primary beneficiary.’’ This requirement has been interpreted to mean that ‘‘each line item of the consolidated balance sheet should differentiate which portion of those amounts meet the separate presentation conditions.’’ 4 In requiring separate presentation for these assets and liabilities, the FASB agreed with commenters on its proposed accounting standard on consolidation that ‘‘separate presentation * * * would provide transparent and useful information about an enterprise’s involvement and associated risks in a variable interest entity.’’ 5 The federal banking agencies concur that separate presentation would provide similar benefits to them and other Call Report and TFR users. Consistent with the presentation requirements discussed above, the banking agencies are proposing to add a new Schedule RC–V, Variable Interest Entities, to the Call Report, and OTS is proposing to add a new Schedule VIE, Variable Interest Entities, to the TFR. Financial institutions would use the proposed new schedules to report a breakdown of the assets of consolidated VIEs that can be used only to settle obligations of the consolidated VIEs and liabilities of consolidated VIEs for which creditors do not have recourse to the general credit of the financial institution. The following proposed categories of assets and liabilities would include some of the same categories presented on the Call Report and TFR balance sheet schedules: Cash and balances due from depository institutions, Held-to-maturity securities; Available-for-sale securities; Securities purchased under agreements to resell, Loans and leases held for sale; Loans 3 Formerly paragraph 22A of FIN 46(R), as amended by FAS 167. 4 Deloitte & Touche LLP, ‘‘Back on-balance sheet: Observations from the adoption of FAS 167,’’ May 2010, page 4 (http://www.deloitte.com/view/en_US/ us/Services/audit-enterprise-risk-services/ Financial-Accounting-Reporting/f3a70ca 28d9f8210VgnVCM200000bb42f00aRCRD.htm). 5 See paragraphs A80 and A81 of FAS 167. E:\FR\FM\05OCN1.SGM 05OCN1 61568 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices and leases, net of unearned income; Allowance for loan and lease losses; Trading assets (other than derivatives); Derivative trading assets; Other real estate owned; Other assets; Securities sold under agreements to repurchase; Derivative trading liabilities; Other borrowed money (other than commercial paper); Commercial paper; and Other liabilities. These assets and liabilities would be presented separately for securitization trusts, asset-backed commercial paper conduits, and other VIEs. In addition, the federal banking agencies propose to include separate items in the new schedules in which financial institutions would report the total assets and the total liabilities of consolidated VIEs (for which the breakdown of assets and liabilities described above is not reported) to help the agencies understand the magnitude of any VIE assets that are not dedicated solely to settling obligations of the VIE and any VIE liabilities for which creditors may have recourse to the general credit of the bank. These consolidated VIEs’ total assets and total liabilities, which would be reported after eliminating intercompany transactions, would also be reported separately for securitization trusts, asset-backed commercial paper conduits, and other VIEs. mstockstill on DSKH9S0YB1PROD with NOTICES G. Assets Covered by FDIC Loss-Sharing Agreements In March 2010, the federal banking agencies added a four-way breakdown of assets covered by loss-sharing agreements with the FDIC to the Call Report and the TFR. In a January 22, 2010, comment letter to the banking agencies on the agencies’ submission for OMB review of proposed Call Report revisions for implementation in 2010, the American Bankers Association (ABA) stated that while the addition of the covered asset items to Schedule RC–M was a step in the right direction, ABA believes it would be beneficial to regulators, reporting banks, investors, and the public to have additional, more granular information about the various categories of assets subject to the FDIC loss-sharing agreements. While we recognize that this would result in additional reporting burden on banks, on balance our members feel strongly that the benefit of additional disclosure of loss-sharing data would outweigh the burden of providing these detailed data. Thus, we urge the Agencies and the FFIEC to further revise the collection of data from banks on assets covered by FDIC loss-sharing agreements on the Call Report to include the several changes suggested below. * * * We believe these changes would provide a more precise and accurate picture of a bank’s asset quality. VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 OTS is proposing to revise the TFR along the lines suggested by the ABA by adding the following new lines: Breakdown of line SI770, Loans and Leases: SI771 Construction Loans—Total SI773 Residential—Total SI717 1–4 Dwelling Units SI718 Multifamily (5 or More) Dwelling Units SI775 Nonresidential Property SI777 Permanent Loans—Total SI778 Residential—Total SI779 1–4 Dwelling Units—Total SI780 Revolving Open-End Loans SI781 All Other—First Liens SI782 All Other—Junior Liens SI783 Multifamily (5 or More) Dwelling Units SI784 Nonresidential Property—Total SI785 Owner-Occupied Nonfarm Nonresidential Property SI786 Other Nonfarm Nonresidential Property SI787 Land SI788 Commercial Loans—Total SI789 Secured SI790 Unsecured SI791 Credit Card Loans Outstanding—Business SI792 Lease Receivables SI793 Consumer Loans—Total SI794 Loans on Deposits SI795 Home Improvement Loans (Not Secured by Real Estate) SI796 Education Loans SI797 Auto Loans SI798 Mobile Home Loans SI799 Credit Cards SI800 Other, Including Lease Receivables SI801 Repossessed Assets—Total SI802 Real Estate—Total SI803 Construction SI804 Residential—Total SI805 1–4 Dwelling Units SI806 Multifamily (5 or More) Dwelling Units SI807 Nonresidential (Except Land) SI808 Land SI809 Other Repossessed Assets SI810 Guaranteed amount of total amount of covered real estate owned SI811 Total Income Included on Schedule SO Received From or Accrued on Assets Covered by the FDIC Under Loss-Sharing Agreements Breakdown of Covered Past Due and Nonaccrual Loans and Leases (3 amounts for each line—30–89 days past due and still accruing, 90 days or more past due and still accruing, and nonaccrual): PD515, PD615, PD715 Construction Loans—Total PD SUBxxx, PD SUBxxx, PD SUBxxx Residential—Total PD516, PD616, PD716 1–4 Dwelling Units PO 00000 Frm 00158 Fmt 4703 Sfmt 4703 PD517, PD617, PD717 Multifamily (5 or More) Dwelling Units PD518, PD618, PD718 Nonresidential Property PD SUBxxx, PD SUBxxx, PD SUBxxx Permanent Loans—Total PD SUBxxx, PD SUBxxx, PD SUBxxx Residential—Total PD SUBxxx, PD SUBxxx, PD SUBxxx 1–4 Dwelling Units—Total PD521, PD621, PD721 Revolving Open-End Loans PD523, PD623, PD723 All Other—First Liens PD524, PD624, PD724 All Other— Junior Liens PD525, PD625, PD725 Multifamily (5 or More) Dwelling Units PD535, PD635, PD735 Nonresidential Property—Total PD536, PD636, PD736 OwnerOccupied Nonresidential Property PD537, PD637, PD737 Other Nonresidential Property PD538, PD638, PD738 Land PD540, PD640, PD740 Commercial Loans—Total PD541, PD641, PD741 Secured PD542, PD642, PD742 Unsecured PD540, PD643, PD743 Credit Card Loans Outstanding—Business PD545, PD645, PD745 Lease Receivables PD SUBxxx, PD SUBxxx, PD SUBxxx Consumer Loans—Total PD561, PD661, PD761 Loans on Deposits PD563, PD663, PD763 Home Improvement Loans (Not Secured by Real Estate) PD565, PD665, PD765 Education Loans PD567, PD667, PD767 Auto Loans PD569, PD669, PD769 Mobile Home Loans PD571, PD671, PD771 Credit Cards PD580, PD680, PD780 Other, Including Lease Receivables PD596, PD696, PD796 Guaranteed Amount of Total Amount of Covered Past Due and Nonaccrual Loans and Leases H. Life Insurance Assets Financial institutions purchase and hold bank-owned life insurance (BOLI) policies as assets, the premiums for which may be used to acquire general account or separate account life insurance policies. Savings associations currently report the aggregate amount of their life insurance assets in Schedule SC without regard to whether their holdings are general account or separate account policies. Many financial institutions have BOLI assets, and the distinction between those life insurance policies that represent general account products and E:\FR\FM\05OCN1.SGM 05OCN1 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices including its TFR. The cash flows for a captive reinsurer’s transactions also are not transparent in an institution’s consolidated financial statements. A number of financial institutions own captive insurers or reinsurers, several of which were authorized to operate more than ten years ago. Some of the most common lines of business underwritten by financial institution captive insurers are credit life, accident, and health; disability insurance; and employee benefits coverage. Additionally, financial institution captive reinsurance subsidiaries may underwrite private mortgage guaranty reinsurance and terrorism risk reinsurance. As part of their supervisory processes, the federal banking agencies have been following the proliferation of financial institution captive insurers and reinsurers and the performance trends of these captives for the past several years. Collection of financial information regarding the total assets of captive insurance and reinsurance subsidiaries would assist the agencies in monitoring the insurance activities of banking organizations as well as any safety and soundness risks posed to the parent institution from the activities of these subsidiaries. OTS is proposing to collect two new items in Schedule SI: SI762 Total assets of captive insurance subsidiaries; SI763 Total assets of captive reinsurance subsidiaries. These new items are not expected to be applicable to the vast majority of savings associations. When reporting the total assets of these captive subsidiaries in the proposed new items, savings associations should measure the subsidiaries’ total assets before eliminating intercompany transactions between the consolidated subsidiary and other offices or subsidiaries of the consolidated institution. I. Captive Insurance and Reinsurance Subsidiaries mstockstill on DSKH9S0YB1PROD with NOTICES those that represent separate account products has meaning with respect to the degree of credit risk involved as well as performance measures for the life insurance assets in a volatile market environment. In a general account policy, the general assets of the insurance company issuing the policy support the policy’s cash surrender value. In a separate account policy, the policyholder’s cash surrender value is supported by assets segregated from the general assets of the insurance carrier. Under such an arrangement, the policyholder neither owns the underlying separate account created by the insurance carrier on its behalf nor controls investment decisions in the account. Nevertheless, the policyholder assumes all investment and price risk. A number of financial institutions holding separate account life insurance policies have recorded significant losses in recent years due to the volatility in the markets and the vulnerability to market fluctuations of the instruments that are investment options in separate account life insurance policies. Information distinguishing between the cash surrender values of general account and separate account life insurance policies would allow the OTS to track savings associations’ holdings of both types of life insurance policies with their differing risk characteristics and changes in their carrying amounts resulting from their performance over time. Accordingly, the OTS is proposing to add the following new items: Key Person Life Insurance: SC617 General Account Life Insurance Assets; SC619 Separate Account Life Insurance Assets. Other BOLI Not Considered Key Person Life Insurance: SC627 General Account Life Insurance Assets; SC629 Separate Account Life Insurance Assets. J. Quarterly Reporting for Collective Investment Funds Captive insurance companies are utilized by banking organizations to ‘‘self insure’’ or reinsure their own risks pursuant to incidental activities authority. A captive insurance company is a limited purpose insurer that may be licensed as a direct writer of insurance or as a reinsurer. Insurance premiums paid by an institution to its captive insurer, and claims paid back to the institution by the captive, are transacted on an intercompany basis, so there is no evidence of this type of self-insurance activity when an institution prepares consolidated financial statements, For financial institutions that provide fiduciary and related services, the volume of assets under management is an important metric for understanding risk at these institutions and in the banking system. A savings association’s assets under management may include such pooled investment vehicles as collective investment funds and common trust funds (hereafter, collectively, CIFs) that it offers to investors. When considering how and where to place funds in pooled investment vehicles, which also include registered investment funds (mutual VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 PO 00000 Frm 00159 Fmt 4703 Sfmt 4703 61569 funds), investors’ decisions are highly influenced by risk and return factors. While registered investment funds regularly disclose an array of fundrelated data to the U.S. Securities and Exchange Commission and the investing public, the OTS’s collection and public disclosure of summary data on CIFs is limited to annual data reported in lines FS610 through FS675 of TFR Schedule FS, Fiduciary and Related Services, as of each December 31. Like other investment vehicles, CIFs were affected by market disruptions during the recent financial crisis. To detect changes in investor behavior and bank investment management strategies at an early stage in this $2.5 trillion line of business, the banking agencies believe it would be beneficial to change the reporting frequency for the Schedule FS data on collective investment funds and common trust funds from annually to quarterly for those institutions that currently report their fiduciary assets and fiduciary income quarterly. Quarterly filing of these Schedule FS data is required of institutions with total fiduciary assets greater than $250 million (as of the preceding December 31) or with gross fiduciary and related income greater than 10 percent of revenue for the preceding calendar year. K. Service Charges on Deposit Accounts Savings associations currently do not report separate detail on service charges on deposit accounts. There has been growing interest in the amount of deposit account service fees charged by financial institutions. Banks currently report this data as a separate component of noninterest income in Call Report Schedule RI. In reporting this item, banks include amounts charged depositors (in domestic offices): (1) For the maintenance of their deposit accounts with the bank, socalled ‘‘maintenance charges,’’ (2) For their failure to maintain specified minimum deposit balances, (3) Based on the number of checks drawn on and deposits made in their deposit accounts, (4) For checks drawn on so-called ‘‘no minimum balance’’ deposit accounts, (5) For withdrawals from nontransaction deposit accounts, (6) For the closing of savings accounts before a specified minimum period of time has elapsed, (7) For accounts which have remained inactive for extended periods of time or which have become dormant, (8) For deposits to or withdrawals from deposit accounts through the use of automated teller machines or remote service units, E:\FR\FM\05OCN1.SGM 05OCN1 61570 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES (9) For the processing of checks drawn against insufficient funds, socalled ‘‘NSF check charges,’’ that the bank assesses regardless of whether it decides to pay, return, or hold the check. Exclude subsequent charges levied against overdrawn accounts based on the length of time the account has been overdrawn, the magnitude of the overdrawn balance, or which are otherwise equivalent to interest (report in the appropriate subitem of Schedule RI, item 1.a, ‘‘Interest and fee income on loans (in domestic offices)’’), (10) For issuing stop payment orders, (11) For certifying checks, and (12) For the accumulation or disbursement of funds deposited to Individual Retirement Accounts (IRAs) or Keogh Plan accounts when not handled by the bank’s trust department. Report such commissions and fees received for accounts handled by the bank’s trust department in Schedule RI, item 5.a, ‘‘Income from fiduciary activities.’’ Exclude penalties paid by depositors for the early withdrawal of time deposits (report as ‘‘Other noninterest income’’ in Schedule RI, item 5.l, or deduct from the interest expense of the related category of time deposits, as appropriate). OTS is proposing to add the following line to Schedule SO as a detail item of other fees and charges within the noninterest income section: SO422 Service Charges on Deposit Accounts L. Qualifying Noncontrolling (Minority) Interests in Consolidated Subsidiaries Only qualifying noncontrolling (minority) interests in consolidated subsidiaries are allowable in Tier 1 capital. Those that are non-qualifying are not. The existing Schedule CCR computes Tier 1 Capital using Total Equity Capital (Line SC 84), which includes all noncontrolling (minority) interests from Line SC 800. This can be interpreted as permitting all noncontrolling (minority) interests (Line SC 800), whether qualifying or not, to be included in the calculation of Tier 1 Capital. Therefore to clarify the treatment of noncontrolling (minority) interests, OTS is proposing to use Total Savings Association Equity Capital (Line SC 80), which is net of noncontrolling (minority) interests, as the starting point for computation of Tier 1 capital for Schedule CCR. Noncontrolling (minority) interests are then added to Tier 1, per the new line CCR187 described below, only to the extent they are qualifying noncontrolling (minority) interests. This approach is consistent with the approach used on the Call Report. Thus, VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 OTS is proposing to revise one line and add a new line on Schedule CCR to address the treatment of noncontrolling (minority) interests in Tier 1 Capital: Revise line CCR100 Total Equity Capital (SC84) to CCR100 Total Savings Association Equity Capital (SC80) Add new line CCR187 Qualifying Noncontrolling (Minority) Interests in Consolidated Subsidiaries. M. Trust Preferred Securities As financial institution investments, trust preferred securities are hybrid instruments possessing characteristics typically associated with debt obligations. Although each issue of these securities may involve minor differences in terms, under the basic structure of trust preferred securities a corporate issuer, such as a financial institution holding company, first organizes a business trust or other special purpose entity. This trust issues two classes of securities: common securities, all of which are purchased and held by the corporate issuer, and trust preferred securities, which are sold to investors. The business trust’s only assets are deeply subordinated debentures of the corporate issuer, which the trust purchases with the proceeds from the sale of its common and preferred securities. The corporate issuer makes periodic interest payments on the subordinated debentures to the business trust, which uses these payments to pay periodic dividends on the trust preferred securities to the investors. The subordinated debentures have a stated maturity and may also be redeemed under other circumstances. Most trust preferred securities are subject to mandatory redemption upon the repayment of the debentures. Trust preferred securities meet the definition of a security in FASB Statement No. 115, ‘‘Accounting for Certain Investments in Debt and Equity Securities.’’ Because of the mandatory redemption provision in the typical trust preferred security, investments in trust preferred securities would normally be considered debt securities for financial accounting purposes. Accordingly, regardless of the authority under which a financial institution is permitted to invest in trust preferred securities, savings associations should report these investments as debt securities for purposes of these reports (unless, based on the specific facts and circumstances of a particular issue of trust preferred securities, the securities would be considered equity rather than debt securities under Statement No. 115. To better gauge the level of investment in trust preferred securities by savings PO 00000 Frm 00160 Fmt 4703 Sfmt 4703 associations, the OTS is proposing to add the following two lines as detail to other investment securities reported in Schedule SC: SC187 Trust Preferred Securities Issues By FDIC–Insured Depository Institutions or Their Holding Companies; SC188 Other Trust Preferred Securities. N. General, Specific, and Total Valuation Allowances by Major Loan Type OTS is proposing that savings associations report additional detail on loans for general and specific valuation allowances. The proposed additional detail on valuation allowances in Schedules VA would enable OTS to better understand reserves activity within loan categories at savings associations. More specifically, new items are proposed for Schedule VA under three columns for the amount of general valuation allowances at the end of the current quarter (1100 series of lines), the amount of specific valuation allowances at the end of the current quarter (1200 series of lines), and the total of valuation allowances at the end of the current quarter (1300 series of lines): VA1115, VA1215, VA1315 Construction Loans—Total VA SUBxxx, VA SUBxxx,VA SUBxxx Residential—Total VA1120, VA1220, VA1320 1–4 Dwelling Units VA1122, VA1222, VA1322 Multifamily (5 or More) Dwelling Units VA1130, VA1230, VA1330 Nonresidential Property VA SUBxxx, VA SUBxxx,VA SUBxxx Permanent Loans—Total VA SUBxxx, VA SUBxxx,VA SUBxxx Residential—Total VA SUBxxx, VA SUBxxx,VA SUBxxx 1–4 Dwelling Units—Total VA1140, VA1240, VA1340 Revolving Open-End Loans VA1145, VA1245, VA1345 All Other— First Liens VA1147, VA1247, VA1347 All Other— Junior Liens VA1150, VA1250, VA1350 Multifamily (5 or More) Dwelling Units VA1160, VA1260, VA1360 Nonresidential Property—Total VA1162, VA1262, VA1362 OwnerOccupied Nonresidential Property VA1163, VA1263, VA1363 Other Nonresidential Property VA1165, VA1265, VA1365 Land VA1170, VA1270, VA1370 Commercial Loans—Total E:\FR\FM\05OCN1.SGM 05OCN1 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES VA1172, VA1272, VA1372 Secured VA1173, VA1273, VA1373 Unsecured VA1174, VA1274, VA1374 Credit Card Loans Outstanding—Business VA1176, VA1276, VA1376 Lease Receivables VA SUBxxx, VA SUBxxx,VA SUBxxx Consumer Loans—Total VA1182, VA1282, VA1382 Loans on Deposits VA1183, VA1283, VA1383 Home Improvement Loans (Not Secured by Real Estate) VA1184, VA1284, VA1384 Education Loans VA1185, VA1285, VA1385 Auto Loans VA1186, VA1286, VA1386 Mobile Home Loans VA1187, VA1287, VA1387 Credit Cards VA1188, VA1288, VA1388 Other, Including Lease Receivables O. Classified Assets by Major Loan Type OTS is proposing that savings associations report additional detail on classified assets by major loan type. The proposed additional detail on classified assets in Schedules VA would enable OTS to better understand asset quality within loan categories at savings associations. More specifically, new items are proposed for Schedule VA under four columns for the amount of special mention assets at the end of the current quarter (1400 series of lines), the amount of substandard assets at the end of the current quarter (1500 series of lines), the amount of doubtful assets at the end of the current quarter (1600 series of lines), and the amount of loss assets at the end of the current quarter (1700 series of lines): VA1415, VA1515, VA1615, VA1715 Construction Loans—Total VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx Residential—Total VA1420, VA1520, VA1620, VA1720 1– 4 Dwelling Units VA1422, VA1522, VA1622, VA1722 Multifamily (5 or More) Dwelling Units VA1430, VA1530, VA1630, VA1730 Nonresidential Property VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx Permanent Loans— Total VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx Residential—Total VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx 1–4 Dwelling Units— Total VA1440, VA1540, VA1640, VA1740 Revolving Open-End Loans VA1445, VA1545, VA1645, VA1745 All Other—First Liens VA1447, VA1547, VA1647, VA1747 All Other—Junior Liens VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 VA1450, VA1550, VA1650, VA1750 Multifamily (5 or More) Dwelling Units VA1460, VA1560, VA1660, VA1760 Nonresidential Property—Total VA1462, VA1562, VA1662, VA1762 Owner-Occupied Nonresidential Property VA1463, VA1563, VA1663, VA1763 Other Nonresidential Property VA1465, VA1565, VA1665, VA1765 Land VA1470, VA1570, VA1670, VA1770 Commercial Loans—Total VA1472, VA152, VA1672, VA1772 Secured VA1473, VA1573, VA1673, VA1773 Unsecured VA1475, VA1575, VA1675, VA1775 Credit Card Loans Outstanding— Business VA1476, VA1576, VA1676, VA1776 Lease Receivables VASUBxxx, VASUBxxx, VASUBxxx, VASUBxxx Consumer Loans—Total VA1482, VA1582, VA1682, VA1782 Loans on Deposits VA1483, VA1583, VA1683, VA1783 Home Improvement Loans (Not Secured by Real Estate) VA1484, VA1584, VA1684, VA1784 Education Loans VA1485, VA1585, VA1685, VA1785 Auto Loans VA1486, VA1586, VA1686, VA1786 Mobile Home Loans VA1487, VA1587, VA1687, VA1787 Credit Cards VA1488, VA1588, VA1688, VA1788 Other, Including Lease Receivables Request for Comments: OTS may not conduct or sponsor an information collection, and respondents are not required to respond to an information collection, unless the information collection displays a currently valid OMB control number. In this notice, OTS is soliciting comments concerning the following information collection. Statutory Requirement: 12 U.S.C. 1464(v) imposes reporting requirements for savings associations. Type of Review: Revision of currently approved collections. Frequency of Response: Quarterly; Annually. Affected Public: Business or other forprofit. Estimated Number of Respondents: 753 savings associations. Estimated Burden Hours per Respondent: 60.0 hours average for quarterly schedules and 2.0 hours average for schedules required only annually plus recordkeeping of an average of one hour per quarter. Estimated Total Annual Burden: 188,712 burden hours. PO 00000 Frm 00161 Fmt 4703 Sfmt 4703 61571 OTS is proposing to revise the TFR, which is currently an approved collection of information, in March 2011. The effect on reporting burden of the proposed revisions to the TFR requirements will vary from institution to institution depending on the institution’s asset size and its involvement with the types of activities or transactions to which the proposed changes apply. The proposed TFR changes that would take effect as of March 31, 2011 would change the reporting frequency for the number and market value of collective investment funds and common trust funds data reported in Memorandum Item 3 of Schedule FS, revise several existing lines, add new lines to the TFR, and add a new Schedule VIE, Variable Interest Entities. OTS estimates that the implementation of these reporting revisions will result in an increase in the current reporting burden imposed by the TFR on all savings associations. As part of the approval process, we invite comments addressing one or more of the following points: a. Whether the proposed revisions to the TFR collections of information are necessary for the proper performance of the agency’s functions, including whether the information has practical utility; b. The accuracy of the agency’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 information collections on respondents, including through the use of automated collection techniques, the Internet, 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. OTS will summarize the comments received and include them in the request for OMB approval. All comments will become a matter of public record. Clearance Officer: Ira L. Mills, (202) 906–6531, Office of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552. OMB Reviewer: Desk Officer for OTS, FAX: (202) 395–6974, U.S. Office of Management and Budget, 725—17th Street, NW., Room 10235, Washington, DC 20503. E:\FR\FM\05OCN1.SGM 05OCN1 61572 Federal Register / Vol. 75, No. 192 / Tuesday, October 5, 2010 / Notices Dated: September 29, 2010. Ira L. Mills, Paperwork Clearance Officer, Office of Chief Counsel, Office of Thrift Supervision. DEPARTMENT OF THE TREASURY Office of Thrift Supervision [Docket ID OTS–2010–0030] [FR Doc. 2010–24883 Filed 10–4–10; 8:45 am] Open Meeting of the OTS Mutual Savings Association Advisory Committee BILLING CODE 6720–01–P DEPARTMENT OF THE TREASURY Department of the Treasury, Office of Thrift Supervision. ACTION: Notice of meeting. AGENCY: United States Mint Change to ‘‘Procedures To Qualify for Bulk Purchase of Silver Bullion Coins’’ United States Mint, Department of the Treasury. AGENCY: ACTION: Notice. The United States Mint has revised the requirements to become an Authorized Purchaser of American Eagle Silver Bullion Coins. The revised qualification requirements are documented in the revised ‘‘Procedures to Qualify for Bulk Purchase of Silver Bullion Coins.’’ This document can be accessed at http:// www.usmint.gov/consumer/ index.cfm?action=AmericanEagles. These changes apply to new applications effective immediately. Significant modifications include the addition of the America the Beautiful Silver Bullion CoinTM; Program to the Background section, clarifications to the ‘‘Purpose’’ section and ‘‘Marketing Support’’ section, and adjustments to the ‘‘Experienced Market-Maker in Silver Bullion Coins’’ section and ‘‘Tangible Net Worth’’ section. Changes to the accounting certification requirements and agreement terms and conditions are also incorporated. A new section has been added entitled ‘‘Right to Temporarily Refrain from the Review of New Applications’’ during periods in which the allocation of a bullion product is required. Other minor changes have been made that provide further clarifications to various production descriptions and/or the silver bullion coin program in accordance with 31 U.S.C. 5112(e)&(f). SUMMARY: B. B. Craig, Associate Director for Sales and Marketing; United States Mint; 801 9th Street, NW.; Washington, DC 20220; or call 202–354–7500. mstockstill on DSKH9S0YB1PROD with NOTICES FOR FURTHER INFORMATION CONTACT: Authority: 31 U.S.C. 5112(e)&(f). Dated: September 30, 2010. Andrew D. Brunhart, Deputy Director, United States Mint. [FR Doc. 2010–24915 Filed 10–4–10; 8:45 am] BILLING CODE 4810–02–P VerDate Mar<15>2010 18:36 Oct 04, 2010 Jkt 223001 The OTS Mutual Savings Associations Advisory Committee (MSAAC) will convene a meeting on Wednesday, October 20, 2010, beginning at 9:30 a.m. Eastern Time. The meeting will be open to the public. Members of the public interested in attending the meeting and members of the public who require auxiliary aid should e-mail OTS at mutualcommittee@ots.treas.gov or call (202) 906–6429 to obtain information on how to attend the meeting. DATES: The meeting will be held on Wednesday, October 20, 2010, at 9:30 a.m. Eastern Time. ADDRESSES: The meeting will be held in Berkley B, Third Floor, Sheraton Boston Hotel, 39 Dalton Street, Boston, MA 02199. The public is invited to submit written statements to the MSAAC by any one of the following methods: • E-mail address: mutualcommittee@ots.treas.gov; or • Mail: to Charlotte Bahin, Designated Federal Official, Office of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552 in triplicate. The agency must receive statements no later than October 13, 2010. FOR FURTHER INFORMATION CONTACT: Charlotte M. Bahin, Designated Federal Official, (202) 906–6452, Office of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552. SUPPLEMENTARY INFORMATION: By this notice, the Office of Thrift Supervision is announcing that the OTS Mutual Savings Association Advisory Committee will convene a meeting on Wednesday, October 20, 2010, beginning at 9:30 a.m. Eastern Time. The meeting will be open to the public. Anyone wishing to attend the meeting, and members of the public who require auxiliary aid, must contact the Office of Thrift Supervision at 202–906–6429 or mutualcommittee@ots.treas.gov by 5 p.m. Eastern Time on Wednesday, October 13, 2010, to inform OTS of his or her desire to attend the meeting and to obtain information on how to attend the meeting. The purpose of the meeting is to advise OTS on what regulatory changes or other steps OTS may be able to take to ensure the continued health and viability of mutual savings associations, and other issues of concern to the existing mutual savings associations. Dated: September 29, 2010. By the Office of Thrift Supervision. Deborah Dakin, Acting Chief Counsel. [FR Doc. 2010–24846 Filed 10–4–10; 8:45 am] BILLING CODE P SUMMARY: PO 00000 Frm 00162 Fmt 4703 Sfmt 4703 DEPARTMENT OF THE TREASURY Office of Foreign Assets Control Additional Identifying Information Associated With Persons Whose Property and Interests in Property Are Blocked Pursuant to the Executive Order of September 28, 2010, ‘‘Blocking Property of Certain Persons With Respect to Serious Human Rights Abuses by the Government of Iran and Taking Certain Other Actions’’ Office of Foreign Assets Control, Treasury. ACTION: Notice. AGENCY: The Treasury Department’s Office of Foreign Assets Control (‘‘OFAC’’) is publishing additional identifying information associated with the eight individuals listed in the Annex to the Executive Order of September 28, 2010, ‘‘Blocking Property of Certain Persons With Respect to Serious Human Rights Abuses by the Government of Iran and Taking Certain Other Actions,’’ whose property and interests in property are therefore blocked. FOR FURTHER INFORMATION CONTACT: Assistant Director, Compliance Outreach & Implementation, Office of Foreign Assets Control, Department of the Treasury, 1500 Pennsylvania Avenue NW., (Treasury Annex), Washington, DC 20220, Tel.: 202–622– 2490. SUPPLEMENTARY INFORMATION: SUMMARY: Electronic and Facsimile Availability This document and additional information concerning OFAC are available from OFAC’s Web site (www.treas.gov/ofac) or via facsimile through a 24-hour fax-on-demand service, Tel.: 202–622–0077. Background On September 28, 2010, the President issued the Executive Order ‘‘Blocking Property of Certain Persons With Respect to Serious Human Rights Abuses by the Government of Iran and Taking Certain Other Actions’’ (the ‘‘Order’’) pursuant to, inter alia, the E:\FR\FM\05OCN1.SGM 05OCN1

Agencies

[Federal Register Volume 75, Number 192 (Tuesday, October 5, 2010)]
[Notices]
[Pages 61563-61572]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-24883]


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DEPARTMENT OF THE TREASURY

Office of Thrift Supervision


Proposed Agency Information Collection Activities; Comment 
Request--Thrift Financial Report: Schedules SC, SO, VA, PD, LD, CC, CF, 
DI, SI, FS, CCR, and VIE

AGENCY: Office of Thrift Supervision (OTS), Treasury.

ACTION: Notice and request for comment.

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SUMMARY: The Department of the Treasury, as part of its continuing 
effort to reduce paperwork and respondent burden, invites the general 
public and other federal agencies to comment on proposed and continuing 
information collections, as required by the Paperwork Reduction Act of 
1995, 44 U.S.C. 3507. Today, the Office of Thrift Supervision within 
the Department of the Treasury solicits comments on proposed changes to 
the Thrift Financial Report (TFR), Schedule SC--Consolidated Statement 
of Condition, Schedule SO--Consolidated Statement of Operations, 
Schedule VA--Consolidated Valuation Allowances and Related Data, 
Schedule PD--Consolidated Past Due and Nonaccrual, Schedule LD--Loan 
Data, Schedule CC--Consolidated Commitments and Contingencies, Schedule 
CF--Consolidated Cash Flow Information, Schedule DI--Consolidated 
Deposit Information, Schedule SI--Consolidated Supplemental 
Information, Schedule FS--Fiduciary and Related Services, and Schedule 
CCR--Consolidated Capital Requirement, and on a proposed new Schedule 
VIE--Variable Interest Entities. The changes are proposed to become 
effective in March 2011.
    At the end of the comment period, OTS will analyze the comments and 
recommendations received to determine if it should modify the proposed 
revisions prior to giving its final approval. OTS will then submit the 
revisions to the Office of Management and Budget (OMB) for review and 
approval.

DATES: Submit written comments on or before December 6, 2010.

ADDRESSES: Send comments to Information Collection Comments, Chief 
Counsel's Office, Office of Thrift Supervision, 1700 G Street, NW., 
Washington, DC 20552; send facsimile transmissions to FAX number (202) 
906-6518; send e-mails to infocollection.comments@ots.treas.gov; or 
hand deliver comments to the Guard's Desk, east lobby entrance, 1700 G 
Street, NW., on business days between 9 a.m. and 4 p.m. All comments 
should refer to ``TFR Revisions--2011, OMB No. 1550-0023.'' OTS will 
post comments and the related index on the OTS Internet Site at http://www.ots.treas.gov. In addition, interested persons may inspect comments 
at the Public Reading Room, 1700 G Street, NW., by appointment. To make 
an appointment, call (202) 906-5922, send an e-mail to 
publicinfo@ots.treas.gov, or send a facsimile transmission to (202) 
906-7755.

FOR FURTHER INFORMATION: You can access sample copies of the proposed 
2011 TFR forms on OTS's Web site at http://www.ots.treas.gov or you may 
request them by electronic mail from tfr.instructions@ots.treas.gov. 
You can request additional information about this proposed information 
collection from James Caton, Acting Managing Director, Economic Policy 
and Financial Monitoring and Analysis Division, (202) 906-5680, Office 
of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552.

SUPPLEMENTARY INFORMATION:
    Title: Thrift Financial Report.
    OMB Number: 1550-0023.
    Form Number: OTS 1313.
    Abstract:
    OTS is proposing to revise and extend for three years the TFR, 
which is currently an approved collection of information.

[[Page 61564]]

    All OTS-regulated savings associations must comply with the 
information collections described in this notice. OTS collects this 
information each calendar quarter or less frequently if so stated. OTS 
uses this information to monitor the condition, performance, and risk 
profile of individual institutions and systemic risk among groups of 
institutions and the industry as a whole. Except for selected items, 
these information collections are not given confidential treatment.
    Current Actions:

I. Overview

    OTS last revised the form and content of the TFR in a manner that 
significantly affected a substantial percentage of institutions in 
March 2010. Since the beginning of 2010 OTS has evaluated its ongoing 
information needs. OTS recognizes that the TFR imposes reporting 
requirements, which are a component of the regulatory burden facing 
institutions. Another contributor to this regulatory burden is the 
examination process, particularly on-site examinations during which 
institution staff spends time and effort responding to inquiries and 
requests for information designed to assist examiners in evaluating the 
condition and risk profile of the institution. The amount of attention 
that examiners direct to risk areas of the institution under 
examination is, in large part, determined from TFR data. These data, 
and analytical reports, including the Uniform Thrift Performance 
Report, assist examiners in scoping and making their preliminary 
assessments of risks during the planning phase of the examination.
    A risk-focused review of the information from an institution's TFR 
allows examiners to make preliminary risk assessments prior to onsite 
work. The degree of perceived risk determines the extent of the 
examination procedures that examiners initially plan for each risk 
area. If the outcome of these procedures reveals a different level of 
risk in a particular area, the examiner adjusts the examination scope 
and procedures accordingly.
    TFR data are also a vital source of information for the monitoring 
and regulatory activities of OTS. Among their benefits, these 
activities aid in determining whether the frequency of an institution's 
examination cycle should remain at maximum allowed time intervals, 
thereby lessening overall regulatory burden. More risk-focused TFR data 
enhance the ability of OTS to assess whether an institution is 
experiencing changes in its risk profile that warrant immediate follow-
up, which may include accelerating the timing of an on-site 
examination.
    In developing this proposal, OTS considered a range of potential 
information needs, particularly in the areas of credit risk, liquidity, 
and liabilities, and identified those additions to the TFR that are 
most critical and relevant to OTS in fulfilling its supervisory 
responsibilities. OTS recognizes that increased reporting burden will 
result from the addition to the TFR of the new items discussed in this 
proposal. Nevertheless, when viewing these proposed revisions to the 
TFR within a larger context, they help to enhance the on- and off-site 
supervision capabilities of OTS, which assist with controlling the 
overall regulatory burden on institutions.
    OTS also considered the potential impacts from the enactment of the 
Dodd-Frank Wall Street Reform and Consumer Protection Act (``the Dodd-
Frank Act'') that the President signed into law on July 21. The Dodd-
Frank Act provides for the combination of the OTS into the Office of 
the Comptroller of the Currency 12 to 18 months after the enactment 
date. Employees of the OTS on the transfer date will transfer to the 
OCC, the FDIC, or a new Consumer Financial Protection Bureau. At this 
point, no decision about a possible conversion, if any, from the TFR to 
the Call Report has been made. Nevertheless, effort was made to avoid 
increasing differences between the two reports. For this reason, the 
majority of the proposed changes mirror changes proposed for the Call 
Report. However, proposed are some changes that will further and 
enhance off-site monitoring and on-site examination efficiency.
    Thus, OTS is requesting comment on the following proposed revisions 
to the TFR that would take effect as of March 31, 2011, unless 
otherwise noted. These revisions would change the reporting frequency 
for the number and market value of collective investment funds and 
common trust funds data reported in Memorandum Item 3 of Schedule FS 
from annually to quarterly, revise several existing lines, add new 
lines to the TFR, and add a new Schedule VIE, Variable Interest 
Entities.
    For each of the proposed revisions or new items, OTS is 
particularly interested in comments from institutions on whether the 
information proposed to be collected is readily available from existing 
institution records. OTS also invites comment on whether there are 
particular proposed revisions for which the new data would be of 
limited relevance for purposes of assessing risks in a specific segment 
of the savings association industry. In such cases, OTS requests 
comments on what criteria, e.g., an asset size threshold or some other 
measure, we should establish for identifying the specific segment of 
the savings association industry that we should require to report the 
proposed information. Finally, OTS seeks comment on whether, for a 
particular proposed revision, there is an alternative information set 
that could satisfy OTS data needs and be less burdensome for 
institutions to report than the new or revised items that OTS has 
proposed. OTS will consider all of the comments it receives as it 
formulates a final set of revisions to the TFR for implementation in 
2011. The proposed revisions include:
     A breakdown by loan category of the existing troubled debt 
restructurings for amounts added in the current quarter and amounts 
included in Schedule SC in compliance with modified terms in Schedule 
VA, and for troubled debt restructurings that are past due 30 to 89 
days, 90 days or more, or in nonaccrual status in Schedule PD;
     Additional data for automobile loans, including securities 
backed by automobile loans in Schedule SC, interest income from 
automobile loans in Schedule SO, automobile loans closed, purchased, or 
sold during the quarter in Schedule CF, and the average daily balance 
for automobile loans during the quarter in Schedule SI;
     A breakdown in Schedule SC of the existing items for 
mortgage-backed securities between residential and commercial 
securities issued or guaranteed by U.S. Government agencies and 
sponsored enterprises and those that are not;
     New items for the amount and average daily deposits of 
nonbrokered deposits obtained through the use of deposit listing 
service companies in Schedule DI;
     A breakdown of the existing items for deposits of 
individuals, partnerships, and corporations between deposits of 
individuals and deposits of partnerships and corporations in Schedule 
DI;
     A new Schedule VIE, Variable Interest Entities, for 
reporting the categories of assets of consolidated variable interest 
entities (VIEs) that can be used only to settle the VIEs' obligations, 
the categories of liabilities of consolidated VIEs without recourse to 
the savings association's general credit, and the total assets and 
total liabilities of other consolidated VIEs included in the savings 
association's total assets and total liabilities, with these data 
reported separately for securitization trusts,

[[Page 61565]]

asset-backed commercial paper conduits, and other VIEs;
     Breakdowns of loans and repossessed assets covered by FDIC 
loss-sharing agreements by loan and repossessed asset category in 
Schedule SI, new line in Schedule SI for income received from or 
accrued on assets covered by the FDIC under loss-sharing agreements, 
and a breakdown in Schedule PD of loans past due 30 to 89 days, 90 days 
or more, or in nonaccrual status covered by FDIC loss-sharing 
agreements;
     A breakdown of the existing items for key person life 
insurance in Schedule SC into items for general account and separate 
account life insurance assets;
     New items for the total assets of captive insurance and 
reinsurance subsidiaries in Schedule SI;
     A change in reporting frequency from annual to quarterly 
for the data reported in Schedule FS on collective investment funds and 
common trust funds for those savings associations that currently report 
fiduciary assets and income annually, i.e., banks with fiduciary assets 
greater than $250 million or gross fiduciary income greater than 10 
percent of bank revenue;
     A new item in Schedule SO for service charges on deposit 
accounts;
     A new item in Schedule CCR for qualifying noncontrolling 
(minority) interests in consolidated subsidiaries;
     Two new items in Schedule SC for trust preferred 
securities;
     A more detailed breakdown by loan type in Schedule VA of 
general, specific, and total valuation allowances;
     A breakdown by loan type in Schedule VA of classified 
assets;
     A new line in Schedule DI for time deposits of $100,000 or 
more with a remaining maturity of one year or less;
     A new line in Schedule DI for deposits in foreign offices, 
Edge and Agreement subsidiaries, and IBFs;
     A breakdown in Schedule SI of the amortized cost of held-
to-maturity securities and the fair value of available-for-sale 
securities;
     Two new lines in Schedule SI for farmland loans secured by 
real estate, and loans to finance agricultural production and other 
loans to farmers;
     Two new lines in Schedule SI for Federal Home Loan Bank 
advances with a remaining maturity of one year or less, and other 
borrowings with a remaining maturity of one year or less; and
     A new line in Schedule SI for the amount of liabilities 
from a savings association's trading activities.
    The specific wording of the captions for the new or revised TFR 
data items discussed in this proposal and the numbering of these data 
items should be regarded as preliminary.

II. Discussion of Revisions Proposed for March 2011

A. Troubled Debt Restructurings

    OTS is proposing that savings associations report additional detail 
on loans that have undergone troubled debt restructurings in TFR 
Schedules VA and PD. More specifically, new items are proposed for 
Schedule VA under two columns for the amount of troubled debt 
restructured during the current quarter (odd-numbered lines) and the 
amount of troubled debt restructured that is included in Schedule SC in 
compliance with the modified terms (even-numbered lines):

VA211, VA212 Construction Loans (Total of VA213-VA218):
VA213, VA214 1-4 Dwelling Units;
VA215, VA216 Multifamily (5 or more) Dwelling Units;
VA217, VA218 Nonresidential Property.

    Permanent Loans, Secured by:

VA221, VA222 1-4 Dwelling Units;
VA223, VA224 Multifamily (5 or more) Dwelling Units;
VA 225, VA226 Nonresidential Property (Except Land);
VA227, VA228 Owner-Occupied Nonresidential Property;
VA231, VA232 Other Nonresidential Property;
VA233, VA234 Land;

VA241, VA242 Nonmortgage Loans--Total;
V243, VA244 Commercial Loans--Total;
VA245, VA246 Secured;
VA247, VA248 Unsecured;
VA251, VA252 Credit Card Loans Outstanding--Business;
VA253, VA254 Consumer Loans--Total.

    New items are proposed in Schedule PD to add detail to troubled 
debt restructuring amounts past due and still accruing, 30-89 days 
(500-series lines), past due and still accruing, 90 days or more (600-
series lines), and nonaccrual (700-series lines):
    Construction Loans:

PD516, PD616, PD716 1-4 Dwelling Units;
PD517, PD617, PD717 Multifamily (5 or more) Dwelling Units;
PD518, PD618, PD718 Nonresidential Property.

    Permanent Loans, Secured by:

PD519, PD619, PD719 1-4 Dwelling Units;
PD525, PD625, PD725 Multifamily (5 or more) Dwelling Units;
PD535, PD635, PD735 Nonresidential Property (Except Land);
PD536, PD636, PD736 Owner-Occupied Nonresidential Property;
PD537, PD637, PD737 Other Nonresidential Property;
PD538, PD638, PD738 Land;

PD539, PD639, PD739 Nonmortgage Loans--Total;
PD540, PD640, PD740 Commercial Loans--Total;
PD541, PD641, PD741 Secured;
PD542, PD642, PD742 Unsecured;
PD545, PD645, PD745 Credit Card Loans Outstanding--Business;
PD560, PD660, PD760 Consumer Loans--Total.

    In the aggregate, troubled debt restructurings for all insured 
institutions have grown from $6.9 billion at year-end 2007, to $24.0 
billion at year-end 2008, to $58.1 billion at year-end 2009, with a 
further increase to $64.0 billion as of March 31, 2010. The proposed 
additional detail on troubled debt restructurings in Schedules VA and 
PD would enable OTS to better understand the level of restructuring 
activity at savings associations, the categories of loans involved in 
this activity, and, therefore, whether savings associations are working 
with their borrowers to modify and restructure loans. In particular, to 
encourage banks and savings associations to work constructively with 
their commercial borrowers, the federal banking agencies recently 
issued guidance on commercial real estate loan workouts and small 
business lending. While this guidance has explained the agencies' 
expectations for prudent workouts, the agencies do not have adequate 
and reliable data outside of the examination process to assess 
restructuring activity for commercial real estate loans and commercial 
and industrial loans. Further, it is important to separately identify 
commercial real estate loan restructurings from commercial and 
industrial loan restructurings given that the value of the real estate 
collateral is a consideration in an institution's decision to modify 
the terms of a commercial real estate loan in a troubled debt 
restructuring, but such collateral protection would normally be absent 
from commercial and industrial loans for which a loan modification is 
being explored because of borrowers' financial difficulties.
    It is also anticipated that other loan categories will experience 
continued workout activity in the coming months given that every asset 
class has been impacted by the recent recession (as evidenced by the 
increase in past due and nonaccrual assets across all asset

[[Page 61566]]

classes). In addition, because credit availability has substantially 
decreased, borrowers experiencing financial difficulties are left with 
few alternatives for funding and their creditor institutions will need 
to evaluate whether to work with them by granting a concession when 
modifying the terms of their existing loans.
    The new data would provide the OTS with the level of information 
necessary to assess savings associations' troubled debt restructurings 
to the same extent that other loan quality and performance indicators 
can be assessed. However, the OTS notes that, under generally accepted 
accounting principles, troubled debt restructurings do not include 
changes in lease agreements \1\ and we therefore propose to exclude 
leases from the new items proposed.
---------------------------------------------------------------------------

    \1\ Accounting Standards Codification paragraph 470-60-15-11.
---------------------------------------------------------------------------

B. Auto Loans

    OTS is proposing to collect additional information on automobile 
loans. More specifically, the following new lines are proposed:

SC183 Securities Backed by Auto Loans;
SO173 Auto Loans--Interest Income;
CF401 Auto Loans Closed or Purchased During Quarter;
CF402 Auto Loans Sold During Quarter;
SI886 Auto Loans--Average Daily Balance During Quarter.

    Automobile loans are a significant consumer business for many large 
savings associations. The proposed additional lines will enhance 
supervisory evaluation and oversight of automobile lending performance 
and risks.

C. Commercial Mortgage-Backed Securities Issued or Guaranteed by U.S. 
Government Agencies and Sponsored Agencies

    OTS is proposing to split the existing items on mortgage-backed 
securities (MBS) in Schedule SC to distinguish between residential and 
commercial MBS issued or guaranteed by U.S. Government agencies and 
sponsored agencies (collectively, U.S. Government agencies) and 
residential and commercial MBS issued by others. OTS proposes to revise 
the following existing lines to report data for residential MBS:
    Residential Pass-Through:

SC210 Insured or Guaranteed by an Agency or Sponsored Enterprise of the 
U.S.;
SC215 Other Pass-Through.

    Other Residential Mortgage-Backed Securities (Excluding Bonds):

SC217 Issued or Guaranteed by FNMA, FHLMC, or GNMA;
SC219 Collateralized by Mortgage-Backed Securities Issued or Guaranteed 
by FNMA, FHLMC, or GNMA;
SC222 Other.

    OTS proposes the following new lines to report data for commercial 
MBS:
    Commercial Pass-Through:

SC211 Insured or Guaranteed by an Agency or Sponsored Enterprise of the 
U.S.;
SC213 Other Pass-Through.

    Other Commercial Mortgage-Backed Securities (Excluding Bonds):

SC223 Issued or Guaranteed by FNMA, FHLMC, or GNMA;
SC224 Collateralized by Mortgage-Backed Securities Issued or Guaranteed 
by FNMA, FHLMC, or GNMA;
SC225 Other.

D. Nonbrokered Deposits Obtained Through the Use of Deposit Listing 
Service Companies

    Savings associations currently report information on their funding 
in the form of brokered deposits in Schedule DI. These data are an 
integral component of the regulatory analysis of individual 
institutions' liquidity and funding, including their reliance on non-
core sources to fund their activities.
    Deposit brokers have traditionally provided intermediary services 
for financial institutions and investors. However, the Internet, 
deposit listing services, and other automated services now enable 
investors who focus on yield to easily identify high-yielding deposit 
sources. Such customers are highly rate sensitive and can be a less 
stable source of funding than typical relationship deposit customers. 
Because they often have no other relationship with the financial 
institution, these customers may rapidly transfer funds to other 
institutions if more attractive returns become available.
    OTS expects each institution to establish and adhere to a sound 
liquidity and funds management policy. The institution's board of 
directors, or a committee of the board, should also ensure that senior 
management takes the necessary steps to monitor and control liquidity 
risk. This process includes establishing procedures, guidelines, 
internal controls, and limits for managing and monitoring liquidity and 
reviewing the institution's liquidity position, including its deposit 
structure, on a regular basis. A necessary prerequisite to sound 
liquidity and funds management decisions is a sound management 
information system, which provides certain basic information including 
data on non-relationship funding programs, such as brokered deposits, 
deposits obtained through the Internet or other types of advertising, 
and other similar rate sensitive deposits. Thus, an institution's 
management should be aware of the number and magnitude of such 
deposits.
    To improve its ability to monitor potentially volatile funding 
sources, OTS is proposing two lines to Schedule DI in which savings 
associations would report the amount of deposits and average daily 
deposits obtained through the use of deposit listing services that are 
not brokered deposits:

DI117 Total Amount of Deposits Obtained Through Deposit Listing 
Services That Are Not Brokered Deposits;
DI547 Average Daily Deposits Totals: Deposits Obtained Through Deposit 
Listing Services That Are Not Brokered Deposits.

    A deposit listing service is a company that compiles information 
about the interest rates offered on deposits, such as certificates of 
deposit, by insured depository institutions. A particular company could 
be a deposit listing service (compiling information about certificates 
of deposits) as well as a deposit broker (facilitating the placement of 
certificates of deposit). A deposit listing service is not a deposit 
broker if all of the following four criteria are met:
    (1) The person or entity providing the listing service is 
compensated solely by means of subscription fees (i.e., the fees paid 
by subscribers as payment for their opportunity to see the rates 
gathered by the listing service) and/or listing fees (i.e., the fees 
paid by depository institutions as payment for their opportunity to 
list or ``post'' their rates). The listing service does not require a 
depository institution to pay for other services offered by the listing 
service or its affiliates as a condition precedent to being listed.
    (2) The fees paid by depository institutions are flat fees: They 
are not calculated on the basis of the number or dollar amount of 
deposits accepted by the depository institution as a result of the 
listing or ``posting'' of the depository institution's rates.
    (3) In exchange for these fees, the listing service performs no 
services except (A) the gathering and transmission of information 
concerning the availability of deposits; and/or (B) the transmission of 
messages between depositors and depository institutions (including 
purchase orders and trade confirmations). In publishing or

[[Page 61567]]

displaying information about depository institutions, the listing 
service must not attempt to steer funds toward particular institutions 
(except that the listing service may rank institutions according to 
interest rates and also may exclude institutions that do not pay the 
listing fee). Similarly, in any communications with depositors or 
potential depositors, the listing service must not attempt to steer 
funds toward particular institutions.
    (4) The listing service is not involved in placing deposits. Any 
funds to be invested in deposit accounts are remitted directly by the 
depositor to the insured depository institution and not, directly or 
indirectly, by or through the listing service.

E. Deposits of Individuals, Partnerships, and Corporations

    Savings associations currently do not report separate breakdowns of 
their deposit accounts in the TFR by category of depositor. The recent 
crisis has demonstrated that business depositors' behavioral 
characteristics are significantly different than the behavioral 
characteristics of individuals. Thus, separate reporting of deposits of 
individuals versus deposits of partnerships and corporations would 
enable the federal banking agencies to better assess the liquidity risk 
profile of institutions given differences in the relative stability of 
deposits from these two sources.
    OTS is proposing that the following two lines be added to Schedule 
DI:

DI196 Deposits of Individuals;
DI197 Deposits of Partnerships and Corporations.

    Under this proposal, accounts for which the depositor's taxpayer 
identification number, as maintained on the account in the savings 
association's records, is a Social Security Number (or an Individual 
Taxpayer Identification Number \2\) should be treated as deposits of 
individuals. In general, all other accounts should be treated as 
deposits of partnerships and corporations. However, line SC710 
currently includes all certified and official checks. To limit the 
reporting burden of this proposed change, official checks in the form 
of money orders and travelers checks would be reported as deposits of 
individuals. Certified checks and all other official checks would be 
reported as deposits of partnerships and corporations. OTS is 
requesting comment on this approach to reporting certified and official 
checks.
---------------------------------------------------------------------------

    \2\ An Individual Taxpayer Identification Number is a tax 
processing number only available for certain nonresident and 
resident aliens, their spouses, and dependents who cannot get a 
Social Security Number. It is a 9-digit number, beginning with the 
number ``9,'' formatted like a Social Security Number.
---------------------------------------------------------------------------

F. Variable Interest Entities

    In June 2009, the Financial Accounting Standards Board (FASB) 
issued accounting standards that have changed the way entities account 
for securitizations and special purpose entities. ASU No. 2009-16 
(formerly FAS 166) revised ASC Topic 860, Transfers and Servicing, by 
eliminating the concept of a ``qualifying special-purpose entity'' 
(QSPE) and changing the requirements for derecognizing financial 
assets. ASU No. 2009-17 (formerly FAS 167) revised ASC Topic 810, 
Consolidations, by changing how a financial institution or other 
company determines when an entity that is insufficiently capitalized or 
is not controlled through voting or similar rights, i.e., a ``variable 
interest entity'' (VIE), should be consolidated. For most financial 
institutions, ASU Nos. 2009-16 and 2009-17 took effect January 1, 2010.
    Under ASC Topic 810, as amended, determining whether a financial 
institution is required to consolidate a VIE depends on a qualitative 
analysis of whether that institution has a ``controlling financial 
interest'' in the VIE and is therefore the primary beneficiary of the 
VIE. The analysis focuses on the institution's power over and interest 
in the VIE. With the removal of the QSPE concept from generally 
accepted accounting principles that was brought about in amended ASC 
Topic 860, an institution that transferred financial assets to an SPE 
that met the definition of a QSPE before the effective date of these 
amended accounting standards was required to evaluate whether, pursuant 
to amended ASC Topic 810, it must begin to consolidate the assets, 
liabilities, and equity of the SPE as of that effective date. Thus, 
when implementing amended ASC Topics 860 and 810 at the beginning of 
2010, financial institutions began to consolidate certain previously 
off-balance securitization vehicles, asset-backed commercial paper 
conduits, and other structures. Going forward, financial institutions 
with variable interests in new VIEs must evaluate whether they have a 
controlling financial interest in these entities and, if so, 
consolidate them. In addition, institutions must continually reassess 
whether they are the primary beneficiary of VIEs in which they have 
variable interests.
    For those VIEs that savings associations must consolidate, guidance 
advises institutions to report the assets and liabilities of these VIEs 
on Schedule SC in the balance sheet category appropriate to the asset 
or liability. However, ASC paragraph 810-10-45-25 \3\ requires a 
reporting entity to present ``separately on the face of the statement 
of financial position: a. Assets of a consolidated variable interest 
entity (VIE) that can be used only to settle obligations of the 
consolidated VIE [and] b. Liabilities of a consolidated VIE for which 
creditors (or beneficial interest holders) do not have recourse to the 
general credit of the primary beneficiary.'' This requirement has been 
interpreted to mean that ``each line item of the consolidated balance 
sheet should differentiate which portion of those amounts meet the 
separate presentation conditions.'' \4\ In requiring separate 
presentation for these assets and liabilities, the FASB agreed with 
commenters on its proposed accounting standard on consolidation that 
``separate presentation * * * would provide transparent and useful 
information about an enterprise's involvement and associated risks in a 
variable interest entity.'' \5\ The federal banking agencies concur 
that separate presentation would provide similar benefits to them and 
other Call Report and TFR users.
---------------------------------------------------------------------------

    \3\ Formerly paragraph 22A of FIN 46(R), as amended by FAS 167.
    \4\ Deloitte & Touche LLP, ``Back on-balance sheet: Observations 
from the adoption of FAS 167,'' May 2010, page 4 (http://www.deloitte.com/view/en_US/us/Services/audit-enterprise-risk-services/Financial-Accounting-Reporting/f3a70ca28d9f8210VgnVCM200000bb42f00aRCRD.htm).
    \5\ See paragraphs A80 and A81 of FAS 167.
---------------------------------------------------------------------------

    Consistent with the presentation requirements discussed above, the 
banking agencies are proposing to add a new Schedule RC-V, Variable 
Interest Entities, to the Call Report, and OTS is proposing to add a 
new Schedule VIE, Variable Interest Entities, to the TFR. Financial 
institutions would use the proposed new schedules to report a breakdown 
of the assets of consolidated VIEs that can be used only to settle 
obligations of the consolidated VIEs and liabilities of consolidated 
VIEs for which creditors do not have recourse to the general credit of 
the financial institution. The following proposed categories of assets 
and liabilities would include some of the same categories presented on 
the Call Report and TFR balance sheet schedules: Cash and balances due 
from depository institutions, Held-to-maturity securities; Available-
for-sale securities; Securities purchased under agreements to resell, 
Loans and leases held for sale; Loans

[[Page 61568]]

and leases, net of unearned income; Allowance for loan and lease 
losses; Trading assets (other than derivatives); Derivative trading 
assets; Other real estate owned; Other assets; Securities sold under 
agreements to repurchase; Derivative trading liabilities; Other 
borrowed money (other than commercial paper); Commercial paper; and 
Other liabilities. These assets and liabilities would be presented 
separately for securitization trusts, asset-backed commercial paper 
conduits, and other VIEs.
    In addition, the federal banking agencies propose to include 
separate items in the new schedules in which financial institutions 
would report the total assets and the total liabilities of consolidated 
VIEs (for which the breakdown of assets and liabilities described above 
is not reported) to help the agencies understand the magnitude of any 
VIE assets that are not dedicated solely to settling obligations of the 
VIE and any VIE liabilities for which creditors may have recourse to 
the general credit of the bank. These consolidated VIEs' total assets 
and total liabilities, which would be reported after eliminating 
intercompany transactions, would also be reported separately for 
securitization trusts, asset-backed commercial paper conduits, and 
other VIEs.

G. Assets Covered by FDIC Loss-Sharing Agreements

    In March 2010, the federal banking agencies added a four-way 
breakdown of assets covered by loss-sharing agreements with the FDIC to 
the Call Report and the TFR. In a January 22, 2010, comment letter to 
the banking agencies on the agencies' submission for OMB review of 
proposed Call Report revisions for implementation in 2010, the American 
Bankers Association (ABA) stated that while the addition of the covered 
asset items to Schedule RC-M was

a step in the right direction, ABA believes it would be beneficial 
to regulators, reporting banks, investors, and the public to have 
additional, more granular information about the various categories 
of assets subject to the FDIC loss-sharing agreements. While we 
recognize that this would result in additional reporting burden on 
banks, on balance our members feel strongly that the benefit of 
additional disclosure of loss-sharing data would outweigh the burden 
of providing these detailed data. Thus, we urge the Agencies and the 
FFIEC to further revise the collection of data from banks on assets 
covered by FDIC loss-sharing agreements on the Call Report to 
include the several changes suggested below. * * * We believe these 
changes would provide a more precise and accurate picture of a 
bank's asset quality.

    OTS is proposing to revise the TFR along the lines suggested by the 
ABA by adding the following new lines:
    Breakdown of line SI770, Loans and Leases:

SI771 Construction Loans--Total
SI773 Residential--Total
SI717 1-4 Dwelling Units
SI718 Multifamily (5 or More) Dwelling Units
SI775 Nonresidential Property

SI777 Permanent Loans--Total
SI778 Residential--Total
SI779 1-4 Dwelling Units--Total
SI780 Revolving Open-End Loans
SI781 All Other--First Liens
SI782 All Other--Junior Liens
SI783 Multifamily (5 or More) Dwelling Units
SI784 Nonresidential Property--Total
SI785 Owner-Occupied Nonfarm Nonresidential Property
SI786 Other Nonfarm Nonresidential Property
SI787 Land
SI788 Commercial Loans--Total
SI789 Secured
SI790 Unsecured
SI791 Credit Card Loans Outstanding--Business
SI792 Lease Receivables
SI793 Consumer Loans--Total
SI794 Loans on Deposits
SI795 Home Improvement Loans (Not Secured by Real Estate)
SI796 Education Loans
SI797 Auto Loans
SI798 Mobile Home Loans
SI799 Credit Cards
SI800 Other, Including Lease Receivables
SI801 Repossessed Assets--Total
SI802 Real Estate--Total
SI803 Construction
SI804 Residential--Total
SI805 1-4 Dwelling Units
SI806 Multifamily (5 or More) Dwelling Units
SI807 Nonresidential (Except Land)
SI808 Land
SI809 Other Repossessed Assets
SI810 Guaranteed amount of total amount of covered real estate owned

SI811 Total Income Included on Schedule SO Received From or Accrued on 
Assets Covered by the FDIC Under Loss-Sharing Agreements

    Breakdown of Covered Past Due and Nonaccrual Loans and Leases (3 
amounts for each line--30-89 days past due and still accruing, 90 days 
or more past due and still accruing, and nonaccrual):

PD515, PD615, PD715 Construction Loans--Total
PD SUBxxx, PD SUBxxx, PD SUBxxx Residential--Total
PD516, PD616, PD716 1-4 Dwelling Units
PD517, PD617, PD717 Multifamily (5 or More) Dwelling Units
PD518, PD618, PD718 Nonresidential Property

PD SUBxxx, PD SUBxxx, PD SUBxxx Permanent Loans--Total
PD SUBxxx, PD SUBxxx, PD SUBxxx Residential--Total
PD SUBxxx, PD SUBxxx, PD SUBxxx 1-4 Dwelling Units--Total
PD521, PD621, PD721 Revolving Open-End Loans
PD523, PD623, PD723 All Other--First Liens
PD524, PD624, PD724 All Other--Junior Liens
PD525, PD625, PD725 Multifamily (5 or More) Dwelling Units
PD535, PD635, PD735 Nonresidential Property--Total
PD536, PD636, PD736 Owner-Occupied Nonresidential Property
PD537, PD637, PD737 Other Nonresidential Property
PD538, PD638, PD738 Land
PD540, PD640, PD740 Commercial Loans--Total
PD541, PD641, PD741 Secured
PD542, PD642, PD742 Unsecured
PD540, PD643, PD743 Credit Card Loans Outstanding--Business
PD545, PD645, PD745 Lease Receivables
PD SUBxxx, PD SUBxxx, PD SUBxxx Consumer Loans--Total
PD561, PD661, PD761 Loans on Deposits
PD563, PD663, PD763 Home Improvement Loans (Not Secured by Real Estate)
PD565, PD665, PD765 Education Loans
PD567, PD667, PD767 Auto Loans
PD569, PD669, PD769 Mobile Home Loans
PD571, PD671, PD771 Credit Cards
PD580, PD680, PD780 Other, Including Lease Receivables
PD596, PD696, PD796 Guaranteed Amount of Total Amount of Covered Past 
Due and Nonaccrual Loans and Leases

H. Life Insurance Assets

    Financial institutions purchase and hold bank-owned life insurance 
(BOLI) policies as assets, the premiums for which may be used to 
acquire general account or separate account life insurance policies. 
Savings associations currently report the aggregate amount of their 
life insurance assets in Schedule SC without regard to whether their 
holdings are general account or separate account policies.
    Many financial institutions have BOLI assets, and the distinction 
between those life insurance policies that represent general account 
products and

[[Page 61569]]

those that represent separate account products has meaning with respect 
to the degree of credit risk involved as well as performance measures 
for the life insurance assets in a volatile market environment. In a 
general account policy, the general assets of the insurance company 
issuing the policy support the policy's cash surrender value. In a 
separate account policy, the policyholder's cash surrender value is 
supported by assets segregated from the general assets of the insurance 
carrier. Under such an arrangement, the policyholder neither owns the 
underlying separate account created by the insurance carrier on its 
behalf nor controls investment decisions in the account. Nevertheless, 
the policyholder assumes all investment and price risk.
    A number of financial institutions holding separate account life 
insurance policies have recorded significant losses in recent years due 
to the volatility in the markets and the vulnerability to market 
fluctuations of the instruments that are investment options in separate 
account life insurance policies. Information distinguishing between the 
cash surrender values of general account and separate account life 
insurance policies would allow the OTS to track savings associations' 
holdings of both types of life insurance policies with their differing 
risk characteristics and changes in their carrying amounts resulting 
from their performance over time. Accordingly, the OTS is proposing to 
add the following new items:
    Key Person Life Insurance:

SC617 General Account Life Insurance Assets;
SC619 Separate Account Life Insurance Assets.

    Other BOLI Not Considered Key Person Life Insurance:

SC627 General Account Life Insurance Assets;
SC629 Separate Account Life Insurance Assets.

I. Captive Insurance and Reinsurance Subsidiaries

    Captive insurance companies are utilized by banking organizations 
to ``self insure'' or reinsure their own risks pursuant to incidental 
activities authority. A captive insurance company is a limited purpose 
insurer that may be licensed as a direct writer of insurance or as a 
reinsurer. Insurance premiums paid by an institution to its captive 
insurer, and claims paid back to the institution by the captive, are 
transacted on an intercompany basis, so there is no evidence of this 
type of self-insurance activity when an institution prepares 
consolidated financial statements, including its TFR. The cash flows 
for a captive reinsurer's transactions also are not transparent in an 
institution's consolidated financial statements.
    A number of financial institutions own captive insurers or 
reinsurers, several of which were authorized to operate more than ten 
years ago. Some of the most common lines of business underwritten by 
financial institution captive insurers are credit life, accident, and 
health; disability insurance; and employee benefits coverage. 
Additionally, financial institution captive reinsurance subsidiaries 
may underwrite private mortgage guaranty reinsurance and terrorism risk 
reinsurance.
    As part of their supervisory processes, the federal banking 
agencies have been following the proliferation of financial institution 
captive insurers and reinsurers and the performance trends of these 
captives for the past several years. Collection of financial 
information regarding the total assets of captive insurance and 
reinsurance subsidiaries would assist the agencies in monitoring the 
insurance activities of banking organizations as well as any safety and 
soundness risks posed to the parent institution from the activities of 
these subsidiaries.
    OTS is proposing to collect two new items in Schedule SI:

SI762 Total assets of captive insurance subsidiaries;
SI763 Total assets of captive reinsurance subsidiaries.

    These new items are not expected to be applicable to the vast 
majority of savings associations. When reporting the total assets of 
these captive subsidiaries in the proposed new items, savings 
associations should measure the subsidiaries' total assets before 
eliminating intercompany transactions between the consolidated 
subsidiary and other offices or subsidiaries of the consolidated 
institution.

J. Quarterly Reporting for Collective Investment Funds

    For financial institutions that provide fiduciary and related 
services, the volume of assets under management is an important metric 
for understanding risk at these institutions and in the banking system. 
A savings association's assets under management may include such pooled 
investment vehicles as collective investment funds and common trust 
funds (hereafter, collectively, CIFs) that it offers to investors. When 
considering how and where to place funds in pooled investment vehicles, 
which also include registered investment funds (mutual funds), 
investors' decisions are highly influenced by risk and return factors. 
While registered investment funds regularly disclose an array of fund-
related data to the U.S. Securities and Exchange Commission and the 
investing public, the OTS's collection and public disclosure of summary 
data on CIFs is limited to annual data reported in lines FS610 through 
FS675 of TFR Schedule FS, Fiduciary and Related Services, as of each 
December 31.
    Like other investment vehicles, CIFs were affected by market 
disruptions during the recent financial crisis. To detect changes in 
investor behavior and bank investment management strategies at an early 
stage in this $2.5 trillion line of business, the banking agencies 
believe it would be beneficial to change the reporting frequency for 
the Schedule FS data on collective investment funds and common trust 
funds from annually to quarterly for those institutions that currently 
report their fiduciary assets and fiduciary income quarterly. Quarterly 
filing of these Schedule FS data is required of institutions with total 
fiduciary assets greater than $250 million (as of the preceding 
December 31) or with gross fiduciary and related income greater than 10 
percent of revenue for the preceding calendar year.

K. Service Charges on Deposit Accounts

    Savings associations currently do not report separate detail on 
service charges on deposit accounts. There has been growing interest in 
the amount of deposit account service fees charged by financial 
institutions. Banks currently report this data as a separate component 
of noninterest income in Call Report Schedule RI. In reporting this 
item, banks include amounts charged depositors (in domestic offices):
    (1) For the maintenance of their deposit accounts with the bank, 
so-called ``maintenance charges,''
    (2) For their failure to maintain specified minimum deposit 
balances,
    (3) Based on the number of checks drawn on and deposits made in 
their deposit accounts,
    (4) For checks drawn on so-called ``no minimum balance'' deposit 
accounts,
    (5) For withdrawals from nontransaction deposit accounts,
    (6) For the closing of savings accounts before a specified minimum 
period of time has elapsed,
    (7) For accounts which have remained inactive for extended periods 
of time or which have become dormant,
    (8) For deposits to or withdrawals from deposit accounts through 
the use of automated teller machines or remote service units,

[[Page 61570]]

    (9) For the processing of checks drawn against insufficient funds, 
so-called ``NSF check charges,'' that the bank assesses regardless of 
whether it decides to pay, return, or hold the check. Exclude 
subsequent charges levied against overdrawn accounts based on the 
length of time the account has been overdrawn, the magnitude of the 
overdrawn balance, or which are otherwise equivalent to interest 
(report in the appropriate subitem of Schedule RI, item 1.a, ``Interest 
and fee income on loans (in domestic offices)''),
    (10) For issuing stop payment orders,
    (11) For certifying checks, and
    (12) For the accumulation or disbursement of funds deposited to 
Individual Retirement Accounts (IRAs) or Keogh Plan accounts when not 
handled by the bank's trust department. Report such commissions and 
fees received for accounts handled by the bank's trust department in 
Schedule RI, item 5.a, ``Income from fiduciary activities.'' Exclude 
penalties paid by depositors for the early withdrawal of time deposits 
(report as ``Other noninterest income'' in Schedule RI, item 5.l, or 
deduct from the interest expense of the related category of time 
deposits, as appropriate).
    OTS is proposing to add the following line to Schedule SO as a 
detail item of other fees and charges within the noninterest income 
section:

SO422 Service Charges on Deposit Accounts

L. Qualifying Noncontrolling (Minority) Interests in Consolidated 
Subsidiaries

    Only qualifying noncontrolling (minority) interests in consolidated 
subsidiaries are allowable in Tier 1 capital. Those that are non-
qualifying are not. The existing Schedule CCR computes Tier 1 Capital 
using Total Equity Capital (Line SC 84), which includes all 
noncontrolling (minority) interests from Line SC 800. This can be 
interpreted as permitting all noncontrolling (minority) interests (Line 
SC 800), whether qualifying or not, to be included in the calculation 
of Tier 1 Capital. Therefore to clarify the treatment of noncontrolling 
(minority) interests, OTS is proposing to use Total Savings Association 
Equity Capital (Line SC 80), which is net of noncontrolling (minority) 
interests, as the starting point for computation of Tier 1 capital for 
Schedule CCR. Non-controlling (minority) interests are then added to 
Tier 1, per the new line CCR187 described below, only to the extent 
they are qualifying noncontrolling (minority) interests. This approach 
is consistent with the approach used on the Call Report. Thus, OTS is 
proposing to revise one line and add a new line on Schedule CCR to 
address the treatment of noncontrolling (minority) interests in Tier 1 
Capital:
    Revise line CCR100 Total Equity Capital (SC84) to CCR100 Total 
Savings Association Equity Capital (SC80)
    Add new line CCR187 Qualifying Noncontrolling (Minority) Interests 
in Consolidated Subsidiaries.

M. Trust Preferred Securities

    As financial institution investments, trust preferred securities 
are hybrid instruments possessing characteristics typically associated 
with debt obligations. Although each issue of these securities may 
involve minor differences in terms, under the basic structure of trust 
preferred securities a corporate issuer, such as a financial 
institution holding company, first organizes a business trust or other 
special purpose entity. This trust issues two classes of securities: 
common securities, all of which are purchased and held by the corporate 
issuer, and trust preferred securities, which are sold to investors. 
The business trust's only assets are deeply subordinated debentures of 
the corporate issuer, which the trust purchases with the proceeds from 
the sale of its common and preferred securities. The corporate issuer 
makes periodic interest payments on the subordinated debentures to the 
business trust, which uses these payments to pay periodic dividends on 
the trust preferred securities to the investors. The subordinated 
debentures have a stated maturity and may also be redeemed under other 
circumstances. Most trust preferred securities are subject to mandatory 
redemption upon the repayment of the debentures.
    Trust preferred securities meet the definition of a security in 
FASB Statement No. 115, ``Accounting for Certain Investments in Debt 
and Equity Securities.'' Because of the mandatory redemption provision 
in the typical trust preferred security, investments in trust preferred 
securities would normally be considered debt securities for financial 
accounting purposes. Accordingly, regardless of the authority under 
which a financial institution is permitted to invest in trust preferred 
securities, savings associations should report these investments as 
debt securities for purposes of these reports (unless, based on the 
specific facts and circumstances of a particular issue of trust 
preferred securities, the securities would be considered equity rather 
than debt securities under Statement No. 115. To better gauge the level 
of investment in trust preferred securities by savings associations, 
the OTS is proposing to add the following two lines as detail to other 
investment securities reported in Schedule SC:

SC187 Trust Preferred Securities Issues By FDIC-Insured Depository 
Institutions or Their Holding Companies;
SC188 Other Trust Preferred Securities.

N. General, Specific, and Total Valuation Allowances by Major Loan Type

    OTS is proposing that savings associations report additional detail 
on loans for general and specific valuation allowances. The proposed 
additional detail on valuation allowances in Schedules VA would enable 
OTS to better understand reserves activity within loan categories at 
savings associations.
    More specifically, new items are proposed for Schedule VA under 
three columns for the amount of general valuation allowances at the end 
of the current quarter (1100 series of lines), the amount of specific 
valuation allowances at the end of the current quarter (1200 series of 
lines), and the total of valuation allowances at the end of the current 
quarter (1300 series of lines):

VA1115, VA1215, VA1315 Construction Loans--Total
VA SUBxxx, VA SUBxxx,VA SUBxxx Residential--Total
VA1120, VA1220, VA1320 1-4 Dwelling Units
VA1122, VA1222, VA1322 Multifamily (5 or More) Dwelling Units
VA1130, VA1230, VA1330 Nonresidential Property

VA SUBxxx, VA SUBxxx,VA SUBxxx Permanent Loans--Total
VA SUBxxx, VA SUBxxx,VA SUBxxx Residential--Total
VA SUBxxx, VA SUBxxx,VA SUBxxx 1-4 Dwelling Units--Total
VA1140, VA1240, VA1340 Revolving Open-End Loans
VA1145, VA1245, VA1345 All Other--First Liens
VA1147, VA1247, VA1347 All Other--Junior Liens
VA1150, VA1250, VA1350 Multifamily (5 or More) Dwelling Units
VA1160, VA1260, VA1360 Nonresidential Property--Total
VA1162, VA1262, VA1362 Owner-Occupied Nonresidential Property
VA1163, VA1263, VA1363 Other Nonresidential Property
VA1165, VA1265, VA1365 Land
VA1170, VA1270, VA1370 Commercial Loans--Total

[[Page 61571]]

VA1172, VA1272, VA1372 Secured
VA1173, VA1273, VA1373 Unsecured
VA1174, VA1274, VA1374 Credit Card Loans Outstanding--Business
VA1176, VA1276, VA1376 Lease Receivables
VA SUBxxx, VA SUBxxx,VA SUBxxx Consumer Loans--Total
VA1182, VA1282, VA1382 Loans on Deposits
VA1183, VA1283, VA1383 Home Improvement Loans (Not Secured by Real 
Estate)
VA1184, VA1284, VA1384 Education Loans
VA1185, VA1285, VA1385 Auto Loans
VA1186, VA1286, VA1386 Mobile Home Loans
VA1187, VA1287, VA1387 Credit Cards
VA1188, VA1288, VA1388 Other, Including Lease Receivables

O. Classified Assets by Major Loan Type

    OTS is proposing that savings associations report additional detail 
on classified assets by major loan type. The proposed additional detail 
on classified assets in Schedules VA would enable OTS to better 
understand asset quality within loan categories at savings 
associations.
    More specifically, new items are proposed for Schedule VA under 
four columns for the amount of special mention assets at the end of the 
current quarter (1400 series of lines), the amount of substandard 
assets at the end of the current quarter (1500 series of lines), the 
amount of doubtful assets at the end of the current quarter (1600 
series of lines), and the amount of loss assets at the end of the 
current quarter (1700 series of lines):

VA1415, VA1515, VA1615, VA1715 Construction Loans--Total
VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx Residential--Total
VA1420, VA1520, VA1620, VA1720 1-4 Dwelling Units
VA1422, VA1522, VA1622, VA1722 Multifamily (5 or More) Dwelling Units
VA1430, VA1530, VA1630, VA1730 Nonresidential Property

VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx Permanent Loans--Total
VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx Residential--Total
VA SUBxxx, VA SUBxxx, VA SUBxxx, VA SUBxxx 1-4 Dwelling Units--Total
VA1440, VA1540, VA1640, VA1740 Revolving Open-End Loans
VA1445, VA1545, VA1645, VA1745 All Other--First Liens
VA1447, VA1547, VA1647, VA1747 All Other--Junior Liens
VA1450, VA1550, VA1650, VA1750 Multifamily (5 or More) Dwelling Units
VA1460, VA1560, VA1660, VA1760 Nonresidential Property--Total
VA1462, VA1562, VA1662, VA1762 Owner-Occupied Nonresidential Property
VA1463, VA1563, VA1663, VA1763 Other Nonresidential Property
VA1465, VA1565, VA1665, VA1765 Land
VA1470, VA1570, VA1670, VA1770 Commercial Loans--Total
VA1472, VA152, VA1672, VA1772 Secured
VA1473, VA1573, VA1673, VA1773 Unsecured
VA1475, VA1575, VA1675, VA1775 Credit Card Loans Outstanding--Business
VA1476, VA1576, VA1676, VA1776 Lease Receivables
VASUBxxx, VASUBxxx, VASUBxxx, VASUBxxx Consumer Loans--Total
VA1482, VA1582, VA1682, VA1782 Loans on Deposits
VA1483, VA1583, VA1683, VA1783 Home Improvement Loans (Not Secured by 
Real Estate)
VA1484, VA1584, VA1684, VA1784 Education Loans
VA1485, VA1585, VA1685, VA1785 Auto Loans
VA1486, VA1586, VA1686, VA1786 Mobile Home Loans
VA1487, VA1587, VA1687, VA1787 Credit Cards
VA1488, VA1588, VA1688, VA1788 Other, Including Lease Receivables

    Request for Comments: OTS may not conduct or sponsor an information 
collection, and respondents are not required to respond to an 
information collection, unless the information collection displays a 
currently valid OMB control number.
    In this notice, OTS is soliciting comments concerning the following 
information collection.
    Statutory Requirement: 12 U.S.C. 1464(v) imposes reporting 
requirements for savings associations.
    Type of Review: Revision of currently approved collections.
    Frequency of Response: Quarterly; Annually.
    Affected Public: Business or other for-profit.
    Estimated Number of Respondents: 753 savings associations.
    Estimated Burden Hours per Respondent: 60.0 hours average for 
quarterly schedules and 2.0 hours average for schedules required only 
annually plus recordkeeping of an average of one hour per quarter.
    Estimated Total Annual Burden: 188,712 burden hours.
    OTS is proposing to revise the TFR, which is currently an approved 
collection of information, in March 2011. The effect on reporting 
burden of the proposed revisions to the TFR requirements will vary from 
institution to institution depending on the institution's asset size 
and its involvement with the types of activities or transactions to 
which the proposed changes apply.
    The proposed TFR changes that would take effect as of March 31, 
2011 would change the reporting frequency for the number and market 
value of collective investment funds and common trust funds data 
reported in Memorandum Item 3 of Schedule FS, revise several existing 
lines, add new lines to the TFR, and add a new Schedule VIE, Variable 
Interest Entities.
    OTS estimates that the implementation of these reporting revisions 
will result in an increase in the current reporting burden imposed by 
the TFR on all savings associations.
    As part of the approval process, we invite comments addressing one 
or more of the following points:
    a. Whether the proposed revisions to the TFR collections of 
information are necessary for the proper performance of the agency's 
functions, including whether the information has practical utility;
    b. The accuracy of the agency'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 information collections on 
respondents, including through the use of automated collection 
techniques, the Internet, 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.
    OTS will summarize the comments received and include them in the 
request for OMB approval. All comments will become a matter of public 
record.
    Clearance Officer: Ira L. Mills, (202) 906-6531, Office of Thrift 
Supervision, 1700 G Street, NW., Washington, DC 20552.
    OMB Reviewer: Desk Officer for OTS, FAX: (202) 395-6974, U.S. 
Office of Management and Budget, 725--17th Street, NW., Room 10235, 
Washington, DC 20503.


[[Page 61572]]


    Dated: September 29, 2010.
Ira L. Mills,
Paperwork Clearance Officer, Office of Chief Counsel, Office of Thrift 
Supervision.
[FR Doc. 2010-24883 Filed 10-4-10; 8:45 am]
BILLING CODE 6720-01-P