[Federal Register Volume 63, Number 19 (Thursday, January 29, 1998)]
[Notices]
[Pages 4450-4453]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-2254]


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FEDERAL RESERVE SYSTEM


Agency Information Collection Activities: Proposed Collection; 
Comment Request

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Notice.

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SUMMARY: On June 15, 1984, the Office of Management and Budget (OMB) 
delegated to the Board of Governors of the Federal Reserve System 
(Board) its approval authority under the Paperwork Reduction Act, as 
per 5 CFR 1320.16, to approve of and assign OMB control numbers to 
collection of information requests and requirements conducted or 
sponsored by the Board under conditions set forth in 5 CFR 1320 
Appendix A.1. The Federal Reserve 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 OMB control number. Board-
approved collections of information will be incorporated into the 
official OMB inventory of currently approved collections of 
information. Copies of the OMB 83-Is, supporting statements, and the 
approved collection of information instruments will be placed into 
OMB's public docket files. The following information collections, which 
are being handled under this delegated authority, have received initial 
Board approval and are hereby published for comment. At the end of the 
comment period, the proposed information collections, along with an 
analysis of comments and recommendations received, will be submitted to 
the Board for final approval under OMB delegated authority. Comments 
are invited on the following: a. Whether the proposed collections of 
information are necessary for the proper performance of the Federal 
Reserve's functions; including whether the information has practical 
utility; b. the accuracy of the Federal Reserve's estimates of the 
burden of the proposed information collection, 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

[[Page 4451]]

respondents, including through the use of automated collection 
techniques or other forms of information technology.

DATES: Comments must be submitted on or before March 30, 1998.

ADDRESSES: Comments, which should refer to the OMB control number or 
agency form number, should be addressed to William W. Wiles, Secretary, 
Board of Governors of the Federal Reserve System, 20th and C Streets, 
N.W., Washington, DC 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 Sec. 261.8 of the Board's Rules Regarding Availability of 
Information, 12 CFR 261.8(a).
    A copy of the comments may also be submitted to the OMB desk 
officer for the Board: Alexander T. Hunt, Office of Information and 
Regulatory Affairs, Office of Management and Budget, New Executive 
Office Building, Room 3208, Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT: A copy of the proposed form and 
instructions, the Paperwork Reduction Act Submission (OMB 83-I), 
supporting statement, and other documents that will be placed into 
OMB's public docket files once approved may be requested from the 
agency clearance officer, whose name appears below.
    Mary M. McLaughlin, Chief, Financial Reports Section (202-452-
3829), Division of Research and Statistics, Board of Governors of the 
Federal Reserve System, Washington, DC 20551.
    Telecommunications Device for the Deaf (TDD) users may contact 
Diane Jenkins (202-452-3544), Board of Governors of the Federal Reserve 
System, Washington, DC 20551.
    For further information on the proposals concerning the FR Y-9 
reports, contact Robert T. Maahs, Senior Supervisory Financial Analyst 
(202-872-4935). For further information on the proposals concerning the 
FR Y-11 reports, contact Tina Robertson, Supervisory Financial Analyst 
(202-452-2949).

General Information

     The FR Y-9 and FR Y-11 series of reports have historically been, 
and continue to be, the primary source of financial information on bank 
holding companies and their nonbanking activities between on-site 
inspections. Financial information are used to detect emerging 
financial problems, to review performance for pre-inspection analysis, 
to monitor and evaluate capital adequacy, to evaluate bank holding 
company mergers and acquisitions, and to analyze holding companies 
overall financial condition and performance as part of the Federal 
Reserve System's overall supervisory responsibilities.

Proposal To Approve Under OMB Delegated Authority the Revision of 
the Following Reports

    1. Report title: Consolidated Financial Statements for Bank Holding 
Companies.
    Agency form number: FR Y-9C.
    OMB control number: 7100-0128.
    Frequency: Quarterly.
    Reporters: Bank holding companies.
    Annual reporting hours: 196,578.
    Estimated average hours per response: Ranges from 5 to 1,250 hours.
    Number of respondents: 1,457.
    Small businesses are affected.
    General description of report: The information collection is 
mandatory 12 U.S.C. 1844(b) and (c) and 12 CFR 225.5(b). Confidential 
treatment is not routinely given to the data in these reports. However, 
confidential treatment for the reporting information, in whole or in 
part, can be requested in accordance with the instructions to the form. 
Data reported on the FR Y-9C, Schedule HC-H, Column A, requiring 
information on ``assets past due 30 through 89 days and still 
accruing'' and memoranda item 2 are confidential pursuant to Section 
(b)(8) of the Freedom of Information Act 5 U.S.C. 552(b)(8).
    The FR Y-9C consists of standardized financial statements similar 
to the commercial bank Report of Condition and Income (Call 
Report)(FFIEC 031-034; OMB No. 7100-0036). The FR Y-9C is filed 
quarterly by top-tier bank holding companies with total consolidated 
assets of $150 million or more and by lower-tier bank holding companies 
that have total consolidated assets of $1 billion or more. In addition, 
multibank holding companies with total consolidated assets of less than 
$150 million with debt outstanding to the general public or engaged in 
certain nonbank activities must file the FR Y-9C.
    The Federal Reserve proposes to make the following changes to the 
FR Y-9C effective with the March 31, 1998, reporting date to parallel 
proposed and recent changes to the Call Report.

Schedule HC-B, Part II--Trading Assets and Liabilities

    Eliminate the separate reporting of item 6, ``Certificates of 
deposit in domestic offices,'' item 7, ``Commercial paper in domestic 
offices,'' and item 8, ``Bankers acceptances in domestic offices.'' 
Instead, existing items 6 and 8 would be included in existing item 9, 
``Other trading assets in domestic offices.'' Commercial paper held for 
trading would begin to be reported as part of the bank holding 
company's trading account securities, in existing item 5, ``Other debt 
securities in domestic offices,'' consistent with the change in balance 
sheet classification of commercial paper not held for trading and the 
elimination of the loan schedule memorandum item for commercial paper, 
both of which took effect as of March 31, 1997.

Schedule HC-I--Risk-Based Capital

    (1) Add an item for the reporting of the ``Maximum contractual 
dollar amount of recourse exposure in low level recourse transactions'' 
to allow respondents to report low level recourse for capital purposes 
under the ``direct reduction method.'' Currently, bank holding 
companies can only report its low level recourse transactions using the 
``gross-up'' method. In general, the gross-up method requires the bank 
holding company to multiply the maximum amount of its recourse exposure 
by the reciprocal of the full effective minimum risk-based capital 
requirement for the assets transferred and to report the resulting 
dollar amount as an off-balance sheet credit equivalent amount in the 
risk weight category appropriate to the assets transferred. However, 
the greater the volume of a bank holding company's low level recourse 
transactions and the higher the bank holding company's risk-based 
capital in relation to the minimum requirement, the more the bank 
holding company's calculated risk-based capital ratios become distorted 
as a result of applying the gross-up method. In these situations, 
another method of handling the bank holding company's low level 
recourse transactions, the so-called direct reduction method, results 
in a more accurate measure of the bank holding company's risk-based 
capital ratios.
    (2) Add two items to incorporate new capital requirements for the 
measurement of market risk. These items are: ``Market risk equivalent 
assets'' and ``Tier 3 Capital.'' In addition, include an item to report 
the amount of ``Tier 2 Capital.''
    (3) Revise the caption of Item 3 of Part III to read ``Net risk-
weighted assets (gross risk-weighted assets less excess allowance 
[amount that exceeds 1.25% of gross risk-weighted assets] and all other 
deductions).''

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Allowance for Credit Losses

    The American Institute of Certified Public Accountants' (AICPA) 
Industry Audit Guide for Banks and Savings Institutions, issued as of 
April 1, 1996, requires the allocation on the balance sheet of the 
allowance for credit losses between on-balance sheet financial 
instruments and off-balance sheet credit exposures. Previously, these 
allowance components often were reported in the aggregate in the 
allowance for loan and lease losses (ALLL).
    Bank holding companies have been advised to allocate the allowance 
for credit losses on Schedule HC--Balance Sheet consistent with their 
allocation methodology for other financial reporting purposes. For 
example, portions of the allowance for credit losses related to off-
balance sheet exposures that are reported as liabilities are to be 
included in Schedule HC, item 23, ``Other liabilities.'' Bank holding 
companies have also been advised to aggregate these components of the 
allowance for credit losses when completing Schedule HI-B, Part II,--
Allowance for Loan and Lease Losses. In addition, bank holding 
companies were advised to disclose the amounts of these components in 
the ``Notes to the Balance Sheet.''
    The Federal Reserve proposes to retain this methodology of 
reporting the allowance for credit losses. In doing so, Schedule HI-B, 
Part II would be retitled ``Allowance for Credit Losses,'' and item 
4.a, of Schedule HI--Income Statement would be recaptioned ``Provision 
for credit losses.'' However, Schedule HI-B, Part I--Charge Offs and 
Recoveries on Loans and Leases would not be changed, that is, bank 
holding companies would continue to disclose their loan and lease 
charge-offs and recoveries only.

Schedule HI--Income Statement

    Add a memorandum item to determine whether the bank holding company 
has made a Subchapter S selection for the purposes of the current tax 
year.

Instructions

    Instructional revisions and clarifications would be made as 
necessary, particularly with respect to implementing certain deferred 
provisions of Financial Accounting Standards Board Statement No. 125, 
``Accounting for Transfers and Servicing of Financial Assets and 
Extinguishments of Liabilities,'' that become effective in 1998. 
Instructional revisions and clarifications will be done in accordance 
with changes made to the Call Report instructions and revisions, if 
any, to the Capital Guidelines.
    2. Report title: Parent Company Only Financial Statements for Large 
Bank Holding Companies.
    Agency form number: FR Y-9LP.
    OMB control number: 7100-0128.
    Frequency: Quarterly.
    Reporters: Bank holding companies.
    Annual reporting hours: 33,032.
    Estimated average hours per response: Range from 2.0 to 13.5 hours.
    Number of respondents: 1,807.
    Small businesses are affected.
    General description of report: The information collection is 
mandatory 12 U.S.C. 1844(b) and (c) and 12 CFR 225.5(b). Confidential 
treatment is not routinely given to the information in these reports. 
However, confidential treatment for the report information, in whole or 
in part, can be requested in accordance with the instructions to the 
form.
    The FR Y-9LP includes standardized financial statements filed 
quarterly on a parent company only basis from each bank holding company 
that files the FR Y-9C. In addition, for tiered bank holding companies, 
a separate FR Y-9LP must be filed for each lower tier bank holding 
company.
    The Federal Reserve proposes the following revisions to the FR Y-
9LP effective with the March 31, 1998, reporting date.

Schedule PC-B--Memoranda

    Revise item 9, ``Total combined nonbank assets of nonbank 
subsidiaries,'' and expand the information reported about nonbank 
subsidiaries. In addition, instructional clarifications would be made 
to the existing item related to combined nonbank assets of nonbank 
subsidiaries. Existing item 9 would be moved to a new item (item 15), 
and additional reporting items would be included. However, all of these 
items would only be reported by the top-tier bank holding company in a 
multi-tier bank holding company. In addition to reporting the total 
combined nonbank assets of nonbank subsidiaries, the top-tier bank 
holding company would report separately the amount of combined thrift 
assets and the combined foreign subsidiary assets that are included in 
the total combined nonbank assets of nonbank subsidiaries. The top-tier 
bank holding company would also report the total number of nonbank 
subsidiaries that are included in the combined total assets, combined 
thrift, and combined foreign nonbank asset balances.

Schedule PI--Income Statement

    Change item 2(c)(1), ``Provision for possible loan and lease 
losses'' to the ``Provision for credit losses'' to parallel the 
revision made to Schedule HI--Income Statement of the FR Y-9C.

Instructions

    Instructional revisions and clarifications would be made as 
necessary, particularly with respect to the reporting of goodwill, 
negative goodwill, and other identifiable intangible assets on Schedule 
PC and Schedule PC-A.
    3. Report title: Parent Company Only Financial Statements for Small 
Bank Holding Companies.
    Agency form number: FR Y-9SP.
    OMB control number: 7100-0128.
    Frequency: Semiannual.
    Reporters: Bank holding companies.
    Annual reporting hours: 31,912.
    Estimated average hours per response: Range from 1.5 to 6.0 hours.
    Number of respondents: 4,166.
    Small businesses are affected.
    General description of report: The information collection is 
mandatory 12 U.S.C. 1844(b) and (c) and 12 CFR 225.5(b). Confidential 
treatment is not routinely given to the information in these reports. 
However, confidential treatment for the report information, in whole or 
in part, can be requested in accordance with the instructions to the 
form.
    The FR Y-9SP is a parent company only financial statement filed on 
a semiannual basis by one-bank holding companies with total 
consolidated assets of less than $150 million, and multibank holding 
companies with total consolidated assets of less than $150 million that 
meet certain other criteria. This report, an abbreviated version of the 
more extensive FR Y-9LP, is designed to obtain basic balance sheet and 
income statement information for the parent company, information on 
intercompany transactions, and data for capital adequacy evaluation.
    The Federal Reserve proposes the following revisions to the FR Y-
9SP effective with the June 30, 1998, reporting date.

Balance Sheet

    Expand memorandum item 8 for the reporting of additional 
information about nonbank subsidiaries. Specifically, existing 
memorandum item 8 would be moved to memorandum item 16, and this item 
would be completed only by the top-tier bank holding company in a 
multi-tiered bank holding company. In addition, the top-tier bank 
holding company would disclose the combined thrift assets included in 
total combined nonbank assets, as well as the total number of nonbank 
entities (and separately the

[[Page 4453]]

number of thrifts) that are included in the amount of total combined 
nonbank assets reported. Instructional clarifications would also be 
made to the existing item related to combined nonbank assets of nonbank 
subsidiaries.

Income Statement

    Add a memorandum item to ask whether the bank holding company has 
made a Subchapter S selection for the purposes of the current tax year.

Instructions

    Instructional revisions and clarifications would be made as 
necessary, particularly with respect to the reporting of goodwill, 
negative goodwill, and other identifiable intangible assets on the 
balance sheet.

Proposal To Approve Under OMB Delegated Authority the Extension for 
Three Years, With Revision, of the Following Reports

    1. Report title: Quarterly Financial Statements of Nonbank 
Subsidiaries of Bank Holding Companies.
    Agency form number: FR Y-11Q.
    OMB control number: 7100-0244.
    Frequency: Quarterly.
    Reporters: Bank holding companies.
    Annual reporting hours: 7,589.
    Estimated average hours per response: Range from 3.0 to 8.0 hours.
    Number of respondents: 306.
    Small businesses are affected.
    General description of report: The information collection is 
mandatory 12 U.S.C. 1844(b) and (c) and 12 CFR 225.5(b). Confidential 
treatment is not routinely given to most of the data in these reports. 
However, confidential treatment for the report information, in whole or 
in part, can be requested in accordance with the instructions to the 
form. FR Y-11Q, memorandum item 7.a, ``loans and leases past due 30 
through 89 days'' and FR Y-11Q, memorandum item 7.d, ``loans and leases 
restructured and included in past due and nonaccrual loans'' are 
confidential pursuant to Section (b)(8) of the Freedom of Information 
Act 5 U.S.C. 552(b)(8).
    The FR Y-11Q is filed quarterly by the top tier bank holding 
companies for each nonbank subsidiary of a bank holding company with 
total consolidated assets of $150 million or more in which the nonbank 
subsidiary has total assets of 5 percent or more of the top-tier bank 
holding company's consolidated Tier 1 capital, or where the nonbank 
subsidiary's total operating revenue equals 5 percent or more of the 
top-tier bank holding company's consolidated total operating revenue. 
The report consists of a balance sheet, income statement, off-balance-
sheet items, information on changes in equity capital, and a memoranda 
section.
    The Federal Reserve proposes a minor revision to the FR Y-11Q 
effective with the March 31, 1998, reporting date.

Income Statement

    Item 4, ``Provision for loan and lease losses'' would be changed to 
``Provision for credit losses.'' This revision, which would parallel a 
proposed change to the FR Y-9C, would conform with the requirements of 
the American Institute of Certified Public Accountants' (AICPA) 
Industry Audit Guide for Banks and Savings Institutions that was issued 
as of April 1, 1996.
    2. Report title: Annual Financial Statements of Nonbank 
Subsidiaries.
    Agency form number: FR Y-11I.
    OMB control number: 7100-0244.
    Frequency: Annual.
    Reporters: Bank holding companies.
    Annual reporting hours: 6,720.
    Estimated average hours per response: Range from .4 to 8.0 hours.
    Number of respondents: 2,100.
    Small businesses are affected.
    General description of report: The information collection is 
mandatory 12 U.S.C. 1844(b) and (c) and 12 CFR 225.5(b). Confidential 
treatment is not routinely given to the data in these reports. However, 
confidential treatment for the report information, in whole or in part, 
can be requested in accordance with the instructions to the form. FR Y-
11I, Schedule A, item 7.a, ``loans and leases past due 30 through 89 
days'' and FR Y-11I, Schedule A, item 7.d, ``loans and leases 
restructured and included in past due and nonaccrual loans'' are 
confidential pursuant to Section (b)(8) of the Freedom of Information 
Act 5 U.S.C. 552(b)(8).
    The FR Y-11I is filed annually by the top tier bank holding 
companies for each of their nonbank subsidiaries that are not required 
to file a quarterly FR Y-11Q. The FR Y-11I report consists of similar 
balance sheet, income statement, off-balance-sheet, and change in 
equity capital information that is included on the FR Y-11Q. In 
addition, the FR Y-11I also includes a loan schedule to be submitted 
only by respondents engaged in credit extending activities.
    The Federal Reserve proposes a minor revision to the FR Y-11I 
effective with the December 31, 1998, reporting date.

Income Statement

    Item 4, ``Provision for loan and lease losses'' would be changed to 
``Provision for credit losses.'' This revision, which would parallel a 
proposed change to the FR Y-9C, would conform with the requirements of 
the American Institute of Certified Public Accountants' (AICPA) 
Industry Audit Guide for Banks and Savings Institutions that was issued 
as of April 1, 1996.

    Board of Governors of the Federal Reserve System, January 26, 
1998.
William W. Wiles,
Secretary of the Board.
[FR Doc. 98-2254 Filed 1-28-98; 8:45 am]
BILLING CODE 6210-01-P