Proposed Agency Information Collection Activities; Comment Request, 89489-89495 [2023-28473]
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Federal Register / Vol. 88, No. 247 / Wednesday, December 27, 2023 / Notices
The RERC
was established to advise TVA on its
energy resource activities and the
priorities among competing objectives
and values. The RRSC was established
to advise TVA on its natural resource
and stewardship activities, and the
priorities among competing objectives
and values. The RRSC and RERC are
discretionary advisory committees
established under the authority of the
Tennessee Valley Authority (TVA) in
accordance with the provisions of the
Federal Advisory Committee Act
(FACA), as amended, 5 U.S.C. 10.
The meeting agenda includes the
following:
SUPPLEMENTARY INFORMATION:
January 18
1. Welcome and Introductions
2. TVA Leadership Update
3. Valley Pathways Study presentation
4. Review and discuss Advice Questions
5. Public Listening Session
6. Finalize Advice Statements
The DFO of the Tennessee Valley
Authority and Vice President of
External Strategy and Regulatory
Oversight, Melanie Farrell, having
review and approved this document, is
delegating the authority to sign this
document to Bekim Haliti, Specialist of
Valley Alliances for publication in the
Federal Register.
Dated: December 18, 2023.
Bekim Haliti,
Specialist, Valley Alliances, Tennessee Valley
Authority.
[FR Doc. 2023–28534 Filed 12–26–23; 8:45 am]
BILLING CODE 8120–08–P
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the
Currency
FEDERAL RESERVE SYSTEM
FEDERAL DEPOSIT INSURANCE
CORPORATION
Proposed Agency Information
Collection Activities; Comment
Request
Office of the Comptroller of the
Currency (OCC), Treasury; Board of
Governors of the Federal Reserve
System (Board); and Federal Deposit
Insurance Corporation (FDIC).
ACTION: Joint notice and request for
comment.
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AGENCY:
In accordance with the
requirements of the Paperwork
Reduction Act of 1995 (PRA), the OCC,
the Board, and the FDIC (the agencies)
may not conduct or sponsor, and the
SUMMARY:
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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 Federal Financial
Institutions Examination Council
(FFIEC), of which the agencies are
members, has approved the agencies’
publication for public comment of a
proposal to revise and extend for three
years the Consolidated Reports of
Condition and Income (Call Reports)
(FFIEC 031, FFIEC 041, and FFIEC 051),
which are currently approved
collections of information. The FFIEC
has also approved the Board’s
publication for public comment, on
behalf of the agencies, of a proposal to
revise and extend for three years the
Report of Assets and Liabilities of U.S.
Branches and Agencies of Foreign Banks
(FFIEC 002), and the Report of Assets
and Liabilities of a Non-U.S. Branch that
is Managed or Controlled by a U.S.
Branch or Agency of a Foreign (NonU.S.) Bank (FFIEC 002S), which are also
currently approved collections of
information. The agencies are requesting
comment on proposed revisions to the
Call Report forms and instructions, and
the FFIEC 002, as applicable, that
include the revision and addition of
certain new data items related to the
reporting on loans to nondepository
financial institutions (NDFIs) and other
loans, guaranteed structured financial
products, and proposed long-term debt
requirements. In addition, the agencies
are seeking comment on a proposal to
adopt ongoing standards for electronic
signatures to comply with the Call
Report signature and attestation
requirement. The revisions are proposed
to take effect with the June 30, 2024,
report date, except for those related to
the proposed long-term debt
requirements which would take effect
for the first report date at or following
the effective date of any final rule.
DATES: Comments must be submitted on
or before February 26, 2024.
ADDRESSES: Interested parties are
invited to submit written comments to
any or all of the agencies. All comments
will be shared among the agencies.
OCC: You may submit comments,
which should refer to ‘‘Call Report and
FFIEC 002 Revisions,’’ by any of the
following methods:
• Email: prainfo@occ.treas.gov.
• Mail: Chief Counsel’s Office, Office
of the Comptroller of the Currency,
Attention: 1557–0081, 400 7th Street
SW, Suite 3E–218, Washington, DC
20219.
• Hand Delivery/Courier: 400 7th
Street SW, Suite 3E–218, Washington,
DC 20219.
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• Fax: (571) 293–4835.
Instructions: You must include
‘‘OCC’’ as the agency name and ‘‘1557–
0081’’ in your comment. In general, the
OCC will publish comments on
www.reginfo.gov without change,
including any business or personal
information provided, such as name and
address information, email addresses, or
phone numbers. Comments received,
including attachments and other
supporting materials, are part of the
public record and subject to public
disclosure. Do not include any
information in your comment or
supporting materials that you consider
confidential or inappropriate for public
disclosure.
You may review comments and other
related materials that pertain to this
information collection beginning on the
date of publication of the second notice
for this collection by the following
method:
• Viewing Comments Electronically:
Go to www.reginfo.gov. Hover over the
‘‘Information Collection Review’’ tab
and click on ‘‘Information Collection
Review’’ from the drop-down menu.
From the ‘‘Currently under Review’’
drop-down menu, select ‘‘Department of
Treasury’’ and then click ‘‘submit.’’ This
information collection can be located by
searching OMB control number ‘‘1557–
0081.’’ Upon finding the appropriate
information collection, click on the
related ‘‘ICR Reference Number.’’ On the
next screen, select ‘‘View Supporting
Statement and Other Documents’’ and
then click on the link to any comment
listed at the bottom of the screen.
• For assistance in navigating
www.reginfo.gov, please contact the
Regulatory Information Service Center
at (202) 482–7340.
Board: You may submit comments,
which should refer to ‘‘Call Report and
FFIEC 002 Revisions,’’ by any of the
following methods:
• Agency Website: https://
www.federalreserve.gov. Follow the
instructions for submitting comments at:
https://www.federalreserve.gov/
generalinfo/foia/ProposedRegs.cfm.
• Email: regs.comments@
federalreserve.gov. Include ‘‘Call Report
and FFIEC 002 Revisions’’ in the subject
line of the message.
• Fax: (202) 395–6974.
• Mail: Ann E. Misback, Secretary,
Board of Governors of the Federal
Reserve System, 20th Street and
Constitution Avenue NW, Washington,
DC 20551.
All public comments are available on
the Board’s website at https://
www.federalreserve.gov/apps/foia/
proposedregs.aspx as submitted, unless
modified for technical reasons.
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Accordingly, your comments will not be
edited to remove any identifying or
contact information.
FDIC: You may submit comments,
which should refer to ‘‘Call Report and
FFIEC 002 Revisions,’’ by any of the
following methods:
• Agency Website: https://
www.fdic.gov/resources/regulations/
federal-register-publications/. Follow
the instructions for submitting
comments on the FDIC’s website.
• Email: comments@FDIC.gov.
Include ‘‘Call Report and FFIEC 002
Revisions’’ in the subject line of the
message.
• Mail: Manuel E. Cabeza, Counsel,
Attn: Comments, Room MB–3128,
Federal Deposit Insurance Corporation,
550 17th Street NW, Washington, DC
20429.
• Hand Delivery: Comments may be
hand-delivered to the guard station at
the rear of the 550 17th Street NW
building (located on F Street NW) on
business days between 7 a.m. and 5 p.m.
• Public Inspection: All comments
received, including any personal
information provided, will be posted
without change to https://www.fdic.gov/
resources/regulations/federal-registerpublications/. Commenters should
submit only information that the
commenter wishes to make available
publicly. The FDIC may review, redact,
or refrain from posting all or any portion
of any comment that it may deem to be
inappropriate for publication, such as
irrelevant or obscene material. The FDIC
may post only a single representative
example of identical or substantially
identical comments, and in such cases
will generally identify the number of
identical or substantially identical
comments represented by the posted
example. All comments that have been
redacted, as well as those that have not
been posted, that contain comments on
the merits of this document will be
retained in the public comment file and
will be considered as required under all
applicable laws. All comments may be
accessible under the Freedom of
Information Act.
Additionally, commenters may send a
copy of their comments to the OMB
desk officer for the agencies by mail to
the Office of Information and Regulatory
Affairs, U.S. Office of Management and
Budget, New Executive Office Building,
Room 10235, 725 17th Street NW,
Washington, DC 20503; by fax to (202)
395–6974; or by email to oira_
submission@omb.eop.gov.
FOR FURTHER INFORMATION CONTACT: For
further information about the proposed
revisions to the information collections
discussed in this notice, please contact
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any of the agency staff whose names
appear below. In addition, copies of the
report forms for the Call Reports and the
FFIEC 002 can be obtained at the
FFIEC’s website (https://www.ffiec.gov/
ffiec_report_forms.htm).
OCC: Kevin Korzeniewski, Counsel,
Chief Counsel’s Office, (202) 649–5490.
If you are deaf, hard of hearing, or have
a speech disability, please dial 7–1–1 to
access telecommunications relay
services.
Board: Nuha Elmaghrabi, Federal
Reserve Board Clearance Officer, (202)
452–3884, Office of the Chief Data
Officer, Board of Governors of the
Federal Reserve System, 20th and C
Streets NW, Washington, DC 20551.
Telecommunications Device for the Deaf
(TDD) users may call (202) 263–4869.
FDIC: Manuel E. Cabeza, Counsel,
(202) 898–3767, Legal Division, Federal
Deposit Insurance Corporation, 550 17th
Street NW, Washington, DC 20429.
SUPPLEMENTARY INFORMATION:
I. Affected Reports
The proposed changes discussed
below affect the Call Reports and the
FFIEC 002.
A. Call Report
The agencies propose to extend for
three years, with revision, their
information collections associated with
the FFIEC 031, FFIEC 041, and FFIEC
051 Call Reports.
Report Title: Consolidated Reports of
Condition and Income (Call Report).
Form Number: FFIEC 031
(Consolidated Reports of Condition and
Income for a Bank with Domestic and
Foreign Offices), FFIEC 041
(Consolidated Reports of Condition and
Income for a Bank with Domestic
Offices Only), and FFIEC 051
(Consolidated Reports of Condition and
Income for a Bank with Domestic
Offices Only and Total Assets Less Than
$5 Billion).
Frequency of Response: Quarterly.
Affected Public: Business or other forprofit.
Type of Review: Revision and
extension of currently approved
collections.
Estimated Number of Respondents:
708 state member banks.
Estimated Average Burden per
Response: 44.33 burden hours per
quarter to file.
Estimated Total Annual Burden:
125,543 burden hours to file.
FDIC
OMB Control No.: 3064–0052.
Estimated Number of Respondents:
2,975 insured state nonmember banks
and state savings associations.
Estimated Average Burden per
Response: 38.94 burden hours per
quarter to file.
Estimated Total Annual Burden:
463,386 burden hours to file.
The estimated average burden hours
collectively reflect the estimates for the
FFIEC 031, the FFIEC 041, and the
FFIEC 051 reports for each agency.
When the estimates are calculated by
type of report across the agencies, the
estimated average burden hours per
quarter are 85.88 (FFIEC 031), 54.79
(FFIEC 041), and 34.49 (FFIEC 051). The
changes to the Call Report forms and
instructions proposed in this notice
would result in an estimated increase in
burden hours per quarter for the FFIEC
031 of 1.35 hours, FFIEC 041 of 0.19
hours, and FFIEC 051 of 0.08 hours. The
estimated burden per response for the
quarterly filings of the Call Report is an
average that varies by agency because of
differences in the composition of the
institutions under each agency’s
supervision (e.g., size distribution of
institutions, types of activities in which
they are engaged, and existence of
foreign offices).
Type of Review: Extension and
revision of currently approved
collections. In addition to the proposed
revisions discussed below, Call Reports
are periodically updated to clarify
instructional guidance and correct
grammatical and typographical errors on
the forms and instructions, which are
published on the FFIEC website.1 These
non-substantive updates may also be
commented upon.
Legal Basis and Need for Collections
OCC
OMB Control No.: 1557–0081.
Estimated Number of Respondents:
1,014 national banks and federal savings
associations.
Estimated Average Burden per
Response: 40.85 burden hours per
quarter to file.
Estimated Total Annual Burden:
165,688 burden hours to file.
The Call Report information
collections are mandatory: 12 U.S.C. 161
(national banks), 12 U.S.C. 324 (state
member banks), 12 U.S.C. 1817 (insured
state nonmember commercial and
savings banks), and 12 U.S.C. 1464
(federal and state savings associations).
At present, except for selected data
items and text, these information
collections are not given confidential
treatment.
Board
OMB Control No.: 7100–0036.
1 www.ffiec.gov/forms031.htm; www.ffiec.gov/
forms041.htm; www.ffiec.gov/forms051.htm.
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Banks and savings associations
submit Call Report data to the agencies
each quarter for the agencies’ use in
monitoring the condition, performance,
and risk profile of individual
institutions and the industry as a whole.
Call Report data serve a regulatory or
public policy purpose by assisting the
agencies in fulfilling their shared
missions of ensuring the safety and
soundness of financial institutions and
the financial system and protecting
consumer financial rights, as well as
agency-specific missions affecting
federal and state-chartered institutions,
such as conducting monetary policy,
ensuring financial stability, and
administering federal deposit insurance.
Call Reports are the source of the most
current statistical data available for
identifying areas of focus for on-site and
off-site examinations. Among other
purposes, the agencies use Call Report
data in evaluating institutions’ corporate
applications, including interstate merger
and acquisition applications for which
the agencies are required by law to
determine whether the resulting
institution would control more than 10
percent of the total amount of deposits
of insured depository institutions in the
United States. Call Report data also are
used to calculate the risk-based
assessments for insured depository
institutions.
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B. FFIEC 002 and 002S
The Board proposes to extend for
three years, with revision, the FFIEC
002 and FFIEC 002S reports.
Report Titles: Report of Assets and
Liabilities of U.S. Branches and
Agencies of Foreign Banks; Report of
Assets and Liabilities of a Non-U.S.
Branch that is Managed or Controlled by
a U.S. Branch or Agency of a Foreign
(Non-U.S.) Bank.
Form Numbers: FFIEC 002; FFIEC
002S.
OMB Control Number: 7100–0032.
Frequency of Response: Quarterly.
Affected Public: Business or other forprofit.
Respondents: All state-chartered or
federally-licensed U.S. branches and
agencies of foreign banking
organizations, and all non-U.S. branches
managed or controlled by a U.S. branch
or agency of a foreign banking
organization.
Estimated Number of Respondents:
FFIEC 002—183; FFIEC 002S—18.
Estimated Average Burden per
Response: FFIEC 002—24.67 hours;
FFIEC 002S—6.0 hours.
Estimated Total Annual Burden:
FFIEC 002—18,058 hours; FFIEC 002S—
432 hours.
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Type of Review: Extension and
revision of currently approved
collections.
The proposed revisions to the FFIEC
002 instructions in this notice would
not have a material impact on the
existing burden estimates.
Legal Basis and Need for Collection
On a quarterly basis, all U.S. branches
and agencies of foreign banks are
required to file the FFIEC 002, which is
a detailed report of condition with a
variety of supporting schedules. This
information is used to fulfill the
supervisory and regulatory requirements
of the International Banking Act of
1978. The data also are used to augment
the bank credit, loan, and deposit
information needed for monetary policy
and other public policy purposes. In
addition, FFIEC 002 data are used to
calculate the risk-based assessments for
FDIC-insured U.S. branches of foreign
banks. The FFIEC 002S is a supplement
to the FFIEC 002 that collects
information on assets and liabilities of
any non-U.S. branch that is managed or
controlled by a U.S. branch or agency of
the foreign bank. A non-U.S. branch is
managed or controlled by a U.S. branch
or agency if a majority of the
responsibility for business decisions,
including but not limited to decisions
with regard to lending or asset
management or funding or liability
management, or the responsibility for
recordkeeping in respect of assets or
liabilities for that foreign branch resides
at the U.S. branch or agency. A separate
FFIEC 002S must be completed for each
managed or controlled non-U.S. branch.
The FFIEC 002S must be filed quarterly
along with the U.S. branch or agency’s
FFIEC 002.
These information collections are
mandatory (12 U.S.C. 1817(a)(1) and (3),
3102(b), and 3105(c)(2)). Except for
select sensitive items, the FFIEC 002 is
not given confidential treatment; the
FFIEC 002S is given confidential
treatment (5 U.S.C. 552(b)(4) and (8)).
The data from both reports are used for
(1) monitoring deposit and credit
transactions of U.S. residents; (2)
monitoring the impact of policy
changes; (3) analyzing structural issues
concerning foreign bank activity in U.S.
markets; (4) understanding flows of
banking funds and indebtedness of
developing countries in connection with
data collected by the International
Monetary Fund and the Bank for
International Settlements that are used
in economic analysis; and (5) assisting
in the supervision of U.S. offices of
foreign banks. The Federal Reserve
System collects and processes these
reports on behalf of all three agencies.
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89491
II. Current Actions
A. Loans to Nondepository Financial
Institutions
1. Background
Loans to NDFIs have increasingly
played an essential role in the financial
system. NDFIs include a wide range of
counterparties including insurance
companies, mortgage companies, private
equity funds, hedge funds, brokerdealers, real estate investment trusts
(REITs), marketplace lenders, special
purpose entities, and other financial
vehicles. Currently, data on loans to
NDFIs is collected on Schedule RC–C,
Part I, Loans and Leases, item 9.a.
‘‘Loans to nondepository financial
institutions.’’
Since this item was added in 2010,
institutions have increased direct
lending exposure to NDFIs. In March
2010, loans to NDFIs reported in this
item totaled approximately $56 billion
and represented only 0.8 percent of
gross loans reported by respondents.
However, in June 2023, the reported
amount of loans to NDFIs increased
significantly to almost $786 billion and
represented 6.4 percent of respondents’
total loan exposure. Notwithstanding
this increase in NDFI credit risk, current
Call Report forms and instructions do
not provide granularity on specific NDFI
exposure, such as direct and off-balance
sheet exposure, data on NDFI exposure
in non-domestic offices, or NDFI loan
performance data (e.g., nonaccrual and
past due status). Further, the agencies
have observed inconsistency in NDFI
exposure reporting among industry
filers.
2. Call Report Proposed Revisions
The agencies are proposing to update
the Call Report forms and instructions
to increase the granularity in reporting
exposure to NDFIs and to improve
reporting consistency. These proposed
revisions would enhance the
understanding of NDFI exposure, risks,
and performance trends. The revisions
would group together loan exposures
that exhibit similar underlying risk
characteristics while addressing the
diversity in practice on the reporting of
these loans that exists today. In
addition, the proposed granular
reporting would allow for more accurate
analysis of bank financial statements for
applicable institutions and performance
metrics. These revisions and
clarifications are proposed to be
effective as of the June 30, 2024, report
date.
The specific proposed revisions and
clarifications impacting the three report
forms are as follows:
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Schedule RC–C, Part I, Loans and Leases
D For all three Call Reports, to ensure
consistent reporting on loans to NDFIs,
the instructions for item 9.a, ‘‘Loans to
nondepository financial institutions’’
would be updated to include additional
detail on the types of loans that should
be reported in this line item. In
addition, the instructions would be
revised to include in the amounts
reported in this item all loans to brokers
and dealers in securities and loans to
investment firms and mutual funds.
These loans were previously included
in item 9.b (FFIEC 051) or in item 9.b.(1)
(FFIEC 031 and FFIEC 041), as noted
below.
D On the FFIEC 051, item 9.b, ‘‘Other
loans,’’ and on the FFIEC 031 and FFIEC
041, item 9.b.(1), ‘‘Loans for purchasing
or carrying securities (secured and
unsecured),’’ the instructions would be
revised to exclude from the amounts
reported in this item all loans to brokers
and dealers in securities and loans to
investment firms and mutual funds.
These loans would be reported under
the new NDFI definition in item 9.a,
‘‘Loans to nondepository financial
institutions.’’
D On the FFIEC 051, item 9.b, ‘‘Other
loans,’’ and on the FFIEC 031 and FFIEC
041 reports, item 9.b.(1), ‘‘Loans for
purchasing or carrying securities
(secured and unsecured),’’ the
instructions would also be revised to
include in the amounts reported in this
item all margin loans, including
securities-based loans and non-purpose
margin loans. In addition, this item
description on the FFIEC 031 and FFIEC
041 report forms would be revised to
‘‘Loans for purchasing or carrying
securities, including margin loans.’’
D For the FFIEC 031 and FFIEC 041,
Memorandum item 10 (currently ‘‘not
applicable’’) would be renamed ‘‘Loans
to nondepository financial institutions’’
and would include the following
subitems, as defined in the instructions
for Schedule RC–C, Part I, item 9.a, to
capture direct lending exposures to
NDFIs: 10.a, ‘‘Loans to mortgage credit
intermediaries;’’ 10.b, ‘‘Loans to
business credit intermediaries;’’ 10.c,
‘‘Loans to private equity funds;’’ 10.d,
‘‘Loans to consumer credit
intermediaries;’’ and 10.e, ‘‘Other loans
to nondepository financial institutions.’’
The sum of subitems 10.a through 10.e
would equal Schedule RC–C, Part I,
item 9.a. These items would only be
collected from institutions with $10
billion or more in total assets.
D For the FFIEC 031 only, item 9,
‘‘Loans to nondepository financial
institutions and other loans,’’ additional
subitems 9.a, 9.b.1, and 9.b.2 (Column
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A) would be added to collect data at the
consolidated bank level that would be
in addition to the exposure currently
captured for those items in domestic
offices only (Column B). In addition,
item 9, ‘‘Loans to nondepository
financial institutions and other loans,’’
column A, would no longer be reported
as an aggregate amount.
Schedule RC–L, ‘‘Derivatives and OffBalance Sheet Items’’
D For all three report forms, the
subitems for item 1.e, ‘‘Other unused
commitments’’ would be revised to
include the collection of data on both
depository financial institutions and
NDFIs. Specifically, subitem 1.e.(2),
‘‘Loans to financial institutions’’ would
be changed to ‘‘Loans to depository
financial institutions.’’ Subitem 1.e.(3),
would be renamed ‘‘Loans to
nondepository financial institutions’’
and would collect data on unused
commitments for loans to nondepository
financial institutions. The existing
subitem 1.e.(3), ‘‘All other unused
commitments,’’ would be renumbered to
item 1.e.(4).
D For the FFIEC 031 and FFIEC 041,
item 1.e.(3), ‘‘Loans to nondepository
financial institutions,’’ would include
five subitems with the same five
categories as the new subitems listed for
Schedule RC–C, Part I, Memorandum
item 10 above. The sum of these
subitems 1.e.(3)(a) through 1.e.(3)(e)
would equal the amount reported in
Schedule RC–L, item 1.e.(3). These
items would only be collected from
institutions with $10 billion or more in
total assets.
Schedule RC–N, ‘‘Past Due and
Nonaccrual Loans, Leases, and Other
Assets’’
D For the FFIEC 041 and the FFIEC
051, Memorandum item 9 would be
renamed, ‘‘Loans to nondepository
financial institutions included in
Schedule RC–N, item 7’’ and would
capture past due and nonaccrual
information for NDFIs in columns A
through C.
D For the FFIEC 031 only,
Memorandum item 9, would also be
renamed, ‘‘Loans to nondepository
financial institutions included in
Schedule RC–N, item 7’’ to capture past
due and nonaccrual information for
NDFIs. However, institutions would
report amounts in Memorandum item
9.a, ‘‘To U.S. nondepository financial
institutions’’ and Memorandum item
9.b, ‘‘To foreign nondepository
institutions’’ in columns A through C.
Question 1: Is the granularity of the
proposed subcategories appropriate or
are there additional or fewer
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subcategories that should be
considered?
3. FFIEC 002 Proposed Revisions
The Board’s proposed revisions to the
FFIEC 002 are intended to align with
similar changes proposed to the Call
Report, Schedule RC–C, Part I, as
applicable, and discussed in the prior
section.
Schedule C, ‘‘Loans’’
D The instructions for item 3, ‘‘Loans
to other financial institutions’’ would be
updated to include additional detail on
the types of loans that should be
reported in this line item. In addition,
the instructions would be revised to
include all loans to brokers and dealers
in securities and loans to investment
firms and mutual funds in the amounts
reported in this item. These loans were
previously included in item 7, below.
D The instructions for item 7, ‘‘Loans
for purchasing or carrying securities
(secured and unsecured)’’ would be
revised to exclude from the amounts
reported in this item all loans to brokers
and dealers in securities and loans to
investment firms and mutual funds.
These loans would be reported under
the new NDFI definition in item 3,
‘‘Loans to other financial institutions.’’
D The instructions for item 7, ‘‘Loans
for purchasing or carrying securities
(secured and unsecured)’’ would also be
revised to include in the amounts
reported in this item all margin loans,
including securities-based loans and
non-purpose margin loans. In addition,
this item description on the report form
would be revised to ‘‘Loans for
purchasing or carrying securities,
including margin loans.’’
The Board is proposing to align the
effective date for these revisions on
Schedule C of the FFIEC 002 with the
revised Call Report items, described
above.
B. Reporting on Guaranteed Structured
Financial Products
In February 2023, a proposal for
revisions to the Call Reports 2 included
a question on the reporting of certain
Federal Home Loan Mortgage
Corporation and similar securitization
structures that have government
guarantees on Schedule RC–B,
Securities. The agencies sought
comment on the reporting of these types
of structured financial products
including those issued or guaranteed by
U.S. government or government
sponsored agencies.
The agencies received two comments
on this topic. One comment opposed
2 85
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reporting these securities in Schedule
RC–B, Securities, item 5.b, noting that
this item includes a broad range of
structured financial products, and there
would be a lack of clarity on the amount
reported in this item that is guaranteed
by a government or agency. The other
comment supported reporting these
securities in item 5.b. However, the
commenter also noted the lack of
transparency in this item regarding the
composition of reported structured
financial products. The commenter
stated it would be appropriate for an
additional breakdown to be added to
item 5.b to report the amount that is
guaranteed by the U.S. government or
an agency. In the final 30-day notice
published in June 2023,3 the agencies
indicated they would continue
reviewing the original clarification and
the new item proposed by the
commenter.
After further review of the comment
to collect data on the amounts reported
in item 5.b that are guaranteed by U.S.
government agencies or sponsored
agencies, the agencies are proposing to
add a new Memorandum item 7,
‘‘Guaranteed by U.S. Government
agencies or sponsored agencies included
in Schedule RC–B, item 5.b’’, columns
A through D, on Schedule RC–B. The
proposed amounts in the new
Memorandum item would collect the
total amortized cost and total fair value
for held-to-maturity securities and
available-for-sale securities.
ddrumheller on DSK120RN23PROD with NOTICES1
C. Long-Term Debt
On August 29, 2023, the federal bank
regulatory agencies requested comment
on a proposal that would require large
banks with total assets of $100 billion or
more to maintain a layer of long-term
debt, which would improve financial
stability by increasing the resolvability
and resiliency of such institutions. This
notice of proposed rulemaking (NPR)
was published in the Federal Register
on September 19, 2023.4 This NPR
would affect insured depository
institutions (IDIs) that are not
consolidated subsidiaries of U.S. global
systemically important banks (G–SIBs)
and that (i) have at least $100 billion in
consolidated assets or (ii) are affiliated
with IDIs that have $100 billion in
consolidated assets (covered IDIs) that
are required to have outstanding a
minimum amount of eligible long-term
debt (LTD). Generally, under the
proposal, covered IDIs that are
consolidated subsidiaries of covered
bank holding companies and savings
3 88
4 88
FR 38592 (June 13, 2023).
FR 64524 (September 19, 2023).
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and loan holding companies would be
required to issue the LTD.
The agencies are proposing to revise
Schedule RC–R, Part I, Regulatory
Capital Components and Ratios, for all
three Call Reports by adding the
following new line items under the
heading ‘‘Long-Term Debt (LTD).’’
These new line items would be
applicable only to IDIs subject to the
long-term debt requirement in the NPR:
D 56.a, ‘‘Effective date of LTD
requirement;’’
D 56.b, ‘‘Outstanding eligible LTD;’’
D 56.c, ‘‘Outstanding eligible LTD
with a remaining maturity greater than
or equal to one year and less than two
years;’’
D 56.d, ‘‘LTD total risk-weighted
assets ratio;’’ and
D 56.e, ‘‘LTD leverage ratio.’’
Additionally, on the FFIEC 031 and
FFIEC 041 forms only, the agencies will
add a sixth item, 56.f, ‘‘LTD
supplementary leverage ratio.’’
The agencies are proposing to add
these new items to monitor compliance
by covered IDIs with the applicable
proposed LTD requirements. These
items would be consistent with similar
items reported by holding companies on
the Board’s Consolidated Financial
Statements for Holding Companies (FR
Y–9C), Schedule HC–R, Part I,
Regulatory Capital Components and
Ratios. For example, item 56.b,
‘‘Outstanding eligible LTD,’’ on the Call
Report would capture the same longterm debt information as item 54,
‘‘Outstanding eligible long-term debt,’’
on the FR Y–9C, except it would apply
to covered IDIs instead of holding
companies. The proposed instructions
for items 56.a through 56.f would
correspond with the relevant items on
the FR Y–9C as proposed in the NPR
that was published on September 19,
2023. Similar to the FR Y–9C, the
proposed effective date for the Call
Report revisions would align with the
effective date of any final rule on LTD
requirements, and the reporting changes
would take effect for the first report date
on or after that effective date.
D. Electronic Signatures
Background
Federal law requires that certain
personnel and directors attest to the
accuracy of the data submitted in the
bank’s Call Report by signature.5 In
addition to being required by statute,
review of the Call Report in connection
with signing the attestation supports
internal control over the bank’s
reporting. The Call Report instructions
5 12 U.S.C. 161(a) (national banks) and 1817(a)(3)
(all insured depository institutions).
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89493
permit a bank to satisfy the signature
requirement by obtaining physical
signatures from the relevant parties
attached to a copy of the associated Call
Report that is retained in the bank’s
files.
The onset of the COVID–19 pandemic
in March 2020 and resulting bank office
closures presented challenges to
complying with the physical signature
requirement. The agencies responded by
permitting reasonable alternative
signature methods, including electronic
signatures, to be used for the duration
of the pandemic.6
The federal COVID–19 public health
emergency declaration ended on May
11, 2023. However, both the agencies
and banks have benefitted from the
alternative to the use of physical
signatures on each Call Report
submission. For the agencies, electronic
documentation can provide a stronger
audit trail than a paper copy that can be
misplaced or altered. For banks,
electronic signatures can reduce
recordkeeping burden associated with
preparing for, collecting, and retaining
signatures. Therefore, the agencies are
proposing to adopt ongoing standards
for electronic signatures to comply with
the Call Report signature and attestation
requirement. Until the agencies finalize
these proposed standards, banks may
continue following the alternate
standards provided in the quarterly Call
Report Supplemental Instructions. The
agencies also will continue to permit
physical signatures for banks that
choose not to use the electronic
signature alternative.
Proposed Framework
A valid electronic signature generally
must meet the following requirements:
(1) The signer must use an acceptable
electronic form of signature; (2) The
electronic form of signature must be
executed or adopted by a person with
the intent to sign the electronic record;
(3) The electronic form of signature
must be attached to 7 or part of the
electronic record being signed; (4) There
must be a means to identify, verify, and
authenticate a particular person as the
signer; and (5) There must be a means
to preserve the integrity of the signed
record.8 The agencies are proposing the
6 Call Report Supplemental Instructions for
March 2020, available at: https://www.ffiec.gov/pdf/
FFIEC_forms/FFIEC031_FFIEC041_FFIEC051_
suppinst_202003.pdf.
7 In this context, ‘‘attached to’’ means ‘‘logically
associated with.’’
8 See ‘‘Use of Electronic Signatures in Federal
Organization Transactions,’’ available at: https://
assets.cio.gov/assets/files/resources/Use_of_
ESignatures_in_Federal_Agency_Transactions_v10_20130125.pdf.
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electronic signature alternative for the
Call Report signature purposes
consistent with these requirements and
Federal law on electronic signatures.9
1. Form of Signature
The agencies are proposing to allow
the following forms of signature: an
image of the signer’s physical signature;
or application of an electronic signature,
such as by clicking a box or entering a
personal identification number (PIN).
These forms of signature are widely
available in current software products,
are used by many banks that permit
electronic signatures on loans or other
agreements with customers and have
been used by banks under the
alternatives permitted for the Call
Report since March 2020. While other
forms of signature exist, such as
biometric identification (e.g., voiceprint,
fingerprint, retinal scan), these would
not be suitable for the Call Report given
cost, complexity, and associated privacy
issues involved in recording and
maintaining signatures in these forms.
ddrumheller on DSK120RN23PROD with NOTICES1
2. Intent to Sign
In order to be a valid electronic
signature, the signature of the
appropriate bank officer or director
must be applied by the officer or
director with the intent to sign and in
the appropriate capacity. For the Call
Report, this means the appropriate bank
officer (typically the chief financial
officer) or director intends to sign the
Call Report as the attestation that it is
prepared in accordance with the
instructions and is true and correct, as
stated on the signature page of the Call
Report. The bank officer’s or director’s
intent and capacity must be included as
part of the electronic signature process
by using an electronic version of the
relevant attestation text on the Call
Report signature page.
the signature data and the record signed.
An electronic signature made on a cover
page or the Call Report signature page,
without the Call Report schedules
incorporated or attached, would not
satisfy this requirement.
To validate that the bank obtained the
signatures prior to filing the Call Report,
the date of each electronic signature
would need to be included as part of the
signature and attestation process and
similarly made part of the record. This
could be accomplished in different
ways, for example, by the signer
manually entering the date when
signing, which could be verified by
system transaction logs, or by software
embedding the date as part of the form
of signature or elsewhere within the
record.
4. Identification and Authentication of
the Signer
A valid signature requires proving an
association between the signature and
the person signing. For Call Report
purposes, the agencies would accept
any reliable information technology
system identification and authentication
method or process that associates access
to and execution of the electronic
signature transaction with the identity
of the signer with a level of assurance
sufficient to protect against repudiation
or adverse impact to the bank that
would result from a successful
challenge to the execution of the
electronic signature. For example,
requiring the bank officer or director to
log into the bank’s network using
unique multifactor credentials in order
to electronically sign the Call Report
could identify and authenticate the
signer with sufficient assurance to
protect against such risks. Credentials
used to access the signature transaction
must be sufficient for the protection of
a bank’s non-public or otherwise
proprietary information.
3. Association of Signature
A valid electronic signature must be
made part of the record of the document
being signed, to confirm that the
signature applies to and is linked to the
entire record. For Call Report purposes,
this means the signature must be
associated with a complete version of
the bank’s Call Report, including all
applicable schedules, as the signer is
attesting to the correctness of the
information in those schedules. This
association can be made by using a
process that appends the signature data
to the record signed, or which
establishes a database-type link between
5. Integrity of Signed Record
The usability of a signed electronic
record requires maintaining the integrity
of the electronic signature and
associated record. A bank would need to
have sufficient data security and data
integrity practices to ensure that the Call
Report with electronic signature is
safely stored, readily retrievable, and
cannot be lost or altered.10 As with
paper-based signatures, electronic
signatures would not be submitted to
the Central Data Repository along with
the Call Report data, but the
electronically signed Call Report would
9 See, e.g., Electronic Records and Signatures in
Global and National Commerce Act, Pub. L. 106–
229; Government Paperwork Elimination Act of
1998, Pub. L. 105–277.
10 These practices generally already exist within
banks’ current information technology
infrastructure for other bank records and customer
information.
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need to be available to agency
examiners upon request.
A Call Report with an electronic
signature would be subject to the same
record retention period as a paper
version of the Call Report, as specified
in the Call Report instructions, and may
be deleted after the relevant timeframe.
Generally, this period is three years after
the report date, unless state law or a
dispute with the FDIC requires a longer
retention period. A bank that uses
electronic signatures for its Call Reports
would not be required to print or
maintain a paper version of the
submitted Call Report, as the relevant
electronic versions of the Call Report
and signatures would be stored in
electronic form.
Question 2: Are the proposed
requirements for Call Report electronic
signatures appropriate? What additional
options should the agencies consider
allowing or disallowing?
Question 3: Does the proposed
effective date provide sufficient time for
banks seeking to use electronic
signatures to implement the proposed
standards?
Question 4: Should the agencies
consider expanding the use of electronic
signatures to other FFIEC reports? If so,
would the proposed requirements for
Call Report electronic signatures be
appropriate for those reports as well?
III. Timing
The proposed revisions to the Call
Report forms and instructions, and the
FFIEC 002, as applicable, and adoption
of ongoing standards for electronic
signatures to comply with the Call
Report signature and attestation
requirement are proposed to become
effective with the June 30, 2024, report
date, except for those related to the
proposed long-term debt requirements
which would take effect for the first
report date at or following the effective
date of any final rule. The agencies
invite comment on any difficulties that
institutions would expect to encounter
in implementing the systems changes
necessary to accommodate the proposed
revisions to the Call Reports and the
FFIEC 002, as applicable, consistent
with this effective date.
IV. Request for Comment
Public comment is requested on all
aspects of this joint notice including the
questions that were provided in the
earlier sections. In addition to the
questions included above, comment is
specifically invited on:
(a) Whether the proposed revisions to
the collections of information that are
the subject of this notice are necessary
for the proper performance of the
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agencies’ functions, including whether
the information has practical utility;
(b) The accuracy of the agencies’
estimates of the burden of the
information collections as they are
proposed to be revised, including the
validity of the methodology and
assumptions used;
(c) Ways to enhance the quality,
utility, and clarity of the information to
be collected;
(d) Ways to minimize the burden of
information collections on respondents,
including through the use of automated
collection techniques or other forms of
information technology; and
(e) Estimates of capital or start-up
costs and costs of operation,
maintenance, and purchase of services
to provide information.
Comments submitted in response to
this joint notice will be shared among
the agencies.
Patrick T. Tierney,
Assistant Director, Bank Advisory Office of
the Comptroller of the Currency.
Michele Taylor Fennell,
Deputy Associate Secretary of the Board.
Federal Deposit Insurance Corporation.
Dated at Washington, DC, on December 14,
2023.
James P. Sheesley,
Assistant Executive Secretary.
[FR Doc. 2023–28473 Filed 12–26–23; 8:45 am]
BILLING CODE 4810–33–P; BILLING CODE 6210–01–P;
BILLING CODE 6714–01–P
DEPARTMENT OF THE TREASURY
Office of Foreign Assets Control
Notice of OFAC Sanctions Actions
Office of Foreign Assets
Control, Treasury.
ACTION: Notice.
AGENCY:
The U.S. Department of the
Treasury’s Office of Foreign Assets
Control (OFAC) is publishing the names
of one or more persons that have been
placed on OFAC’s Specially Designated
Nationals and Blocked Persons List
(SDN List) based on OFAC’s
determination that one or more
applicable legal criteria were satisfied.
All property and interests in property
subject to U.S. jurisdiction of these
persons are blocked, and U.S. persons
are generally prohibited from engaging
in transactions with them.
DATES: See Supplementary Information
section for effective date(s).
FOR FURTHER INFORMATION CONTACT:
OFAC: Bradley T. Smith, Director, tel.:
ddrumheller on DSK120RN23PROD with NOTICES1
VerDate Sep<11>2014
19:00 Dec 26, 2023
Jkt 262001
Electronic Availability
The SDN List and additional
information concerning OFAC sanctions
programs are available on OFAC’s
website (https://www.treasury.gov/ofac).
Notice of OFAC Actions
On December 19, 2023, OFAC
determined that the property and
interests in property subject to U.S.
jurisdiction of the following persons are
blocked under the relevant sanctions
authorities listed below.
Individuals
Board of Governors of the Federal Reserve
System.
SUMMARY:
202–622–2490; Associate Director for
Global Targeting, tel.: 202–622–2420;
Assistant Director for Licensing, tel.:
202–622–2480; Assistant Director for
Regulatory Affairs, tel.: 202–622–4855;
or the Assistant Director for
Enforcement, Compliance and Analysis,
tel.: 202–622–2490.
SUPPLEMENTARY INFORMATION:
1. ARDAKANI, Gholamreza Ebrahimzadeh
(a.k.a. ARDAKANI HOSEIN, Gholamreza
Ebrahimzadeh; a.k.a. ARDAKANI, Gholam
Reza Ebrahimzadeh; a.k.a. ‘‘Denise Lee’’),
Iran; DOB 20 Aug 1992; nationality Iran;
Additional Sanctions Information—Subject
to Secondary Sanctions; Gender Male;
Passport M34961597 (Iran) expires 27 Sep
2020; National ID No. 4440049443 (Iran)
(individual) [NPWMD] [IRGC] [IFSR] (Linked
To: ARDAKANI, Hossein Hatefi).
Designated pursuant to section 1(a)(iii) of
Executive Order 13382 of June 28, 2005,
‘‘Blocking Property of Weapons of Mass
Destruction Proliferators and Their
Supporters,’’ 70 FR 38567, 3 CFR, 2005
Comp., p. 170 (‘‘E.O. 13382’’), for having
provided, or attempted to provide, financial,
material, technological or other support for,
or goods or services in support of,
ARDAKANI, Hossein Hatefi, a person whose
property and interests in property are
blocked pursuant to E.O. 13382.
2. ARDAKANI, Hossein Hatefi (a.k.a.
ARDAKANI, Hosein Hatefi; a.k.a.
ARDAKANI, Hussein Hatefi; a.k.a.
ARDEKANI, Hossein Hatafi; a.k.a. ‘‘Seatha
Murugiah’’), Tehran, Iran; DOB 21 Sep 1985;
POB Ardakan, Iran; nationality Iran;
Additional Sanctions Information—Subject
to Secondary Sanctions; Gender Male;
Passport U34290111 (Iran); National ID No.
4449916581 (Iran) (individual) [NPWMD]
[IRGC] [IFSR] (Linked To: ISLAMIC
REVOLUTIONARY GUARD CORPS
AEROSPACE FORCE SELF SUFFICIENCY
JIHAD ORGANIZATION).
Designated pursuant to section 1(a)(iii) of
E.O. 13382 for having provided, or attempted
to provide, financial, material, technological
or other support for, or goods or services in
support of, ISLAMIC REVOLUTIONARY
GUARD CORPS AEROSPACE FORCE SELF
SUFFICIENCY JIHAD ORGANIZATION, a
person whose property and interests in
property are blocked pursuant to E.O. 13382.
3. DEWANTO, Agung Surya, Indonesia;
DOB 17 Apr 1973; nationality Indonesia;
PO 00000
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89495
Additional Sanctions Information—Subject
to Secondary Sanctions; Gender Male;
Passport R248877 (Indonesia); alt. Passport
M765751 (Indonesia) expires 28 Mar 2008;
alt. Passport A2935714 (Indonesia);
Identification Number 1398039 (Indonesia)
(individual) [NPWMD] [IRGC] [IFSR] (Linked
To: SURABAYA HOBBY CV).
Designated pursuant to section 1(a)(iv) of
E.O. 13382 for acting or purporting to act for
or on behalf of, directly or indirectly,
SURABAYA HOBBY CV, a person whose
property and interests in property are
blocked pursuant to E.O. 13382.
4. MOHAMMADABADI, Mehdi Dehghani
(a.k.a. MOHAMMADABADI ABOLGHASEM,
Mehdi Dehghani), Tehran, Iran; DOB 23 Sep
1982; nationality Iran; Additional Sanctions
Information—Subject to Secondary
Sanctions; Gender Male; National ID No.
4433172081 (Iran) (individual) [NPWMD]
[IRGC] [IFSR] (Linked To: KAVAN
ELECTRONICS BEHRAD LIMITED
LIABILITY COMPANY).
Designated pursuant to section 1(a)(iv) of
E.O. 13382 for acting or purporting to act for
or on behalf of, directly or indirectly,
KAVAN ELECTRONICS BEHRAD LIMITED
LIABILITY COMPANY, a person whose
property and interests in property are
blocked pursuant to E.O. 13382.
Entities
1. ARTA WAVE SDN BHD, No. 46–1, Jalan
Tasik Utama, 5 Medan, Niaga, Kuala Lumpur
57000, Malaysia; 26–2, Jalan 9/23 E, Taman
Danau Kota, Off Jalan Genting Klang, Kuala
Lumpur 53300, Malaysia; Rm. 1014, Favor
Industrial Centre, 2–6 King Hong Street,
Kwai Chung, Hong Kong, China; Additional
Sanctions Information—Subject to Secondary
Sanctions; Organization Established Date 10
Dec 2018; Commercial Registry Number
1306915A (Malaysia); Registration Number
201801044883 (Malaysia) [NPWMD] [IRGC]
[IFSR] (Linked To: ARDAKANI, Hossein
Hatefi).
Designated pursuant to section 1(a)(iii) of
E.O. 13382 for having provided, or attempted
to provide, financial, material, technological
or other support for, or goods or services in
support of, ARDAKANI, Hossein Hatefi, a
person whose property and interests in
property are blocked pursuant to E.O. 13382.
2. BASAMAD ELECTRONIC POUYA
ENGINEERING LIMITED LIABILITY
COMPANY (a.k.a. DYNAMIC ELECTRONIC
FREQUENCY ENGINEERING LIMITED
LIABILITY COMPANY), No. 63, Unit 4,
Shahrara, Patrice Lumumba St., Abshori St.,
Tehran 1445934911, Iran; Additional
Sanctions Information—Subject to Secondary
Sanctions; Organization Established Date 20
Jan 2015; National ID No. 14004684489
(Iran); Registration Number 466887 (Iran)
[NPWMD] [IRGC] [IFSR] (Linked To:
ARDAKANI, Hossein Hatefi).
Designated pursuant to section 1(a)(iv) of
E.O. 13382 for being owned or controlled by
ARDAKANI, Hossein Hatefi, a person whose
property and interests in property are
blocked pursuant to E.O. 13382.
3. DIRAC TECHNOLOGY HK LIMITED,
Rm 2304 Ho King, Commercial Bldg 2–16, Fa
Yuen St., Mongkok, Kowloon, Hong Kong,
China; website https://dirac-tech.com/;
E:\FR\FM\27DEN1.SGM
27DEN1
Agencies
[Federal Register Volume 88, Number 247 (Wednesday, December 27, 2023)]
[Notices]
[Pages 89489-89495]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-28473]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
FEDERAL RESERVE SYSTEM
FEDERAL DEPOSIT INSURANCE CORPORATION
Proposed Agency Information Collection Activities; Comment
Request
AGENCY: Office of the Comptroller of the Currency (OCC), Treasury;
Board of Governors of the Federal Reserve System (Board); and Federal
Deposit Insurance Corporation (FDIC).
ACTION: Joint notice and request for comment.
-----------------------------------------------------------------------
SUMMARY: In accordance with the requirements of the Paperwork Reduction
Act of 1995 (PRA), the OCC, the Board, and the FDIC (the agencies) may
not conduct or sponsor, and the respondent is not required to respond
to, an information collection unless it displays a currently valid
Office of Management and Budget (OMB) control number. The Federal
Financial Institutions Examination Council (FFIEC), of which the
agencies are members, has approved the agencies' publication for public
comment of a proposal to revise and extend for three years the
Consolidated Reports of Condition and Income (Call Reports) (FFIEC 031,
FFIEC 041, and FFIEC 051), which are currently approved collections of
information. The FFIEC has also approved the Board's publication for
public comment, on behalf of the agencies, of a proposal to revise and
extend for three years the Report of Assets and Liabilities of U.S.
Branches and Agencies of Foreign Banks (FFIEC 002), and the Report of
Assets and Liabilities of a Non-U.S. Branch that is Managed or
Controlled by a U.S. Branch or Agency of a Foreign (Non-U.S.) Bank
(FFIEC 002S), which are also currently approved collections of
information. The agencies are requesting comment on proposed revisions
to the Call Report forms and instructions, and the FFIEC 002, as
applicable, that include the revision and addition of certain new data
items related to the reporting on loans to nondepository financial
institutions (NDFIs) and other loans, guaranteed structured financial
products, and proposed long-term debt requirements. In addition, the
agencies are seeking comment on a proposal to adopt ongoing standards
for electronic signatures to comply with the Call Report signature and
attestation requirement. The revisions are proposed to take effect with
the June 30, 2024, report date, except for those related to the
proposed long-term debt requirements which would take effect for the
first report date at or following the effective date of any final rule.
DATES: Comments must be submitted on or before February 26, 2024.
ADDRESSES: Interested parties are invited to submit written comments to
any or all of the agencies. All comments will be shared among the
agencies.
OCC: You may submit comments, which should refer to ``Call Report
and FFIEC 002 Revisions,'' by any of the following methods:
Email: [email protected].
Mail: Chief Counsel's Office, Office of the Comptroller of
the Currency, Attention: 1557-0081, 400 7th Street SW, Suite 3E-218,
Washington, DC 20219.
Hand Delivery/Courier: 400 7th Street SW, Suite 3E-218,
Washington, DC 20219.
Fax: (571) 293-4835.
Instructions: You must include ``OCC'' as the agency name and
``1557-0081'' in your comment. In general, the OCC will publish
comments on www.reginfo.gov without change, including any business or
personal information provided, such as name and address information,
email addresses, or phone numbers. Comments received, including
attachments and other supporting materials, are part of the public
record and subject to public disclosure. Do not include any information
in your comment or supporting materials that you consider confidential
or inappropriate for public disclosure.
You may review comments and other related materials that pertain to
this information collection beginning on the date of publication of the
second notice for this collection by the following method:
Viewing Comments Electronically: Go to www.reginfo.gov.
Hover over the ``Information Collection Review'' tab and click on
``Information Collection Review'' from the drop-down menu. From the
``Currently under Review'' drop-down menu, select ``Department of
Treasury'' and then click ``submit.'' This information collection can
be located by searching OMB control number ``1557-0081.'' Upon finding
the appropriate information collection, click on the related ``ICR
Reference Number.'' On the next screen, select ``View Supporting
Statement and Other Documents'' and then click on the link to any
comment listed at the bottom of the screen.
For assistance in navigating www.reginfo.gov, please
contact the Regulatory Information Service Center at (202) 482-7340.
Board: You may submit comments, which should refer to ``Call Report
and FFIEC 002 Revisions,'' by any of the following methods:
Agency Website: https://www.federalreserve.gov. Follow the
instructions for submitting comments at: https://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
Email: [email protected]. Include ``Call
Report and FFIEC 002 Revisions'' in the subject line of the message.
Fax: (202) 395-6974.
Mail: Ann E. Misback, Secretary, Board of Governors of the
Federal Reserve System, 20th Street and Constitution Avenue NW,
Washington, DC 20551.
All public comments are available on the Board's website at https://www.federalreserve.gov/apps/foia/proposedregs.aspx as submitted,
unless modified for technical reasons.
[[Page 89490]]
Accordingly, your comments will not be edited to remove any identifying
or contact information.
FDIC: You may submit comments, which should refer to ``Call Report
and FFIEC 002 Revisions,'' by any of the following methods:
Agency Website: https://www.fdic.gov/resources/regulations/federal-register-publications/. Follow the instructions for
submitting comments on the FDIC's website.
Email: [email protected]. Include ``Call Report and FFIEC
002 Revisions'' in the subject line of the message.
Mail: Manuel E. Cabeza, Counsel, Attn: Comments, Room MB-
3128, Federal Deposit Insurance Corporation, 550 17th Street NW,
Washington, DC 20429.
Hand Delivery: Comments may be hand-delivered to the guard
station at the rear of the 550 17th Street NW building (located on F
Street NW) on business days between 7 a.m. and 5 p.m.
Public Inspection: All comments received, including any
personal information provided, will be posted without change to https://www.fdic.gov/resources/regulations/federal-register-publications/.
Commenters should submit only information that the commenter wishes to
make available publicly. The FDIC may review, redact, or refrain from
posting all or any portion of any comment that it may deem to be
inappropriate for publication, such as irrelevant or obscene material.
The FDIC may post only a single representative example of identical or
substantially identical comments, and in such cases will generally
identify the number of identical or substantially identical comments
represented by the posted example. All comments that have been
redacted, as well as those that have not been posted, that contain
comments on the merits of this document will be retained in the public
comment file and will be considered as required under all applicable
laws. All comments may be accessible under the Freedom of Information
Act.
Additionally, commenters may send a copy of their comments to the
OMB desk officer for the agencies by mail to the Office of Information
and Regulatory Affairs, U.S. Office of Management and Budget, New
Executive Office Building, Room 10235, 725 17th Street NW, Washington,
DC 20503; by fax to (202) 395-6974; or by email to
[email protected].
FOR FURTHER INFORMATION CONTACT: For further information about the
proposed revisions to the information collections discussed in this
notice, please contact any of the agency staff whose names appear
below. In addition, copies of the report forms for the Call Reports and
the FFIEC 002 can be obtained at the FFIEC's website (https://www.ffiec.gov/ffiec_report_forms.htm).
OCC: Kevin Korzeniewski, Counsel, Chief Counsel's Office, (202)
649-5490. If you are deaf, hard of hearing, or have a speech
disability, please dial 7-1-1 to access telecommunications relay
services.
Board: Nuha Elmaghrabi, Federal Reserve Board Clearance Officer,
(202) 452-3884, Office of the Chief Data Officer, Board of Governors of
the Federal Reserve System, 20th and C Streets NW, Washington, DC
20551. Telecommunications Device for the Deaf (TDD) users may call
(202) 263-4869.
FDIC: Manuel E. Cabeza, Counsel, (202) 898-3767, Legal Division,
Federal Deposit Insurance Corporation, 550 17th Street NW, Washington,
DC 20429.
SUPPLEMENTARY INFORMATION:
I. Affected Reports
The proposed changes discussed below affect the Call Reports and
the FFIEC 002.
A. Call Report
The agencies propose to extend for three years, with revision,
their information collections associated with the FFIEC 031, FFIEC 041,
and FFIEC 051 Call Reports.
Report Title: Consolidated Reports of Condition and Income (Call
Report).
Form Number: FFIEC 031 (Consolidated Reports of Condition and
Income for a Bank with Domestic and Foreign Offices), FFIEC 041
(Consolidated Reports of Condition and Income for a Bank with Domestic
Offices Only), and FFIEC 051 (Consolidated Reports of Condition and
Income for a Bank with Domestic Offices Only and Total Assets Less Than
$5 Billion).
Frequency of Response: Quarterly.
Affected Public: Business or other for-profit.
Type of Review: Revision and extension of currently approved
collections.
OCC
OMB Control No.: 1557-0081.
Estimated Number of Respondents: 1,014 national banks and federal
savings associations.
Estimated Average Burden per Response: 40.85 burden hours per
quarter to file.
Estimated Total Annual Burden: 165,688 burden hours to file.
Board
OMB Control No.: 7100-0036.
Estimated Number of Respondents: 708 state member banks.
Estimated Average Burden per Response: 44.33 burden hours per
quarter to file.
Estimated Total Annual Burden: 125,543 burden hours to file.
FDIC
OMB Control No.: 3064-0052.
Estimated Number of Respondents: 2,975 insured state nonmember
banks and state savings associations.
Estimated Average Burden per Response: 38.94 burden hours per
quarter to file.
Estimated Total Annual Burden: 463,386 burden hours to file.
The estimated average burden hours collectively reflect the
estimates for the FFIEC 031, the FFIEC 041, and the FFIEC 051 reports
for each agency. When the estimates are calculated by type of report
across the agencies, the estimated average burden hours per quarter are
85.88 (FFIEC 031), 54.79 (FFIEC 041), and 34.49 (FFIEC 051). The
changes to the Call Report forms and instructions proposed in this
notice would result in an estimated increase in burden hours per
quarter for the FFIEC 031 of 1.35 hours, FFIEC 041 of 0.19 hours, and
FFIEC 051 of 0.08 hours. The estimated burden per response for the
quarterly filings of the Call Report is an average that varies by
agency because of differences in the composition of the institutions
under each agency's supervision (e.g., size distribution of
institutions, types of activities in which they are engaged, and
existence of foreign offices).
Type of Review: Extension and revision of currently approved
collections. In addition to the proposed revisions discussed below,
Call Reports are periodically updated to clarify instructional guidance
and correct grammatical and typographical errors on the forms and
instructions, which are published on the FFIEC website.\1\ These non-
substantive updates may also be commented upon.
---------------------------------------------------------------------------
\1\ www.ffiec.gov/forms031.htm; www.ffiec.gov/forms041.htm;
www.ffiec.gov/forms051.htm.
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Legal Basis and Need for Collections
The Call Report information collections are mandatory: 12 U.S.C.
161 (national banks), 12 U.S.C. 324 (state member banks), 12 U.S.C.
1817 (insured state nonmember commercial and savings banks), and 12
U.S.C. 1464 (federal and state savings associations). At present,
except for selected data items and text, these information collections
are not given confidential treatment.
[[Page 89491]]
Banks and savings associations submit Call Report data to the
agencies each quarter for the agencies' use in monitoring the
condition, performance, and risk profile of individual institutions and
the industry as a whole. Call Report data serve a regulatory or public
policy purpose by assisting the agencies in fulfilling their shared
missions of ensuring the safety and soundness of financial institutions
and the financial system and protecting consumer financial rights, as
well as agency-specific missions affecting federal and state-chartered
institutions, such as conducting monetary policy, ensuring financial
stability, and administering federal deposit insurance. Call Reports
are the source of the most current statistical data available for
identifying areas of focus for on-site and off-site examinations. Among
other purposes, the agencies use Call Report data in evaluating
institutions' corporate applications, including interstate merger and
acquisition applications for which the agencies are required by law to
determine whether the resulting institution would control more than 10
percent of the total amount of deposits of insured depository
institutions in the United States. Call Report data also are used to
calculate the risk-based assessments for insured depository
institutions.
B. FFIEC 002 and 002S
The Board proposes to extend for three years, with revision, the
FFIEC 002 and FFIEC 002S reports.
Report Titles: Report of Assets and Liabilities of U.S. Branches
and Agencies of Foreign Banks; Report of Assets and Liabilities of a
Non-U.S. Branch that is Managed or Controlled by a U.S. Branch or
Agency of a Foreign (Non-U.S.) Bank.
Form Numbers: FFIEC 002; FFIEC 002S.
OMB Control Number: 7100-0032.
Frequency of Response: Quarterly.
Affected Public: Business or other for-profit.
Respondents: All state-chartered or federally-licensed U.S.
branches and agencies of foreign banking organizations, and all non-
U.S. branches managed or controlled by a U.S. branch or agency of a
foreign banking organization.
Estimated Number of Respondents: FFIEC 002--183; FFIEC 002S--18.
Estimated Average Burden per Response: FFIEC 002--24.67 hours;
FFIEC 002S--6.0 hours.
Estimated Total Annual Burden: FFIEC 002--18,058 hours; FFIEC
002S--432 hours.
Type of Review: Extension and revision of currently approved
collections.
The proposed revisions to the FFIEC 002 instructions in this notice
would not have a material impact on the existing burden estimates.
Legal Basis and Need for Collection
On a quarterly basis, all U.S. branches and agencies of foreign
banks are required to file the FFIEC 002, which is a detailed report of
condition with a variety of supporting schedules. This information is
used to fulfill the supervisory and regulatory requirements of the
International Banking Act of 1978. The data also are used to augment
the bank credit, loan, and deposit information needed for monetary
policy and other public policy purposes. In addition, FFIEC 002 data
are used to calculate the risk-based assessments for FDIC-insured U.S.
branches of foreign banks. The FFIEC 002S is a supplement to the FFIEC
002 that collects information on assets and liabilities of any non-U.S.
branch that is managed or controlled by a U.S. branch or agency of the
foreign bank. A non-U.S. branch is managed or controlled by a U.S.
branch or agency if a majority of the responsibility for business
decisions, including but not limited to decisions with regard to
lending or asset management or funding or liability management, or the
responsibility for recordkeeping in respect of assets or liabilities
for that foreign branch resides at the U.S. branch or agency. A
separate FFIEC 002S must be completed for each managed or controlled
non-U.S. branch. The FFIEC 002S must be filed quarterly along with the
U.S. branch or agency's FFIEC 002.
These information collections are mandatory (12 U.S.C. 1817(a)(1)
and (3), 3102(b), and 3105(c)(2)). Except for select sensitive items,
the FFIEC 002 is not given confidential treatment; the FFIEC 002S is
given confidential treatment (5 U.S.C. 552(b)(4) and (8)). The data
from both reports are used for (1) monitoring deposit and credit
transactions of U.S. residents; (2) monitoring the impact of policy
changes; (3) analyzing structural issues concerning foreign bank
activity in U.S. markets; (4) understanding flows of banking funds and
indebtedness of developing countries in connection with data collected
by the International Monetary Fund and the Bank for International
Settlements that are used in economic analysis; and (5) assisting in
the supervision of U.S. offices of foreign banks. The Federal Reserve
System collects and processes these reports on behalf of all three
agencies.
II. Current Actions
A. Loans to Nondepository Financial Institutions
1. Background
Loans to NDFIs have increasingly played an essential role in the
financial system. NDFIs include a wide range of counterparties
including insurance companies, mortgage companies, private equity
funds, hedge funds, broker-dealers, real estate investment trusts
(REITs), marketplace lenders, special purpose entities, and other
financial vehicles. Currently, data on loans to NDFIs is collected on
Schedule RC-C, Part I, Loans and Leases, item 9.a. ``Loans to
nondepository financial institutions.''
Since this item was added in 2010, institutions have increased
direct lending exposure to NDFIs. In March 2010, loans to NDFIs
reported in this item totaled approximately $56 billion and represented
only 0.8 percent of gross loans reported by respondents. However, in
June 2023, the reported amount of loans to NDFIs increased
significantly to almost $786 billion and represented 6.4 percent of
respondents' total loan exposure. Notwithstanding this increase in NDFI
credit risk, current Call Report forms and instructions do not provide
granularity on specific NDFI exposure, such as direct and off-balance
sheet exposure, data on NDFI exposure in non-domestic offices, or NDFI
loan performance data (e.g., nonaccrual and past due status). Further,
the agencies have observed inconsistency in NDFI exposure reporting
among industry filers.
2. Call Report Proposed Revisions
The agencies are proposing to update the Call Report forms and
instructions to increase the granularity in reporting exposure to NDFIs
and to improve reporting consistency. These proposed revisions would
enhance the understanding of NDFI exposure, risks, and performance
trends. The revisions would group together loan exposures that exhibit
similar underlying risk characteristics while addressing the diversity
in practice on the reporting of these loans that exists today. In
addition, the proposed granular reporting would allow for more accurate
analysis of bank financial statements for applicable institutions and
performance metrics. These revisions and clarifications are proposed to
be effective as of the June 30, 2024, report date.
The specific proposed revisions and clarifications impacting the
three report forms are as follows:
[[Page 89492]]
Schedule RC-C, Part I, Loans and Leases
[ssquf] For all three Call Reports, to ensure consistent reporting
on loans to NDFIs, the instructions for item 9.a, ``Loans to
nondepository financial institutions'' would be updated to include
additional detail on the types of loans that should be reported in this
line item. In addition, the instructions would be revised to include in
the amounts reported in this item all loans to brokers and dealers in
securities and loans to investment firms and mutual funds. These loans
were previously included in item 9.b (FFIEC 051) or in item 9.b.(1)
(FFIEC 031 and FFIEC 041), as noted below.
[ssquf] On the FFIEC 051, item 9.b, ``Other loans,'' and on the
FFIEC 031 and FFIEC 041, item 9.b.(1), ``Loans for purchasing or
carrying securities (secured and unsecured),'' the instructions would
be revised to exclude from the amounts reported in this item all loans
to brokers and dealers in securities and loans to investment firms and
mutual funds. These loans would be reported under the new NDFI
definition in item 9.a, ``Loans to nondepository financial
institutions.''
[ssquf] On the FFIEC 051, item 9.b, ``Other loans,'' and on the
FFIEC 031 and FFIEC 041 reports, item 9.b.(1), ``Loans for purchasing
or carrying securities (secured and unsecured),'' the instructions
would also be revised to include in the amounts reported in this item
all margin loans, including securities-based loans and non-purpose
margin loans. In addition, this item description on the FFIEC 031 and
FFIEC 041 report forms would be revised to ``Loans for purchasing or
carrying securities, including margin loans.''
[ssquf] For the FFIEC 031 and FFIEC 041, Memorandum item 10
(currently ``not applicable'') would be renamed ``Loans to
nondepository financial institutions'' and would include the following
subitems, as defined in the instructions for Schedule RC-C, Part I,
item 9.a, to capture direct lending exposures to NDFIs: 10.a, ``Loans
to mortgage credit intermediaries;'' 10.b, ``Loans to business credit
intermediaries;'' 10.c, ``Loans to private equity funds;'' 10.d,
``Loans to consumer credit intermediaries;'' and 10.e, ``Other loans to
nondepository financial institutions.'' The sum of subitems 10.a
through 10.e would equal Schedule RC-C, Part I, item 9.a. These items
would only be collected from institutions with $10 billion or more in
total assets.
[ssquf] For the FFIEC 031 only, item 9, ``Loans to nondepository
financial institutions and other loans,'' additional subitems 9.a,
9.b.1, and 9.b.2 (Column A) would be added to collect data at the
consolidated bank level that would be in addition to the exposure
currently captured for those items in domestic offices only (Column B).
In addition, item 9, ``Loans to nondepository financial institutions
and other loans,'' column A, would no longer be reported as an
aggregate amount.
Schedule RC-L, ``Derivatives and Off-Balance Sheet Items''
[ssquf] For all three report forms, the subitems for item 1.e,
``Other unused commitments'' would be revised to include the collection
of data on both depository financial institutions and NDFIs.
Specifically, subitem 1.e.(2), ``Loans to financial institutions''
would be changed to ``Loans to depository financial institutions.''
Subitem 1.e.(3), would be renamed ``Loans to nondepository financial
institutions'' and would collect data on unused commitments for loans
to nondepository financial institutions. The existing subitem 1.e.(3),
``All other unused commitments,'' would be renumbered to item 1.e.(4).
[ssquf] For the FFIEC 031 and FFIEC 041, item 1.e.(3), ``Loans to
nondepository financial institutions,'' would include five subitems
with the same five categories as the new subitems listed for Schedule
RC-C, Part I, Memorandum item 10 above. The sum of these subitems
1.e.(3)(a) through 1.e.(3)(e) would equal the amount reported in
Schedule RC-L, item 1.e.(3). These items would only be collected from
institutions with $10 billion or more in total assets.
Schedule RC-N, ``Past Due and Nonaccrual Loans, Leases, and Other
Assets''
[ssquf] For the FFIEC 041 and the FFIEC 051, Memorandum item 9
would be renamed, ``Loans to nondepository financial institutions
included in Schedule RC-N, item 7'' and would capture past due and
nonaccrual information for NDFIs in columns A through C.
[ssquf] For the FFIEC 031 only, Memorandum item 9, would also be
renamed, ``Loans to nondepository financial institutions included in
Schedule RC-N, item 7'' to capture past due and nonaccrual information
for NDFIs. However, institutions would report amounts in Memorandum
item 9.a, ``To U.S. nondepository financial institutions'' and
Memorandum item 9.b, ``To foreign nondepository institutions'' in
columns A through C.
Question 1: Is the granularity of the proposed subcategories
appropriate or are there additional or fewer subcategories that should
be considered?
3. FFIEC 002 Proposed Revisions
The Board's proposed revisions to the FFIEC 002 are intended to
align with similar changes proposed to the Call Report, Schedule RC-C,
Part I, as applicable, and discussed in the prior section.
Schedule C, ``Loans''
[ssquf] The instructions for item 3, ``Loans to other financial
institutions'' would be updated to include additional detail on the
types of loans that should be reported in this line item. In addition,
the instructions would be revised to include all loans to brokers and
dealers in securities and loans to investment firms and mutual funds in
the amounts reported in this item. These loans were previously included
in item 7, below.
[ssquf] The instructions for item 7, ``Loans for purchasing or
carrying securities (secured and unsecured)'' would be revised to
exclude from the amounts reported in this item all loans to brokers and
dealers in securities and loans to investment firms and mutual funds.
These loans would be reported under the new NDFI definition in item 3,
``Loans to other financial institutions.''
[ssquf] The instructions for item 7, ``Loans for purchasing or
carrying securities (secured and unsecured)'' would also be revised to
include in the amounts reported in this item all margin loans,
including securities-based loans and non-purpose margin loans. In
addition, this item description on the report form would be revised to
``Loans for purchasing or carrying securities, including margin
loans.''
The Board is proposing to align the effective date for these
revisions on Schedule C of the FFIEC 002 with the revised Call Report
items, described above.
B. Reporting on Guaranteed Structured Financial Products
In February 2023, a proposal for revisions to the Call Reports \2\
included a question on the reporting of certain Federal Home Loan
Mortgage Corporation and similar securitization structures that have
government guarantees on Schedule RC-B, Securities. The agencies sought
comment on the reporting of these types of structured financial
products including those issued or guaranteed by U.S. government or
government sponsored agencies.
---------------------------------------------------------------------------
\2\ 85 FR 10644 (February 21, 2023).
---------------------------------------------------------------------------
The agencies received two comments on this topic. One comment
opposed
[[Page 89493]]
reporting these securities in Schedule RC-B, Securities, item 5.b,
noting that this item includes a broad range of structured financial
products, and there would be a lack of clarity on the amount reported
in this item that is guaranteed by a government or agency. The other
comment supported reporting these securities in item 5.b. However, the
commenter also noted the lack of transparency in this item regarding
the composition of reported structured financial products. The
commenter stated it would be appropriate for an additional breakdown to
be added to item 5.b to report the amount that is guaranteed by the
U.S. government or an agency. In the final 30-day notice published in
June 2023,\3\ the agencies indicated they would continue reviewing the
original clarification and the new item proposed by the commenter.
---------------------------------------------------------------------------
\3\ 88 FR 38592 (June 13, 2023).
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After further review of the comment to collect data on the amounts
reported in item 5.b that are guaranteed by U.S. government agencies or
sponsored agencies, the agencies are proposing to add a new Memorandum
item 7, ``Guaranteed by U.S. Government agencies or sponsored agencies
included in Schedule RC-B, item 5.b'', columns A through D, on Schedule
RC-B. The proposed amounts in the new Memorandum item would collect the
total amortized cost and total fair value for held-to-maturity
securities and available-for-sale securities.
C. Long-Term Debt
On August 29, 2023, the federal bank regulatory agencies requested
comment on a proposal that would require large banks with total assets
of $100 billion or more to maintain a layer of long-term debt, which
would improve financial stability by increasing the resolvability and
resiliency of such institutions. This notice of proposed rulemaking
(NPR) was published in the Federal Register on September 19, 2023.\4\
This NPR would affect insured depository institutions (IDIs) that are
not consolidated subsidiaries of U.S. global systemically important
banks (G-SIBs) and that (i) have at least $100 billion in consolidated
assets or (ii) are affiliated with IDIs that have $100 billion in
consolidated assets (covered IDIs) that are required to have
outstanding a minimum amount of eligible long-term debt (LTD).
Generally, under the proposal, covered IDIs that are consolidated
subsidiaries of covered bank holding companies and savings and loan
holding companies would be required to issue the LTD.
---------------------------------------------------------------------------
\4\ 88 FR 64524 (September 19, 2023).
---------------------------------------------------------------------------
The agencies are proposing to revise Schedule RC-R, Part I,
Regulatory Capital Components and Ratios, for all three Call Reports by
adding the following new line items under the heading ``Long-Term Debt
(LTD).'' These new line items would be applicable only to IDIs subject
to the long-term debt requirement in the NPR:
[ssquf] 56.a, ``Effective date of LTD requirement;''
[ssquf] 56.b, ``Outstanding eligible LTD;''
[ssquf] 56.c, ``Outstanding eligible LTD with a remaining maturity
greater than or equal to one year and less than two years;''
[ssquf] 56.d, ``LTD total risk-weighted assets ratio;'' and
[ssquf] 56.e, ``LTD leverage ratio.''
Additionally, on the FFIEC 031 and FFIEC 041 forms only, the
agencies will add a sixth item, 56.f, ``LTD supplementary leverage
ratio.''
The agencies are proposing to add these new items to monitor
compliance by covered IDIs with the applicable proposed LTD
requirements. These items would be consistent with similar items
reported by holding companies on the Board's Consolidated Financial
Statements for Holding Companies (FR Y-9C), Schedule HC-R, Part I,
Regulatory Capital Components and Ratios. For example, item 56.b,
``Outstanding eligible LTD,'' on the Call Report would capture the same
long-term debt information as item 54, ``Outstanding eligible long-term
debt,'' on the FR Y-9C, except it would apply to covered IDIs instead
of holding companies. The proposed instructions for items 56.a through
56.f would correspond with the relevant items on the FR Y-9C as
proposed in the NPR that was published on September 19, 2023. Similar
to the FR Y-9C, the proposed effective date for the Call Report
revisions would align with the effective date of any final rule on LTD
requirements, and the reporting changes would take effect for the first
report date on or after that effective date.
D. Electronic Signatures
Background
Federal law requires that certain personnel and directors attest to
the accuracy of the data submitted in the bank's Call Report by
signature.\5\ In addition to being required by statute, review of the
Call Report in connection with signing the attestation supports
internal control over the bank's reporting. The Call Report
instructions permit a bank to satisfy the signature requirement by
obtaining physical signatures from the relevant parties attached to a
copy of the associated Call Report that is retained in the bank's
files.
---------------------------------------------------------------------------
\5\ 12 U.S.C. 161(a) (national banks) and 1817(a)(3) (all
insured depository institutions).
---------------------------------------------------------------------------
The onset of the COVID-19 pandemic in March 2020 and resulting bank
office closures presented challenges to complying with the physical
signature requirement. The agencies responded by permitting reasonable
alternative signature methods, including electronic signatures, to be
used for the duration of the pandemic.\6\
---------------------------------------------------------------------------
\6\ Call Report Supplemental Instructions for March 2020,
available at: https://www.ffiec.gov/pdf/FFIEC_forms/FFIEC031_FFIEC041_FFIEC051_suppinst_202003.pdf.
---------------------------------------------------------------------------
The federal COVID-19 public health emergency declaration ended on
May 11, 2023. However, both the agencies and banks have benefitted from
the alternative to the use of physical signatures on each Call Report
submission. For the agencies, electronic documentation can provide a
stronger audit trail than a paper copy that can be misplaced or
altered. For banks, electronic signatures can reduce recordkeeping
burden associated with preparing for, collecting, and retaining
signatures. Therefore, the agencies are proposing to adopt ongoing
standards for electronic signatures to comply with the Call Report
signature and attestation requirement. Until the agencies finalize
these proposed standards, banks may continue following the alternate
standards provided in the quarterly Call Report Supplemental
Instructions. The agencies also will continue to permit physical
signatures for banks that choose not to use the electronic signature
alternative.
Proposed Framework
A valid electronic signature generally must meet the following
requirements: (1) The signer must use an acceptable electronic form of
signature; (2) The electronic form of signature must be executed or
adopted by a person with the intent to sign the electronic record; (3)
The electronic form of signature must be attached to \7\ or part of the
electronic record being signed; (4) There must be a means to identify,
verify, and authenticate a particular person as the signer; and (5)
There must be a means to preserve the integrity of the signed
record.\8\ The agencies are proposing the
[[Page 89494]]
electronic signature alternative for the Call Report signature purposes
consistent with these requirements and Federal law on electronic
signatures.\9\
---------------------------------------------------------------------------
\7\ In this context, ``attached to'' means ``logically
associated with.''
\8\ See ``Use of Electronic Signatures in Federal Organization
Transactions,'' available at: https://assets.cio.gov/assets/files/resources/Use_of_ESignatures_in_Federal_Agency_Transactions_v1-0_20130125.pdf.
\9\ See, e.g., Electronic Records and Signatures in Global and
National Commerce Act, Pub. L. 106-229; Government Paperwork
Elimination Act of 1998, Pub. L. 105-277.
---------------------------------------------------------------------------
1. Form of Signature
The agencies are proposing to allow the following forms of
signature: an image of the signer's physical signature; or application
of an electronic signature, such as by clicking a box or entering a
personal identification number (PIN). These forms of signature are
widely available in current software products, are used by many banks
that permit electronic signatures on loans or other agreements with
customers and have been used by banks under the alternatives permitted
for the Call Report since March 2020. While other forms of signature
exist, such as biometric identification (e.g., voiceprint, fingerprint,
retinal scan), these would not be suitable for the Call Report given
cost, complexity, and associated privacy issues involved in recording
and maintaining signatures in these forms.
2. Intent to Sign
In order to be a valid electronic signature, the signature of the
appropriate bank officer or director must be applied by the officer or
director with the intent to sign and in the appropriate capacity. For
the Call Report, this means the appropriate bank officer (typically the
chief financial officer) or director intends to sign the Call Report as
the attestation that it is prepared in accordance with the instructions
and is true and correct, as stated on the signature page of the Call
Report. The bank officer's or director's intent and capacity must be
included as part of the electronic signature process by using an
electronic version of the relevant attestation text on the Call Report
signature page.
3. Association of Signature
A valid electronic signature must be made part of the record of the
document being signed, to confirm that the signature applies to and is
linked to the entire record. For Call Report purposes, this means the
signature must be associated with a complete version of the bank's Call
Report, including all applicable schedules, as the signer is attesting
to the correctness of the information in those schedules. This
association can be made by using a process that appends the signature
data to the record signed, or which establishes a database-type link
between the signature data and the record signed. An electronic
signature made on a cover page or the Call Report signature page,
without the Call Report schedules incorporated or attached, would not
satisfy this requirement.
To validate that the bank obtained the signatures prior to filing
the Call Report, the date of each electronic signature would need to be
included as part of the signature and attestation process and similarly
made part of the record. This could be accomplished in different ways,
for example, by the signer manually entering the date when signing,
which could be verified by system transaction logs, or by software
embedding the date as part of the form of signature or elsewhere within
the record.
4. Identification and Authentication of the Signer
A valid signature requires proving an association between the
signature and the person signing. For Call Report purposes, the
agencies would accept any reliable information technology system
identification and authentication method or process that associates
access to and execution of the electronic signature transaction with
the identity of the signer with a level of assurance sufficient to
protect against repudiation or adverse impact to the bank that would
result from a successful challenge to the execution of the electronic
signature. For example, requiring the bank officer or director to log
into the bank's network using unique multifactor credentials in order
to electronically sign the Call Report could identify and authenticate
the signer with sufficient assurance to protect against such risks.
Credentials used to access the signature transaction must be sufficient
for the protection of a bank's non-public or otherwise proprietary
information.
5. Integrity of Signed Record
The usability of a signed electronic record requires maintaining
the integrity of the electronic signature and associated record. A bank
would need to have sufficient data security and data integrity
practices to ensure that the Call Report with electronic signature is
safely stored, readily retrievable, and cannot be lost or altered.\10\
As with paper-based signatures, electronic signatures would not be
submitted to the Central Data Repository along with the Call Report
data, but the electronically signed Call Report would need to be
available to agency examiners upon request.
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\10\ These practices generally already exist within banks'
current information technology infrastructure for other bank records
and customer information.
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A Call Report with an electronic signature would be subject to the
same record retention period as a paper version of the Call Report, as
specified in the Call Report instructions, and may be deleted after the
relevant timeframe. Generally, this period is three years after the
report date, unless state law or a dispute with the FDIC requires a
longer retention period. A bank that uses electronic signatures for its
Call Reports would not be required to print or maintain a paper version
of the submitted Call Report, as the relevant electronic versions of
the Call Report and signatures would be stored in electronic form.
Question 2: Are the proposed requirements for Call Report
electronic signatures appropriate? What additional options should the
agencies consider allowing or disallowing?
Question 3: Does the proposed effective date provide sufficient
time for banks seeking to use electronic signatures to implement the
proposed standards?
Question 4: Should the agencies consider expanding the use of
electronic signatures to other FFIEC reports? If so, would the proposed
requirements for Call Report electronic signatures be appropriate for
those reports as well?
III. Timing
The proposed revisions to the Call Report forms and instructions,
and the FFIEC 002, as applicable, and adoption of ongoing standards for
electronic signatures to comply with the Call Report signature and
attestation requirement are proposed to become effective with the June
30, 2024, report date, except for those related to the proposed long-
term debt requirements which would take effect for the first report
date at or following the effective date of any final rule. The agencies
invite comment on any difficulties that institutions would expect to
encounter in implementing the systems changes necessary to accommodate
the proposed revisions to the Call Reports and the FFIEC 002, as
applicable, consistent with this effective date.
IV. Request for Comment
Public comment is requested on all aspects of this joint notice
including the questions that were provided in the earlier sections. In
addition to the questions included above, comment is specifically
invited on:
(a) Whether the proposed revisions to the collections of
information that are the subject of this notice are necessary for the
proper performance of the
[[Page 89495]]
agencies' functions, including whether the information has practical
utility;
(b) The accuracy of the agencies' estimates of the burden of the
information collections as they are proposed to be revised, including
the validity of the methodology and assumptions used;
(c) Ways to enhance the quality, utility, and clarity of the
information to be collected;
(d) Ways to minimize the burden of information collections on
respondents, including through the use of automated collection
techniques or other forms of information technology; and
(e) Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
Comments submitted in response to this joint notice will be shared
among the agencies.
Patrick T. Tierney,
Assistant Director, Bank Advisory Office of the Comptroller of the
Currency.
Board of Governors of the Federal Reserve System.
Michele Taylor Fennell,
Deputy Associate Secretary of the Board.
Federal Deposit Insurance Corporation.
Dated at Washington, DC, on December 14, 2023.
James P. Sheesley,
Assistant Executive Secretary.
[FR Doc. 2023-28473 Filed 12-26-23; 8:45 am]
BILLING CODE 4810-33-P; BILLING CODE 6210-01-P; BILLING CODE 6714-01-P