[Federal Register Volume 69, Number 243 (Monday, December 20, 2004)]
[Notices]
[Pages 76034-76041]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-27752]


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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

[Docket No. 04-25]

FEDERAL RESERVE SYSTEM

[Docket No. OP-1218]

FEDERAL DEPOSIT INSURANCE CORPORATION

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

[No. 2004-57]


Shared National Credit Data Collection Modernization

AGENCIES: Office of the Comptroller of the Currency, Treasury (OCC); 
Board of Governors of the Federal Reserve System (Board), the Federal 
Deposit Insurance Corporation (FDIC); and the Office of Thrift 
Supervision (OTS) as an assisting agency.

ACTION: Notice for public comment.

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[[Page 76035]]

SUMMARY: The Federal Banking Agencies (Board, FDIC, OCC, and OTS, 
collectively referred to as ``the Agencies'') are seeking comment on 
proposed changes to the examination data collected in support of the 
Shared National Credit Program (Program). The Agencies propose to 
standardize and expand the data collection to improve the efficiency 
and effectiveness of Shared National Credit (SNC) examinations. By 
standardizing and expanding the collection of data, the Agencies will 
be able to use advanced credit risk analytics that will be beneficial 
to the reporting banks and the Agencies. The proposed changes are 
warranted based on the increasing sophistication of banks' risk 
management practices and the complexity of credit markets. Going 
forward, the Program also plans to take advantage of current 
information technologies. The Agencies plan to implement the changes 
beginning with the 2007 SNC examinations, employing data as of December 
31, 2006.

DATES: Comments must be submitted on or before February 15, 2005.

ADDRESSES: Because the Agencies will jointly review all of the comments 
submitted, interested parties may send comments to any one of the 
Agencies without the need to send comments (or copies) to all of the 
Agencies. Postal service in the Washington, DC area and at the Agencies 
is subject to delay, so please consider submitting your comments by e-
mail or fax. Commenters are encouraged to use the title ``SNC Program 
Modernization'' to facilitate the organization and distribution of 
comments among the Agencies. Interested parties may submit comments to:
    OCC: You should include OCC and Docket Number 04-25 in your 
comment. You may submit comments by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     OCC Web site: http://www.occ.treas.gov. Click on ``Contact 
the OCC,'' scroll down and click on ``Comments on Proposed 
Regulations.''
     E-mail address: [email protected].
     Fax: (202) 874-4448.
     Mail: Office of the Comptroller of the Currency, 250 E 
Street, SW., Mail Stop 1-5, Washington, DC 20219.
     Hand Delivery/Courier: 250 E Street, SW., Attn: Public 
Information Room, Mail Stop 1-5, Washington, DC 20219.
    Instructions: All submissions received must include the agency name 
(OCC) and docket number or Regulatory Information Number (RIN) for this 
notice of proposed rulemaking. In general, OCC will enter all comments 
received into the docket without change, including any business or 
personal information that you provide. You may review comments and 
other related materials by any of the following methods:
     Viewing Comments Personally: You may personally inspect 
and photocopy comments at the OCC's Public Information Room, 250 E 
Street, SW., Washington, DC. You can make an appointment to inspect 
comments by calling (202) 874-5043.
     Viewing Comments Electronically: You may request e-mail or 
CD-ROM copies of comments that the OCC has received by contacting the 
OCC's Public Information Room at [email protected].
     Docket: You may also request available background 
documents and project summaries using the methods described above.
    Board: You may submit comments, identified by Docket No. OP-1218 by 
any of the following methods:
     Agency Web site: http://www.federalreserve.gov. Follow the 
instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: [email protected]. Include the 
docket number in the subject line of the message.
     Fax: (202) 452-3819 or (202) 452-3102.
     Mail: Jennifer J. Johnson, Secretary, Board of Governors 
of the Federal Reserve System, 20th Street and Constitution Avenue, 
NW., Washington, DC 20551.
    All public comments are available from the Board's Web site at 
http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as 
submitted, except as necessary for technical reasons. Accordingly, your 
comments will not be edited to remove any identifying or contact 
information. Public comments may also be viewed in electronic or paper 
form in Room MP-500 of the Board's Martin Building (20th and C Streets, 
NW.) between 9 a.m. and 5 p.m. on weekdays.
    FDIC: You may submit comments by any of the following methods:
     Agency Web site: http://www.FDIC.gov/regulations/laws/federal/propose.html.Follow the instructions for submitting comments.
     E-mail: [email protected].
     Mail: Robert E. Feldman, Executive Secretary, Attention: 
Comments/Legal ESS, Federal Deposit Insurance Corporation, 550 17th 
Street, NW., Washington, DC 20429.
     Hand Delivered/Courier: The guard station at the rear of 
the 550 17th Street Building (located on F Street), on business days 
between 7 a.m. and 5 p.m.
     Public Inspection: Comments may be inspected and 
photocopied in the FDIC Public Information Center, Room 100, 801 17th 
Street, NW., Washington, DC, between 9 a.m. and 4:30 p.m. on business 
days.
    Instructions: Comments received will be posted without change to 
http://www.FDIC.gov/regulations/laws/federal/propose.html, including 
any personal information provided.
    OTS: You may submit comments, identified by No. 2004-57, by any of 
the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail address: [email protected]. Please 
include No. 2004-57 in the subject line of the message and include your 
name and telephone number in the message.
     Fax: (202) 906-6518.
     Mail: Regulation Comments, Chief Counsel's Office, Office 
of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552, 
Attention: No. 2004-57.
     Hand Delivery/Courier: Guard's Desk, East Lobby Entrance, 
1700 G Street, NW., from 9 a.m. to 4 p.m. on business days, Attention: 
Regulation Comments, Chief Counsel's Office, Attention: No. 2004-57.
    Instructions: All submissions received must include the agency name 
and No. 2004-57 for this request for comment. All comments received 
will be posted without change to the OTS Internet Site at http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1, including any 
personal information provided.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1.
    In addition, you may inspect comments at the Public Reading Room, 
1700 G Street, NW., by appointment. To make an appointment for access, 
call (202) 906-5922, send an e-mail to public.info@ots.treas.gov">public.info@ots.treas.gov, or 
send a facsimile transmission to (202) 906-7755. (Prior notice 
identifying the materials you will be requesting will assist us in 
serving you.) We schedule appointments on business days between 10 a.m. 
and 4 p.m. In most cases,

[[Page 76036]]

appointments will be available the next business day following the date 
we receive a request.

FOR FURTHER INFORMATION CONTACT:
    OCC: MaryAnn Nash, Counsel, Legislative and Regulatory Affairs 
Division (202) 874-5753; or Louise Francis, National Bank Examiner, 
Large Bank Supervision, (202) 874-1306; or Kevin Satterfield, Public 
Reference Room Assistant, Communications Division, 202-874-4700.
    Board: Elaine Boutilier, Managing Senior Counsel, or Alye Foster, 
Senior Counsel, (202) 452-5289; or John T. Colwell, Senior Project 
Manager, Division of Bank Supervision and Regulation, (202) 728-5885. 
For users of Telecommunications Device for the Deaf (``TDD'') only, 
contact (202) 263-4869.
    FDIC: William R. Baxter, Chief, Large Bank Section, Division of 
Supervision and Consumer Protection, (202) 898-8514 or 
[email protected]; Cecilia L. Barry, Senior Financial Analyst, Large 
Bank Section, Division of Supervision and Consumer Protection, (202) 
898-3506 or [email protected]; Rodney D. Ray, Counsel, Legal Division, 
(202) 898-3556 or [email protected]; or Leneta G. Gregorie, Counsel, Legal 
Division, (202) 898-3719 or [email protected].
    OTS: David W. Tate, Manager, Examination Quality Review, (202) 906-
5717.

SUPPLEMENTARY INFORMATION:

I. Introduction

    The SNC Program is a cooperative initiative through which the 
Agencies examine and supervise shared national credits. A shared 
national credit is a lending commitment of $20 million or more that is 
held by three or more regulated lenders.
    For the reasons explained in the discussion that follows, the 
Agencies have determined that their administration of the SNC Program 
could be improved, and the quality of the feedback we provide to banks 
in the SNC Program enhanced, by creating a single, shared SNC database 
and by standardizing and expanding the set of data we collect from 
certain banks that currently report data pursuant to the Program. 
Accordingly, this notice describes the changes to the reporting system 
that the Agencies contemplate and identifies the new data elements that 
the Agencies propose to collect. The proposed data elements are 
included in a chart appended to the notice. Immediately preceding the 
chart, the Agencies present a series of questions designed to elicit 
comment on the expanded program. Commenters' responses will help refine 
our thinking about the ultimate design of the expanded data collection 
process. Toward that end, the questions focus on the feasibility of 
providing the expanded information and on the effects and consequences 
of including particular new elements in the SNC reporting system. 
Commenters also are invited to suggest alternatives where appropriate.
    Concurrently with this notice, the Board is publishing a separate 
Request for Information (RFI) to gather information from prospective 
contractors pertaining to system integration services to develop a 
common system solution for supporting the SNC Program.
    Following our evaluation of the comments received in response to 
this notice and the RFI, the Agencies expect to develop a more detailed 
description of the new data collection process and to publish that 
description for additional comment. At that time, the Agencies will 
also solicit comment on burden estimates pursuant to the Paperwork 
Reduction Act. We anticipate that final changes to the SNC data 
collection process will be implemented through an interagency statement 
or similar issuance.

II. Background

    The SNC Program has been an effective supervisory tool for over 
twenty-five years. In 2004, it covered approximately 7,500 facilities 
\1\ to nearly 5,000 borrowers and represented committed exposure in 
excess of $1.5 trillion. The current objectives are to:
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    \1\ The borrower receives funds from the lender by initiating a 
facility under the credit agreement. Essentially a loan, a facility 
might consist of a revolving, term, or other type of loan.
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     Provide uniformity in approach and credit rating 
determinations,
     Gain efficiencies in risk analysis,
     Provide timely results to the reporting banks and 
Agencies, and
     Gather and analyze reporting bank and industry credit 
data.
    Advancements in credit risk management and information technology 
have created an opportunity to improve the Agencies' ability to achieve 
these objectives going forward. In that regard, the Agencies propose 
to:
     Standardize the SNC data collection system so that all 
Agencies collect the same data using the same data definitions,
     Expand SNC data collected from the banks that agent a 
significant volume of SNCs,
     Apply advanced credit risk analytics and benchmarking \2\ 
techniques to common SNC borrowers, facilities, and reporting bank 
portfolios, and
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    \2\ Benchmarking references a standardized problem or test that 
serves as a basis for evaluation or comparison.
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     Provide reporting banks with feedback on their commonly 
held SNC portfolios across those metrics.
    The creation of a shared SNC database will improve the efficiency 
and accuracy of data submission by the reporting banks. Currently, the 
Federal Reserve and the OCC maintain separate SNC databases with 
slightly different data collection processes (the OCC also processes 
SNC data for the FDIC and OTS). A shared database and a common set of 
data definitions will allow for increased use of electronic data 
collection and will make the collection, reconciliation, and 
maintenance of SNC data more effective.
    By expanding the data collected from the banks that agent a 
significant volume of SNCs, the Agencies will be able to develop and 
share useful credit risk information with them. Over time and as credit 
risk management techniques continue to evolve, reporting banks will 
want additional feedback from their primary Federal regulator on how 
their SNC portfolios compare with their peers. SNC benchmarking 
information will provide a unique reference point because comparable 
peer ratios on the internal credit risk estimates are currently not 
available.

III. Proposed Enhancements

    The Agencies intend to standardize the SNC data collected from the 
reporting banks that serve as agent for at least 100 SNC facilities and 
have been identified as likely mandatory or opt-in Basel II banks \3\ 
(i.e., ``Expanded Reporters''). Banks that do not meet this criterion, 
but are able to provide the credit risk management data outlined in 
this proposal, could also voluntarily choose to participate as Expanded 
Reporters. All other reporting banks (i.e., ``Basic Reporters'') would 
continue to submit data similar to the existing SNC reporting 
requirements. The Agencies also propose to clarify the data definitions 
and standardize the submission format to reduce ambiguity and automate 
the data collection process for those banks that are able to submit 
data electronically.
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    \3\ See Risk-Based Capital Guidelines; Implementation of New 
Basel Capital Accord, 68 FR 45900 (Aug. 4, 2003).
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III.A. Basic Reporters

     Basic Reporters should see few changes outside of improved 
software and feedback reports from the Agencies.
     Basic Reporters would continue to provide data annually 
prior to the SNC

[[Page 76037]]

examination period only on SNC facilities they agent.
     The data elements provided by Basic Reporters in the 
existing SNC Program would remain substantially unchanged. However, 
they would be subject to a common set of detailed definitions (e.g., 
five or six digit NAICS codes would be required rather than the four 
(FRB) or five (OCC, FDIC, and OTS) that are currently requested).
     The Agencies would provide user-friendly software to the 
Basic Reporters to electronically transmit data.
     The Agencies would distribute identifiers (IDs) for 
borrowers and facilities agented by Basic Reporters (see the section on 
Regulatory IDs).
     A Basic Reporter would have the option to become an 
Expanded Reporter and receive benchmark comparisons as well.

III.B. Expanded Reporters

    The following points highlight the primary changes that would 
affect Expanded Reporters.
     Expanded Reporters would report data on a quarterly basis 
instead of annually. Quarterly data submission will allow each Agency 
to provide more frequent feedback on the risk characteristics of SNC 
portfolios to the Expanded Reporters.
     Data would be collected on all Program borrowers and 
facilities (i.e., agented and participated facilities) held by the 
Expanded Reporters.
     Expanded Reporters would report additional data elements.
    The tables in Appendix I and II list the set of data elements 
required by the proposed changes to the Program.

III.C Regulatory IDs

    Collecting and matching expanded data on the commonly held SNCs 
from agent reporting banks and participant reporting banks presents 
challenges. To ensure borrowers and facilities are uniformly 
identified, common identifiers (i.e., Regulatory IDs) will need to be 
assigned. The Agencies are requesting assistance in the design, 
implementation, and administration of the Regulatory ID system.
    The Agencies propose to create Regulatory IDs that the Expanded 
Reporters would distribute to participant reporting banks. The 
Regulatory IDs would accompany the data elements with each data 
submission by all Expanded Reporters that participate in the facility. 
Agencies would assign Regulatory IDs to current SNC borrowers and 
credits and provide those IDs to Expanded Reporters as they transition 
to the new system. Going forward, Expanded Reporters would request 
Regulatory IDs, as needed, on a post-origination basis.
    The Agencies intend to distribute Regulatory IDs to Basic Reporters 
on an annual basis, following their annual data collection. The 
Agencies have not determined how an Expanded Reporter would provide 
data on facilities agented by Basic Reporters.

IV. Technology and Data Exchange

    The Agencies propose to provide all reporting banks with a common 
set of detailed data element definitions that specify data quality 
standards as well as provide data validation and edit checks as part of 
the collection process. In addition, the new technologies will support 
seamless and secure electronic data exchanges between reporting banks 
and the Agencies. The Agencies also plan to use technologies for 
enhanced electronic reporting and feedback to reporting banks. 
Technologies and techniques to collect and distribute SNC data and 
reports are currently under investigation and include XML and XBRL 
taxonomies. The Agencies intend to implement an efficient data 
transmission process for each organization (i.e., holding company level 
and all subsidiaries and affiliates) that prefers to submit and receive 
data centrally. Results could be mailed to one location, and data would 
be broken down by legal entity. These enhancements should improve the 
quality of information and the efficiency of the program.

V. Benefits of the Proposed Enhancements

    The benefits of the proposed enhancements discussed in this notice 
would be significant to both reporting banks and the Agencies. The 
ability to quantify and compare institutional risk across the same 
syndicated exposure or portfolio of commonly held exposures (i.e., 
``benchmark'') is one important benefit of the proposed changes. With 
improved data, the Agencies will be able to benchmark the quality of 
broadly held credits in the banking industry and in individual 
reporting bank portfolios, and assist in the evaluation of credit risk 
metrics across commonly held portfolios of risk. Where appropriate, 
supervisors will be able to provide peer information on such items as 
capital intensity (i.e., capital per dollar of exposure), weighted 
average Probability of Default (PD), weighted average Loss Given 
Default (LGD), and many other metrics on a reporting bank's total SNC 
portfolio (or by industry) versus peer basis. Analysis and benchmark 
comparisons may prompt examinations by the Agencies, particularly when 
reporting banks begin identifying emerging risks that other reporting 
banks have not. This information could also alert both the Agencies and 
reporting bank management to emerging trends or other pertinent 
factors.
    Feedback relating to the range of risk metrics (e.g., PDs, LGDs, 
and Exposures at Default) assigned by peer reporting banks to various 
industry sector exposures could help reporting banks evaluate and 
improve their internal risk systems. Such information could also 
improve the Agencies' understanding of internal risk assessment 
methodologies. Examples of this feedback might include:
     Feedback grouped by risk grade categories that would show 
median PDs, LGDs, or EADs for various industry segments.
     Borrower to borrower comparisons that would show a 
reporting bank how its PDs compared to the range of scores assigned to 
the same borrower by other banks.
     Credit comparisons, possibly grouped by facility type, 
size, industry, collateral, etc. that would help reporting banks 
compare their EAD and LGD values to the range of scores assigned by 
other banks to the same exposures.
     Accumulated actual credit loss measured over time, which 
could prove to be a valuable source of empirical information relating 
to LGD estimates.
    The Agencies realize that there are various methods used to 
evaluate risk. Consequently, multiple conclusions could be drawn from 
the same information, yet still arrive at a sound and consistent risk 
assessment.
    As supervisors and reporting banks gain experience with 
benchmarking and other data, the Agencies anticipate that the SNC on-
site examination process will become more efficient. In the past, the 
Program has relied heavily upon examination of individual credit 
transactions. Going forward, examiners would continue to examine 
credits; however, they could focus their on-site examination on credits 
where portfolio analysis, market data and risk metrics indicate an 
increased risk or concentration. Moreover, with the expanded 
examination data, examiners should have a better understanding of a 
reporting bank's credit portfolio and macro credit trends.

VI. Conclusion

    The benefits of the proposed changes to the Program discussed in 
this notice support the Agencies' goals to improve the data collection 
system, the efficiency and effectiveness of SNC examinations, and to 
provide the ability to perform and share advanced risk

[[Page 76038]]

analytics on the data. The effective implementation of a portfolio 
approach to credit risk is dependent on a timely and reliable flow of 
useful and relevant data in conjunction with benchmarking commonly held 
exposures and risk-focused examinations. These changes call for the 
reporting banks and Agencies to share more credit risk information than 
in the past. The ultimate goal of the proposed changes is to create a 
streamlined, risk-focused Program that recognizes and takes advantage 
of the significant advances in bank risk management practices, 
leverages current technology, and enables the production of meaningful 
credit risk information for the Agencies and reporting banks.
    The questions in the next section address specific aspects of the 
proposal as well as request feedback on obstacles that the Agencies may 
not have anticipated.
    The Agencies intend to use feedback from this preliminary proposal 
to develop a more detailed notice for comment prior to any final 
implementation of the proposed changes. This more detailed notice will, 
to the extent necessary, formally propose a new data collection and 
request comment on burden estimates.

VII. Questions

Feasibility of Reporting Banks Providing the Data and Establishing 
Which Reporting Banks Would Provide That Data

    1. To perform benchmark analysis and provide meaningful feedback to 
the reporting banks, what data elements should the Agencies add, 
delete, or change from the Expanded Reporter list?
    2. What are the effects on Expanded Reporters of providing data on 
credit participations?
    a. Are there data elements that reporting banks would not be able 
to compile electronically without manual intervention?
    b. Are there equivalent data elements that would be easier to 
provide?
    3. For Basic Reporters, the Agencies anticipate that the effects of 
the proposal will be minimal. What effects, if any, do reporting banks 
see from the proposed changes?
    a. The main change for Basic Reporters is improved data software. 
Are there changes to the current software that would be particularly 
helpful?
    b. Which, if any, additional data items would be useful for the 
Agencies to collect, either to improve their understanding of the 
underlying transactions or to provide better feedback to the reporting 
banks?
    c. What, if any, effects would the use of a common set of detailed 
definitions have on Basic Reporters? Are there other alternatives that 
could achieve the goals of reducing ambiguity and automating the data 
collection process?
    4. Are the criteria ``agents 100 or more facilities and is a 
mandatory or opt-in Basel II bank'' reasonable to separate Expanded 
Reporters from Basic Reporters? If not, please provide an alternative.
    5. Since more banks are using credit derivatives to manage their 
exposures, should the Program begin to collect data on credit 
derivatives in order to provide benchmarking feedback? Should the data 
files include credit derivative positions used to manage portfolio 
risk, along with the same risk metrics used for loans and other credit 
exposures?

Assignment and Maintenance of Unique Facility and Borrower Identifiers

    6. Are there obstacles to the Agencies' proposal to assign, 
distribute, and maintain Regulatory IDs and, if so, what are they?
    a. Should the Agencies distribute Regulatory IDs directly to 
participants instead of relying on the Expanded Reporter Agent banks to 
do so?
    b. Should Basic Reporters also distribute Regulatory IDs to their 
participants? Are credit participations held by Basic Reporters' 
numerous enough to provide useful, relevant feedback?
    c. Are there existing or planned commercial systems that might help 
uniquely identify facilities and borrowers in place of the process 
proposed here?
    d. Would quarterly batch submission and Regulatory ID feedback for 
Expanded Reporters be preferable or would those banks prefer to request 
the Regulatory IDs throughout the year as deals are completed?
    7. Which technologies would best support the reporting banks in 
requesting Regulatory IDs?

Feasibility of Data Exchange, Data Definitions, and Selecting Data 
Exchange Technologies

    8. For both Basic and Expanded Reporters, the Agencies propose to 
define standard data requirements to support the secure file exchanges, 
and utilize web-based data exchanges, such as XML and XBRL taxonomies 
and related secure technologies, to exchange SNC examination data.
    a. Is there an alternative to XML and XBRL taxonomies and related 
secure technologies to collect SNC examination data that would be 
superior?
    b. Would it be feasible to extend existing data exchange 
technologies, conduits, and processes, such as those used for the FFIEC 
Call Reporting, to collect SNC data?
    9. Do reporting banks store sufficient information in their 
databases to electronically identify a SNC according to the current 
criteria--$20 million or more with three or more lenders regulated by 
the Agencies?
    a. Would reporting banks need a resource to determine if the 
Agencies regulate a lender?
    b. Would other criteria help reporting banks identify SNCs and 
submit data electronically?
    c. Would a larger data feed to the Agencies, which the Agencies 
would then screen for SNC criteria and then extract SNC facilities, be 
easier for reporting banks to administer?

Additional Issues Related to the Delivery of Reports and Data to 
Reporting Banks

    10. Assuming that the proposed list of data elements is adopted, 
how could that data be best presented to provide value to Basic and 
Expanded Reporters (i.e., what views would be most advantageous)?
    a. Alternatively, should the Agencies simply provide raw data 
tables to support bank-generated reports?
    b. Will your reporting bank be able to receive the feedback data 
and reports electronically by the proposed 2007 implementation date?
    11. Are there any unintended consequences that might arise from the 
use of this comparative information?

Additional Questions

    12. The Agencies currently ask reporting banks to provide the name, 
city, and state for SNC borrowers. This has often not been enough 
information to clearly identify borrowers in the SNC database. The 
Agencies are looking for additional data that reporting banks might 
provide to help identify their borrowers more clearly (e.g., stock 
tickers, taxpayer identification numbers, CUSIP numbers, MKMV's PIDs, 
etc).
    a. Which of these additional data elements would be most useful for 
this project?
    b. What are the minimum data required to clearly identify borrowers 
and facilities?
    c. Which, if any, of these items do reporting banks store 
electronically?
    d. Is the proposal to require submission of at least one of these 
items reasonable?
    13. Over the past two decades, some of the industry's largest 
losses involved credits extended to groups of related borrowers.

[[Page 76039]]

    a. How are reporting banks identifying groups of related borrowers 
in their own systems?
    b. What data could participating reporting banks provide to help 
identify related borrowers in SNC credits?
    c. Could reporting banks electronically transmit data on guarantors 
for credits, sponsors, or other related and relevant parties?
    14. Could the reporting banks provide entries tracking the 
resolution of credits over time, such as amounts charged off or sales 
of assets since the last data submission?
    15. The data submission software currently in use (OSCAR and SNC 
Reporting Application) does not easily support aggregated reporting of 
SNC information for all of a reporting bank's related entities. Should 
the Agencies design software to permit aggregate, single-point, 
reporting of SNC data for a reporting bank? Should electronic data file 
submission also allow this type of reporting?

Appendix I

                                      Data Elements for Expanded Reporters
----------------------------------------------------------------------------------------------------------------
 Data element (``N'' denotes data that
    is not collected in the current                       Comments                  A / P* (Agent / participant)
                program)
----------------------------------------------------------------------------------------------------------------
Name and address of Borrower and Agent   Full, legal name as it appears in the      AP
 Bank.                                    corporate charter, and State, ZIP, and
                                          country.
Name and address of the Review Bank, if  A ``review'' bank is designated in two     A
 any.                                     situations: by the agent when it wishes
                                          to identify a location other than its
                                          headquarters for examination of the
                                          credit files by Agency supervisors, or
                                          by the supervisors when the agent is a
                                          non-regulated bank and the supervisors
                                          wish to examine the transaction. In the
                                          latter case, the supervisors will
                                          designate one of the regulated
                                          participant banks as the ``review'' bank.
RegIDs of the Borrower and Agent Bank..  The Regulatory IDs (``RegIDs'') of the     AP
                                          Borrower and the Agent bank are
                                          currently referred to as the borrower's
                                          and agent bank's ``RSSD''. This
                                          document proposes to expand the use of
                                          ``RegIDs'' to facilitate linkage of
                                          agent bank and participant bank
                                          information, and the RSSD system may, or
                                          may not, be used in the future for this
                                          purpose.
RegID of the Review Bank, if any.......  The ``RegID'' of the Review Bank is        A
                                          currently referred to as the review
                                          bank's ``RSSD.'' The RSSD
                                          system may, or may not, be used in the
                                          future for this purpose.
Industry Code (NAICS)..................  2002 North American Industrial             A
                                          Classification System (NAICS) code
                                          number reflecting the borrower's
                                          business activity. Note that although
                                          this data element is currently provided,
                                          this document proposed to increase the
                                          number of digits required to five or six
                                          (from four required by the FRB and five
                                          requested by the OCC/FDIC/OTS), which is
                                          consistent with the industry code
                                          requirements for filers of Form FR Y-10.
Parent Identification (N)..............  Name, Address, and Industry information    AP
                                          for Parent Organization. If the
                                          reporting bank does not store the legal
                                          parent, or better yet the ultimate
                                          parent company in a multi-tier
                                          structure, then reporting banks would
                                          provide the name that they use to
                                          aggregate related exposures.
Reporting bank's internal Facility ID..  Reporting bank's internal facility         AP
                                          number. Helps examiners identify
                                          facilities in bank records.
RegID of the Facility..................  The ``RegID'' of the facility is           AP
                                          currently referred to as the ``Credit
                                          Number'' and is assigned by the
                                          Agencies. The ``Credit Number''
                                          identifier would be replaced by the
                                          proposed ``RegID'' system, which would
                                          facilitate linkage of agent bank and
                                          participant bank information.
Facility Origination Date..............  Date the facility originated. Permits      A
                                          analysis of facilities by ``vintage'' to
                                          identify underwriting trends.
Most Recent Renewal Date...............  Currently provided by FRB reporting banks  A
                                          only. Date the facility was last renewed
                                          or reviewed to confirm the risk rating.
Facility Maturity Date.................  Date by which all utilizations must be     A
                                          repaid (i.e., not the latest drawdown
                                          date, but the date by which all drawings
                                          must be repaid).
Facility Committed Exposure............  Total facility availability legally        A
                                          committed to the borrower as of the date
                                          of the data submission. Includes the
                                          total facility amount, not just the
                                          portion retained by the agent reporting
                                          bank (if any)--the agent bank's portion
                                          of the total exposure would be reported
                                          in ``Participant bank Share of Committed
                                          Exposure'' below.
Facility Utilized Exposure.............  Total utilized amount, including off-      A
                                          balance sheet instruments (e.g., LCs),
                                          as of the date of the data submission.
                                          Includes the total facility utilization,
                                          not just the portion retained by the
                                          agent bank (if any)-- the agent bank's
                                          portion of the total utilization is a
                                          new data element that would be reported
                                          in ``Participant bank Share of Utilized
                                          Exposure'' below.
Borrower Risk Rating (N)...............  Risk rating assigned to the borrower.....  AP
Borrower PD--Probability of Default      PD used for regulatory capital purposes    AP
 (Reg) (N).                               (after any guarantor effect).
Facility EAD--Exposure at Default (Reg)  EAD used for regulatory capital purposes.  AP
 (N).
Facility LGD--Loss Given Default (Reg)   LGD used for regulatory capital purposes   AP
 (N).                                     (after any guarantor effect).
Facility EL--Expected Loss (Reg) (N)...  EL using the PD, EAD, and LGD for          AP
                                          regulatory capital purposes (after any
                                          guarantor impact).
Facility Capital (Reg) (N).............  Regulatory capital applicable to the       AP
                                          facility (after any guarantor effect).
Guarantor Name and stand alone PD, and   To be submitted only if the guarantor's    AP
 guaranty amount (N).                     attributes are modifying the standalone
                                          characteristics of the borrower's PD or
                                          facility LGD. The parameter that was
                                          mitigated (i.e., PD or LGD) will also be
                                          provided.

[[Page 76040]]

 
At least one of the following (N):       A corroborating variable to identify the   AP
 Taxpayer ID (TIN), CUSIP        borrower in the event of ambiguity in
 (borrower), Stock Ticker, MKMV's         the other data elements.
 ``PID'', LPC's Loan ID (LIN).
Participant bank Share of Utilized       In the current Program, the agent bank     AP
 Exposure.                                submits the committed exposure for each
                                          participant bank. As a new data element,
                                          the Agent bank would also be asked to
                                          provide the utilized exposure for each
                                          participant bank. Additionally, each
                                          participant bank would be asked to
                                          submit its utilized exposure, which
                                          would be linked to the data provided by
                                          the agent bank using the proposed
                                          RegID system.
Cumulative Facility Charge offs (N)....  Supports reconciliation and analysis of    AP
                                          risk exposures over time.
Facility collateral type (e.g., A/R,     Supports LGD analysis....................  A
 Equip) (N).
 Days Principal or Interest     Distress indicator/nonaccrual trigger....  A
 Past Due (N).
Reportable SNC Flag (N)................  Identifies the current quarter as that in  A
                                          which a borrower no longer qualifies as
                                          a SNC, and notifies users that the
                                          facility will not appear in future data
                                          submissions.
Participant bank names and addresses...  In the current Program, the agent          AP
                                          reporting bank submits the full, legal
                                          name of each participant bank, and its
                                          State, Zip, and country, and would
                                          continue to do so under this proposal.
                                          Each participant bank would also provide
                                          its name and address (in addition to
                                          other data elements as noted), which
                                          would be used to supplement linkage of
                                          agent bank and participant bank
                                          information through the new RegID system.
RegID of each Participant bank.........  The ``RegID'' of a participant bank is     AP
                                          currently referred to as the participant
                                          bank's ``RSSD''. Currently the
                                          agent bank submits the RegID (RSSD) of each participant bank, and would
                                          continue to do so under this proposal.
                                          Each participant bank would also provide
                                          its RegID (in addition to other
                                          data elements as noted), which would be
                                          used to link agent bank and participant
                                          bank information. If the agent bank is
                                          also a participant bank, it would use
                                          the same RegID to report both its agency
                                          and its participation.
Participant bank Share of Committed      In the current Program, the agent bank     AP
 Exposure.                                submits the committed exposure for each
                                          participant bank. Additionally, each
                                          participant bank would be asked to
                                          submit its committed exposure, which
                                          would be linked to the data provided by
                                          the agent bank using the proposed RegID
                                          system.
Facility Type..........................  Generic description of the facility        A
                                          (e.g., revolver, term).
Facility Purpose.......................  Generic description of purpose (e.g.,      A
                                          purchase equipment, provide operating
                                          funds).
Facility Risk Rating...................  Facility rating using the reporting        AP
                                          bank's risk rating system.
% Pass.................................  % of committed exposure rated Pass (i.e.,  AP
                                          translation of the reporting bank's risk
                                          rating into the regulatory risk rating
                                          system). Under the current Program, this
                                          is reported by the agent bank and covers
                                          the entire facility amount (``Facility
                                          Committed Exposure'') using the agent
                                          bank's credit evaluation. Under this
                                          proposal, each participant bank
                                          (including the agent bank) would report
                                          the ``% Pass'' but only for their
                                          ``Participant bank Share of Committed
                                          Exposure'' (see above).
% Special Mention......................  % of committed exposure rated Special      AP
                                          Mention--see ``% Pass'' above for a more
                                          detailed explanation of expected
                                          reporting.
% Substandard..........................  % of committed exposure rated              AP
                                          Substandard--see ``% Pass'' above for a
                                          more detailed explanation of expected
                                          reporting.
% Doubtful.............................  % of committed exposure rated Doubtful--   AP
                                          see ``% Pass'' above for a more detailed
                                          explanation of expected reporting.
% Loss.................................  % of committed exposure rated Loss--see    AP
                                          ``% Pass'' above for a more detailed
                                          explanation of expected reporting.
Nonaccrual Indicator...................  Yes / No.................................  AP
Nonaccrual Date........................  First day for which interest was no        AP
                                          longer accrued as income.
Internal Watch Indicator...............  Currently provided only by FRB reporting   AP
                                          banks. On the bank's watch list--Yes /
                                          No.
Name of Responsible Account Officer....  Account officer that examiners could       A
                                          contact to discuss the credit.
Phone Number of Responsible Account      Account officer's external phone number..  A
 Officer.
Department Handling Account............  Currently provided only by OCC reporting   A
                                          banks. Name of the business unit that is
                                          responsible for monitoring the
                                          borrower's performance and credit
                                          quality.
----------------------------------------------------------------------------------------------------------------
\*\ Data to be provided for Agented (A) and/or Participated (P) facilities. Readers should also note that, for
  purposes of this document, an agent reporting bank is also a participant reporting bank if the agent reporting
  bank retains credit exposure.

Appendix II

[[Page 76041]]



                    Data Elements for Basic Reporters
------------------------------------------------------------------------
 Data element (``N'' denotes
data that is not collected in                   Comments
     the current program)
------------------------------------------------------------------------
Name and address of Borrower   Full, legal name as it appears in the
 and Agent reporting bank.      corporate charter, and State, ZIP, and
                                country.
Name and address of the        Normally the same as the agent bank, a
 Review Bank, if any.           ``review'' bank differs from the agent
                                bank in two situations: when the agent
                                bank wishes to identify a location other
                                than its headquarters for examination of
                                the credit files by Agencies, or by the
                                Agencies when the agent bank is a non-
                                regulated bank and the Agencies wish to
                                examine the transaction. In the latter
                                case, the Agencies will designate one of
                                the regulated participant banks as the
                                ``review'' bank.
RegID of the Borrower and the  The ``RegIDs'' of the Borrower and the
 Agent Bank.                    Agent bank are currently referred to as
                                the borrower's and the agent bank's
                                ``RSSD.'' This document
                                proposed to expand the use of ``RegIDs''
                                to facilitate linkage of agent bank and
                                participant bank information, and the
                                RSSD system may, or may not, be used in
                                the future for this purpose.
RegID of the Review Bank, if   The ``RegID'' of the Review Bank is
 any.                           currently referred to as the review
                                bank's ``RSSD.'' The RSSD
                                system may, or may not, be used in the
                                future for this purpose.
Industry Code................   2002 North American Industrial
                                Classification System (NAICS) code
                                number reflecting the borrower's
                                business activity. Note that although
                                this data element is currently provided,
                                this document proposed to increase the
                                number of digits required to five or six
                                (from four required by the FRB and five
                                requested by the OCC/FDIC/OTS), which is
                                consistent with the industry code
                                requirements for filers of Form FR Y-10.
Bank's internal Facility ID..  Bank's internal facility number. Helps
                                examiners identify facilities in bank
                                records.
Facility Origination Date....  Date the facility originated. Permits
                                analysis of facilities by ``vintage'' to
                                identify underwriting trends.
Most Recent Renewal Date.....  Currently provided by FRB banks only.
                                Date the facility was last renewed or
                                reviewed to confirm the risk rating.
Facility Maturity Date.......  Date by which all utilizations must be
                                repaid (i.e., not the latest drawdown
                                date, but the date by which all drawings
                                must be repaid).
Facility Committed Exposure..  Total facility availability legally
                                committed to the borrower as of the date
                                of the data submission. Includes the
                                total facility amount, not just the
                                portion retained by the agent bank (if
                                any).
Facility Utilized Exposure...  Total utilized amount, including off-
                                balance sheet instruments (e.g., LCs),
                                as of the date of the data submission.
                                Includes the total facility utilization,
                                not just the portion retained by the
                                agent bank (if any).
 Days Principal or    Distress indicator/nonaccrual trigger.
 Interest Past Due (N).
Participant bank Names and     The agent bank submits the full, legal
 Addresses.                     name of each participant bank, and its
                                State, Zip, and Country.
Participant Bank's Share of    The agent bank submits the committed
 Committed Exposure.            exposure for each participant bank.
Facility Type................  Generic description of the facility
                                (e.g., revolver, term).
Facility Purpose.............  Generic description of purpose (e.g.,
                                purchase equipment, provide operating
                                funds).
Facility Risk Rating.........  Facility rating using the reporting
                                bank's risk rating system.
% Pass.......................  % of committed exposure rated Pass (i.e.,
                                translation of the bank's risk rating
                                into the regulatory risk rating system).
% Special Mention............  % of committed exposure rated Special
                                Mention (i.e., translation of the bank's
                                risk rating into the regulatory risk
                                rating system).
% Substandard................  % of committed exposure rated Substandard
                                (i.e., translation of the bank's risk
                                rating into the regulatory risk rating
                                system).
% Doubtful...................  % of committed exposure rated Doubtful
                                (i.e., translation of the bank's risk
                                rating into the regulatory risk rating
                                system).
% Loss.......................  % of committed exposure rated Loss (i.e.,
                                translation of the bank's risk rating
                                into the regulatory risk rating system).
Nonaccrual Indicator.........  Yes / No
Nonaccrual Date..............  First day for which interest was no
                                longer accrued as income.
Internal Watch Indicator.....  Currently provided only by FRB reporting
                                banks. On the reporting bank's watch
                                list--Yes / No.
Name of Responsible Account    Account officer name.
 Officer.
Phone Number of Responsible    Account officer's external phone number.
 Account Officer.
Department Handling Account..  Currently provided only by OCC reporting
                                banks. Name of the business unit that is
                                responsible for monitoring the
                                borrower's performance and credit
                                quality.
------------------------------------------------------------------------


    Dated: December 14, 2004.
Julie L. Williams,
Acting Comptroller of the Currency.

    By order of the Board of Governors of the Federal Reserve 
System, December 14, 2004.
Jennifer J. Johnson,
Secretary of the Board.

    Dated at Washington, DC, the 7th day of December, 2004.

    By order of the Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.

    Dated: December 9, 2004.

    By the Office of Thrift Supervision.
James E. Gilleran,
Director.
[FR Doc. 04-27752 Filed 12-17-04; 8:45 am]
BILLING CODE 4810-33- 6210-01- 6714-01- 6720-01-P