Agency Information Collection Activities: Revision of an Approved Information Collection; Submission for OMB Review; Company-Run Annual Stress Test Reporting Template and Documentation for Covered Institutions With Total Consolidated Assets of $50 Billion or More Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, 6336-6338 [2016-02212]

Agencies

[Federal Register Volume 81, Number 24 (Friday, February 5, 2016)]
[Notices]
[Pages 6336-6338]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-02212]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency


Agency Information Collection Activities: Revision of an Approved 
Information Collection; Submission for OMB Review; Company-Run Annual 
Stress Test Reporting Template and Documentation for Covered 
Institutions With Total Consolidated Assets of $50 Billion or More 
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act

AGENCY: Office of the Comptroller of the Currency, Treasury (OCC).

ACTION: Notice and request for comment.

-----------------------------------------------------------------------

SUMMARY: The OCC, as part of its continuing effort to reduce paperwork 
and respondent burden, invites the general public and other federal 
agencies to comment on a revision to this information collection, as 
required by the Paperwork Reduction Act of 1995. An agency may not 
conduct or sponsor, and a respondent is not required to respond to, an 
information collection unless it displays a currently valid Office of 
Management and Budget (OMB) control number. The OCC is finalizing 
revisions to a regulatory reporting requirement for national banks and 
federal savings associations titled, ``Company-Run Annual Stress Test 
Reporting Template and Documentation for Covered Institutions with 
Total Consolidated Assets of $50 Billion or More under the Dodd-Frank 
Wall Street Reform and Consumer Protection Act.'' The OCC also is 
giving notice that it has sent the collection to OMB for review.

DATES: Comments must be received by March 7, 2016.

ADDRESSES: Because paper mail in the Washington, DC area and at the OCC 
is subject to delay, commenters are encouraged to submit comments by 
email, if possible. Comments may be sent to: Legislative and Regulatory 
Activities Division, Office of the Comptroller of the Currency, 
Attention: 1557-0319, 400 7th Street SW., Suite 3E-218, Mail Stop 9W-
11, Washington, DC 20219. In addition, comments may be sent by fax to 
(571) 465-4326 or by electronic mail to prainfo@occ.treas.gov. You may 
personally inspect and photocopy comments at the OCC, 400 7th Street 
SW., Washington, DC 20219. For security reasons, the OCC requires that 
visitors make an appointment to inspect comments. You may do so by 
calling (202) 649-6700 or, for persons who are deaf or hard of hearing, 
TTY, (202) 649-5597. Upon arrival, visitors will be required to present 
valid government-issued photo identification and submit to security 
screening in order to inspect and photocopy comments.
    All comments received, including attachments and other supporting 
materials, are part of the public record and subject to public 
disclosure. Do not include any information in your comment or 
supporting materials that you consider confidential or inappropriate 
for public disclosure.
    Additionally, please send a copy of your comments by mail to: OCC 
Desk Officer, [1557-0319], U.S. Office of Management and Budget, 725 
17th Street NW., #10235, Washington, DC 20503, or by email to: 
oira_submission_@omb.eop.gov.

FOR FURTHER INFORMATION CONTACT: Shaquita Merritt or Mary H. Gottlieb, 
OCC Clearance Officers, (202) 649-5490 or, for persons who are deaf or 
hard of hearing, TTY, (202) 649-5597, Legislative and Regulatory 
Activities Division, Office of the Comptroller of the Currency, 400 7th 
St. SW., Washington, DC 20219. In addition, copies of the templates 
referenced in this notice can be found on the OCC's Web site under News 
and Issuances (http://www.occ.treas.gov/tools-forms/forms/bank-operations/stress-test-reporting.html).

SUPPLEMENTARY INFORMATION: The OCC is requesting comment on the 
following revision to an approved information collection:
    Title: Company-Run Annual Stress Test Reporting Template and 
Documentation for Covered Institutions with Total Consolidated Assets 
of $50 Billion or More under the Dodd-Frank Wall Street Reform and 
Consumer Protection Act.
    OMB Control No.: 1557-0319.
    Description: Section 165(i)(2) of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act \1\ (Dodd-Frank Act) requires certain 
financial companies, including national banks and federal savings 
associations, to conduct annual stress tests \2\ and requires the 
primary financial regulatory agency \3\ of those financial companies to 
issue regulations implementing the stress test requirements.\4\ A 
national bank or Federal savings association is a ``covered 
institution'' and therefore subject to the stress test requirements if 
its total consolidated assets are more than $10 billion. Under section 
165(i)(2), a covered institution is

[[Page 6337]]

required to submit to the Board of Governors of the Federal Reserve 
System (Board) and to its primary financial regulatory agency a report 
at such time, in such form, and containing such information as the 
primary financial regulatory agency may require.\5\ On October 9, 2012, 
the OCC published in the Federal Register a final rule implementing the 
section 165(i)(2) annual stress test requirement.\6\ This rule 
describes the reports and information collections required to meet the 
reporting requirements under section 165(i)(2). These information 
collections will be given confidential treatment (5 U.S.C. 552(b)(4)).
---------------------------------------------------------------------------

    \1\ Public Law 111-203, 124 Stat. 1376, July 2010.
    \2\ 12 U.S.C. 5365(i)(2)(A).
    \3\ 12 U.S.C. 5301(12).
    \4\ 12 U.S.C. 5365(i)(2)(C).
    \5\ 12 U.S.C. 5365(i)(2)(B).
    \6\ 77 FR 61238 (October 9, 2012) (codified at 12 CFR 46).
---------------------------------------------------------------------------

    In 2012, the OCC first implemented the reporting templates 
referenced in the final rule. See 77 FR 49485 (August 16, 2012) and 77 
FR 66663 (November 6, 2012). The OCC proposed revisions to these 
templates on November 17, 2015.\7\ No comments were received on those 
proposed revisions, and the OCC is now finalizing those revisions, as 
described below.
---------------------------------------------------------------------------

    \7\ 80 FR 71915 (November 17, 2015).
---------------------------------------------------------------------------

    The OCC intends to use the data collected to assess the 
reasonableness of the stress test results of covered institutions and 
to provide forward-looking information to the OCC regarding a covered 
institution's capital adequacy. The OCC also may use the results of the 
stress tests to determine whether additional analytical techniques and 
exercises could be appropriate to identify, measure, and monitor risks 
at the covered institution. The stress test results are expected to 
support ongoing improvement in a covered institution's stress testing 
practices with respect to its internal assessments of capital adequacy 
and overall capital planning.
    The OCC recognizes that many covered institutions with total 
consolidated assets of $50 billion or more are required to submit 
reports using Comprehensive Capital Analysis and Review (CCAR) 
reporting form FR Y-14A.\8\ The OCC also recognizes the Board has 
recently modified the FR Y-14A, and, to the extent practical, the OCC 
has kept its reporting requirements consistent with the Board's FR Y-
14A in order to minimize burden on covered institutions.\9\ The OCC has 
also revised the Scenario Schedule, which collects information on 
scenario variables beyond those provided by the OCC. The purpose of 
this revision is to require further clarity on the definitions of the 
additional scenario variables.
---------------------------------------------------------------------------

    \8\ http://www.federalreserve.gov/reportforms.
    \9\ 80 FR 55631 (September 16, 2015).
---------------------------------------------------------------------------

Revisions To Reporting Templates for Institutions With $50 Billion or 
More in Assets

    The revisions to the DFAST-14A reporting templates consist of the 
following:
     Bank-specific scenario: Covered institutions would be 
required to submit bank-specific baseline and stress scenarios and 
projections for 2017 and will have the option to do so for 2016;
     Largest counterparty default: For the largest trading 
covered institutions that also submit the Global Market Shock scenario, 
they would be required to assume the default of their largest 
counterparty in the supervisory severely adverse and adverse scenarios 
for 2017 and will have the option to do so for 2016;
     Advanced approaches banks: (1) Delay incorporation of the 
supplemental leverage ratio for one year and (2) indefinitely defer the 
use of the advance approaches for stress testing projections;
     Reporting Template and Supporting Documentation Changes: 
Clarifying instructions, adding data items, deleting data items, and 
redefining existing data items. This includes an expansion of the 
information collected in the scenario schedule. The proposed revisions 
also include a shift of the as-of date in accordance with modifications 
to the OCC's stress testing rule.\10\
---------------------------------------------------------------------------

    \10\ See 79 FR 71630 (December 3, 2014) (shifting the dates of 
the annual stress testing cycle).
---------------------------------------------------------------------------

     These revisions also reflect the implementation of the 
final Basel III regulatory capital rule. On July 9, 2013, the OCC 
approved a joint final rule that will revise and replace the OCC's 
risk-based and leverage capital requirements to be consistent with 
agreements reached by the Basel Committee on Banking Supervision in 
``Basel III: A Global Regulatory Framework for More Resilient Banks and 
Banking Systems'' (Basel III).\11\ Accordingly, the revisions reflect 
the fact that institutions will no longer report items based on the 
pre-Basel III capital rules.
---------------------------------------------------------------------------

    \11\ http://www.occ.gov/news-issuances/news-releases/2013/nr-occ-2013-110.html.
---------------------------------------------------------------------------

Bank-Specific Scenarios

    Covered institutions are required to submit bank-specific baseline 
and bank-specific stress scenarios and associated projections for the 
2017 annual stress testing submission and may do so optionally for the 
2016 annual stress testing submission. While supervisory scenarios 
provide a homogeneous scenario and a consistent market-wide view of the 
condition of the banking sector, these prescribed scenarios may not 
fully capture all of the risks that may be associated with a particular 
institution. The revisions require covered institutions to provide 
bank-specific baseline and bank-specific stress scenarios.
    The OCC recognizes that the Board requires bank holding companies 
(BHCs) to submit BHC-specific baseline and stress scenarios and 
projections. Where OCC-covered institutions also submit BHC-specific 
scenarios, the OCC requires that bank-specific scenarios be consistent 
with the BHC-specific scenarios.

Largest Counterparty Default

    Covered institutions that currently complete the Global Market 
Shock will also be required to complete the Largest Counterparty 
Default component for the 2017 submission and have the option to do so 
for the 2016 submission. This is currently required by the Board, and 
the OCC is adopting a similar requirement to enhance consistency.

Supplemental Leverage Ratio

    The supplementary leverage ratio requirement applies only to 
covered institutions that use the advanced approaches to calculate 
their minimum regulatory capital requirements. For these covered 
institutions, the revisions delay the incorporation of the 
supplementary leverage ratio in stress testing projections for one 
year. Under the revisions, these covered institutions are not required 
to include an estimate of the supplementary leverage ratio for the 
stress test cycle beginning on January 1, 2016. The Board has adopted a 
similar delay.

Advanced Approaches

    Covered institutions have noted that the use of advanced approaches 
in stress test rules would require significant resources and would 
introduce complexity and opacity. In light of the concerns raised by 
these covered institutions, and pending a review of how the stress test 
rules interact with the regulatory capital rules as described above, 
the revisions delay until further notice the use of the advanced 
approaches for calculating risk-based capital requirements for purposes 
of the capital plan and stress test rule.

Other Reporting Template and Instruction Changes

    The revisions to the DFAST-14A consist of clarifying instructions, 
adding and removing schedules, adding, deleting, and modifying existing 
data items, and altering the as-of dates. These

[[Page 6338]]

changes (1) increase consistency between the DFAST-14A with the FR Y-
14A, Call Report, FFIEC 101, and FFIEC 102; (2) remove the requirement 
to calculate tier 1 common capital and the tier 1 common ratio; (3) 
shift the as-of dates by one quarter in accordance with the 
modifications to the stress test rules; (4) modify and expand the 
supporting documentation requirements; and (5) increase the historical 
information collected in the scenario schedule in order to facilitate 
comparisons of the data. Furthermore, the Board is currently collecting 
information for the Summary Schedule via XML scheme technology, and the 
OCC will use a similar format to enhance consistency and reduce 
regulatory burden. Technical details on these forms can be found under 
technical instructions at http://www.occ.gov/tools-forms/forms/bank-operations/stress-test-reporting.html.

Schedule A (Summary, General RWA)--Deletion

    This schedule has been removed in accordance with the elimination 
of the use of the tier 1 common ratio, effective for the 2016 DFAST 
submission. However, in order to mitigate operational issues and allow 
for appropriate time to adjust internal systems to accommodate changes 
this schedule remains part of the technical XML instructions for the 
2016 DFAST submission.

Schedule A (Summary, Standardized RWA)--Revisions

    This schedule has been modified to increase consistency with the 
FFIEC 102. Specifically, the items of the existing market risk-weighted 
asset portion have been replaced with the appropriate items from the 
FFIEC 102. There are also a number of other technical changes; some 
will be required for the 2016 DFAST submission and others will be 
required for the 2017 submission. See the final instructions for 
specific details.

Schedule A (Summary, Capital)--Revisions

    The OCC has removed certain items related to tier 1 common capital, 
effective for the 2016 DFAST submission. However, in order to mitigate 
operational issues and allow for appropriate time to adjust internal 
systems to accommodate changes, this schedule remains part of the 
technical XML instructions for the DFAST 2016 submission. Additionally, 
effective for the 2017 DFAST submission (previously proposed to be 
effective for the 2016 DFAST submission), the OCC has added one item 
that captures the aggregate non-significant investments in the capital 
of unconsolidated financial institutions in the form of common stock 
and separating two items related to deferred tax assets into the amount 
before valuation allowances and the associated valuation allowance. The 
additional information from these changes results in two existing items 
converting to derived items based on the additional information.

Schedule A (Summary, Re-Purchase)--Revisions

    This schedule has been removed to reduce reporting burden, 
effective for the 2017 DFAST submission.

Schedule A (Summary, ASC 310-30)--Deletion

    This schedule has been removed to reduce reporting burden, 
effective for the 2017 DFAST submission.

Schedule A (Summary, PPNR Metrics)--Revisions

    In order to fully align the schedule with the stress scenarios, the 
beta information will be collected according to the scenario instead of 
the current ``normal environment'' requirement, effective for the 2016 
DFAST submission. The Board has delayed implementation of this change, 
and in order to maintain consistency between the DFAST-14A and the FR 
Y-14A, the effective date of all modifications to the PPNR Metrics 
schedule will be delayed until the 2017 DFAST submission.

Business Plan Changes Schedule--Addition

    The OCC has added a requirement to use the existing summary 
schedule to collect the net effects of an intended business plan change 
on a respondent's asset, liability, and capital projections.

Counterparty Credit Risk Schedule--Deletion

    This schedule has been removed to reduce reporting burden effective 
for the 2016 DFAST submission. Aggregate counterparty credit risk 
information will continue to be obtained through the Summary Schedule 
(Schedule A).

Scenario Schedule--Revisions

    Information about additional scenarios that are used by covered 
institutions is currently submitted in a format with limited structure, 
which makes it difficult for the OCC to evaluate. As such, the 
revisions require that covered institutions provide three more 
historical quarters in addition to the currently required most recent 
historical quarter of actual data values for each additional variable 
submitted. The revisions also provide additional instructions on 
variable naming conventions and other appropriate standardizations in 
order to facilitate more streamlined electronic processing of the data. 
In addition to the proposed schedule, the OCC is adding three new items 
to this final schedule in order to provide further standardized 
classification system for each variable submitted.

Regulatory Capital Transitions Schedule--Revisions

    The OCC has modified this schedule by removing projected year six 
from the projection period.

Regulatory Capital Instruments Schedule--Revisions

    The OCC has modified this schedule by removing line items 
corresponding to the general risk-based capital rules.
    Type of Review: Revision.
    Affected Public: Businesses or other for-profit.
    Estimated Number of Respondents: 22.
    Estimated Total Annual Burden: 12,254 hours.
    The OCC believes that the systems covered institutions use to 
prepare the FR Y-14 reporting templates to submit to the Board will 
also be used to prepare the reporting templates described in this 
notice. Comments submitted in response to this notice will be 
summarized and included in the request for OMB approval. All comments 
will become a matter of public record. Comments continue to be invited 
on:
    (a) Whether the collection of information is necessary for the 
proper performance of the functions of the OCC, including whether the 
information has practical utility;
    (b) The accuracy of the OCC's estimate of the burden of the 
collection of information;
    (c) Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    (d) Ways to minimize the burden of the collection on respondents, 
including through the use of automated collection techniques or other 
forms of information technology; and
    (e) Estimates of capital or start-up costs and costs of operation, 
maintenance, and purchase of services to provide information.

    Dated: February 1, 2016.
Stuart Feldstein,
Director, Legislative and Regulatory Activities Division.
[FR Doc. 2016-02212 Filed 2-4-16; 8:45 am]
 BILLING CODE 4810-33-P