[Federal Register Volume 71, Number 2 (Wednesday, January 4, 2006)]
[Proposed Rules]
[Pages 287-290]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-12]


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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Chapter I

[Docket No. 05-22]

Office of Thrift Supervision

12 CFR Chapter V

[No. 2005-53]

FEDERAL RESERVE SYSTEM

12 CFR Chapter II

[Docket No. R-1243]

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Chapter III


Request for Burden Reduction Recommendations; Rules Relating to 
Prompt Corrective Action and the Disclosure and Reporting of CRA-
Related Agreements; Economic Growth and Regulatory Paperwork Reduction 
Act of 1996 Review

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

ACTION: Notice of regulatory review; request for comments.

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SUMMARY: The OCC, Board, FDIC and OTS (``we'' or ``the Agencies'') are 
reviewing our regulations to identify outdated, unnecessary, or unduly 
burdensome regulatory requirements pursuant to the Economic Growth and 
Regulatory Paperwork Reduction Act of 1996 (EGRPRA). Today, we request 
your comments and suggestions on ways to reduce burden with respect to 
rules regarding Prompt Corrective Action and the Disclosure and 
Reporting of CRA-Related Agreements, which are in the Capital and 
Community Reinvestment Act categories of regulations. All comments are 
welcome. We specifically invite comment on the following issues: 
whether statutory changes are needed; whether the regulations contain 
requirements that are not needed to serve the purposes of the statutes 
they implement; the extent to which the regulations may adversely 
affect competition; whether the cost of compliance associated with 
reporting, recordkeeping, and disclosure requirements, particularly on 
small institutions, is justified; whether any regulatory requirements 
are inconsistent or redundant; and whether any regulations are unclear.
    This is our last request for comment on categories of regulations 
in the first 10-year cycle of regulatory review under EGRPRA. We will 
analyze the comments received and propose burden-reducing changes to 
our regulations where appropriate. Some of your suggestions for burden 
reduction might require legislative changes. Where legislative changes 
would be required, we will consider your suggestions in recommending 
appropriate changes to Congress.

DATES: Written comments must be received no later than April 4, 2006.

ADDRESSES: You may submit comments by any of the following methods:
    EGRPRA Web site: http://www.EGRPRA.gov
     Comments submitted at the Agencies' joint Web site will 
automatically be distributed to all the Agencies. Comments received at 
the EGRPRA Web site and by other means will be posted on the Web site 
to the extent possible.
    Individual agency addresses: You are also welcome to submit 
comments to the Agencies at the following contact points (due to delays 
in paper mail delivery in the Washington area, commenters may prefer to 
submit their comments by alternative means):
    OCC: You should include OCC and Docket Number 05-22 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 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

[[Page 288]]

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 Number R-1243, 
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 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, unless modified for technical reasons. Accordingly, your 
comments will not be edited to remove any identifying or contact 
information. Public comments may also be viewed electronically or in 
paper 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, identified as EGRPRA burden 
reduction comments, by any of the following methods:
     Agency Web site: http://www.fdic.gov/regulations/laws/federal/propose.html.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-mail: [email protected]. Include ``EGRPRA'' in the 
subject line of the message.
     Mail: Robert E. Feldman, Executive Secretary, Federal 
Deposit Insurance Corporation, Washington, DC 20429.
     Hand Delivery: Comments may be hand delivered to 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: You may inspect comments at the FDIC Public 
Information Center, Room 100, 801 17th Street, NW., between 9 a.m. and 
4:30 p.m. on business days.
    OTS: You may submit comments, identified by ``No. 2005-53'' by any 
of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     E-Mail: [email protected]. Include ``No. 2005-
53'' in the subject line of the message, and provide your name and 
telephone number.
     Fax: (202) 906-6518.
     Mail: Regulation Comments, Chief Counsel's Office, Office 
of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552.
     Hand Delivery: Comments may be hand delivered to the 
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.
    Public Inspection: OTS will post comments and the related index on 
the OTS Internet Site at 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 fax to (202) 906-7755. (Please 
identify the material you would like to inspect to assist us in serving 
you.) OTS schedules appointments on business days between 10 a.m. and 4 
p.m. In most cases, appointments will be available the next business 
day following the date OTS receives a request.

FOR FURTHER INFORMATION CONTACT: OCC:
     Heidi Thomas, Special Counsel, Legislative and Regulatory 
Activities Division, (202) 874-5090.
     Lee Walzer, Counsel, Legislative and Regulatory Activities 
Division, (202) 874-5090.
    Board:
     Patricia A. Robinson, Assistant General Counsel, Legal 
Division, (202) 452-3005.
     Michael J. O'Rourke, Counsel, Legal Division, (202) 452-
3288.
     John C. Wood, Counsel, Division of Consumer and Community 
Affairs, (202) 452-2412.
     Kevin H. Wilson, Supervisory Financial Analyst, Division 
of Banking Supervision and Regulation, (202) 452-2362.
     For users of Telecommunications Device for the Deaf (TDD) 
only, contact (202) 263-4869.
    FDIC:
     Steven D. Fritts, Associate Director, Division of 
Supervision and Consumer Protection, (202) 898-3723.
     Ruth R. Amberg, Senior Counsel, Legal Division, (202) 898-
3736.
     Susan van den Toorn, Counsel, Legal Division, (202) 898-
8707.
    OTS:
     Glenn Gimble, Senior Project Manager, Thrift Policy, 
Supervision Policy, (202) 906-7158.
     Josephine Battle, Program Analyst, Thrift Policy, 
Supervision Policy, (202) 906-6870.
     Karen Osterloh, Special Counsel, Regulations and 
Legislation Division, Chief Counsel's Office, (202) 906-6639.

SUPPLEMENTARY INFORMATION: 

I. Overview of the EGRPRA Review and the Steps Taken So Far

    The Agencies \1\ are asking for your comments and suggestions on 
ways in which we can reduce regulatory burden consistent with our 
statutory obligations. Today, we request your input to help us identify 
which regulatory requirements involving Prompt Corrective Action and 
the Disclosure and Reporting of CRA-Related Agreements are outdated, 
unnecessary, or unduly burdensome. We list these rules, which are in 
the Capital and Community Reinvestment Act categories, in a chart at 
the end of this notice. Please send us your recommendations at our Web 
site, http://www.EGRPRA.gov, or to one of the listed addresses.
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    \1\ The National Credit Union Administration has participated in 
planning the EGRPRA review but has issued, and will issue, requests 
for comment separately.
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    Today's request for comment is the sixth and final notice in our 
multi-year review of regulations for burden reduction required by 
section 2222 of EGRPRA.\2\ We described the EGRPRA review's 
requirements in our first

[[Page 289]]

EGRPRA notice. In summary, EGRPRA requires us to:
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    \2\ Public Law 104-208, Sept. 30, 1996, 12 U.S.C. 3311. We 
published our first notice in the Federal Register on June 16, 2003, 
at 68 FR 35589; our second notice on January 21, 2004, at 69 FR 
2852; our third notice on July 20, 2004, at 69 FR 43347; our fouroth 
ntoice on February 3, 2005, at 70 FR 5571; and our fifth notice on 
August 11, 2005, at 70 FR 46779. You may view the notices at our Web 
site, http://www.EGRPRA.gov.
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     Categorize our regulations by type.
     Publish the regulations by category to request comment on 
which regulations contain requirements that are outdated, unnecessary, 
or unduly burdensome.
     Publish a summary of those comments.
     Eliminate unnecessary regulations to the extent 
appropriate.
     Report to Congress: summarizing the significant issues 
raised and their relative merits and analyzing whether legislative 
change is required to reduce burden.
    The first publication and review cycle under EGRPRA must be 
completed by September 2006. The regulatory response and report to 
Congress will occur after the publication cycle is finished.
    We have identified 13 categories of rules to implement our EGRPRA 
review. The categories are: Applications and Reporting; Banking 
Operations; Capital; Community Reinvestment Act; Consumer Protection: 
Lending Related Rules; Consumer Protection: Account/Deposit 
Relationships and Miscellaneous Consumer Rules; Directors, Officers and 
Employees; International Operations; Money Laundering; Powers and 
Activities; Rules of Procedure; Safety and Soundness; and Securities. 
You may see the categories and the rules placed within them at our Web 
site, http://www.EGRPRA.gov.
    With this notice, we have requested public comment regarding 
possible burden reduction in all categories of rules. Our June 16, 
2003, notice requested comment on three categories: Applications and 
Reporting; Powers and Activities; and International Operations. Our 
January 21, 2004, notice requested comment on Consumer Protection: 
Lending Related Rules. Our July 20, 2004, notice requested comment on 
Consumer Protection: Account/Deposit Relationships and Miscellaneous 
Consumer Rules. Our February 3, 2005 notice requested comment on three 
categories: Money Laundering, Safety and Soundness, and Securities. Our 
August 11, 2005 notice requested comment on three categories: Banking 
Operations; Directors, Officers and Employees; and Rules of Procedure.
    Additionally, an EGRPRA request for comment was included in the 
recent joint advance notice of proposed rulemaking regarding Risk-Based 
Capital Guidelines; Capital Adequacy Guidelines; and Capital 
Maintenance: Domestic Capital Modifications.\3\ As a result, a request 
for comment on those regulations is not duplicated here. In addition, 
the regulations implementing the Community Reinvestment Act are not 
included in this notice and request for comment because, during the 
past two years, the Agencies solicited comment on burden reduction 
measures for the CRA regulations and received voluminous comments in 
response.\4\ The Agencies have adopted final rules revising the CRA 
regulations, mindful of the comments related to burden reduction.\5\ 
Today, we request comment on rules regarding Prompt Corrective Action 
and the Disclosure and Reporting of CRA-Related Agreements, which are 
in the Capital and Community Reinvestment Act categories, 
respectively--the regulations on which burden reduction comments have 
not yet been sought.
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    \3\ 70 FR 61068, 61071 (Oct. 20, 2005).
    \4\ See 66 FR 37602 (July 19, 2001) (Joint Advance Notice of 
Proposed Rulemaking); 69 FR 5729 (Feb. 6, 2004) (Joint Notice of 
Proposed Rulemaking); 69 FR 51611 (Aug. 20, 2004) (FDIC Notice of 
Proposed Rulemaking); 69 FR 56175 (Sept. 20, 2004) (FDIC extension 
of comment period for proposed rule); 69 FR 68257 (Nov. 24, 2004) 
(OTS Notice of Proposed Rulemaking); and 70 FR 12148 (Mar. 11, 2005) 
(OCC, FRB and FDIC Notice of Proposed Rulemaking).
    \5\ See 69 FR 51155 (Aug. 18, 2004) (OTS Final Rule); 70 FR 
10023 (Mar. 2, 2005) (OTS Final Rule); and 70 FR 44256 (Aug. 2, 
2005) (OCC, FRB and FDIC Final Rule).
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    In addition to soliciting written comments, we held banker outreach 
meetings in Orlando, St. Louis, Denver, San Francisco, New York, 
Nashville, Seattle, Chicago, Phoenix and New Orleans. Approximately 450 
bankers attended these meetings. The Agencies have also held outreach 
meetings with over 100 participants from consumer and community groups 
to obtain their input on regulatory burden reduction. These meetings 
were held in San Francisco, Chicago, Washington, DC and Arlington, 
Virginia. In addition, the Agencies held joint outreach meetings 
including bankers as well as consumer and community groups in 
Washington, DC, Los Angeles and Kansas City. You may learn more about 
the meetings and related recommendations at our EGRPRA Web site, http://www.EGRPRA.gov.
    We received 19 comments in response to the first notice, about 560 
to the second notice, over 100 to the third notice, 123 to the fourth 
notice and 29 to the fifth notice. The Agencies appreciate the response 
to our notices and outreach meetings. The written comments and remarks 
at the meetings came from individuals, banks, savings associations, 
holding companies, industry trade groups, and consumer and community 
groups. Many comments contained multiple suggestions for regulatory 
reform. You may view the comments at our EGRPRA Web site, http://www.EGRPRA.gov. We are actively reviewing the feedback received about 
specific ways to reduce regulatory burden, as well as conducting our 
own analyses.
    In addition, Congress has considered various legislative proposals 
to reduce burden on the financial services industry. In 2004 and 2005, 
representatives of the Agencies and industry leaders testified before 
congressional committees about these legislative reform proposals and 
other ideas for reducing burden on the financial services industry. We 
will continue to post information about legislative and regulatory 
reform efforts on our Web site.

II. Request for Comment on Prompt Corrective Action and the Disclosure 
and Reporting of CRA-Related Agreements

    Today we are asking the public to identify ways in which the rules 
pertaining to Prompt Corrective Action and the Disclosure and Reporting 
of CRA-Related Agreements (which are part of the Capital and Community 
Reinvestment Act categories) may be outdated, unnecessary, or unduly 
burdensome. The chart at the end of this notice sets forth the 
regulations about which we seek comment.
    Specific issues to consider. While all comments are welcome, we 
specifically invite comment on the following issues:
    A. Need for statutory change. (1) Do any statutory requirements 
underlying the rules impose unnecessary, redundant, conflicting or 
unduly burdensome requirements? (2) Are there less burdensome 
alternatives?
    B. Need and purpose of the regulations. (1) Are the regulations 
consistent with the purposes of the statutes that they implement? (2) 
Have circumstances changed so that a rule is no longer necessary or 
needs revision? (3) Do changes in the financial products and services 
offered to consumers and businesses suggest a need to revise certain 
regulations (or statutes)? (4) Do any of the regulations impose 
compliance burdens not required by the statutes they implement?
    C. General approach/flexibility. (1) Would a different general 
approach to regulating achieve statutory goals with less burden? (2) Do 
any of these rules impose unnecessarily inflexible requirements?
    D. Effect of the regulations on competition. Do any of the 
regulations

[[Page 290]]

or statutes create competitive disadvantages for insured depository 
institutions compared to the rest of the financial services industry or 
competitive disadvantages for one type of insured depository 
institution over another?
    E. Reporting, recordkeeping, and disclosure requirements. (1) Which 
reporting, recordkeeping, or disclosure requirements impose the most 
compliance burdens? (2) Are any of the reporting or recordkeeping 
requirements unnecessary to demonstrate compliance with the law?
    F. Consistency and redundancy. (1) Are any of the requirements 
under one regulation inconsistent with or duplicative of requirements 
under another regulation? (2) If so, are the inconsistencies not 
warranted by the purposes of the regulations?
    G. Clarity. Are any of the regulations drafted unclearly?
    H. Burden on small insured institutions. We have particular 
interest in minimizing burden on small insured institutions (those with 
assets of $150 million or less). Are there appropriate ways to amend 
these rules to minimize adverse economic impact on small insured 
institutions?
    The Agencies appreciate the efforts of all interested parties to 
help us eliminate outdated, unnecessary, or unduly burdensome 
regulatory requirements.

                                                      Rules for Which We Are Requesting Comment Now
                                                      [Capital and the Community Reinvestment Act]
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                                                                                        State non-member                             Holding companies
              Subject                    National banks        State member banks            banks                 Thrifts            Bank \6\ Thrift
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                                                                       1. Capital
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Interagency Regulations:
    Prompt Corrective Action.......  12 CFR part 6.........  12 CFR part 208,        12 CFR part 325,       12 CFR part 565......  12 CFR 208.44(i); 12
                                                              subpart D[Reg. H]; 12   subpart B.                                    CFR 263.201-.202,
                                                              CFR 263.201-.205.                                                     .205.
                                                                                                                                   12 CFR 565.5(i); 12
                                                                                                                                    CFR 565.7; 12 CFR
                                                                                                                                    565.10.
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                                                              2. Community Reinvestment Act
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Interagency Regulations:
    Disclosure and Reporting of CRA- 12 CFR part 35........  12 CFR part 207 [Reg.   12 CFR part 346......  12 CFR part 533......  12 CFR part 207 [Reg.
     Related Agreements.                                      G].                                                                   G].
                                                                                                                                   12 CFR part 533.
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\6\ Foreign banking organizations that conduct banking operations in the U.S., either directly through branches and agencies or indirectly through U.S.
  bank subsidiaries or commercial lending company subsidiaries, generally are subject to the same regulatory regime as domestic bank holding companies.


    Dated: December 23, 2005.
John C. Dugan,
Comptroller of the Currency.
    By order of the Board of Governors of the Federal Reserve System 
on December 8, 2005.
Jennifer J. Johnson,
Secretary of the Board.
    By order of the Board of Directors.

Federal Deposit Insurance Corporation.

    Dated at Washington, DC, this 5th day of December 2005.
Robert E. Feldman,
Executive Secretary.
    Dated: December 6, 2005.
John M. Reich,
Director, Office of Thrift Supervision.
[FR Doc. 06-12 Filed 1-3-06; 8:45 am]
BILLING CODE 4810-33-P 6210-01-P 6714-01-P 6720-01-P