Interagency Guidance on Nontraditional Mortgage Products; Extension of Comment Period
On December 29, 2005, the OCC, Board, FDIC, OTS, and NCUA (the Agencies) published for public comment proposed Interagency Guidance on Nontraditional Mortgage Products (Guidance). The Agencies are extending the comment period on the proposed guidance for 30 days.
Risk-Based Capital Guidelines; Market Risk Measure; Securities Borrowing Transactions
The Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (Board), and the Federal Deposit Insurance Corporation (FDIC) (collectively, the Agencies) are issuing a final rule that amends their market risk rules to revise the risk-based capital treatment for cash collateral that is posted in connection with securities borrowing transactions. This final rule will make permanent, and expand the scope of, an interim final rule issued in 2000 (the interim rule) that reduced the capital requirement for certain cash-collateralized securities borrowing transactions of banks and bank holding companies (banking organizations) that have adopted the market risk rule. This action more appropriately aligns the capital requirements for these transactions with the risk involved and provides a capital treatment for U.S. banking organizations that is more in line with the capital treatment to which their domestic and foreign competitors are subject.
Certification of Assumption of Deposits and Notification of Changes of Insured Status
The FDIC is adopting a final rule which clarifies and simplifies the procedures to be used when all of the deposit liabilities of an insured depository institution have been assumed by another insured depository institution or institutions. The final regulation would modify the current rule's requirements by: Making clear that an insured institution is required to file a ``certification'' when all of its deposits are assumed, but no certification is required if only a portion of its deposits are assumed; and requiring that the transferring institution, or its legal successor, file the certification rather than the assuming institution. The rule also clarifies that the transferring institution's status as an insured institution automatically terminates upon the FDIC's receipt of an accurate certification stating that: All of its deposits have been assumed by an insured depository institution or institutions, and the legal authority of the transferring institution to accept deposits has been terminated contemporaneously with the deposit assumption. In such a situation, and in a situation in which the FDIC has been appointed receiver of an insured institution, little practical purpose would be served by an order terminating deposit insurance, and the final rule provides that no such order will be issued in such situations. Finally, the rule would provide more specificity concerning how notice is given to depositors when an insured depository institution voluntarily terminates its insured status without the assumption of all of its deposits by an insured institution. In sum, the revisions would make the insurance termination process somewhat easier for insured depository institutions, and somewhat more efficient for the FDIC.
Agency Information Collection Activities: Submission for OMB Review; Joint Comment Request
In accordance with the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), 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. On August 23, 2005, the Financial Institutions Examination Council (FFIEC), of which the Agencies are members, requested public comment for 60 days on proposed revisions to the Consolidated Reports of Condition and Income (Call Report), which are currently approved collections of information. After considering the comments, the FFIEC has modified some of the proposed changes and will stagger the effective dates of the revisions from March 31, 2006, through March 31, 2008. The burden-reducing revisions included in the proposal will be implemented March 31, 2006, as proposed.
Agency Information Collection Activities; Proposed Collection; Comment Request; Suspicious Activity Report by Depository Institutions
The Financial Crimes Enforcement Network and the Banking Supervisory Agencies \1\, as part of their continuing effort to reduce paperwork and respondent burden, invite the general public and other Federal agencies to take this opportunity to comment on information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C. 3506(c)(2)(A)). The Financial Crimes Enforcement Network and the Banking Supervisory Agencies are soliciting comments concerning the Suspicious Activity Report by Depository Institutions, which is being revised and reformatted to standardize this report with suspicious activity reports being filed by other financial institutions. The report also is being revised to support joint filing, providing the necessary data blocks and instructions for completing a jointly filed suspicious activity report. The instructions limit joint filing to those suspicious activities that do not involve insider abuse.
Interagency Advisory on the Unsafe and Unsound Use of Limitation of Liability Provisions in External Audit Engagement Letters
The OTS, Board, FDIC, NCUA, and OCC (collectively, the ``Agencies''), have finalized the Interagency Advisory on the Unsafe and Unsound Use of Limitation of Liability Provisions in External Audit Engagement Letters (``Advisory''). The Advisory informs financial institutions'' boards of directors, audit committees, and management that they should not enter into agreements that incorporate unsafe and unsound external auditor limitation of liability provisions with respect to engagements for financial statement audits, audits of internal control over financial reporting, and attestations on management's assessment of internal control over financial reporting.
Interagency Guidance on Response Programs for Unauthorized Access to Customer Information and Customer Notice; Correction
The OCC, Board, FDIC and OTS published in the Federal Register on March 29, 2005 interpretive guidance on the Gramm-Leach-Bliley Act (GLBA) and the Interagency Guidelines Establishing Information Security Standards (Security Guidelines). In footnote six of the interpretive guidance, the Federal Trade Commission (``FTC'') citation reads 12 CFR part 314 whereas it should read 16 CFR part 314.