[Federal Register Volume 67, Number 160 (Monday, August 19, 2002)]
[Notices]
[Pages 53797-53800]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-21017]


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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: Background. 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. Board-approved collections of information are 
incorporated into the official OMB inventory of currently approved 
collections of information. Copies of the OMB 83-I's and supporting 
statements and approved collection of information instruments are 
placed into OMB's public docket files. 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.
    Request for comment on information collection proposals. 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

[[Page 53798]]

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 estimate of the burden of 
the proposed information collections, 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 collections on 
respondents, including through the use of automated collection 
techniques or other forms of information technology.

DATES: Comments must be submitted on or before October 18, 2002.

ADDRESSES: Comments should be mailed to Ms. Jennifer J. Johnson, 
Secretary, Board of Governors of the Federal Reserve System, 20th 
Street and Constitution Avenue, N.W., Washington, D.C. 20551, or mailed 
electronically to [email protected]. Comments addressed 
to Ms. Johnson may also be delivered to the Board's mail facility in 
the West Courtyard between 8:45 a.m. and 5:15 p.m., located on 21st 
Street between Constitution Avenue and C Street, N.W. Members of the 
public may inspect comments in Room MP-500 of the Martin Building 
between 9:00 a.m. and 5:00 p.m. on weekdays pursuant to Sec.  261.12, 
except as provided in Sec.  261.14, of the Board's Rules Regarding 
Availability of Information, 12 CFR 261.12 and 261.14.
    A copy of the comments may also be submitted to the OMB desk 
officer for the Board: Joseph F. Lackey, Office of Information and 
Regulatory Affairs, Office of Management and Budget, New Executive 
Office Building, Room 10235, 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. West, 
Federal Reserve Board Clearance Officer (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 Capria Mitchell (202) 872-4984, Board of 
Governors of the Federal Reserve System, Washington, DC 20551.

SUPPLEMENTARY INFORMATION:

Proposal to Approve Under OMB Delegated Authority the Extension For 
Three Years, With Revision, the Following Reports:

    1. Report title: Reports of Foreign Banking Organizations
    Agency form number: FR Y-7 (and proposed FR Y-7N, FR Y-7NS, and FR 
Y-7Q)
    OMB control number: 7100-0125
    Frequency: Quarterly and annually
    Reporters: Foreign banking organizations (FBO's)
    Annual reporting hours: 5,920 hours
    Estimated average hours per response:
    FR Y-7: 3.25 hours,
    FR Y-7N (quarterly): 6 hours,
    FR Y-7N (annual): 6 hours,
    FR Y-7NS: 1 hour,
    FR Y-7Q (annual): 1 hour,
    FR Y-7Q (quarterly): 1.25 hours
    Number of respondents:
    FR Y-7: 327,
    FR Y-7N (quarterly): 128,
    FR Y-7N (annual): 195,
    FR Y-7NS: 184,
    FR Y-7Q (annual):301,
    FR Y-7Q (quarterly): 26
    Small businesses are affected.
    General description of report: This information collection is 
mandatory (12 U.S.C. Secs.  601-604a, 611-631, 1844(c), 3106, and 
3108(a)). 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, pursuant to sections (b)(4) and (b)(6) of 
the Freedom of Information Act [5 U.S.C. Secs.  522(b)(4) and (b)(6)].
    Abstract: The FR Y-7 is an annual report filed by all FBO's that 
engage in banking in the United States, either directly or indirectly, 
to update their financial and organizational information. The Federal 
Reserve uses information to assess an FBO's ability to be a continuing 
source of strength to its U.S. banking operations and to determine 
compliance with U.S. laws and regulations.
    Current actions: The Federal Reserve proposes the following 
revisions to the FR Y-7:
    (1) Remove the risk-based capital reporting, Report Item 1.B., from 
the FR Y-7 report and require FBO's to report risk-based capital 
information on the new Capital and Asset Report for FBO's (FR Y-7Q).
    (2) Remove the Nonbank Financial Information Summary (NFIS) report, 
which includes data from U.S. nonbank subsidiaries held directly by a 
foreign parent (i.e., not through a U.S. bank holding company (BHC) or 
financial holding company (FHC)), from the FR Y-7 and require these 
entities to file the new FR Y-7N or FR Y-7NS);
    (3) Update the eligibility requirements for qualifying foreign 
banking organizations (QFBO's) in accordance with recent revisions to 
Regulation K;
    (4) Remove Report Items 6 and 7 from the FR Y-7 pertaining to 
Financial Statements of Unconsolidated Majority-Owned Related 
Subsidiaries and Financial Data on Unconsolidated Minority-Owned 
Related Companies, respectively; and
    (5) Provide other technical revisions to the FR Y-7 form and 
instructions to ensure consistency with other reporting forms, and 
reorder the sequence of the form to facilitate reporting.
    In addition, the Federal Reserve proposes to implement the 
following information collections:
    (1) Capital and Asset Report for Foreign Banking Organizations (FR 
Y-7Q) - This report would collect consolidated regulatory capital 
information from all FBO's either quarterly or annually. FBO's that 
have effectively elected to become financial holding companies (FHC's) 
will be required to file the FR Y-7Q on a quarterly basis. All other 
FBO's (those that have not elected to become FHCs) would file the FR Y-
7Q annually.
    (2) Financial Statements of U.S. Nonbank Subsidiaries Held by 
Foreign Banking Organizations (FR Y-7N) and Abbreviated Financial 
Statements of U.S. Nonbank Subsidiaries Held by Foreign Banking 
Organizations (FR Y-7NS) - The FR Y-7N report would collect nonbank 
financial information similar to information currently collected from 
U.S. BHC's for their nonbank activities. The FR Y-7N would be collected 
from significant nonbank subsidiaries and would be filed quarterly or 
annually based on total assets and other reporting criteria. Other, 
smaller respondents would file the FR Y-7NS, an abbreviated report with 
only four items.
    In a change from current NFIS reporting, consolidation of reporters 
would not be permitted on the Y-7N and the Y-7NS. In the past, the 
Federal Reserve has found that the consolidation rules contribute to 
inaccurate data collection and raise processing issues. However, since 
a majority of reporters in the current panel would be exempt from 
reporting altogether, the removal of the consolidation option should 
not pose a material burden on reporters.

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    Also, functionally regulated\1\ subsidiaries and merchant banking 
investments would be exempt from reporting on the FR Y-7N and FR Y-7NS. 
Provisions of the Gramm-Leach-Bliley Act direct that the Federal 
Reserve must first rely on reports and information provided by the 
primary functional regulators for functionally regulated subsidiaries.
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    \1\ The term ``functionally regulated'' nonbank subsidiaries are 
entities where the primary regulator is an organization other than 
the Federal Reserve, namely the Securities and Exchange Commission, 
Commodity Futures Trading Commission, state insurance commissioners, 
or state securities departments.
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    The proposed implementation date for all of the FR Y-7 changes is 
December 31, 2002.

2. Report title: Financial Statements of U.S. Nonbank Subsidiaries of 
U.S. Bank Holding Companies

    Agency form number: FR Y-11Q and FR Y-11I (proposed FR Y-11, FR Y-
11S)
    OMB control number: 7100-0244
    Frequency: Quarterly and annually
    Reporters: Bank holding companies (BHC's)
    Annual reporting hours: 23,809 hours
    Estimated average hours per response:
    FR Y-11 (quarterly): 6 hours,
    FR Y-11 (annual): 6 hours,
    FR Y-11S (annual): 1 hour
    Number of respondents:
    FR Y-11 (quarterly): 843,
    FR Y-11 (annual): 488,
    FR Y-11S (annual): 649
    Small businesses are affected.
    General description of report: This information collection is 
mandatory (12 U.S.C. Secs.  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, pursuant to sections (b)(4) and (b)(6) of the 
Freedom of Information Act [5 U.S.C. Secs.  522(b)(4) and (b)(6)].
    Abstract: The FR Y-11Q is filed quarterly by 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 FR Y-11I is filed annually by 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. However, 
some of the items on the FR Y-11I are collected in a less detailed 
manner. In addition, the FR Y-11I also includes a loan schedule to be 
submitted only by respondents engaged in extending credit.
    Current actions: The Federal Reserve proposes to revise the FR Y-
11Q and retitle the report as the Financial Statements of U.S. Nonbank 
Subsidiaries of U.S. Bank Holding Companies (FR Y-11). The Federal 
Reserve also proposes to eliminate the Annual Financial Statements of 
Nonbank Subsidiaries of Bank Holding Companies (FR Y-11I) and replace 
it with a new abbreviated annual report, the Abbreviated Financial 
Statements of U.S. Nonbank Subsidiaries of U.S. Bank Holding Companies 
(FR Y-11S).
    The Federal Reserve proposes to streamline the existing nonbank 
subsidiary reporting framework for all non-functionally-regulated\2\ 
nonbank subsidiaries. The revised framework would both provide 
essential information to supervise and regulate non-functionally-
regulated subsidiaries and reduce the burden on the industry. The 
proposed framework affects U.S. nonbank subsidiaries held by a U.S. 
bank holding company. Proposed revisions include:
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    \2\ As distinguished from the term ``functionally regulated'' 
nonbank subsidiaries, which are entities in which the primary 
regulator is an organization other than the Federal Reserve, namely 
the Securities and Exchange Commission, Commodity Futures Trading 
Commission, state insurance commissioners, or state securities 
departments.
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    (1) Implementing a uniform reporting form for all nonbank 
subsidiary filers;
    (2) Reducing the burden by increasing or establishing consistent 
filing thresholds for all nonbank subsidiary filers;
    (3) Establishing filing thresholds for reporters, consistent with 
risk-focused supervision, based on asset size and off-balance-sheet 
activity (absolute measures), plus operating revenues and equity 
capital (relative measures); and
    (4) Eliminating reporting for the smallest filers.
    The FR Y-11Q would be retitled as the Financial Statements of U.S. 
Nonbank Subsidiaries of U.S. Bank Holding Companies (FR Y-11). This 
proposed form would collect nonbank subsidiary financial information 
and would be filed by the top-tier BHC for more significant nonbank 
subsidiaries quarterly or annually based on total assets and other 
reporting criteria. The new Abbreviated Financial Statements of U.S. 
Nonbank Subsidiaries of U.S. Bank Holding Companies (FR Y-11S) report 
would comprise only four financial data items: net income, total 
assets, total equity capital, and total off-balance-sheet items. This 
report would be filed by the top-tier BHC for smaller nonbank 
subsidiaries.
    The proposed reporting changes would introduce more uniformity to 
several aspects of reporting requirements for nonbank subsidiaries and 
reduce regulatory burden. The proposed implementation date for all of 
the FR Y-11 changes is December 31, 2002.
    Also, functionally regulated subsidiaries and merchant banking 
investments would be exempt from reporting on the FR Y-11 and FR Y-11S. 
Provisions of the Gramm-Leach-Bliley Act direct that the Federal 
Reserve must first rely on reports and information provided by the 
primary functional regulators for functionally regulated subsidiaries.

3. Report title: Financial Statements of Foreign Subsidiaries of U.S. 
Banking Organizations

    Agency form number: FR 2314 a, b, and c (proposed FR 2314 and FR 
2314S)
    OMB control number: 7100-0073
    Frequency: Quarterly and annually
    Reporters: Foreign subsidiaries of U.S. state member banks, bank 
holding companies, and Edge or agreement corporations
    Annual reporting hours: 5,087 hours
    Estimated average hours per response:
    FR Y-2314 (quarterly): 6 hours,
    FR Y-2314 (annual): 6 hours,
    FR Y-2314S (annual): 1 hour
    Number of respondents:
    FR Y-2314 (quarterly): 123,
    FR Y-2314 (annual): 300,
    FR Y-2314S (annual): 335
    Small businesses are not affected.
    General description of report: This information collection is 
mandatory (12 U.S.C. Secs.  324, 602, 625, and 1844). FR 2314 data are 
exempt from disclosure pursuant to Sections (b)(4) and (b)(8) of the 
Freedom of Information Act (5 U.S.C. Sec. 552(b)(4) and (8)).\3\
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    \3\ Please see the FR 2314 ``Current actions'' section for the 
proposed change to confidentiality treatment.
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    Abstract: The FR 2314 reports are collected from U.S. member banks, 
Edge and agreement corporations, and BHC's for their direct or indirect 
foreign subsidiaries. Separate reports are

[[Page 53800]]

required for most subsidiaries, although they may consolidate 
affiliates that are principally engaged in a similar line of business 
and that are located in the same country. Newly established or acquired 
foreign subsidiaries are added to the reporting panel on a flow basis. 
The parent organization files the FR 2314a for their significant 
foreign subsidiaries (those with at least $2 billion in total assets or 
$5 billion in off-balance-sheet activity) quarterly and file the FR 
2314a, b, or c annually for their other foreign subsidiaries as of 
December 31. Subsidiaries with total assets exceeding $250 million must 
be reported on the FR 2314a. Subsidiaries with total assets between $50 
million and $250 million must be reported the FR 2314b. Subsidiaries 
with total assets less than $50 million must be reported on the FR 
2314c. For nominee and inactive companies with total assets less than 
$1 million, the parent must provide only the name, location, and total 
assets of the company; the FR 2314c may be used for this purpose, or 
the information may be transmitted in letter format.
    The FR 2314a collects information on assets and liabilities and 
includes several memoranda items on contingent liabilities and twelve 
supporting schedules. The supporting schedules provide detail on cash 
and balances due from depository institutions, securities, loans and 
lease financing receivables, other assets, claims on related 
organizations, deposits, other liabilities, liabilities to related 
organizations, changes in capital and reserve accounts, income and 
expenses, assets held in trading accounts, and past due and nonaccrual 
loans and leases. The FR 2314b collects somewhat less information on 
assets and liabilities, off-balance-sheet items, income and expenses, 
and securities. The FR 2314c is a brief, one-page report that collects 
information on total assets, equity capital, net income, and off-
balance-sheet items.
    Current actions: The Federal Reserve proposes to revise and retitle 
the FR 2314a as the Financial Statements of Foreign Subsidiaries of 
U.S. Banking Organizations (FR 2314).
    The FR 2314c would be revised and retitled as the Abbreviated 
Financial Statements of Foreign Subsidiaries of U.S. Banking 
Organizations (FR 2314S). The FR 2314b the Report of Condition for 
Foreign Subsidiaries of U. S. Banking Organizations would be 
eliminated.
    The Federal Reserve's proposal to streamline the existing nonbank 
subsidiary reporting framework for all non-functionally-regulated\4\ 
nonbank subsidiaries\5\ will also have an effect on existing FR 2314 
reporters (not just those that are nonbanks). The revised framework 
would both provide essential information to supervise and regulate non-
functionally-regulated subsidiaries and reduce the burden on the 
industry. The proposed framework affects foreign subsidiaries held by a 
U.S. bank holding company or U.S. bank (FR 2314 a, b, and c). Proposed 
revisions include:
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    \4\ As distinguished from the term ``functionally regulated'' 
nonbank subsidiaries, which are entities in which the primary 
regulator is an organization other than the Federal Reserve, namely 
the Securities and Exchange Commission, Commodity Futures Trading 
Commission, state insurance commissioners, or state securities 
departments. Provisions of the Gramm-Leach-Bliley Act direct that 
the Federal Reserve must first rely on reports and information 
provided by the primary regulator for functionally regulated 
subsidiaries.
    \5\ The use of the term nonbank subsidiaries includes foreign 
bank subsidiaries of U.S. BHC's that file the FR 2314 report.
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    (1) Implementing a reporting form that is consistent with the 
proposed form for domestic nonbank subsidiary filers;
    (2) Reducing the burden by increasing or establishing filing 
thresholds that are consistent with those proposed for domestic nonbank 
subsidiary filers;
    (3) Establishing filing thresholds for reporters, consistent with 
risk-focused supervision, based on asset size and off-balance-sheet 
activity (absolute measures), plus operating revenues and equity 
capital (relative measures);
    (4) Allowing no consolidation among filers; and
    (5) Eliminating reporting for the smallest filers.
    The FR 2314a would be retitled as the Financial Statements of 
Foreign Subsidiaries of U.S. Banking Organizations (FR 2314). This 
proposed form would collect financial information and would be filed by 
more significant subsidiaries quarterly or annually based on total 
assets and other reporting criteria. The Abbreviated Financial 
Statements of Foreign Subsidiaries of U.S. Banking Organizations (FR 
2314S) report would comprise only four financial data items: net 
income, total assets, total equity capital, and total off-balance-sheet 
items. These are the same four financial data items currently collected 
as part of the current FR 2314c. This report would be filed by the top-
tier BHC or parent organization of smaller subsidiaries.
    The proposed reporting changes would introduce more uniformity to 
several aspects of reporting requirements for subsidiaries and reduce 
regulatory burden. The proposed implementation date for all of the FR 
2314 changes is December 31, 2002.
    Also, functionally regulated subsidiaries and merchant banking 
investments would be exempt from reporting on the FR 2314 and FR 2314S. 
Provisions of the Gramm-Leach-Bliley Act direct that the Federal 
Reserve must first rely on reports and information provided by the 
primary functional regulators for functionally regulated subsidiaries.
    In a change from current FR 2314 reporting, consolidation of 
reporters would not be permitted on the FR 2314 and the FR 2314S. In 
the past, the Federal Reserve has found that the consolidation rules 
contribute to inaccurate data collection and raise processing issues. 
However, since a majority of reporters in the current panel would be 
exempt from reporting altogether, the removal of the consolidation 
option should not pose a material burden on reporters.
    Also, in accord with the accounting basis for all other regulatory 
reports filed with the Federal Reserve, the reporting basis for the FR 
2314 would be revised to specifically instruct respondents to follow 
U.S. generally accepted accounting principles (GAAP).
    The Federal Reserve proposes that data collected on the FR 2314 
reports no longer be given confidential treatment and made available to 
the public. The Federal Reserve proposes this change in treatment for 
consistency with public disclosure requirements of other financial 
reports and believes that the concern of competitive disadvantage 
relative to their foreign corporate counterparts is no longer a 
prevalent issue. However, the Federal Reserve may grant confidential 
treatment for the reporting information, in whole or in part, on a 
case-by-case basis if justified by the respondent. The Federal Reserve 
requests specific comment on this proposed change.
    Board of Governors of the Federal Reserve System, August 14, 2002.

Robert deV. Frierson,
Deputy Secretary of the Board.
[FR Doc. 02-21017 Filed 8-16-02; 8:45 am]
BILLING CODE 6210-01-S