[Federal Register Volume 60, Number 221 (Thursday, November 16, 1995)]
[Notices]
[Pages 57618-57621]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-28251]



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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

FEDERAL RESERVE SYSTEM

FEDERAL DEPOSIT INSURANCE CORPORATION


Proposed Agency Information Collection Activities; Comment

AGENCIES: 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: Notice and request for comment.

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BACKGROUND: 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 
that has been extended, revised, or implemented on or after October 1, 
1995, unless it displays a currently valid Office of Management and 
Budget (OMB) control number. Proposed revisions to the following 
currently approved collections of information have received approval 
from the Federal Financial Institutions Examination Council (FFIEC), of 
which the agencies are members, and are hereby published for comment. 
At the end of the comment period, the comments and recommendations 
received will be analyzed to determine the extent to which the proposed 
revisions should be modified prior to the agencies' submission of them 
to OMB for review and approval. Comments are invited on: (a) Whether 
the proposed revisions to the following collections of information are 
necessary for the proper performance of the agencies' functions, 
including whether the information has practical utility; (b) the 
accuracy of the agencies' estimate 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; and 
(d) ways to minimize the burden of information collection on 
respondents, including through the use of automated collection 
techniques or other forms of information technology.

DATES: Comments must be submitted on or before January 16, 1996.

ADDRESSES: Interested parties are invited to submit written comments to 
any or all of the agencies. All comments, which should refer to the OMB 
control number(s), will be shared among the agencies.
    OCC: Written comments should be submitted to the Communications 
Division, Ninth Floor, Office of the Comptroller of the Currency, 250 E 
Street, S.W., Washington, D.C. 20219; Attention: Paperwork Docket No. 
1557-0081 [FAX number (202) 874-5274; Internet address: 
[email protected]]. Comments will be available for inspection 
and photocopying at that address.
    Board: Written comments should be addressed to Mr. William W. 
Wiles, Secretary, Board of Governors of the Federal Reserve System, 
20th and C Streets, N.W., Washington, D.C. 20551, or delivered to the 
Board's mail room between 8:45 a.m. and 5:15 p.m., and to the security 
control room outside of those hours. Both the mail room and the 
security control room are accessible from the courtyard entrance on 
20th Street between Constitution Avenue and C Street, N.W. Comments 
received may be inspected in room M-P-500 between 9:00 a.m. and 5:00 
p.m., except as provided in section 261.8 of the Board's Rules 
Regarding Availability of Information, 12 CFR 261.8(a).
    FDIC: Written comments should be sent to Jerry L. Langley, 
Executive Secretary, Attention: Room F-402, Federal Deposit Insurance 
Corporation, 550 17th Street, N.W., Washington, D.C. 20429. Comments 
may be hand-delivered to Room F-402, 1776 F Street, N.W., Washington, 
D.C. 20429, on business days between 8:30 a.m. and 5:00 p.m. [FAX 
number (202) 898-3838; Internet address: [email protected]]. Comments 
will be available for inspection and photocopying in Room 7118, 550 
17th Street, N.W., Washington, D.C. 20429, between 9:00 a.m. and 4:30 
p.m. on business days.
    A copy of the comments may also be submitted to the OMB desk 
officer for the agencies: Milo Sunderhauf, Office of Information and 
Regulatory Affairs, Office of Management and Budget, New Executive 
Office Building, Room 3208, Washington, D.C. 20503.

FOR FURTHER INFORMATION CONTACT: A copy of the proposed revisions to 
the collections of information may be requested from any of the agency 
clearance officers whose names appear below.
    OCC: Jessie Gates, OCC Clearance Officer, (202) 874-5090, Office of 
the Comptroller of the Currency, 250 E Street, SW., Washington, DC 
20219.
    Board: Mary M. McLaughlin, Board Clearance Officer, (202) 452-3829, 
Division of Research and Statistics, Board of Governors of the Federal 
Reserve System, 20th and C Streets, NW., Washington, DC 20551. For the 
hearing impaired only, Telecommunications Device for the Deaf (TDD), 
Dorothea Thompson, (202) 452-3544, Board of Governors of the Federal 
Reserve System, 20th and C Streets, NW., Washington, DC 20551.
    FDIC: Steven F. Hanft, FDIC Clearance Officer, (202) 898-3907, 
Office of the Executive Secretary, Federal Deposit Insurance 
Corporation, 550 17th Street NW., Washington, DC 20429.

SUPPLEMENTARY INFORMATION: Proposal to revise the following currently 
approved collections of information:

Title: Consolidated Reports of Condition and Income.
Form Number: FFIEC 031, 032, 033, 034.

    For OCC:

OMB Number: 1557-0081.
Frequency of Response: Quarterly.
Affected Public: National Banks.
Estimated Number of Respondents: 2,900 national banks.
Estimated Time per Response: 38.02 burden hours.
Estimated Total Annual Burden: 441,024 burden hours.

    For Board:

OMB Number: 7100-0036.
Frequency of Response: Quarterly.
Affected Public: State Member Banks.
Estimated Number of Respondents: 1,002 state member banks.
Estimated Time per Response: 44.01 burden hours. 

[[Page 57619]]

Estimated Total Annual Burden: 176,392 burden hours.

    For FDIC:

OMB Number: 3064-0052.
Frequency of Response: Quarterly.
Affected Public: Insured State Nonmember Commercial and Savings Banks.
Estimated Number of Respondents: 7,011 insured state nonmember 
commercial and savings banks.
Estimated Time per Response: 27.87 burden hours.
Estimated Total Annual Burden: 781,473 burden hours.

    The estimated time per response varies by agency because of 
differences in the composition of the banks under each agency's 
supervision (e.g., size distribution of banks, types of activities in 
which they are engaged, and number of banks with foreign offices).
    General Description of Report: This information collection is 
mandatory: 12 U.S.C. 161 (for national banks), 12 U.S.C. 324 (for state 
member banks), and 12 U.S.C. 1817 (for insured state nonmember 
commercial and savings banks). Except for select sensitive items, this 
information collection is not given confidential treatment. Small 
businesses (i.e., small banks) are affected.
    Abstract: Consolidated Reports of Condition and Income are filed 
quarterly with the agencies for their use in monitoring the condition 
and performance of reporting banks and the industry as a whole. The 
reports are also used by the FDIC to calculate banks' deposit insurance 
assessments.
    Current Actions: The new items that would be added to the Call 
Report are necessary to enhance the supervisory process for monitoring 
regulatory capital ratios, liquidity ratios, sales of assets, off-
balance sheet derivative contracts, and managed credit card 
receivables. A number of items would be consolidated or deleted.
    Type of Review: Revisitation.
    The proposed revisions to the Consolidated Reports of Condition and 
Income (Call Report) that are the subject of this notice have been 
approved by the FFIEC for implementation as of the March 31, 1996, 
report date. The proposed changes affect several existing Call Report 
schedules. Unless otherwise indicated, the Call Report changes apply to 
all four sets of report forms (FFIEC 031, 032, 033, and 034). 
Nonetheless, as is customary for Call Report changes, banks are advised 
that, for the March 31, 1996, report date, reasonable estimates may be 
provided for any new or revised item for which the requested 
information is not readily available.
    On August 2, 1995, the agencies jointly published for a 60-day 
public comment period a proposed Supervisory Policy Statement 
Concerning A Supervisory Framework for Measuring and Assessing Banks' 
Interest Rate Risk Exposure (60 FR 39495, August 2, 1995). That 
proposal included proposed Call Report schedules and draft instructions 
that would be implemented beginning with the March 31, 1996, report 
date, except by small banks that meet certain exemption criteria. 
Because comments were invited regarding the proposed Call Report 
interest rate risk reporting requirements and their paperwork 
implications, the proposed interest rate risk schedules are not covered 
by this notice.
    The proposed revisions are summarized as follows:

Deletions and Reductions in Detail

    The level of detail would be reduced in two areas for banks that 
file the FFIEC 031, 032, and 033 report forms (i.e., banks with $100 
million or more in assets or with foreign offices). (Smaller banks that 
file the FFIEC 034 report forms do not provide these detailed data.) 
First, the breakdown of nontransaction accounts by type of depositor in 
the deposit schedule (Schedule RC-E) would contain fewer categories. 
The separate items for nontransaction accounts of ``U.S. branches and 
agencies of foreign banks'' and ``Other commercial banks in the U.S.'' 
would be combined into a single item. Similarly, the separate items for 
nontransaction accounts of ``Foreign branches of other U.S. banks'' and 
``Other banks in foreign countries'' would be combined.
    Second, a single income statement item for trading revenue would 
replace the separate items for foreign exchange trading gains (losses) 
and other trading gains (losses). The memorandum items providing a 
four-way breakdown of trading revenue by risk exposure (interest rate, 
foreign exchange, equity, and commodity and other), which were added in 
March 1995, would continue to be collected. The sum of the memorandum 
items would equal the new single income statement item.
    Call Report items in the four following areas would be deleted:
    (1) Memorandum items for total deposits, total demand deposits, and 
total time and savings deposits (in domestic offices) that have been 
collected in the deposit schedule for deposit insurance assessment 
purposes (Schedule RC-E, Memorandum items 4, 4.a, and 4.b).
    (2) A deposit schedule memorandum item for total deposits (in 
domestic offices) denominated in foreign currencies (Schedule RC-E, 
Memorandum item 1.d).
    (3) An income statement memorandum item for foreign tax credits 
(Schedule RI, Memorandum item 3). (This item has been completed only by 
banks that file the FFIEC 031, 032, and 033 report forms, i.e., banks 
with $100 million or more in assets or with foreign offices.)
    (4) An income statement memorandum item for the taxable equivalent 
adjustment to pretax income (Schedule RI, Memorandum item 4). (This 
item has been applicable only to banks with foreign offices and $1 
billion or more in assets that file the FFIEC 031 report forms.)

New Items

    Call Report items in the following areas would be added:
(1) Capital and Asset Amounts Used in Calculating Regulatory Capital 
Ratios
    At present, the Call Report includes a variety of items in several 
schedules which the agencies use to calculate the leverage and risk-
based capital ratios for individual banks. However, a comparison of the 
agencies' regulatory capital standards to the information currently 
reported in the Call Report reveals that the Call Report does not 
collect all of the information that the agencies need to calculate each 
bank's Tier 1, Tier 2, and total capital in strict accordance with the 
definitions in the agencies' capital standards. Nevertheless, according 
to informal input received from bankers, banks routinely calculate 
their regulatory capital ratios at least quarterly for internal 
management purposes.
    Thus, rather than introducing new Call Report items for specific 
elements of the regulatory capital ratio calculations that are not 
currently reported so that further refinements can be made to the 
banking agencies' formulas for calculating capital ratios, banks would 
begin to report the end results of their own internal regulatory 
capital analyses. Six new items would cover Tier 1 capital, Tier 2 
capital, total risk-based capital, total risk-weighted assets (the 
denominator of the risk-based capital ratio, i.e., net of deductions), 
the excess amount of the allowance for loan and lease losses (if any), 
and ``average total assets'' (the denominator of the leverage capital 
ratio, i.e., net of deductions).
    Banks would not be required to go to greater lengths to identify 
and determine the amounts to be reported in the six new capital-related 
items than they are currently doing when they calculate their capital 
ratios for internal 

[[Page 57620]]
management purposes. Beginning to collect the six regulatory capital 
items in 1996 may provide a basis for eliminating at a later date some 
items now reported in the Call Report solely for risk-based capital 
calculation purposes. To assist banks in accurately reporting these 
capital items, an optional regulatory capital worksheet would be 
developed, provided regularly to banks, and updated as necessary.
    In addition, the agencies understand that bankers and other 
interested parties have found it difficult and time-consuming to 
calculate the regulatory capital ratios for other banks using existing 
Call Report data. Consequently, the addition of these six items should 
simplify bankers' calculations of other banks' capital ratios as well 
as calculations made by other public users of bank Call Reports.
(2) Short-Term Liabilities and Assets
    The staffs of the agencies plan to revise the liquidity ratios in 
the Uniform Bank Performance Report (UBPR) to focus on short-term and 
total non-core liabilities (instead of so-called ``volatile 
liabilities'') as well as short-term assets and liabilities. As a 
result, changes would be made to the reporting of maturity and 
repricing data for certain categories of liabilities and assets.
    Accordingly, the following changes would be implemented:
    (a) Other borrowed money--On the Call Report balance sheet, the 
two-way breakdown of ``Other borrowed money'' based on the original 
maturity of the borrowing would be changed to a two-way breakdown based 
on remaining maturity (Schedule RC, item 16).
    (b) Time deposits--A number of changes would be made in the 
reporting of these data.
    First, the maturity and repricing data for open-account time 
deposits of $100,000 or more, which are currently included with the 
maturity and repricing data for time deposits of less than $100,000 (in 
Schedule RC-E, Memorandum item 5), would be switched so that these data 
are included with the maturity and repricing data for time certificates 
of deposit of $100,000 or more (in Schedule RC-E, Memorandum item 6). 
(Schedule RC-E, Memorandum items 5 and 6 are not applicable to FDIC-
supervised savings banks that must complete the Call Report's 
supplemental Schedule RC-J.)
    Second, the maturity and repricing data for fixed rate and floating 
rate time deposits of less than $100,000, which are currently reported 
on a combined basis (in Schedule RC-E, Memorandum item 5), would be 
split so that the remaining maturity of fixed rate time deposits of 
less than $100,000 would be reported separately from the repricing 
frequency of floating rate time deposits of less than $100,000. A new 
time interval would also be added for these time deposits. Fixed rate 
time deposits less than $100,000 would contain a maturity category of 
over 12 months and floating rate time deposits of less than $100,000 
would include a repricing interval of less frequently than annually. 
(Schedule RC-E, Memorandum item 5 is not applicable to FDIC-supervised 
savings banks that must complete the Call Report's supplemental 
Schedule RC-J.)
    Third, two new Memorandum items would be collected in the deposit 
schedule for floating rate time deposits of $100,000 or more with a 
remaining maturity of one year or less and for floating rate time 
deposits of less than $100,000 with a remaining maturity of one year or 
less. These items would be collected from commercial banks. For FDIC-
supervised savings banks, two new Memorandum items would be collected 
in supplemental Schedule RC-J for time deposits of $100,000 or more 
with a remaining maturity of one year or less and for time deposits of 
less than $100,000 with a remaining maturity of one year or less.
    (c) Brokered deposits and deposits in foreign offices--New 
Memorandum items would be created for (i) Brokered deposits issued in 
denominations of less than $100,000 with a remaining maturity of one 
year or less, (ii) brokered deposits issued in denominations of 
$100,000 or more with a remaining maturity of one year or less, and 
(ii) for banks that file the FFIEC 031 version of the Call Report, time 
deposits in foreign offices with a remaining maturity of one year or 
less.
    (d) Loans--For commercial banks, a single Memorandum item for 
floating rate loans with a remaining maturity of one year or less would 
be added to the loan schedule (Schedule RC-C). For FDIC-supervised 
savings banks, a single Memorandum item for loans with a remaining 
maturity of one year or less would be added to supplemental Schedule 
RC-J.
    (e) Debt securities--For FDIC-supervised savings banks, a single 
Memorandum item for debt securities with a remaining maturity of one 
year or less would be added to supplemental Schedule RC-J. Savings 
banks would begin to complete this new item instead of an existing 
Memorandum item in the securities schedule on floating rate debt 
securities with a remaining maturity of one year or less (Schedule RC-
B, Memorandum item 6). Commercial banks would continue to complete 
existing Memorandum item 6 in Schedule RC-B. In the new Memorandum item 
for savings banks, held-to-maturity securities would be reported at 
amortized cost and available-for-sale securities would be reported at 
fair value, consistent with the method of reporting these two 
categories of securities in the Schedule RC-B Memorandum item.
(3) Small Business Obligations Sold With Recourse
    The agencies have issued rules to implement section 208 of the 
Riegle Community Development and Regulatory Improvement Act of 1994. 
(For OCC: 60 FR 47455, September 13, 1995. For Board: 60 FR 45612, 
August 31, 1995. For FDIC: 60 FR 45606, August 31, 1995.) Section 208 
provides that a qualifying insured depository institution that sells 
small business loans and leases on personal property with recourse is 
required to include only the amount of retained recourse in its risk-
weighted assets when calculating its risk-based capital ratios, 
provided certain conditions are met. Section 208 also states that 
qualifying institutions should report these transactions in accordance 
with generally accepted accounting principles (GAAP) in the Call 
Report.
    To be a qualifying institution, a bank must be well capitalized 
based on capital ratio calculations made without regard to the 
preferential capital treatment that Section 208 authorizes for these 
transactions. In addition, in general, for purposes of determining a 
bank's capital category under the prompt corrective action rules, the 
capital ratio calculations must be made without regard to the 
preferential Section 208 treatment.
    The Call Report instructions for ``sales of assets'' will be 
revised to incorporate the GAAP reporting treatment for sales of small 
business obligations with recourse by qualifying institutions. 
Additionally, to enable the agencies to determine the capital ratios of 
institutions that have engaged in transactions covered by Section 208 
on the ``without regard to'' basis mentioned above, Call Report items 
would be added for (i) the outstanding amount of small business 
obligations sold with recourse and (ii) the amount of retained recourse 
on such obligations.
(4) Credit Losses on Off-Balance Sheet Derivative Contracts
    Banks that file the FFIEC 031 and 032 report forms (i.e., banks 
with $300 million or more in assets or with foreign offices) began to 
report information about past due derivatives in the Call 

[[Page 57621]]
Report in 1994. However, some banks have incurred credit losses on 
their derivative contracts, but the agencies cannot track these losses 
for individual institutions or for the industry as a whole. Therefore, 
a new item would be added in which those banks that are required to 
report past due derivative data would also report their year-to-date 
credit losses on derivatives.
    On a related matter, the Call Report instructions for reporting 
amounts associated with derivatives that are past due 90 days or more 
would be revised so that banks would begin to also include information 
about derivatives that, while not technically past due, are with 
counterparties that are not expected to pay the full amounts owed to 
the institution under the derivative contracts.
(5) Change in Frequency of Reporting on Securitized Credit Card 
Receivables
    In order to evaluate the financial performance of credit card banks 
and other banks with credit card operations that have securitized and 
sold credit card receivables, the volume of receivables on all of the 
credit card accounts managed or serviced by a bank, both on and off of 
the books, must be known. Banks that file the FFIEC 031 and 032 report 
forms (i.e., banks with $300 million or more in assets or with foreign 
offices) report annually as of September 30 the outstanding amount of 
``Credit cards and related plans'' that have been securitized and sold 
without recourse with servicing retained. In contrast, these banks 
report the amount of ``Credit cards and related plans'' on their books 
each quarter. Given the growth in the volume of bank credit card 
securitizations, these banks would begin to report the outstanding 
amount of securitized credit card receivables that they service on a 
quarterly rather than annual basis.

Instructional Changes

    The following changes, which may affect how some banks report 
certain information in the Call Report, would be made to the 
instructions.
    (1) Reporting of low level recourse for risk-based capital 
purposes--The three banking agencies amended their risk-based capital 
standards earlier this year to incorporate the low level recourse rule. 
(For OCC: 60 FR 17986, April 10, 1995. For Board: 60 FR 8177, February 
13, 1995. For FDIC: 60 FR 15858, March 28, 1995.) Under this rule, when 
a bank has transferred assets with recourse, the amount of risk-based 
capital that must be maintained is limited to the bank's maximum 
contractual exposure under the recourse agreement if this is less than 
the amount of capital that would have to be held against the 
outstanding amount of the transferred assets.
    In the Call Report materials distributed to banks for the first 
three quarters of this year, interim guidance has been provided on how 
low level recourse transactions should be reported in the risk-based 
capital schedule (Schedule RC-R). Under this interim guidance, a bank's 
maximum contractual exposure in a low level recourse transaction is 
multiplied by a factor that is a function of the risk weight category 
applicable to the transferred assets. The resulting amount is then 
reported in the Schedule RC-R item for the applicable risk weight and 
would thereby be included in the bank's risk-weighted assets. This 
interim guidance would now be formally incorporated into the Call 
Report instructions.
    (2) Reporting of quarterly averages in a quarter when push down 
accounting has been applied--The instructions for the quarterly average 
calculations in Schedule RC-K would be clarified to indicate that banks 
acquired in push down transactions should calculate quarterly averages 
using only amounts for the days since the acquisition in the numerator 
and the number of days since the acquisition in the denominator.
    (3) Instructions for Schedule RC-R, item 8, ``On-balance sheet 
asset values excluded from the calculation of the risk-based capital 
ratio''--Schedule RC-R, item 8, includes any positive fair values 
carried on the balance sheet for interest rate, foreign exchange, 
equity derivative, and commodity and other contracts that are treated 
as off-balance sheet instruments for risk-based capital purposes. 
Because the fair values of such contracts, if positive, are included in 
the calculation of their credit equivalent amounts for risk-based 
capital purposes, the reporting of these amounts in item 8 ensures that 
they are not ``double counted'' when the agencies calculate a bank's 
risk-weighted assets.
    In contrast, the existing instructions indicate that accrued 
receivables associated with off-balance sheet derivative contracts are 
to be excluded from item 8 and assigned to the appropriate risk weight 
category in the same manner as other on-balance sheet items. However, 
consistent with GAAP, institutions may include accrued receivables 
related to derivative contracts in the fair value of such contracts. 
Thus, the instructions would be revised to permit institutions to 
report accrued receivables in item 8 when these amounts are included in 
a bank's credit equivalent amount calculations.
    (4) Other--Instructions for mortgage servicing rights and trading 
accounts would be revised to bring them into conformity with GAAP. 
Clarifications or other conforming changes would also be made to 
several other instructions.

Request for Comment

    Comments submitted in response to this Notice will be shared among 
the agencies and will be summarized or included in the agencies' 
requests for OMB approval. All comments will become a matter of public 
record. Written comments should address the accuracy of the burden 
estimates and ways to minimize burden including the use of automated 
collection techniques or the use of other forms of information 
technology as well as other relevant aspects of the information 
collection request.

    Dated: November 8, 1995.
James F.E. Gillespie,
Director, Legislative and Regulatory Activities Division, Office of the 
Comptroller of the Currency.

Board of Governors of the Federal Reserve System, November 7, 1995.
William W. Wiles,
Secretary of the Board.

    Dated at Washington, DC, this 9th day of November 1995.

Federal Deposit Insurance Corporation.
Jerry L. Langley,
Executive Secretary.
[FR Doc. 95-28251 Filed 11-15-95; 8:45 am]
BILLING CODES OCC: 4810-33-P 1/3; Board: 6210-01-P 1/3; FDIC: 6714-01-P 
1/3