[Federal Register Volume 82, Number 187 (Thursday, September 28, 2017)]
[Notices]
[Pages 45285-45287]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-20759]


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FEDERAL DEPOSIT INSURANCE CORPORATION


Agency Information Collection Activities: Submission for OMB 
Review; Comment Request (OMB Nos. 3064-0085 and 3064-0120)

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Notice and request for comment.

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SUMMARY: The Federal Deposit Insurance Corporation (FDIC) will submit 
the following information collection request to the Office of 
Management and Budget (OMB) for review and approval in accordance with 
the Paperwork Reduction Act of 1995. The proposed information 
collections were previously published in the Federal Register on July 
6, 2017, allowing for a 60-day comment.

DATES: Comments are encouraged and will be accepted for an additional 
30 days until October 30, 2017.

ADDRESSES: Interested parties are invited to submit written comments to 
the FDIC by any of the following methods:
     http://www.FDIC.gov/regulations/laws/federal/notices.html
     Email: [email protected]. Please include the name and OMB 
control number of the relevant information collection in the subject 
line of the message.
     Mail: Manny Cabeza, Counsel, Room MB-3007, Federal Deposit 
Insurance Corporation, 550 17th Street NW., Washington, DC 20429.
     Hand Delivery: Comments may be hand-delivered to the guard 
station at the rear of the 17th Street Building (located on F Street), 
on business days between 7:00 a.m. and 5:00 p.m.

All comments should refer to the relevant OMB control number. Written 
comments and/or suggestions can also be directed to the Office of 
Management and Budget, Office of Information and Regulatory Affairs, 
attention FDIC Desk Officer, New Executive Office Building, Washington 
DC 20503 or sent to [email protected].

FOR FURTHER INFORMATION CONTACT: If you have additional comments, 
particularly with respect to the estimated public burden or associated 
response time, have suggestions, need a copy of any proposed 
information collection instrument and instructions, or desire any other 
additional information, please contact Manny Cabeza, Counsel, FDIC 
Legal Division either by mail at Room MB-3007, Federal Deposit 
Insurance Corporation, 550 17th Street NW., Washington, DC 20429; by 
email at [email protected]; or by telephone at (202) 898-3767.

SUPPLEMENTARY INFORMATION: Written comments and suggestions from the 
public and affected agencies concerning the proposed collections of 
information are encouraged. All comments received will become a matter 
of public record. Your comments should address one or more of the 
following four points:

--Evaluate whether the proposed collection of information is necessary 
for the proper performance of the functions of the agency, including 
whether the information has practical utility;
--Evaluate the accuracy of the agency's estimate of the burden of the 
proposed information collection, including the validity of the 
methodology and assumptions used;
--Evaluate whether and if so, how, the quality, utility, and clarity of 
the information to be collected can be enhanced; and
--Ways to minimize the burden of the information collection on 
respondents, including through the use of automated collection 
techniques or other forms of information technology.

Overview of the Information Collection Request

    1. Title: Record Keeping, Reporting and Disclosure Requirements in 
Connection with the Equal Credit Opportunity Act Regulation B.
    OMB Number: 3064-0085.
    Form Number: None.
    Affected Public: Insured state nonmember banks and state savings 
associations.

[[Page 45286]]

    Burden Estimate: \1\

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                                                                                   Average time      Estimated
        Source and burden            Number of        Annual           Total       per response    annual burden
                                    respondents      frequency       responses       (Minutes)        (Hours)
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Reporting burden:
    Credit Reporting History               3,711           1,333       4,946,763               1          82,466
     (1002.10)..................
    Demographic Information                3,711             279       1,035,369               1          17,256
     Collected for Monitoring
     Purposes (1002.13(a)&(b))..
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        Total Reporting.........  ..............  ..............  ..............  ..............          99,702
Disclosure Burden:
    Disclosure for Optional Self-             50               1              50               2               2
     Test (1002.5)..............
    Notification (1002.9).......           3,711             333       1,235,763               3          61,788
    Appraisal Report............           3,711             279       1,035,369               3          51,768
    (1002.14(a)(1)).............
    Disclosure of Information              3,711             279       1,035,369               1          17,256
     Collected for Monitoring
     Purposes(1002.13(c)).......
        Notice of Right to                 3,711             279       1,035,369               1          17,256
         Appraisal
         (1002.14(a)(2))........
                                 -------------------------------------------------------------------------------
        Total Disclosure........  ..............  ..............  ..............  ..............         148,071
Recordkeeping Burden:
Record Retention (Applications,            3,711           1,333       4,946,763               3         247,338
 Actions, Pre-Screened
 Solicitations)(1002.12)........
Record Retention (Self-                       50               1              50               3               3
 Testing)(1002.12)(b)(6)........
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    Total Recordkeeping.........  ..............  ..............  ..............  ..............         247,341
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    Total Burden Hours..........  ..............  ..............  ..............  ..............         495,113
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    General Description of Collection: Regulation B (12 CFR part 1002) 
issued by the Consumer Financial Protection Bureau, prohibits creditors 
from discriminating against applicants on any bases specified by the 
Equal Credit Opportunity Act; imposes, reporting, record keeping and 
disclosure requirements; establishes guidelines for gathering and 
evaluating credit information; and requires creditors to give 
applicants certain written notices. There is no change in the method or 
substance of the collection. The overall 107,276 hour reduction in 
total estimated annual burden (from 602,389 to 495,113 hours) is a 
result of economic fluctuation reflected in a reduction in the number 
of FDIC-supervised institutions, and because of the revision of the 
FDIC's estimates of the number of responses and the average time 
required to respond to the various information collections tasks.
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    \1\ The average hours per response shown in the table are 
rounded, but the Estimated Annual Burden is calculated using the 
full decimal and then is rounded to the nearest hour.
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    Changes to Data and Assumptions: The burden estimates shown above 
include several changes from the estimates the FDIC previously provided 
for this information collection. The FDIC currently supervises 3,711 
insured financial institutions, a decrease of 687 from the 4,398 
reported in 2014. Whereas the FDIC previously estimated that 25 percent 
(1,100) of its supervised institutions would conduct optional self-
testing, the FDIC's experience shows that very few banks actually 
conduct these optional tests; our revised estimate of 50 banks is 
likely high. The FDIC has also updated the annual frequencies for each 
burden. The FDIC believes the prior estimate of 850 approved loans per 
year, on average, was too low and has increased its estimate to 1,000. 
The agency has also corrected the frequencies for sections 1002.5 and 
1002.12 which are completed only once per year. As a conservative 
estimate, FDIC assumes that the denial rate for residential real estate 
loans applications for covered institutions is 14 percent. According to 
Home Mortgage Disclosure Act (HMDA) data from 2015, the denial rate for 
conventional home-purchase loan applications was 10.8 percent, and the 
denial rate for nonconventional home-purchase loans was 13.9 
percent.\2\ Call report data from June 30, 2017 shows that 
approximately 24 percent of total loan and lease balances are 
residential real estate loans (RRE), so, for purposes of estimating 
burden, FDIC assumes that 24 percent of the number of loans relate to 
RRE. The FDIC estimates that approximately 25 percent of non-RRE loans 
are denied.
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    \2\ Federal Reserve Bulletin, November 2016, Vol. 102, No. 6.
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    The foregoing assumptions result in the following estimates:

1,000 loans approved/(1 - 25 percent) = 1,333 loan applications
1,333 loan applications x 25 percent = 333 loans denied
1,000 loans approved x 24 percent = 240 RRE loans
240 RRE loans/(1 - 14 percent) = 279 RRE loan applications

    The table above now includes the burden estimate for section 
1002.13 that was inadvertently omitted from prior information 
collection submissions. Section 1002.13(a), to monitor compliance, 
requires lenders to collect demographic information from loan 
applicants either on the application form or on a separate form. 
Section 1002.13(b) & (c) involve disclosing to loan applicants the 
purpose and use of this demographic information.
    The burden table also deletes the prior estimated burden for 
1002.15 which only describes the eligibility for incentives for self-
testing and self-correction and does not involve any disclosures, 
reporting, or recordkeeping requirements.
    The FDIC has updated its estimate of the number of burden hours 
required to complete each task. It has estimated a burden of one to 
three minutes for most tasks (0.017 to 0.05 hours), a figure not 
significantly different from the prior estimates. However, the FDIC 
believes that the prior burden estimates for self-testing were greatly 
overstated. Whereas previously, self-testing under section 1002.12 was 
estimated to require two (2) hours to complete, the FDIC believes the 
recordkeeping requirement articulated

[[Page 45287]]

in the rule should take only 3 minutes (0.05 hours) to complete.
    2. Title: Flood Insurance.
    OMB Number: 3064-0120.
    Form Number: None.
    Affected Public: Insured state nonmember banks and state savings 
associations.
    Burden Estimate:

                                                               Table 1--Burden Calculation
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                                                             Share of
                          Item                                burden           Hours           Share           Hours           Hours        Total hours
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1. Disclosure to the Borrower...........................             50%            0.50             90%            0.45           0.225          25,097
2. Disclosure to the Servicer...........................  ..............  ..............  ..............  ..............           0.225          25,097
3. Report to FEMA of a Change in Servicer...............  ..............  ..............             10%            0.05            0.05           5,577
4. Recordkeeping (Bank keeps a copy of all                            50            0.50  ..............            0.50            0.50          55,770
 notifications).........................................
                                                          ..............             1.0  ..............             1.0             1.0         111,540
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Respondents (FDIC supervised banks with real estate loans)..............................................................................           3,718
Frequency (Average no. of real estate loans serviced w/flood ins).......................................................................              30
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    Total burden........................................................................................................................         111,540
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Sources: FDIC, FEMA, Federal Reserve Board.

    General Description of Collection: Each supervised lending 
institution is currently required to provide a notice of special flood 
hazards to each borrower with a loan secured by a building or mobile 
home located or to be located in an area identified by the Director of 
the Federal Emergency Management Agency as being subject to special 
flood hazards. The Riegle Community Development Act requires that each 
institution also provide a copy of the notice to the servicer of the 
loan (if different from the originating lender).
    There is no change in the method or substance of the collection. 
There is an overall reduction in burden hours which is the result of 
(1) economic fluctuation reflected by a decrease in the number of FDIC-
supervised institutions and (2) a decrease in the number of flood 
insurance policies nationally. In particular, the number of respondents 
and the frequency of response (number of loans) have decreased while 
the hours per response remain the same.
    Changes to Data and Assumptions: FDIC estimates total annual burden 
to be 111,540 hours. To obtain this figure, FDIC relied on: (a) Data 
from the Federal Emergency Management Agency (FEMA) as of May 2017; (b) 
FDIC Call Report data as of March 31, 2017; and (c) Federal Reserve 
Board mortgage data as of March 31, 2017.
    FEMA reported there were 4,983,954 flood insurance policies in 
effect with a total insured value of $1,238,657,149,400.\3\
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    \3\ https://www.fema.gov/flood-insurance-statistics-current-month (accessed June 15, 2017).
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    FDIC Call Report data showed that as of March 31, 2017, there were 
a total of 5,790 FDIC-insured institutions with a total of $4.25 
trillion in 1-4 family; multifamily; nonfarm, nonresidential, and 
agricultural loans secured by real estate. As of March 31, 2017, there 
were 3,718 FDIC-regulated institutions with a total value of about 
$1.19 trillion in these loans. Based on the foregoing, we estimate that 
FDIC-regulated banks hold 27.9% of these assets.
    The Federal Reserve Board reported $14.41 trillion in mortgage debt 
outstanding in the U.S., with $4.63 trillion (32.4%) held by depository 
institutions.\4\ Since this total debt held by banks is close to the 
value of these real estate loans from Call Report data, we have 
confidence that we can meld the data sets for estimation purposes. We 
therefore assume that 32.4% of the value of flood insurance policies 
will be held by U.S. commercial banks: $401 billion.
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    \4\ https://www.federalreserve.gov/econresdata/releases/mortoutstand/mortoutstand20170331.htm (accessed June 15, 2017).
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    In the absence of any data on the number of real estate loans with 
flood insurance at any bank, we resort to apportion 32.4% of the number 
of flood insurance policies (1,614,801) to commercial banks, and 27.9% 
of those to FDIC-regulated institutions (451,177). Because the value of 
property varies greatly between different geographical regions and 
different banks, it is doubtful that this estimation of the number of 
policies is accurate. However, there exists no other reasonable method 
for deriving the number of policies at each bank given available data.
    Next, we apportioned the 451,177 flood insurance policies to each 
FDIC-regulated institution according to its share of real estate loans 
to total real estate loans. The resulting apportionment results in an 
average of 121 policies per bank, and a median of 30 policies per bank. 
Because the average is skewed by the large number of policies at large 
banks, we believe the median is a better measure for calculating burden 
hours.
    Our subject-matter experts (SMEs) for this rule believe that the 
total burden to the public for complying with this rule is 1.0 hours 
per policy. We find four PRA related tasks in this rule: (1) Disclosure 
to Borrowers, (2) Disclosure to Servicers, (3) Reporting to FEMA of 
Changes in Coverage, and (4) Recordkeeping for tasks 1-3 above. We 
assume that Recordkeeping will comprise \1/2\ hour, and the remaining 
\1/2\ is split between the other tasks. We assume that 90% of policies 
will involve a new origination, and 10% of policies will involve a 
change in status.
    With 3,718 respondents holding a median of 30 policies and 1 hour 
of burden per policy, we calculate a total burden of 111,540 hours. 
This burden is apportioned to each task as shown in Table 1 above.

    Dated at Washington, DC, this 22nd day of September, 2017. 
Federal Deposit Insurance Corporation.
Valerie J. Best,
Assistant Executive Secretary.
[FR Doc. 2017-20759 Filed 9-27-17; 8:45 am]
 BILLING CODE 6714-01-P