[Federal Register Volume 83, Number 82 (Friday, April 27, 2018)]
[Notices]
[Pages 18562-18564]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-08839]


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FEDERAL RESERVE SYSTEM


Proposed Agency Information Collection Activities: Submission for 
OMB Review; Comment Request

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

ACTION: Notice and request for comment.

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SUMMARY: In accordance with the requirements of the Paperwork Reduction 
Act of 1995 (PRA), the Board, the Federal Deposit Insurance Corporation 
(FDIC), and the Office of the Comptroller of the Currency (OCC) 
(collectively, the agencies) may not conduct or sponsor, and the 
respondent is not required to respond to, an information collection 
unless it displays a currently valid Office of Management and Budget 
(OMB) control number. On December 27, 2017, the Board, under the 
auspices of the Federal Financial Institutions Examination Council 
(FFIEC), requested public comment for 60 days on a proposal to extend, 
with revision, the Report of Assets and Liabilities of U.S. Branches 
and Agencies of Foreign Banks (FFIEC 002) and the Report of Assets and 
Liabilities of a Non-U.S. Branch that is Managed or Controlled by a 
U.S. Branch or Agency of a Foreign (Non-U.S.) Bank (FFIEC 002S), which 
are currently approved collections of information. The Board published 
this proposal on behalf of the agencies.
    The proposed revisions to these reports align with corresponding 
changes made to the Consolidated Reports of Condition and Income (FFIEC 
031, FFIEC 041, and FFIEC 051). The Consolidated Reports of Condition 
and Income are commonly referred to as the Call Report. The proposed 
revisions to the FFIEC 002 and the FFIEC 002S delete or consolidate 
certain items, establish certain reporting thresholds, account for 
changes in the accounting for equity investments, and make 
instructional clarifications consistent with those previously made to 
or currently proposed for the Call Report instructions. The proposed 
revisions would result in an overall reduction in burden.
    The comment period for this proposal ended on February 26, 2018. 
The Board received two comments addressing the proposed changes. After 
considering the comments received on the proposal, the agencies will 
proceed with the proposed reporting revisions to the FFIEC 002 and 
FFIEC 002S, while incorporating one clarification in response to a 
comment. These reporting revisions would take effect as of the June 30, 
2018, report date. The Board is giving notice that it is sending the 
collection to OMB for review.

DATES: Comments must be submitted on or before May 29, 2018.

ADDRESSES: Interested parties are invited to submit written comments to 
the agency listed below. All comments, which should refer to the OMB 
control

[[Page 18563]]

number, will be shared among the agencies.
    You may submit comments, which should refer to ``FFIEC 002 and 
FFIEC 002S,'' by any of the following methods:
     Agency Website: http://www.federalreserve.gov. Follow the 
instructions for submitting comments at: http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
     Email: [email protected]. Include the 
reporting form numbers in the subject line of the message.
     Fax: (202) 452-3819 or (202) 452-3102.
     Mail: Ann E. Misback, 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 website at 
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 form in Room 
3515, 1801 K Street NW (between 18th and 19th Streets NW), Washington, 
DC 20006, between 9:00 a.m. and 5:00 p.m. on weekdays.
    Additionally, commenters may send a copy of their comments to the 
OMB desk officer for the agencies by mail to the Office of Information 
and Regulatory Affairs, U.S. Office of Management and Budget, New 
Executive Office Building, Room 10235, 725 17th Street NW, Washington, 
DC 20503; by fax to (202) 395-6974; or by email to 
[email protected].

FOR FURTHER INFORMATION CONTACT: For further information about the 
proposed revisions to the FFIEC 002 and FFIEC 002S discussed in this 
notice, please contact the agency staff member whose name appears 
below. In addition, copies of the FFIEC 002 and FFIEC 002S forms can be 
obtained at the FFIEC's website (https://www.ffiec.gov/ffiec_report_forms.htm).
    Nuha Elmaghrabi, Federal Reserve Board Clearance Officer, (202) 
452-3884, Office of the Chief Data Officer, Board of Governors of the 
Federal Reserve System, 20th and C Streets NW, Washington, DC 20551. 
Telecommunications Device for the Deaf (TDD) users may call (202) 263-
4869.

SUPPLEMENTARY INFORMATION: The Board is proposing to extend for three 
years, with revision, the FFIEC 002 and FFIEC 002S.
    Report Titles: Report of Assets and Liabilities of U.S. Branches 
and Agencies of Foreign Banks; Report of Assets and Liabilities of a 
Non-U.S. Branch that is Managed or Controlled by a U.S. Branch or 
Agency of a Foreign (Non-U.S.) Bank.
    Form Numbers: FFIEC 002; FFIEC 002S.
    OMB control number: 7100-0032.
    Frequency of Response: Quarterly.
    Affected Public: Business or other for-profit.
    Respondents: All state-chartered or federally-licensed U.S. 
branches and agencies of foreign banking organizations, and all non-
U.S. branches managed or controlled by a U.S. branch or agency of a 
foreign banking organization.
    Estimated Number of Respondents: FFIEC 002--209; FFIEC 002S--38.
    Estimated Average Burden per Response: FFIEC 002--23.87 hours; 
FFIEC 002S--6.0 hours.
    Estimated Total Annual Burden: FFEIC 002--19,955 hours; FFIEC 
002S--912 hours.
    Type of Review: Revision and extension of currently approved 
collections.

General Description of Reports

    These information collections are mandatory (12 U.S.C. 3105(c)(2), 
1817(a)(1) and (3), and 3102(b)). Except for select sensitive items, 
the FFIEC 002 is not given confidential treatment; the FFIEC 002S is 
given confidential treatment (5 U.S.C. 552(b)(4) and (8)).

Abstract

    On a quarterly basis, all U.S. branches and agencies of foreign 
banks are required to file the FFIEC 002, which is a detailed report of 
condition with a variety of supporting schedules. This information is 
used to fulfill the supervisory and regulatory requirements of the 
International Banking Act of 1978. The data are also used to augment 
the bank credit, loan, and deposit information that the Board uses to 
make decisions concerning monetary policy, and for other public policy 
purposes. The FFIEC 002S is a supplement to the FFIEC 002 that collects 
information on assets and liabilities of any non-U.S. branch that is 
managed or controlled by a U.S. branch or agency of the foreign bank. A 
non-U.S. branch is managed or controlled by a U.S. branch or agency if 
a majority of the responsibility for business decisions, including but 
not limited to decisions with regard to lending or asset management or 
funding or liability management, or the responsibility for 
recordkeeping in respect of assets or liabilities for that foreign 
branch resides at the U.S. branch or agency. A separate FFIEC 002S must 
be completed for each managed or controlled non-U.S. branch. The FFIEC 
002S must be filed quarterly along with the U.S. branch or agency's 
FFIEC 002. The data from both reports are used for (1) monitoring 
deposit and credit transactions of U.S. residents; (2) monitoring the 
impact of policy changes; (3) analyzing structural issues concerning 
foreign bank activity in U.S. markets; (4) understanding flows of 
banking funds and indebtedness of developing countries in connection 
with data collected by the International Monetary Fund and the Bank for 
International Settlements that are used in economic analysis; and (5) 
assisting in the supervision of U.S. offices of foreign banks. The 
Federal Reserve System collects and processes these reports on behalf 
of all three agencies.

Current Actions

I. Introduction

    On December 27, 2017, the Board requested comment for 60 days on a 
proposal to revise the existing FFIEC 002 and FFIEC 002S report forms 
and instructions (82 FR 61294). The proposed revisions partially stem 
from a formal initiative launched by the FFIEC in December 2014 to 
identify potential opportunities to reduce burden associated with Call 
Report requirements for community banks. The FFIEC's formal initiative 
included surveys of agency Call Report data users, which have served as 
the foundation for the proposed burden-reducing revisions. As part of 
these surveys, users were asked to fully explain the need for each Call 
Report data item they deemed essential, how the data item is used, the 
frequency with which it is needed, and the population of institutions 
from which it is needed. Based on the results of the surveys, the 
agencies identified Call Report data items that are no longer needed, 
are needed on a less frequent basis, or are needed only above certain 
reporting thresholds, and have proposed or finalized the elimination, 
less frequent collection, or creation of new or upwardly revised 
reporting thresholds for these data items in the Call Report.\1\ In an 
effort to maintain consistency between the FFIEC 002, the FFIEC 002S, 
and the Call Report, the burden-reducing changes identified for the 
Call Report were incorporated into the December 27, 2017, proposal 
where

[[Page 18564]]

applicable. In addition, the proposed revisions ensure that the 
reporting of data on equity investments in several FFIEC 002 schedules 
is consistent with changes in the accounting standards applicable to 
such investments. All of the proposed revisions have been implemented 
or proposed to be implemented in the Call Report.
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    \1\ See 80 FR 56539 (September 18, 2015), 81 FR 45357 (July 13, 
2016), 81 FR 54190 (August 15, 2016), 82 FR 2444 (January 9, 2017), 
82 FR 29147 (June 27, 2017), 82 FR 51908 (November 8, 2017), and 83 
FR 939 (January 8, 2018) for information on other actions taken 
under this initiative.
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    The comment period for this proposal ended on February 26, 2018. 
The Board received two comments on the proposal, one specific comment 
from an individual on a proposed revision and one general comment from 
a government entity. The government entity did not raise concerns about 
the proposal itself, but stated that it uses certain data items in the 
FFIEC 002 and FFIEC 002S in preparing economic statistics on 
international transactions, and encouraged the agencies to continue 
collecting those items. After considering the comments received on the 
proposal, the agencies will proceed with the proposed reporting 
revisions to the FFIEC 002 and FFIEC 002S, while incorporating one 
clarification in response to the specific comment described below. 
These reporting revisions would take effect as of the June 30, 2018, 
report date.

II. Specific Comment on the Proposed FFIEC 002 and FFIEC 002S Revisions

    Respondents to the FFIEC 002 report are currently required to 
indicate, in Schedule RAL, Assets and Liabilities, Memorandum item 17, 
for the March 31 report date, the most comprehensive level of auditing 
work performed for the branch or agency by, or on behalf of, its parent 
organization during the preceding calendar year. In response to certain 
auditing standards issued by the Public Company Accounting Oversight 
Board (PCAOB) and the American Institute of Certified Public 
Accountants' Auditing Standards Board (ASB), the Board proposed to 
revise two of the existing statements describing the most comprehensive 
level of auditing work performed for the branch or agency during the 
preceding year. The Board also proposed to revise the information 
collected in Memorandum item 17 to refer only to work performed by 
independent external auditors and to remove the reference to work 
performed on behalf of the parent organization.
    The Board received one comment from an individual requesting 
clarification as to which branches and agencies are required to have an 
integrated audit conducted by independent external auditors as 
mentioned in the text for proposed statement 1a in the response to 
Memorandum item 17. Specifically, the commenter wanted to confirm that 
only public companies and companies with a market capitalization 
greater than $75 million are required to have an integrated audit.
    Under section 363.3(b) of the FDIC's regulations (12 CFR 363.3(b)), 
the independent public accountant who audits the financial statements 
of an FDIC-insured branch of a foreign bank with $1 billion or more in 
total claims on nonrelated parties is required to audit and report on 
the effectiveness of the branch's internal control over financial 
reporting (ICFR). Standards issued by the PCAOB and the ASB provide 
guidance regarding the integration of audits of ICFR with audits of 
financial statements. Thus, statement 1a and its reference to an 
integrated audit are applicable to certain FDIC-insured branches, which 
means that the requirement for an integrated audit is not limited to 
the circumstances described by the commenter. However, the Board will 
clarify statement 1a of Memorandum item 17 by adding ``(e.g., as 
required for FDIC-insured branches subject to Part 363 of the FDIC's 
regulations that have $1 billion or more in total claims on nonrelated 
parties)'' at the end of the proposed text of this statement.

III. Request for Comment

    Public comment is requested on all aspects of this notice. Comment 
is specifically invited on:
    a. Whether the information collections are necessary for the proper 
performance of the agencies' functions, including whether the 
information has practical utility;
    b. The accuracy of the agencies' estimate of the burden of the 
information collections, including the validity of the methodology and 
assumptions used;
    c. Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    d. Ways to minimize the burden of the information collections on 
respondents, including through the use of automated collection 
techniques or other forms of information technology; and
    e. Estimates of capital or start up costs and costs of operation, 
maintenance, and purchase of services to provide information.
    Comments submitted in response to this notice will be shared among 
the agencies. All comments will become a matter of public record.

    Board of Governors of the Federal Reserve System, April 23, 
2018.
Ann Misback,
Secretary of the Board.
[FR Doc. 2018-08839 Filed 4-26-18; 8:45 am]
BILLING CODE 6210-01-P