Home Mortgage Disclosure (Regulation C) Adjustment to Asset-Size Exemption Threshold, 80433-80435 [2022-28441]

Download as PDF 80433 Rules and Regulations Federal Register Vol. 87, No. 250 Friday, December 30, 2022 This section of the FEDERAL REGISTER contains regulatory documents having general applicability and legal effect, most of which are keyed to and codified in the Code of Federal Regulations, which is published under 50 titles pursuant to 44 U.S.C. 1510. The Code of Federal Regulations is sold by the Superintendent of Documents. BUREAU OF CONSUMER FINANCIAL PROTECTION 12 CFR Part 1003 Home Mortgage Disclosure (Regulation C) Adjustment to AssetSize Exemption Threshold Bureau of Consumer Financial Protection. AGENCY: Final rule; official interpretation. ACTION: The Consumer Financial Protection Bureau (Bureau) is amending the official commentary that interprets the requirements of the Bureau’s Regulation C (Home Mortgage Disclosure) to reflect the asset-size exemption threshold for banks, savings associations, and credit unions based on the annual percentage change in the average of the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI–W). Based on the 8.6 percent increase in the average of the CPI–W for the 12-month period ending in November 2022, the exemption threshold is adjusted to $54 million from $50 million. Therefore, banks, savings associations, and credit unions with assets of $54 million or less as of December 31, 2022, are exempt from collecting data in 2023. SUMMARY: This rule is effective on January 1, 2023. DATES: FOR FURTHER INFORMATION CONTACT: khammond on DSKJM1Z7X2PROD with RULES Adrien Fernandez, Counsel, Thomas Dowell, Senior Counsel; Office of Regulations, at (202) 435–7700. If you require this document in an alternative electronic format, please contact CFPB_ Accessibility@cfpb.gov. The Bureau is amending Regulation C, which implements the HMDA asset thresholds, to establish the asset-sized exemption threshold for depository financial institution for 2023. The asset threshold will be $54 million for 2023. SUPPLEMENTARY INFORMATION: VerDate Sep<11>2014 16:40 Dec 29, 2022 Jkt 259001 I. Background The Home Mortgage Disclosure Act of 1975 (HMDA) 1 requires most mortgage lenders located in metropolitan areas to collect data about their housing related lending activity. Annually, lenders must report their data to the appropriate Federal agencies and make the data available to the public. The Bureau’s Regulation C implements HMDA.2 Prior to 1997, HMDA exempted certain depository institutions as defined in HMDA (i.e., banks, savings associations, and credit unions) with assets totaling $10 million or less as of the preceding year-end. In 1996, HMDA was amended to expand the asset-size exemption for these depository institutions.3 The amendment increased the dollar amount of the asset-size exemption threshold by requiring a onetime adjustment of the $10 million figure based on the percentage by which the CPI–W for 1996 exceeded the CPI– W for 1975, and it provided for annual adjustments thereafter based on the annual percentage increase in the CPI– W, rounded to the nearest multiple of $1 million. The definition of ‘‘financial institution’’ in § 1003.2(g) provides that the Bureau will adjust the asset threshold based on the year-to-year change in the average of the CPI–W, not seasonally adjusted, for each 12-month period ending in November, rounded to the nearest $1 million. For 2022, the threshold was $50 million. During the 12-month period ending in November 2022, the average of the CPI–W increased by 8.6 percent. As a result, the exemption threshold is increased to $54 million for 2023. Thus, banks, savings associations, and credit unions with assets of $54 million or less as of December 31, 2022, are exempt from collecting data in 2023. An institution’s exemption from collecting data in 2023 does not affect its responsibility to report data it was required to collect in 2022. II. Procedural Requirements A. Administrative Procedure Act Under the Administrative Procedure Act (APA), notice and opportunity for public comment are not required if the Bureau finds that notice and public comment are impracticable, unnecessary, or contrary to the public interest.4 Pursuant to this final rule, comment 2(g)–2 in Regulation C, supplement I, is amended to update the exemption threshold. The amendment in this final rule is technical and nondiscretionary, and it merely applies the formula established by Regulation C for determining any adjustments to the exemption threshold. For these reasons, the Bureau has determined that publishing a notice of proposed rulemaking and providing opportunity for public comment are unnecessary. Therefore, the amendment is adopted in final form. Section 553(d) of the APA generally requires publication of a final rule not less than 30 days before its effective date, except (1) a substantive rule which grants or recognizes an exemption or relieves a restriction; (2) interpretive rules and statements of policy; or (3) as otherwise provided by the agency for good cause found and published with the rule.5 At a minimum, the Bureau believes the amendments fall under the third exception to section 553(d). The Bureau finds that there is good cause to make the amendments effective on January 1, 2023. The amendment in this final rule is technical and nondiscretionary, and it applies the method previously established in the agency’s regulations for determining adjustments to the threshold. B. Regulatory Flexibility Act The Regulatory Flexibility Act (RFA) does not apply to a rulemaking where a general notice of proposed rulemaking is not required.6 As noted previously, the Bureau has determined that it is unnecessary to publish a general notice of proposed rulemaking for this final rule. Accordingly, the RFA’s requirement relating to an initial and final regulatory flexibility analysis do not apply. C. Paperwork Reduction Act In accordance with the Paperwork Reduction Act of 1995,7 the Bureau reviewed this final rule. The Bureau has determined that this rule does not create any new information collections or 45 U.S.C. 553(b)(B). U.S.C. 553(d). 6 5 U.S.C. 603(a), 604(a). 7 44 U.S.C. 3506; 5 CFR part 1320. 1 12 U.S.C. 2801–2810. 2 12 CFR part 1003. 3 12 U.S.C. 2808(b). PO 00000 Frm 00001 Fmt 4700 55 Sfmt 4700 E:\FR\FM\30DER1.SGM 30DER1 80434 Federal Register / Vol. 87, No. 250 / Friday, December 30, 2022 / Rules and Regulations substantially revise any existing collections. D. Congressional Review Act Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), the Bureau will submit a report containing this rule and other required information to the United States Senate, the United States House of Representatives, and the Comptroller General of the United States prior to the rule taking effect. The Office of Information and Regulatory Affairs (OIRA) has designated this rule as not a ‘‘major rule’’ as defined by 5 U.S.C. 804(2). III. Signing Authority Senior Advisor Brian Shearer, having reviewed and approved this document, is delegating the authority to sign this document electronically to Laura Galban, a Bureau Federal Register Liaison, for purposes of publication in the Federal Register. List of Subjects in 12 CFR Part 1003 Banks, banking, Credit unions, Mortgages, National banks, Reporting and recordkeeping requirements, Savings associations. Authority and Issuance For the reasons set forth above, the Bureau amends Regulation C, 12 CFR part 1003, as set forth below: PART 1003—HOME MORTGAGE DISCLOSURE (REGULATION C) 1. The authority citation for part 1003 continues to read as follows: ■ Authority: 12 U.S.C. 2803, 2804, 2805, 5512, 5581. 2. Supplement I to part 1003 is amended by revising 2(g) Financial Institution under the heading Section 1003.2—Definitions to read as follows: ■ Supplement I to Part 1003—Official Interpretations * * * * * Section 1003.2—Definitions * * * * * khammond on DSKJM1Z7X2PROD with RULES 2(g) Financial Institution 1. Preceding calendar year and preceding December 31. The definition of financial institution refers both to the preceding calendar year and the preceding December 31. These terms refer to the calendar year and the December 31 preceding the current calendar year. For example, in 2019, the preceding calendar year is 2018 and the preceding December 31 is December 31, 2018. Accordingly, in 2019, Financial Institution A satisfies the asset-size VerDate Sep<11>2014 16:40 Dec 29, 2022 Jkt 259001 threshold described in § 1003.2(g)(1)(i) if its assets exceeded the threshold specified in comment 2(g)–2 on December 31, 2018. Likewise, in 2020, Financial Institution A does not meet the loan-volume test described in § 1003.2(g)(1)(v)(A) if it originated fewer than 25 closed-end mortgage loans during either 2018 or 2019. 2. Adjustment of exemption threshold for banks, savings associations, and credit unions. For data collection in 2023, the asset-size exemption threshold is $54 million. Banks, savings associations, and credit unions with assets at or below $54 million as of December 31, 2022, are exempt from collecting data for 2023. 3. Merger or acquisition—coverage of surviving or newly formed institution. After a merger or acquisition, the surviving or newly formed institution is a financial institution under § 1003.2(g) if it, considering the combined assets, location, and lending activity of the surviving or newly formed institution and the merged or acquired institutions or acquired branches, satisfies the criteria included in § 1003.2(g). For example, A and B merge. The surviving or newly formed institution meets the loan threshold described in § 1003.2(g)(1)(v)(B) if the surviving or newly formed institution, A, and B originated a combined total of at least 200 open-end lines of credit in each of the two preceding calendar years. Likewise, the surviving or newly formed institution meets the asset-size threshold in § 1003.2(g)(1)(i) if its assets and the combined assets of A and B on December 31 of the preceding calendar year exceeded the threshold described in § 1003.2(g)(1)(i). Comment 2(g)–4 discusses a financial institution’s responsibilities during the calendar year of a merger. 4. Merger or acquisition—coverage for calendar year of merger or acquisition. The scenarios described below illustrate a financial institution’s responsibilities for the calendar year of a merger or acquisition. For purposes of these illustrations, a ‘‘covered institution’’ means a financial institution, as defined in § 1003.2(g), that is not exempt from reporting under § 1003.3(a), and ‘‘an institution that is not covered’’ means either an institution that is not a financial institution, as defined in § 1003.2(g), or an institution that is exempt from reporting under § 1003.3(a). i. Two institutions that are not covered merge. The surviving or newly formed institution meets all of the requirements necessary to be a covered institution. No data collection is required for the calendar year of the PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 merger (even though the merger creates an institution that meets all of the requirements necessary to be a covered institution). When a branch office of an institution that is not covered is acquired by another institution that is not covered, and the acquisition results in a covered institution, no data collection is required for the calendar year of the acquisition. ii. A covered institution and an institution that is not covered merge. The covered institution is the surviving institution, or a new covered institution is formed. For the calendar year of the merger, data collection is required for covered loans and applications handled in the offices of the merged institution that was previously covered and is optional for covered loans and applications handled in offices of the merged institution that was previously not covered. When a covered institution acquires a branch office of an institution that is not covered, data collection is optional for covered loans and applications handled by the acquired branch office for the calendar year of the acquisition. iii. A covered institution and an institution that is not covered merge. The institution that is not covered is the surviving institution, or a new institution that is not covered is formed. For the calendar year of the merger, data collection is required for covered loans and applications handled in offices of the previously covered institution that took place prior to the merger. After the merger date, data collection is optional for covered loans and applications handled in the offices of the institution that was previously covered. When an institution remains not covered after acquiring a branch office of a covered institution, data collection is required for transactions of the acquired branch office that take place prior to the acquisition. Data collection by the acquired branch office is optional for transactions taking place in the remainder of the calendar year after the acquisition. iv. Two covered institutions merge. The surviving or newly formed institution is a covered institution. Data collection is required for the entire calendar year of the merger. The surviving or newly formed institution files either a consolidated submission or separate submissions for that calendar year. When a covered institution acquires a branch office of a covered institution, data collection is required for the entire calendar year of the merger. Data for the acquired branch office may be submitted by either institution. E:\FR\FM\30DER1.SGM 30DER1 Federal Register / Vol. 87, No. 250 / Friday, December 30, 2022 / Rules and Regulations 5. Originations. Whether an institution is a financial institution depends in part on whether the institution originated at least 25 closedend mortgage loans in each of the two preceding calendar years or at least 200 open-end lines of credit in each of the two preceding calendar years. Comments 4(a)-2 through –4 discuss whether activities with respect to a particular closed-end mortgage loan or open-end line of credit constitute an origination for purposes of § 1003.2(g). 6. Branches of foreign banks—treated as banks. A Federal branch or a Statelicensed or insured branch of a foreign bank that meets the definition of a ‘‘bank’’ under section 3(a)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1813(a)) is a bank for the purposes of § 1003.2(g). 7. Branches and offices of foreign banks and other entities—treated as nondepository financial institutions. A Federal agency, State-licensed agency, State-licensed uninsured branch of a foreign bank, commercial lending company owned or controlled by a foreign bank, or entity operating under section 25 or 25A of the Federal Reserve Act, 12 U.S.C. 601 and 611 (Edge Act and agreement corporations) may not meet the definition of ‘‘bank’’ under the Federal Deposit Insurance Act and may thereby fail to satisfy the definition of a depository financial institution under § 1003.2(g)(1). An entity is nonetheless a financial institution if it meets the definition of nondepository financial institution under § 1003.2(g)(2). * * * * * Laura Galban, Federal Register Liaison, Consumer Financial Protection Bureau. [FR Doc. 2022–28441 Filed 12–29–22; 8:45 am] BILLING CODE 4810–AM–P account for a higher-priced mortgage loan (HPML). These changes reflect updates to the exemption from the escrow requirement in the Truth in Lending Act (TILA) for creditors that, together with their affiliates that regularly extended covered transactions secured by first liens, had total assets of less than $2 billion (adjusted annually for inflation). They also reflect updates to the exemption the Bureau added, by implementing section 108 of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA), for certain insured depository institutions and insured credit unions with assets of $10 billion or less (adjusted annually for inflation). These amendments are based on the annual percentage change in the average of the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI–W). Based on the 8.6 percent increase in the average of the CPI–W for the 12-month period ending in November 2022, the exemption threshold for creditors and their affiliates that regularly extended covered transactions secured by first liens is adjusted to $2.537 billion from $2.336 billion and the exemption threshold for certain insured depository institutions and insured credit unions with assets of $10 billion or less is adjusted to $11.374 billion from $10.473 billion. DATES: This rule is effective on January 1, 2023. FOR FURTHER INFORMATION CONTACT: Adrien Fernandez, Counsel, Thomas Dowell, Senior Counsel, Office of Regulations, at (202) 435–7700. If you require this document in an alternative electronic format, please contact CFPB_ Accessibility@cfpb.gov. SUPPLEMENTARY INFORMATION: I. Background BUREAU OF CONSUMER FINANCIAL PROTECTION 12 CFR Part 1026 Truth in Lending Act (Regulation Z) Adjustment to Asset-Size Exemption Threshold Bureau of Consumer Financial Protection. ACTION: Final rule; official interpretation. khammond on DSKJM1Z7X2PROD with RULES AGENCY: The Consumer Financial Protection Bureau (Bureau) is amending the official commentary to its Regulation Z in order to make annual adjustments to the asset-size thresholds exempting certain creditors from the requirement to establish an escrow SUMMARY: VerDate Sep<11>2014 16:40 Dec 29, 2022 Jkt 259001 Section 129D of TILA generally requires creditors to establish escrow accounts for certain first-lien higherpriced mortgage loan transactions. However, TILA section 129D also permits the Bureau to exempt creditors from this higher-priced mortgage loan escrow requirement if they meet certain requirements, including any asset-size threshold that the Bureau may establish. In the 2013 Escrows Final Rule,1 the Bureau established an asset-size threshold of $2 billion, which would adjust automatically each year, based on the year-to-year change in the average of the CPI–W for each 12-month period ending in November, with rounding to 1 78 PO 00000 FR 4726 (Jan. 22, 2013). Frm 00003 Fmt 4700 Sfmt 4700 80435 the nearest million dollars.2 In 2015, the Bureau revised the asset-size threshold for small creditors and how it applies. The Bureau included in the calculation of the asset-size threshold the assets of the creditor’s affiliates that regularly extended covered transactions secured by first liens during the applicable period and added a grace period to allow an otherwise eligible creditor that exceeded the asset limit in the preceding calendar year (but not in the calendar year before the preceding year) to continue to operate as a small creditor with respect to transactions with applications received before April 1 of the current calendar year.3 For 2022, the threshold was $2.336 billion. During the 12-month period ending in November 2022, the average of the CPI– W increased by 8.6 percent. As a result, the exemption threshold is increased to $2.537 billion for 2023. Thus, if the creditor’s assets together with the assets of its affiliates that regularly extended first-lien covered transactions during calendar year 2022 are less than $2.537 billion on December 31, 2022, and it meets the other requirements of § 1026.35(b)(2)(iii), the creditor will be exempt from the escrow-accounts requirement for higher-priced mortgage loans in 2023 and will also be exempt from the escrow-accounts requirement for higher-priced mortgage loans for purposes of any loan consummated in 2024 with applications received before April 1, 2024. The adjustment to the escrows asset-size exemption threshold also will increase the threshold for small-creditor portfolio and balloonpayment qualified mortgages under Regulation Z. The requirements for small-creditor portfolio qualified mortgages at § 1026.43(e)(5)(i)(D) reference the asset threshold in § 1026.35(b)(2)(iii)(C). Likewise, the requirements for balloon-payment qualified mortgages at § 1026.43(f)(1)(vi) reference the asset threshold in § 1026.35(b)(2)(iii)(C). Under § 1026.32(d)(1)(ii)(C), balloon-payment qualified mortgages that satisfy all applicable criteria in § 1026.43(f)(1)(i) through (vi) and (f)(2), including being made by creditors that have (together with certain affiliates) total assets below 2 See 12 CFR 1026.35(b)(2)(iii)(C). 80 FR 59943, 59951 (Oct. 2, 2015). The Bureau also issued an interim final rule in March 2016 to revise certain provisions in Regulation Z to effectuate the Helping Expand Lending Practices in Rural Communities Act’s amendments to TILA (Pub. L. 114–94, section 89003, 129 Stat. 1312, 1800–01 (2015)). The rule broadened the cohort of creditors that may be eligible under TILA for the special provisions allowing origination of balloonpayment qualified mortgages and balloon-payment high-cost mortgages, as well as for the escrow exemption. See 81 FR 16074 (Mar. 25, 2016). 3 See E:\FR\FM\30DER1.SGM 30DER1

Agencies

[Federal Register Volume 87, Number 250 (Friday, December 30, 2022)]
[Rules and Regulations]
[Pages 80433-80435]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-28441]



========================================================================
Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents 
having general applicability and legal effect, most of which are keyed 
to and codified in the Code of Federal Regulations, which is published 
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents. 

========================================================================


Federal Register / Vol. 87 , No. 250 / Friday, December 30, 2022 / 
Rules and Regulations

[[Page 80433]]



BUREAU OF CONSUMER FINANCIAL PROTECTION

12 CFR Part 1003


Home Mortgage Disclosure (Regulation C) Adjustment to Asset-Size 
Exemption Threshold

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Final rule; official interpretation.

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

SUMMARY: The Consumer Financial Protection Bureau (Bureau) is amending 
the official commentary that interprets the requirements of the 
Bureau's Regulation C (Home Mortgage Disclosure) to reflect the asset-
size exemption threshold for banks, savings associations, and credit 
unions based on the annual percentage change in the average of the 
Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-
W). Based on the 8.6 percent increase in the average of the CPI-W for 
the 12-month period ending in November 2022, the exemption threshold is 
adjusted to $54 million from $50 million. Therefore, banks, savings 
associations, and credit unions with assets of $54 million or less as 
of December 31, 2022, are exempt from collecting data in 2023.

DATES: This rule is effective on January 1, 2023.

FOR FURTHER INFORMATION CONTACT: Adrien Fernandez, Counsel, Thomas 
Dowell, Senior Counsel; Office of Regulations, at (202) 435-7700. If 
you require this document in an alternative electronic format, please 
contact [email protected].

SUPPLEMENTARY INFORMATION: The Bureau is amending Regulation C, which 
implements the HMDA asset thresholds, to establish the asset-sized 
exemption threshold for depository financial institution for 2023. The 
asset threshold will be $54 million for 2023.

I. Background

    The Home Mortgage Disclosure Act of 1975 (HMDA) \1\ requires most 
mortgage lenders located in metropolitan areas to collect data about 
their housing related lending activity. Annually, lenders must report 
their data to the appropriate Federal agencies and make the data 
available to the public. The Bureau's Regulation C implements HMDA.\2\
---------------------------------------------------------------------------

    \1\ 12 U.S.C. 2801-2810.
    \2\ 12 CFR part 1003.
---------------------------------------------------------------------------

    Prior to 1997, HMDA exempted certain depository institutions as 
defined in HMDA (i.e., banks, savings associations, and credit unions) 
with assets totaling $10 million or less as of the preceding year-end. 
In 1996, HMDA was amended to expand the asset-size exemption for these 
depository institutions.\3\ The amendment increased the dollar amount 
of the asset-size exemption threshold by requiring a one-time 
adjustment of the $10 million figure based on the percentage by which 
the CPI-W for 1996 exceeded the CPI-W for 1975, and it provided for 
annual adjustments thereafter based on the annual percentage increase 
in the CPI-W, rounded to the nearest multiple of $1 million.
---------------------------------------------------------------------------

    \3\ 12 U.S.C. 2808(b).
---------------------------------------------------------------------------

    The definition of ``financial institution'' in Sec.  1003.2(g) 
provides that the Bureau will adjust the asset threshold based on the 
year-to-year change in the average of the CPI-W, not seasonally 
adjusted, for each 12-month period ending in November, rounded to the 
nearest $1 million. For 2022, the threshold was $50 million. During the 
12-month period ending in November 2022, the average of the CPI-W 
increased by 8.6 percent. As a result, the exemption threshold is 
increased to $54 million for 2023. Thus, banks, savings associations, 
and credit unions with assets of $54 million or less as of December 31, 
2022, are exempt from collecting data in 2023. An institution's 
exemption from collecting data in 2023 does not affect its 
responsibility to report data it was required to collect in 2022.

II. Procedural Requirements

A. Administrative Procedure Act

    Under the Administrative Procedure Act (APA), notice and 
opportunity for public comment are not required if the Bureau finds 
that notice and public comment are impracticable, unnecessary, or 
contrary to the public interest.\4\ Pursuant to this final rule, 
comment 2(g)-2 in Regulation C, supplement I, is amended to update the 
exemption threshold. The amendment in this final rule is technical and 
non-discretionary, and it merely applies the formula established by 
Regulation C for determining any adjustments to the exemption 
threshold. For these reasons, the Bureau has determined that publishing 
a notice of proposed rulemaking and providing opportunity for public 
comment are unnecessary. Therefore, the amendment is adopted in final 
form.
---------------------------------------------------------------------------

    \4\ 5 U.S.C. 553(b)(B).
---------------------------------------------------------------------------

    Section 553(d) of the APA generally requires publication of a final 
rule not less than 30 days before its effective date, except (1) a 
substantive rule which grants or recognizes an exemption or relieves a 
restriction; (2) interpretive rules and statements of policy; or (3) as 
otherwise provided by the agency for good cause found and published 
with the rule.\5\ At a minimum, the Bureau believes the amendments fall 
under the third exception to section 553(d). The Bureau finds that 
there is good cause to make the amendments effective on January 1, 
2023. The amendment in this final rule is technical and non-
discretionary, and it applies the method previously established in the 
agency's regulations for determining adjustments to the threshold.
---------------------------------------------------------------------------

    \5\ 5 U.S.C. 553(d).
---------------------------------------------------------------------------

B. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) does not apply to a rulemaking 
where a general notice of proposed rulemaking is not required.\6\ As 
noted previously, the Bureau has determined that it is unnecessary to 
publish a general notice of proposed rulemaking for this final rule. 
Accordingly, the RFA's requirement relating to an initial and final 
regulatory flexibility analysis do not apply.
---------------------------------------------------------------------------

    \6\ 5 U.S.C. 603(a), 604(a).
---------------------------------------------------------------------------

C. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995,\7\ the 
Bureau reviewed this final rule. The Bureau has determined that this 
rule does not create any new information collections or

[[Page 80434]]

substantially revise any existing collections.
---------------------------------------------------------------------------

    \7\ 44 U.S.C. 3506; 5 CFR part 1320.
---------------------------------------------------------------------------

D. Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Bureau will submit a report containing this rule and other required 
information to the United States Senate, the United States House of 
Representatives, and the Comptroller General of the United States prior 
to the rule taking effect. The Office of Information and Regulatory 
Affairs (OIRA) has designated this rule as not a ``major rule'' as 
defined by 5 U.S.C. 804(2).

III. Signing Authority

    Senior Advisor Brian Shearer, having reviewed and approved this 
document, is delegating the authority to sign this document 
electronically to Laura Galban, a Bureau Federal Register Liaison, for 
purposes of publication in the Federal Register.

List of Subjects in 12 CFR Part 1003

    Banks, banking, Credit unions, Mortgages, National banks, Reporting 
and recordkeeping requirements, Savings associations.

Authority and Issuance

    For the reasons set forth above, the Bureau amends Regulation C, 12 
CFR part 1003, as set forth below:

PART 1003--HOME MORTGAGE DISCLOSURE (REGULATION C)


0
1. The authority citation for part 1003 continues to read as follows:

    Authority:  12 U.S.C. 2803, 2804, 2805, 5512, 5581.

0
2. Supplement I to part 1003 is amended by revising 2(g) Financial 
Institution under the heading Section 1003.2--Definitions to read as 
follows:

Supplement I to Part 1003--Official Interpretations

* * * * *

Section 1003.2--Definitions

* * * * *
2(g) Financial Institution
    1. Preceding calendar year and preceding December 31. The 
definition of financial institution refers both to the preceding 
calendar year and the preceding December 31. These terms refer to the 
calendar year and the December 31 preceding the current calendar year. 
For example, in 2019, the preceding calendar year is 2018 and the 
preceding December 31 is December 31, 2018. Accordingly, in 2019, 
Financial Institution A satisfies the asset-size threshold described in 
Sec.  1003.2(g)(1)(i) if its assets exceeded the threshold specified in 
comment 2(g)-2 on December 31, 2018. Likewise, in 2020, Financial 
Institution A does not meet the loan-volume test described in Sec.  
1003.2(g)(1)(v)(A) if it originated fewer than 25 closed-end mortgage 
loans during either 2018 or 2019.
    2. Adjustment of exemption threshold for banks, savings 
associations, and credit unions. For data collection in 2023, the 
asset-size exemption threshold is $54 million. Banks, savings 
associations, and credit unions with assets at or below $54 million as 
of December 31, 2022, are exempt from collecting data for 2023.
    3. Merger or acquisition--coverage of surviving or newly formed 
institution. After a merger or acquisition, the surviving or newly 
formed institution is a financial institution under Sec.  1003.2(g) if 
it, considering the combined assets, location, and lending activity of 
the surviving or newly formed institution and the merged or acquired 
institutions or acquired branches, satisfies the criteria included in 
Sec.  1003.2(g). For example, A and B merge. The surviving or newly 
formed institution meets the loan threshold described in Sec.  
1003.2(g)(1)(v)(B) if the surviving or newly formed institution, A, and 
B originated a combined total of at least 200 open-end lines of credit 
in each of the two preceding calendar years. Likewise, the surviving or 
newly formed institution meets the asset-size threshold in Sec.  
1003.2(g)(1)(i) if its assets and the combined assets of A and B on 
December 31 of the preceding calendar year exceeded the threshold 
described in Sec.  1003.2(g)(1)(i). Comment 2(g)-4 discusses a 
financial institution's responsibilities during the calendar year of a 
merger.
    4. Merger or acquisition--coverage for calendar year of merger or 
acquisition. The scenarios described below illustrate a financial 
institution's responsibilities for the calendar year of a merger or 
acquisition. For purposes of these illustrations, a ``covered 
institution'' means a financial institution, as defined in Sec.  
1003.2(g), that is not exempt from reporting under Sec.  1003.3(a), and 
``an institution that is not covered'' means either an institution that 
is not a financial institution, as defined in Sec.  1003.2(g), or an 
institution that is exempt from reporting under Sec.  1003.3(a).
    i. Two institutions that are not covered merge. The surviving or 
newly formed institution meets all of the requirements necessary to be 
a covered institution. No data collection is required for the calendar 
year of the merger (even though the merger creates an institution that 
meets all of the requirements necessary to be a covered institution). 
When a branch office of an institution that is not covered is acquired 
by another institution that is not covered, and the acquisition results 
in a covered institution, no data collection is required for the 
calendar year of the acquisition.
    ii. A covered institution and an institution that is not covered 
merge. The covered institution is the surviving institution, or a new 
covered institution is formed. For the calendar year of the merger, 
data collection is required for covered loans and applications handled 
in the offices of the merged institution that was previously covered 
and is optional for covered loans and applications handled in offices 
of the merged institution that was previously not covered. When a 
covered institution acquires a branch office of an institution that is 
not covered, data collection is optional for covered loans and 
applications handled by the acquired branch office for the calendar 
year of the acquisition.
    iii. A covered institution and an institution that is not covered 
merge. The institution that is not covered is the surviving 
institution, or a new institution that is not covered is formed. For 
the calendar year of the merger, data collection is required for 
covered loans and applications handled in offices of the previously 
covered institution that took place prior to the merger. After the 
merger date, data collection is optional for covered loans and 
applications handled in the offices of the institution that was 
previously covered. When an institution remains not covered after 
acquiring a branch office of a covered institution, data collection is 
required for transactions of the acquired branch office that take place 
prior to the acquisition. Data collection by the acquired branch office 
is optional for transactions taking place in the remainder of the 
calendar year after the acquisition.
    iv. Two covered institutions merge. The surviving or newly formed 
institution is a covered institution. Data collection is required for 
the entire calendar year of the merger. The surviving or newly formed 
institution files either a consolidated submission or separate 
submissions for that calendar year. When a covered institution acquires 
a branch office of a covered institution, data collection is required 
for the entire calendar year of the merger. Data for the acquired 
branch office may be submitted by either institution.

[[Page 80435]]

    5. Originations. Whether an institution is a financial institution 
depends in part on whether the institution originated at least 25 
closed-end mortgage loans in each of the two preceding calendar years 
or at least 200 open-end lines of credit in each of the two preceding 
calendar years. Comments 4(a)-2 through -4 discuss whether activities 
with respect to a particular closed-end mortgage loan or open-end line 
of credit constitute an origination for purposes of Sec.  1003.2(g).
    6. Branches of foreign banks--treated as banks. A Federal branch or 
a State-licensed or insured branch of a foreign bank that meets the 
definition of a ``bank'' under section 3(a)(1) of the Federal Deposit 
Insurance Act (12 U.S.C. 1813(a)) is a bank for the purposes of Sec.  
1003.2(g).
    7. Branches and offices of foreign banks and other entities--
treated as nondepository financial institutions. A Federal agency, 
State-licensed agency, State-licensed uninsured branch of a foreign 
bank, commercial lending company owned or controlled by a foreign bank, 
or entity operating under section 25 or 25A of the Federal Reserve Act, 
12 U.S.C. 601 and 611 (Edge Act and agreement corporations) may not 
meet the definition of ``bank'' under the Federal Deposit Insurance Act 
and may thereby fail to satisfy the definition of a depository 
financial institution under Sec.  1003.2(g)(1). An entity is 
nonetheless a financial institution if it meets the definition of 
nondepository financial institution under Sec.  1003.2(g)(2).
* * * * *

Laura Galban,
Federal Register Liaison, Consumer Financial Protection Bureau.
[FR Doc. 2022-28441 Filed 12-29-22; 8:45 am]
BILLING CODE 4810-AM-P
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