[Federal Register Volume 86, Number 80 (Wednesday, April 28, 2021)]
[Notices]
[Pages 22431-22437]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-08803]


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FEDERAL DEPOSIT INSURANCE CORPORATION


Agency Information Collection Activities: Proposed Collection 
Renewal; Comment Request (OMB No. 3064-0022; -0027; -0103; -0114; -
0115; -0163; -0208)

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Agency information collection activities: submission for OMB 
review; comment request.

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SUMMARY: The FDIC, as part of its obligations under the Paperwork 
Reduction Act of 1995, invites the general public and other Federal 
agencies to take this opportunity to comment on the request to renew 
the existing information collections described below (OMB Control No. 
3064-0022; -0027; -0103; -0114; -0115; -0163).

DATES: Comments must be submitted on or before May 28, 2021.

ADDRESSES: Interested parties are invited to submit written comments to 
the FDIC by any of the following methods:
     Agency Website: https://www.FDIC.gov/regulations/laws/federal.
     Email: [email protected]. Include the name and number of 
the collection in the subject line of the message.
     Mail: Manny Cabeza (202-898-3767), Regulatory Counsel, MB-
3128, 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 NW building (located on F 
Street), on business days between 7:00 a.m. and 5:00 p.m.
    Written comments and recommendations for the proposed information 
collection should be sent within 30 days of publication of this notice 
to www.reginfo.gov/public/do/PRAMain . Find this particular information 
collection by selecting ``Currently under 30-day Review--Open for 
Public Comments'' or by using the search function.

FOR FURTHER INFORMATION CONTACT:  Manny Cabeza, Regulatory Counsel, 
202-898-3767, [email protected], MB-3128, Federal Deposit Insurance 
Corporation, 550 17th Street NW, Washington, DC 20429.

SUPPLEMENTARY INFORMATION:
    Proposal to renew the following currently approved collections of 
information:
    1. Title: Uniform Application/Uniform Termination for Municipal 
Securities Principal or Representative.
    OMB Number: 3064-0022.
    Form Number: 6200/54; 6200/55.
    Affected Public: Individuals and Insured state nonmember banks and 
state savings associations.
    Burden Estimate:

                                   Summary of Annual Burden and Internal Cost
                                               [OMB No. 3064-0022]
----------------------------------------------------------------------------------------------------------------
                                                     Estimated
                                     Estimated       number of       Estimated    Estimated time     Estimated
        Source and burden            number of     responses per     number of     per response    annual burden
                                    respondents     respondent       responses        (hours)         (hours)
----------------------------------------------------------------------------------------------------------------
Uniform Termination Notice for                 2             0.5               1             1.0             1.0
 Securities Principal or
 Representative (Form MSD-5)....
Uniform Application for                        2             0.5               1             1.0             1.0
 Municipal Securities Principal
 or Representative (Form MSD-4).
                                 -------------------------------------------------------------------------------
    Total Reporting.............  ..............  ..............  ..............  ..............             2.0
                                 -------------------------------------------------------------------------------
    Total Burden Hours..........  ..............  ..............  ..............  ..............             2.0
----------------------------------------------------------------------------------------------------------------
Source: FDIC.

    General Description of Collection: The 1975 Amendments to the 
Securities Exchange Act of 1934 established a comprehensive framework 
for the regulation of the activities of municipal securities dealers. 
Under Section 15B(a) of the Securities Exchange Act, municipal 
securities dealers which are banks, or separately identifiable 
departments or divisions of banks engaging in municipal securities 
activities, are required to be registered with the Securities and 
Exchange Commission in accordance with such rules as the Municipal 
Securities Rulemaking Board (MSRB), a rulemaking authority established 
by the 1975 Amendments, may prescribe as necessary or appropriate in 
the public interest or for the protection of investors. One of the 
areas in which the Act directed the MSRB to promulgate rules is the 
qualifications of persons associated with municipal securities dealers 
as municipal securities principals and municipal securities 
representatives. The MSRB Rules require persons who are or seek to be 
associated with municipal securities dealers as municipal securities 
principals or municipal securities representatives to provide certain 
background information and conversely, require the municipal securities 
dealers to obtain the information from such persons. Generally, the 
information required to be furnished relates to employment history and 
professional background including any disciplinary sanctions and any 
claimed bases for exemption from MSRB examination requirements. The 
FDIC and the other two Federal bank regulatory agencies, the 
Comptroller of the Currency, and the Federal Reserve Board, have 
prescribed Forms MSD-4 to satisfy these requirements and have 
prescribed Form MSD-5 for notification by a bank municipal securities 
dealer that a municipal securities principal's or a municipal 
securities representative's association with the dealer has terminated 
and the reason for such termination. State nonmember banks and state 
savings associations that are municipal security dealers submit these 
forms, as applicable, to the FDIC as their appropriate regulatory 
agency for each person associated with the dealer as a municipal 
securities principal or municipal securities representative. There is 
no change in the methodology or substance of this information

[[Page 22432]]

collection. The decrease in burden hours is a result of the decrease in 
the number of respondents.
    2. Title: Request for Deregistration for Registered Transfer 
Agents.
    OMB Number: 3064-0027.
    Form Number: 6342/12.
    Affected Public: Insured state nonmember banks and state savings 
associations.
    Burden Estimate:

                                                                Summary of Annual Burden
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                     Estimated                            Estimated time
     Information collection           Type of  burden     Obligation to  respond     number of     Estimated  frequency     per response     Estimated
           description                                                              respondents        of  responses          (hours)     annual  burden
--------------------------------------------------------------------------------------------------------------------------------------------------------
Request for Deregistration for    Reporting.............  Mandatory.............               1  On Occasion...........            0.42            0.42
 Registered Transfer Agents.
                                                                                 -----------------------------------------------------------------------
    Total Estimated Annual        ......................  ......................  ..............  ......................  ..............           0.42.
     Burden.
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    General Description of Collection:
    Under the Securities Exchange Act of 1934 (15 U.S.C. 78q-1), an 
insured nonmember bank (or a subsidiary of such a bank) that functions 
as a transfer agent may withdraw from registration as a transfer agent 
by filing a written notice of withdrawal with the FDIC. The FDIC 
requires such banks to file FDIC Form 6342/12 as the written notice of 
withdrawal. There is no change in the methodology or substance of this 
information collection.
    3. Title: Recordkeeping Requirements Associated with Real Estate 
Appraisals and Evaluations.
    OMB Number: 3064-0103.
    Form Number: None.
    Affected Public: Insured State Nonmember Banks and State Savings 
Associations.
    Burden Estimate:

                                                      Table 1--Summary of Estimated Annual Burdens
                                                                   [OMB No. 3064-0103]
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                                      Type of burden
         IC description               (obligation  to     Frequency  of response     Number of     Number of  responses/     Hours per     Annual burden
                                         respond)                                   respondents         respondent           response         (hours)
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Recordkeeping Requirements        Recordkeeping           On occasion...........           3,227  227...................           0.083          60,800
 Associated with Real Estate       (Mandatory).
 Appraisals and Evaluations.
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    Total Annual Burden Hours...  ......................  ......................  ..............  ......................  ..............          60,800
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Source: FDIC.

    Methodology and Assumptions:
    Estimated Number of Respondents--Potential respondents to this 
information collection (IC) include all FDIC-supervised institutions. 
As of December 31, 2020 there were 3,227 FDIC-supervised institutions, 
of which 2,380 are considered ``small'' for the purposes of the 
Regulatory Flexibility Act (RFA).\1\ FDIC therefore uses 3,227 as the 
estimate of the annual number of respondents to this IC.
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    \1\ FDIC Call Report data, December 2020. The Small Business 
Administration (SBA) defines a small banking organization as having 
$600 million or less in assets, where an organization's ``assets are 
determined by averaging the assets reported on its four quarterly 
financial statements for the preceding year.'' See 13 CFR 121.201 
(as amended by 84 FR 34261, effective August 19, 2019). In its 
determination, the ``SBA counts the receipts, employees, or other 
measure of size of the concern whose size is at issue and all of its 
domestic and foreign affiliates.'' See 13 CFR 121.103. Following 
these regulations, the FDIC uses a covered entity's affiliated and 
acquired assets, averaged over the preceding four quarters, to 
determine whether the covered entity is ``small'' for the purposes 
of the RFA.
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    Estimated Number of Responses per Respondent--The estimated number 
of responses per respondent for this ICR is estimated using the dollar 
volume, and where available, loan counts of real estate loans held by 
FDIC-supervised institutions. For each institution, information is 
gathered from the Call Report on the reported dollar value of 1-4 
family residential construction loans, other construction and 
development loans, loans secured by farmland, open-end loans secured by 
1-4 family residential properties, closed-end loans secured by 1-4 
family residential properties, loans secured by multifamily (5 or more) 
residential properties, loans secured by owner-occupied nonfarm 
nonresidential properties, and loans secured by other nonfarm 
nonresidential properties. This data is gathered from Call Report 
Schedule RC-C as of December 31 of each year, or in the case of the 
most recent 12-month period, the most recent period available.
    To convert the reported dollar volume of real estate related loans 
held by FDIC-supervised institutions into loan counts, a more 
appropriate denomination for estimating appraisal and evaluation 
activity, the methodology applies estimated or derived information on 
average loan size for each category of real estate loans. The 
methodology divides the reported dollar value of 1-4 family residential 
construction loans, and closed-end loans secured by 1-4 family 
residential properties, by the U.S. Census Bureau's estimate of the 
average sales price of new homes in order to derive an estimate of the 
number of loans for these loan categories.\2\ The methodology assumes 
that the average loan size of open-end loans secured by 1-4 family 
residential properties is 20 percent of the U.S. Census Bureau's 
estimate of the average sales price of new homes. The methodology uses 
this assumption for the average loan size of open-end loans secured by 
1-4 family residential properties based on supervisory experience 
because the FDIC does not currently have access to

[[Page 22433]]

information that would enable a more empirical estimate. The 
methodology divides the reported dollar value of open-end loans secured 
by 1-4 family residential properties by 20 percent of the U.S. Census 
Bureau's estimate of the average sales price of new homes in order to 
derive an estimate of the number of loans for this loan category. The 
methodology divides the reported dollar value of other construction and 
land development loans, and loans secured by multifamily (5 or more) 
residential properties, by the assumed average loan size of $1 million 
in order to derive an estimate of the number of loans for these loan 
categories. The methodology uses an assumption of $1 million for the 
average loan size based on supervisory experience because the FDIC does 
not currently have access to information that would enable a more 
empirical estimate. Finally, a statistical method is used to derive an 
estimate of the average loan size for loans secured by farmland and 
loans secured by owner-occupied and non-owner-occupied nonfarm 
nonresidential properties. Call Report Schedule RC-C Part II contains 
information on the dollar volume and number of loans of these loan 
types for loans above and below specific dollar-value thresholds 
($100,000 and less, $100,000 to $250,000, and $250,000 to $1 million 
for loans secured by nonfarm nonresidential properties, and $100,000 
and less, $100,000 to $250,000, and $250,000 to $500,000 for loans 
secured by farmland). Assuming that the dollar value of loans secured 
by farmland and nonfarm nonresidential properties held by FDIC-
supervised institutions are normally distributed, the methodology 
derives an estimate of the average loan amount for each of these loan 
types as of December 31 of each year, or the most recent reporting 
period in the case of the most recent 12-month period. For example, as 
of December 31, 2020 this methodology produces an estimate of $585,459 
as the average loan size for loans secured by farmland, and $975,836 as 
the average loan size for loans secured by nonfarm nonresidential 
properties. The methodology divides the reported dollar value of loans 
secured by farmland and loans secured by owner-occupied and non-owner-
occupied nonfarm nonresidential properties by the derived estimate of 
average loan size for loans secured by farmland and nonfarm 
nonresidential properties in order to derive an estimate of the number 
of loans for these loan categories.
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    \2\ See U.S. Census Bureau, ``Median and Average Sale Price of 
Houses Sold.'' Available at https://www.census.gov/construction/nrs/historical_data/index.html.
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    The methodology estimates the number of new loans for each FDIC-
supervised institution by assuming that any positive change in the 
preceding 12-month period in the reported dollar value of a real estate 
related loan type represents new lending activity. The change in the 
12-month dollar value of loans held of each real estate loan type for 
each FDIC-supervised institution, if positive, is divided by the 
estimated average loan size for that loan type in order to produce an 
estimate of the number of new loans issued by each FDIC-supervised 
institution. However, if the 12-month change in the reported dollar 
value of a loan type is zero or negative, the methodology assumes that 
the number of new loans is zero.
    The methodology estimates refinancing activity by assuming that a 
fixed percentage of the estimated count of existing real estate loans 
of each loan type is representative of those loans in the portfolio 
that were refinanced in the preceding 12-month period. For each 
institution, and each real estate-related loan type, the methodology 
subtracts the dollar volume of new loans from the reported dollar 
volume of loans as of each 12-month period end-date, divides that 
figure by the applicable estimate of average loan size, and multiplies 
that figure by 15 percent to derive an estimate of the number of 
existing loans that were refinanced in the preceding 12-month period. 
The 15 percent estimate is based on supervisory experience since the 
FDIC does not currently have access to information that would enable a 
more empirical estimate.
    The methodology also estimates the number of appraisals and 
evaluations commissioned by FDIC-supervised institutions over the 
previous 12-month period in order to monitor their real estate loan 
portfolios for credit risk. The methodology assumes that three percent 
of the estimated loan count for existing loans secured by farmland, 
five percent of the estimated loan count for existing 1-4 family 
residential construction loans, eight percent of the estimated number 
of existing closed-end loans secured by 1-4 family residential 
properties, loans secured by multifamily (5 or more) residential 
properties, and loans secured by owner-occupied nonfarm nonresidential 
properties, and ten percent of the estimated number of existing other 
construction and development loans, open-end loans secured by 1-4 
family residential properties, and loans secured by non-owner-occupied 
nonfarm nonresidential properties is representative of the number of 
loans for which the institution commissioned an appraisal or evaluation 
in the preceding 12-month period. These estimates are based on 
supervisory experience since the FDIC does not currently have access to 
information that would enable a more empirical estimate.
    To calculate the total estimated volume of appraisals and 
evaluations associated with a real estate loan for which an FDIC-
supervised institution would have to comply with the applicable 
recordkeeping requirements of Part 323, the methodology sums the 
estimated count of new loans, existing loans that were refinanced, and 
loans for which the institution commissioned an appraisal or an 
evaluation over the preceding 12-month period and assumes that all of 
these loans would require an appraisal or evaluation. Using this 
methodology, I estimate that there will be 227 responses per respondent 
per year for this IC. This represents an increase of 84 (59 percent) 
from the prior Information Collection submission (143). This increase 
is driven primarily by a change in the methodology used for estimating 
the number of responses per respondent.
    The methodology used to estimate responses per respondent described 
above differs from the methodology used to estimate the PRA burden of 
this information collection when it was last approved by the OMB in 
2018. The previous submission used dollar volume information for real 
estate loan categories aggregated for all FDIC-supervised institutions, 
rather than for each institution as described above. Consequently, even 
if the total dollar value of a particular loan type decreased among 
FDIC-supervised institutions in aggregate, the estimated number of new 
loans of that type would be still be positive if it increased for at 
least one institution, whereas it would have been assumed to be zero 
under the methodology used for the previous submission. Additionally, 
the methodology used to estimate the number of responses per respondent 
in the last information collection submission used average loan value 
estimates for loans secured by farmland and loans secured by owner- and 
non-owner-occupied nonfarm nonresidential properties of $1 million, 
rather than the statistical method just described, to derive average 
loan size estimates for these loan categories. Over the time period 
from year-end 2014 to year-end 2020, the statistical method produced 
estimates ranging from $563,385 to $663,766 for the average loan size 
of loans secured by farmland, and $813,999 to $975,836 for loans 
secured by nonfarm nonresidential properties. Since the average loan 
size estimates for both loan types were lower than $1 million for the 
whole time period, the

[[Page 22434]]

estimated number of existing and new loans for these loan types 
increased relative to the estimates used for the previous submission. 
These methodological changes led to more accurate, and generally 
larger, estimates for responses per respondent than the estimates used 
in the previous submission.
    Estimated Time per Response--The FDIC is not revising its estimate 
of the time required to complete the recordkeeping requirements in this 
IC and will retain an estimated hourly burden per response of 5 
minutes, or 0.083 hours.
    General Description of the Collection:
    FIRREA directs the FDIC to prescribe appropriate performance 
standards for real estate appraisals connected with federally related 
transactions under its jurisdiction. This information collection is a 
direct consequence of the statutory requirement. It is designed to 
provide protection for federal financial and public policy interests by 
requiring real estate appraisals used in connection with federally 
related transactions to be performed in writing, in accordance with 
uniform standards, by an appraiser whose competency has been 
demonstrated and whose professional conduct will be subject to 
effective supervision.
    4. Title: Foreign Banks.
    OMB Number: 3064-0114.
    Form Number: None.
    Affected Public: Insured branches of foreign banks.
    Burden Estimate:

                                                                Summary of Annual Burden
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                                                                               Estimated
     Information collection        Type of  burden       Obligation to         number of     Estimated  frequency    Estimated time per      Estimated
          description                                       respond           respondents       of  responses             response         annual burden
--------------------------------------------------------------------------------------------------------------------------------------------------------
Moving a Branch................  Reporting.........  Mandatory............               1  On Occasion..........  8 hours..............               8
Consent to Operate.............  Reporting.........  Mandatory............               1  On Occasion..........  8 hours..............               8
Approval to Conduct Activities.  Reporting.........  Mandatory............               1  On Occasion..........  8 hours..............               8
Pledge of Assets Documents.....  Reporting.........  Mandatory............              10  Quarterly............  15 minutes...........              10
Pledge of Asset Reports........  Reporting.........  Mandatory............              10  Quarterly............  2 hours..............              80
Recordkeeping..................  Recordkeeping.....  Mandatory............              10  On Occasion..........  120 hours............           1,200
                                                                           -----------------------------------------------------------------------------
    Total Estimated Annual       ..................  .....................  ..............  .....................  .....................           1,314
     Burden.
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    General Description of Collection:
    Applications to move an insured state-licensed branch of a foreign 
bank; applications to operate as such noninsured state-licensed branch 
of a foreign bank; applications from an insured state-licensed branch 
of a foreign bank to conduct activities that are not permissible for a 
federally licensed branch; internal recordkeeping by such branches; and 
reporting and recordkeeping requirements relating to such a branch's 
pledge of assets to the FDIC. There is no change in the methodology or 
substance of this information collection.
    5. Title: Prompt Corrective Action.
    OMB Number: 3064-0115.
    Form Number: None.
    Affected Public: State non-member banks and state savings 
associations.
    Burden Estimate:

                                                           Summary of Estimated Annual Burden
                                                                       [3064-0115]
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                                                                                                                             Estimated
                                                                          Estimated        Estimated         Estimated        average      Total  annual
                                  Type of  burden     Obligation  to      number of       frequency of       time per        number of       estimated
                                                         respond         respondents       responses         response      responses per      burden
                                                                                                              (hours)       respondent
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Prompt Corrective Action (12    Reporting.........  Voluntary........              12  On Occasion......               4           1.334              64
 CFR parts 303, 324, and 390).
                                                                      ----------------------------------------------------------------------------------
    Total Estimated Annual      ..................  .................  ..............  .................  ..............  ..............        64 hours
     Burden.
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    General Description of Collection:
    The Prompt Corrective Action (PCA) provisions of section 38 of the 
Federal Deposit Insurance Act require or permit the FDIC and other 
federal banking agencies to take certain supervisory actions when FDIC-
insured institutions fall within certain capital categories. Various 
provisions of the statute and the FDIC's implementing regulations 
require the prior approval of the FDIC before an FDIC-supervised 
institution, or certain insured depository institutions, can engage in 
certain activities, or allow the FDIC to make exceptions to 
restrictions that would otherwise be imposed. This collection of 
information consists of the applications that are required to obtain 
the FDIC's prior approval to engage in these activities. There is no 
change in the method or substance of the collection.
    6. Title: Qualified Financial Contracts.
    OMB Number: 3064-0163.
    Form Number: None.
    Affected Public: State non-member banks and savings associations.
    Burden Estimate:

[[Page 22435]]



--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                             Estimated
                                            Type of burden  (obligation                                      Estimated     average time      Estimated
              IC description                        to respond)               Frequency of  response         number of     per response    annual burden
                                                                                                            respondents       (hours)         (hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Implementation Burden
    Full Scope Entities..................  Recordkeeping (Mandatory)...  One time.......................               1           6,000           6,000
    Limited Scope Entities...............  Recordkeeping (Mandatory)...  One Time.......................              51              23           1,173
    Application for Extension of Time....  Reporting (Required to        On Occasion....................               1               1               1
                                            Obtain a Benefit).
                                                                                                         -----------------------------------------------
        Total Estimated Annual             ............................  ...............................  ..............  ..............           7,174
         Implementation Burden.
Ongoing Burden
    Full Scope Entities..................  Recordkeeping (Mandatory)...  Annual.........................               4             250           1,000
    Limited Scope Entities...............  Recordkeeping (Mandatory)...  Annual.........................             173              12           2,076
                                                                                                         -----------------------------------------------
        Total Estimated Annual Ongoing     ............................  ...............................  ..............  ..............           3.076
         Burden.
                                                                                                         -----------------------------------------------
            Total Estimated Annual Burden  ............................  ...............................  ..............  ..............          10,250
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    Methodology and Assumptions: For the renewal of this information 
collection, the FDIC determined that the burden estimation methodology 
should be revised to separate the implementation burden estimates for 
those entities that are newly subject to Part 371's recordkeeping 
requirements and the lesser ongoing burden for those entities that only 
need to maintain their existing compliance with Part 371. This split 
applies to both the set of Full Scope Entities and the set of Limited 
Scope Entities. The implementation burden estimates continue to include 
reporting burden for the application for extension of time to comply 
with Part 371 requirements. FDIC records indicate that FDIC has never 
received a request for an extension of time under Part 371 and is 
showing one respondent for this IC to preserve the reporting burden 
estimate in the event an institution elects to submit such a request in 
the future.
    Estimated Number of Respondents and Responses--Potential 
respondents to this information collection are all FDIC-insured 
depository institutions (IDIs). As of December 31, 2020, there are 
5,010 IDIs.\3\ Of these institutions, 3,500 are considered ``small'' 
for purposes of the Regulatory Flexibility Act (RFA).\4\ An IDI is 
subject to this information collection if it has received written 
notice from the IDI's appropriate Federal banking agency or the FDIC 
that it is in a troubled condition and written notice from the FDIC 
that it is subject to the reporting and recordkeeping requirements of 
Part 371 (together, a ``QFC Notification'').\5\ The FDIC has identified 
621 IDIs that were issued QFC Notifications between December 2008 and 
July 2020,\6\ for an average of 52 QFC Notifications per year. Of 
these, 51 notifications would have been to Limited Scope Entities and 1 
would have been to a Full Scope Entity under Part 371.\7\ Approximately 
361 notifications, or 30 notifications per year, would be to IDIs 
considered ``small'' for purposes of the RFA.\8\
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    \3\ FFIEC Call Reports for the period ending December 31st, 
2020.
    \4\ December 31, 2020, Call Report data. The Small Business 
Administration (SBA) defines a small banking organization as having 
$600 million or less in assets, where an organization's ``assets are 
determined by averaging the assets reported on its four quarterly 
financial statements for the preceding year.'' See 13 CFR 121.201 
(as amended by 84 FR 34261, effective August 19, 2019). In its 
determination, the ``SBA counts the receipts, employees, or other 
measure of size of the concern whose size is at issue and all of its 
domestic and foreign affiliates.'' See 13 CFR 121.103. Following 
these regulations, the FDIC uses a covered entity's affiliated and 
acquired assets, averaged over the preceding four quarters, to 
determine whether the covered entity is ``small'' for the purposes 
of RFA.
    \5\ The definition of troubled condition and details of what 
entities are covered is described in the final rule.
    \6\ See the SME analysis separately attached as ``PRA 371 
Internal 16 April.docx.''
    \7\ The definitions of ``Full Scope'' and ``Limited Scope'' 
became effective on October 1, 2017 as part of the final rule. 
However, in order to calculate representative statistics for 
estimated respondents the SME's applied those definitions to IDIs 
who received QFC Notifications in periods prior to enactment of 
those definitions.
    \8\ As of December 31, 2020.
---------------------------------------------------------------------------

    Based on the average annual number of IDIs that were issued QFC 
Notifications over the twelve-year period, the FDIC estimates that 51 
Limited Scope Entities and 1 Full Scope Entity would receive a QFC 
notification and be subject to implementation burden.
    To estimate the number of IDIs that will be subject to Part 371 on 
an ongoing basis, the FDIC identified those IDIs that have been issued 
QFC Notifications and deducted IDIs that failed subsequent to receiving 
such notification. The FDIC determined that 185 of the 621 IDIs 
notified between 2008 and 2020 had not failed, as of February 2021. Of 
these, 173 IDIs would be defined as Limited Scope Entities under the 
final rule,\9\ including 98 IDIs that would be considered ``small'' for 
purposes of the RFA.\10\ The FDIC thus estimates that 173 Limited Scope 
Entities will incur ongoing recordkeeping burden associated with 
maintaining their existing compliance with Part 371.
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    \9\ The SMEs did not track status upgrades of limited scope 
entities for these purposes and, accordingly, the estimate of the 
total existing population of limited scope entities is made assuming 
no change in status of an institution following its first becoming 
subject to Part 371.
    \10\ As of December 31, 2020.
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    The FDIC also identified twelve (12) Full Scope Entities under Part 
371, which were issued QFC Notifications between 2008 and 2020, and had 
not failed, as of February 2021. Six (6) of these entities have since 
been upgraded and are no longer subject to Part 371. Two (2) of the 
remaining entities are either working towards or will begin to work 
towards initial compliance with this ICR. The remaining four (4) Full 
Scope Entities have already completed their initial compliance efforts 
(or are well along in initial compliance efforts and thus treated as 
facing ongoing compliance burden). Thus, the FDIC estimates that four 
(4) Full Scope Entities will incur recordkeeping burden associated with 
maintaining their existing compliance with Part 371.
    Estimated Hourly Burden--The FDIC estimates the information 
collection burdens for affected institutions based on their 
classifications as either Full- or Limited Scope Entities under Part 
371; and based on whether they are newly subject to the requirements

[[Page 22436]]

(implementation burden) or whether they are responding to the 
information collection on an ongoing basis. Full Scope Entities must 
complete the eight QFC Tables contained in Appendix B of the rule; 
limited-scope firms must complete the four QFC Tables contained in 
Appendix A of the rule. The FDIC estimates that new Full Scope Entities 
will incur, on average, approximately 6,000 hours to initially complete 
the required QFC Tables for all of the QFCs in their portfolio. FDIC 
estimates that Full Scope Entities that already complied with the final 
rule in any previous year will incur, on average, 250 hours ongoing 
burden to maintain their QFC Tables.
    For the hourly implementation burden incurred by Limited Scope 
Entities, the FDIC assumes that burden will be based on the number of 
QFCs in the entity's portfolio. The FDIC assumes that 90 percent of New 
Limited Scope Entities, or 46 entities per year, hold 50 or fewer QFCs 
in their portfolio. These entities are expected in incur, on average, 
15 hours of implementation burden in the first year in which they must 
comply with the final rule. The remaining 10 percent of New Limited 
Scope Entities, or 5 entities a year, are assumed to hold more than 50 
QFCs in their portfolio and are expected to incur, on average, 100 
hours of implementation burden. The average hourly implementation 
burden across all New Limited Scope Entities is thus approximately 23 
hours per respondent.\11\ These burdens estimates incorporate the 
expected time to prepare an extension request, if needed.
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    \11\ 23.34 hours = (46 respondents * 15 hours + 5 respondents * 
100 hours)/51 total respondents.
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    The FDIC uses the same methodology to estimate the hourly ongoing 
burden for Limited Scope Entities. It assumes that 90 percent of 
Limited Scope Entities that continue to be subject to Part 371 after 
one year, or 155 entities per year, hold 50 or fewer QFCs in their 
portfolio and are expected to incur, on average, 10 hours to maintain 
their compliance with the requirements of Part 371. The remaining 10 
percent of Existing Limited Scope Entities, or 18 entities per year, 
are assumed to hold more than 50 QFCs in their portfolio and are 
expected to incur, on average, 25 hours of ongoing burden per year. The 
average hourly burden across all New Limited Scope Entities is thus 
approximately 12 hours per respondent.\12\
---------------------------------------------------------------------------

    \12\ 11.56 hours = (155 respondents * 10 hours + 18 respondents 
* 25 hours)/173 total respondents.
---------------------------------------------------------------------------

    These burden estimates, along with the annual estimated number of 
entities, are delineated by burden type in Summary of Estimated Annual 
Burden table. The recordkeeping burdens are assumed to be one tine for 
the implementation phase and one time annually for the ongoing phase. 
Accordingly, the response rate is one response per respondent per year. 
The Summary of Estimated Annual Burden table also shows the estimated 
annual burden of each IC line item, which is equal to the product of 
the estimated number of respondents, the number of responses per 
respondent per year, and the time per response for each line item. The 
total estimated annual burden for this information collection is 10,250 
hours, a decrease of 8,470 hours from the 18,720 estimated annual 
burden hours in the currently-approved information collection request. 
The decrease in burden is due to the change in the methodology used by 
the FDIC in estimating annual burden as discussed above.
    General Description of the Collection:
    Under the Federal Deposit Insurance Act (FDIA), Qualified Financial 
Contract (``QFCs'') have been designated for special treatment by the 
FDIC in the event of the failure of an insured depository institution. 
As codified in FDIA as part of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989 (FIRREA), certain timing 
restrictions are effectively placed on the FDIC for making decisions 
whether to transfer QFCs to another financial institution, repudiate 
the QFCs, or retain the QFCs in the receivership in the event of an 
insured institution's failure. To make an informed decision about QFCs 
in such situations, the FDIC needs timely information pertaining to the 
types and amounts of QFC contracts held, the counterparties to these 
contracts and their affiliates, the purpose of these contracts, their 
maturity dates, the current value of these contracts, and whether these 
contracts are collateralized. Because of the large volume of QFC 
information that a receiver must process in a limited timeframe, in 
Part 371, the FDIC established QFC recordkeeping requirements for 
institutions in a ``troubled condition'' as that term is defined in the 
rule. This information collection consists of recordkeeping and 
reporting requirements for qualified financial contracts (QFCs) held by 
insured depository institutions in troubled condition.
    7. Title: Restrictions on Qualified Financial Contracts of 
Subsidiaries of certain FDIC-Supervised Institutions; Revisions to the 
Definition of Qualifying Master Netting Agreement and Related 
Definitions.
    OMB Number: 3064-0208.
    Form Number: None.
    Affected Public: Private sector.
    Burden Estimate:

                                                                Summary of Annual Burden
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                     Estimated                            Estimated time     Estimated
     Information collection           Type of blurden      Obligation to respond     number of    Estimated frequency of    per response   annual burden
           description                                                              respondents          responses            (hours)         (hours)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Approval requests prepared and    Reporting.............  Voluntary.............               1  On occasion...........              20              20
 submitted to the FDIC regarding
 modifications to enhanced
 creditor protection provisions.
                                                                                 -----------------------------------------------------------------------
    Total Estimated Annual        ......................  ......................  ..............  ......................  ..............              20
     Burden.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    General Description of Collection:
    This rule is necessary to give effect to such cross-default 
restrictions in the ISDA Protocol. The rule requires that FDIC-
supervised institutions that are subsidiaries of GSIBs and their 
counterparties either adhere to the ISDA Protocol or take the 
prescribed steps to amend the contractual provisions of their QFCs, 
consistent with the requirements in the rule, within a specified period 
of time. If such institutions elect to amend their QFCs in lieu of 
adhering to the ISDA Protocol, they must seek the FDIC's approval of

[[Page 22437]]

the proposed amendments, giving rise to the information collection. The 
information collection is necessary to ensure QFC contracts are amended 
in compliance with the rule. The FDIC's rule applies to FDIC-supervised 
institutions that are subsidiaries of GSIBs and sets forth requirements 
parallel to those contained in similar rules recently published by the 
FRB and the OCC with regard to entities they supervise to ensure 
consistent regulatory treatment of QFCs among the various entities 
within a GSIB group.All institutions that were covered FSIs on January 
1, 2018 were required to comply with the QFC stay rule by January 1, 
2020. That means that, except for the three possible exceptions 
described below, all required paperwork revisions that are required to 
be completed by the covered entities to comply with the rule should 
have been completed by January 1, 2020. Consequently, for the purpose 
of 2021 and future PRA analysis, the FDIC does not expect any on-
occasion paperwork burden associated with the rule. The three 
exceptions to the foregoing statement are: (i) Under the QFC stay rule, 
a covered FSI is not required to bring QFCs with a counterparty that 
were entered into prior to January 1, 2019 into compliance unless the 
covered FSI or any affiliate of the covered FSI becomes party to a QFC 
with the same counterparty or a consolidated affiliate of that party on 
or after January 1, 2019 (subject to special rules relating to 
institutions that become covered FSIs after January 1, 2018); (ii) 
entities that become covered entities after January 1 2018 have 
extended compliance periods (which can extend the date for compliance 
to the date that is the first day of the calendar quarter immediately 
following one year, 18 months or two years (depending on the type of 
counterparty) from the date the entity first became a covered entity); 
and (iii) a covered FSI might enter into a QFC with a counterparty that 
is not yet covered by documentation that complies with the rule. 
Moreover, because the market practices and conventions relating to 
derivatives, repo, SFT and other QFC products have evolved to include 
the stay provisions in the documentation used by market participants, 
FDIC estimates that any legal documentation review will be addressed as 
a part of the normal business on-boarding or maintenance of the 
business relations. However, FDIC recognizes that there is a 
possibility of a new entrant or a new product that can fall under the 
scope of the subject rule and, consequently, provides for a possibility 
of one or more respondents that can be impacted by the rule.
    As noted above, the industry undertook major initiatives to achieve 
streamlining and straight-through processing for both on-boarding and 
maintenance of the QFC records over the last years. Consequently, in 
case a new entrant/product will be scoped-in by the subject rule to 
impose the paperwork burden, FDIC estimates that such burden will be 
less than half of the burden estimated in 2018 thanks to the automation 
and standardization of business processes. Accordingly, the time per 
response has been revised to 20 hours from the 40 hours previously 
estimated.

Request for Comment

    Comments are invited on: (a) Whether the collection of information 
is necessary for the proper performance of the FDIC's functions, 
including whether the information has practical utility; (b) the 
accuracy of the estimates of the burden of the information collection, 
including the validity of the methodology and assumptions used; (c) 
ways to enhance the quality, utility, and clarity of the information to 
be collected; and (d) ways to minimize the burden of the collection of 
information on respondents, including through the use of automated 
collection techniques or other forms of information technology. All 
comments will become a matter of public record.

    Federal Deposit Insurance Corporation.

     Dated at Washington, DC, on April 22, 2021.
James P. Sheesley,
Assistant Executive Secretary.
[FR Doc. 2021-08803 Filed 4-27-21; 8:45 am]
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