[Federal Register Volume 67, Number 236 (Monday, December 9, 2002)]
[Notices]
[Pages 72951-72953]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-30970]


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FEDERAL RESERVE SYSTEM


Proposed Agency Information Collection Activities; Comment 
Request

AGENCY: Board of Governors of the Federal Reserve System (Board)

ACTION: Notice and request for comment.

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SUMMARY: In accordance with the requirements of the Paperwork Reduction 
Act of 1995 (44 U.S.C. chapter 35), the Board, the Federal Deposit 
Insurance Corporation (FDIC), and the Office of the Comptroller of the 
Currency (OCC) (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 proposed revisions to the 
Report of Assets and Liabilities of U.S. Branches and Agencies of 
Foreign Banks (FFIEC 002). The Board is publishing the proposed 
revisions on behalf of the agencies. At the end of the comment period, 
the comments and recommendations received will be analyzed to determine 
the extent to which the FFIEC should modify the proposed revisions 
prior to giving its final approval. The Board will then submit the 
revisions to OMB for review and approval.

DATES: Comments must be submitted on or before February 7, 2003.

ADDRESSES: Interested parties are invited to submit written comments to 
the agency listed below. All comments, which should refer to the OMB 
control number, will be shared among the agencies. Written comments, 
which should refer to the ``Report of Assets and Liabilities of U.S. 
Branches and Agencies of Foreign Banks, 7100-0032,'' should be 
addressed to Ms. Jennifer J. Johnson, Secretary, Board of Governors of 
the Federal Reserve System, 20th and C Streets, NW, Washington, DC 
20551. Due to temporary disruptions in the Board's mail service, 
commenters are encouraged to submit comments by electronic mail to 
[email protected], or fax them to the Office of the 
Secretary at (202) 452-3819 or (202) 452-3102. Comments addressed to 
Ms. Johnson may also be delivered to the Board's mailroom between 8:45 
a.m. and 5:15 p.m. weekdays, and to the security control room outside 
those hours. Both the mailroom and the security control room are 
accessible from the Eccles building courtyard entrance on 20th Street 
between Constitution Avenue and C Street, NW. Comments may be inspected 
in room M-P-500 between 9 a.m. and 5 p.m. on weekdays pursuant to 
sections 261.12 and 261.14 of the Board's Rules Regarding Availability 
of Information, 12 CFR 261.12 and 261.14.

FOR FURTHER INFORMATION CONTACT: A draft copy of the proposed FFIEC 002 
reporting form may be obtained at the FFIEC's web site (www.ffiec.gov). 
A copy of the proposed revisions to the collection of information may 
also be requested from Cindy Ayouch, 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. Telecommunications Device for the Deaf (TDD) users may call 
(202) 263-4869.

SUPPLEMENTARY INFORMATION: Proposal to Revise the Following Currently 
Approved Collection of Information:
    Report Title: Report of Assets and Liabilities of U.S. Branches and 
Agencies of Foreign Banks.
    Form Number:  FFIEC 002.
    OMB Number:  7100-0032.
    Frequency of Response:  Quarterly.
    Affected Public:  U.S. branches and agencies of foreign banks.
    Estimated Number of Respondents: 354.
    Estimated Total Annual Responses: 1,416.
    Estimated Time per Response: 22.50 burden hours.
    Estimated Total Annual Burden: 31,860 burden hours.
    General Description of Report: This information collection is 
mandatory: 12 U.S.C. 3105(b)(2), 1817(a)(1) and (3), and 3102(b). 
Except for select sensitive items, this information collection is not 
given confidential treatment (5 U.S.C. 552(b)(8)). Small businesses 
(that is, small U.S. branches and agencies of foreign banks) are 
affected.
    Abstract: On a quarterly basis, all U.S. branches and agencies of 
foreign banks (U.S. branches) are required to file detailed schedules 
of assets and liabilities in the form of a condition report and 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 are also used to augment the bank credit, 
loan, and deposit information needed for monetary policy and other 
public policy purposes. The Federal Reserve System collects and 
processes this report on behalf of all three agencies.
    Current Actions: The agencies propose to implement several 
revisions to the existing reporting requirements of the Report of 
Assets and Liabilities of U.S. Branches and Agencies of Foreign Banks 
(FFIEC 002). The proposed revisions would improve the agencies' ability 
to analyze the risks and activities of branches and agencies and 
achieve consistency with the Reports of

[[Page 72952]]

Condition and Income (Call Report) (forms FFIEC 031 and 041) filed by 
insured commercial banks and FDIC-supervised savings banks, including 
certain proposed changes to the Call Report.
    The proposed revisions to the FFIEC 002 that would take effect as 
of the March 31, 2003, reporting date include:
    Schedule RAL-Assets and Liabilities
    1. Splitting item 1.c(2), ``Mortgage-backed securities,'' into 
separate items 1.c(2)a ``Issued or guaranteed by U.S. Government 
agencies'' and 1.(c).2b ``Other.'' The proposed breakdown would provide 
information on the composition of mortgage-backed securities held by 
branches and agencies, which will enter into the derivation of weekly 
bank credit data used by the Board for monetary policy purposes.
    2. Splitting item 1.d., ``Federal funds sold and securities 
purchased under agreements to resell'' into separate items 1.d.(1), 
``Federal funds sold,'' 1.d.(1)a, ``With depository institutions in the 
U.S.,'' 1.d.(1)b, ``With others,'' and 1.d.(2), ``Securities purchased 
under agreements to resell,'' 1.d.(2)a, ``With depository institutions 
in the U.S.,'' 1.d.(2)b, ``With others.'' The proposed breakdown would 
provide greater insight into the liquidity of branches and agencies. 
These institutions actively participate and often hold large positions 
in the federal funds and repurchase agreement market. The separation 
would also achieve consistency with the existing Reports of Condition 
and Income (Call Report) because insured commercial banks and FDIC-
supervised savings banks currently report federal funds sold separately 
from securities purchased under agreements to resell.
    3. Splitting item 4.b., ``Federal funds purchased and securities 
sold under agreements to repurchase'' into separate items 4.b.(1), 
``Federal funds purchased,'' 4.b.(1)a, ``With depository institutions 
in the U.S.,'' 4.b.(1)b, ``With others'' and 4.b.(2), ``Securities sold 
under agreements to repurchase,'' 4.b.(2)a, ``With depository 
institutions in the U.S.,'' 4.b.(2)b, ``With others.'' The rationale 
for this proposed change, which deals with a funding source for 
branches and agencies, is essentially the same as the justification 
above for splitting ``Federal funds sold and securities purchased under 
agreements to resell''.
    4. Splitting item 1.f, ``Trading Assets,'' into separate items 
1.f(1), ``U.S. Treasury and Agency Securities'' and 1.f(2), ``Other 
trading assets.'' The proposed breakdown would provide information on 
the composition of the trading assets of branches and agencies, which 
will enter into the derivation of weekly bank credit data used by the 
Board for monetary policy purposes. On November 8, 2002, the agencies 
published a notice soliciting comments for 60 days on proposed 
revisions to the Reports of Condition and Income (Call Report) (67 FR 
68234). The notice includes a proposed clarification to the ``Trading 
Account'' Glossary entry on when loans can be designated as trading 
assets. Accordingly, the agencies are proposing the same clarification 
for the FFIEC 002 ``Trading Account'' Glossary entry to achieve 
consistency with the proposed changes to the Call Report.
    Schedule L-Derivatives and Off-Balance-Sheet Items
    1. Adding Memoranda items 1.a., ``Gross positive fair value,'' and 
1.b., ``Gross negative fair value'' to Memoranda item 1., ``Notional 
amount of all credit derivatives on which the reporting branch or 
agency is the guarantor.'' The new items would provide a better measure 
of credit and market risk, particularly for branches and agencies with 
large positions in credit derivatives. These new items will also 
achieve consistency with the existing Reports of Condition and Income 
(Call Report) filed by insured commercial banks and FDIC-supervised 
savings banks.
    2. Adding Memoranda items 2.a., ``Gross positive fair value,'' and 
2.b., ``Gross negative fair value'' to Memoranda item 2., ``Notional 
amount of all credit derivatives on which the reporting branch or 
agency is the beneficiary.'' The rationale for the proposed change is 
the same as the justification above for adding items to Memoranda item 
1.
    Schedule O -Other Data for Deposit Insurance Assessments
    Modifying the captions for Memorandum items 1.a., ``Deposit 
accounts of $100,000 or less,'' and 1.b., ``Deposit accounts of more 
than $100,000,'' to reflect the deposit insurance limits in effect on 
the report date that are to be used as the basis for reporting the 
number and amount of deposit accounts in Memorandum item 1. Memorandum 
item 1, collects information on the number and amount of deposit 
accounts of (a) $100,000 or less and (b) more than $100,000. This 
information provides the basis for calculating ``simple estimates'' of 
the amount of insured and uninsured deposits. The captions for these 
memorandum items explicitly refer to $100,000, which is the current 
deposit insurance limit. Given the purpose of these memorandum items, 
the dollar amount cited in the caption would need to be changed if the 
deposit insurance limit were to change. The proposed revision would 
ensure that such a change occurs automatically as a function of the 
deposit insurance limit in effect on the report date.
    Schedule S - Securitization and Asset Sale Activities
    Splitting item 2.b., ``Standby letters of credit, subordinated 
securities, and other enhancements,'' into two items, one for 
securitization credit enhancements that are on-balance sheet assets and 
another for other credit enhancements. This would be accomplished by 
adding a new item 2.c., ``Standby letters of credit and other 
enhancements,'' where branches and agencies would disclose the unused 
portion of standby letters of credit and the maximum contractual amount 
of recourse or other credit exposure not in the form of an on-balance 
sheet asset that has been provided or retained in connection with the 
securitization structures reported in item 1 of Schedule S. This 
proposed revision will enable the agencies to better understand the 
types of credit support that branches and agencies are providing to 
their securitizations, including which types are typically used for 
different types of securitized loans. The revisions will also achieve 
consistency with the changes proposed to the Reports of Condition and 
Income (Call Report) filed by insured commercial banks and FDIC-
supervised savings banks.
    Request for Comment
    Comments submitted in response to this Notice will be shared among 
the agencies and will be summarized or included in the Board's request 
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 as well as other relevant aspects of the 
information collection requests. Comments are invited on:
    (a) Whether the proposed collection of information is 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 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;
    (d) Ways to minimize the burden of the information collection on 
respondents, including through the use of automated collection 
techniques or

[[Page 72953]]

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.
    Board of Governors of the Federal Reserve System, December 3, 2002.

Jennifer J. Johnson
Secretary of the Board.
[FR Doc. 02-30970 Filed 12-6-02; 8:45 am]
BILLING CODE 6210-01-S