[Federal Register Volume 86, Number 206 (Thursday, October 28, 2021)]
[Notices]
[Pages 59716-59718]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-23432]


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FEDERAL RESERVE SYSTEM


Agency Information Collection Activities: Announcement of Board 
Approval Under Delegated Authority and Submission to OMB

AGENCY: Board of Governors of the Federal Reserve System.

SUMMARY: The Board of Governors of the Federal Reserve System (Board) 
is adopting a proposal to implement the Treasury Securities and Agency 
Debt and Mortgage-Backed Securities Reporting Requirements (FR 2956; 
OMB No. 7100-NEW). The Board has adopted an implementation timeline 
with the first reporting under this collection beginning on September 
1, 2022.

FOR FURTHER INFORMATION CONTACT: Federal Reserve Board Clearance 
Officer--Nuha Elmaghrabi--Office of the Chief Data Officer, Board of 
Governors of the Federal Reserve System, Washington, DC 20551, (202) 
452-3829.
    Office of Management and Budget (OMB) Desk Officer for the Federal 
Reserve Board, Office of Information and Regulatory Affairs, Office of 
Management and Budget, New Executive Office Building, Room 10235, 725 
17th Street, NW, Washington, DC 20503, or by fax to (202) 395-6974.

SUPPLEMENTARY INFORMATION: On June 15, 1984, OMB delegated to the Board 
authority under the Paperwork Reduction Act (PRA) to approve and assign 
OMB control numbers to collections of information conducted or 
sponsored by the Board. Board-approved collections of information are 
incorporated into the official OMB inventory of currently approved 
collections of information. The OMB inventory, as well as copies of the 
PRA Submission, supporting statements, and approved collection of 
information instrument(s) are available at https://www.reginfo.gov/public/do/PRAMain. These documents are also available on the Federal 
Reserve Board's public website at https://www.federalreserve.gov/apps/reportforms/review.aspx or may be requested from the agency clearance 
officer, whose name appears above.

Final Approval Under OMB Delegated Authority of the Implementation of 
the Following Information Collection

    Report title: Treasury Securities and Agency Debt and Mortgage-
Backed Securities Reporting Requirements.
    Agency form number: FR 2956.
    OMB control number: 100-NEW.
    Frequency: Daily.
    Respondents: Depository institutions that meet the reporting 
thresholds and daily transact in trading of marketable U.S. Treasury 
securities and the trading of the debt and mortgage-backed securities 
(MBS) issued by agencies.
    Estimated number of respondents: Treasury securities, 10; Agency 
debt and MBS, 12.
    Estimated average hours per response: 3.
    Estimated annual burden hours: 16,500.
    General description of report: The FR 2956 will collect detailed 
data on depository institutions' daily transactions of marketable U.S. 
Treasury securities and of the debt and MBS issued by U.S. federal 
government agencies including government-sponsored enterprises 
(agencies). The report will have two parts: Part 1 will collect data on 
transactions in U.S. Treasury securities, and Part 2 will collect 
transactions in debt and MBS issued by agencies. Depository 
institutions subject to reporting under the FR 2956 collection will be 
required to report all the transaction details, information, and fields 
as described in the applicable Trade Reporting and Compliance Engine 
(TRACE) technical documentation, FAQs, and guides located at https://www.finra.org/filing-reporting/trace. This information will include, 
but is not limited to, the Committee on Uniform Securities 
Identification Procedures (CUSIP) number or similar identifier, the 
transaction size (volume), price of the transaction, date of trade 
execution, time of execution, and date of

[[Page 59717]]

settlement. The Board is adopting an implementation timeline for first 
reporting under this collection of September 1, 2022.
    Reporting transactions will be event-generated and estimated to 
occur daily. Depository institutions will be required to assess 
annually whether they meet the reporting criteria. If a depository 
institution meets the event-generated threshold to report based on the 
average of its daily transactions from October 1 of the previous year 
through September 30, the depository institution will be required to 
begin to report the implemented FR 2956 effective January 1 of the 
following year and continue reporting such transactions throughout that 
calendar year.\1\ If a depository institution that reports on the 
implemented FR 2956 falls below the threshold based on the average of 
its daily transactions from October 1 of the previous year through 
September 30, the depository institution will be required to continue 
to report through December 31 of that year but will not be required to 
report for the next calendar year.
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    \1\ For the initial reporting under FR 2956 beginning on 
September 1, 2022, depository institutions should assess their 
transactions from October 1, 2020, through September 30, 2021, to 
determine whether they will be required to report.
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    Every national bank, state member bank, state non-member bank, 
savings association, or U.S. branch and agency of a foreign bank filing 
a Notice of Government Securities Broker or Government Dealer 
Activities Form (Form G-FIN; OMB No. 7100-0224) with average daily 
transaction volumes of over $100 million for U.S. Treasury securities, 
or over $50 million for agency-issued debt and MBS, during the prior 
fiscal year will be subject to the proposed reporting requirements. 
Depository institutions subject to the reporting requirements of the 
adopted FR 2956 will electronically report transactions through the 
Board's data collection provider, the Financial Industry Regulatory 
Authority (FINRA), utilizing its Trade Reporting and Compliance Engine 
(TRACE).
    Legal authorization and confidentiality: The FR 2956 is authorized 
by sections 2A and 11 of the Federal Reserve Act (FRA). Section 2A of 
the FRA requires that the Board and the Federal Open Market Committee 
(FOMC) maintain long-run growth of the monetary and credit aggregates 
commensurate with the economy's long run potential to increase 
production, so as to promote effectively the goals of maximum 
employment, stable prices, and moderate long-term interest rates.\2\ 
Section 11 of the FRA authorizes the Board to require reports from 
depository institutions as it may deem necessary and authorizes the 
Board to prescribe reports of liabilities and assets from insured 
depository institutions to enable the Board to discharge its 
responsibility to monitor and control monetary and credit 
aggregates.\3\
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    \2\ 12 U.S.C. 225a. Treasury Securities, agency debt, and MBS 
are an important channel of monetary policy transmission. The 
information to be collected by the FR 2956 is not available from 
other sources, and collecting these transaction data will help the 
Board and FOMC better monitor and interpret fluctuations in supply 
and demand as well as interest rate movements in these key credit 
aggregates.
    \3\12 U.S.C. 248(a).
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    The obligation to respond to the FR 2956 is mandatory. The 
information collected through the FR 2956 may generally be considered 
confidential under exemption 4 of the Freedom of Information Act as 
confidential commercial or financial information that is both 
customarily and actually treated as private.\4\
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    \4\ 5 U.S.C. 552(b)(4).
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    Current actions: On January 21, 2021, the Board published a notice 
in the Federal Register (86 FR 6329) requesting public comment for 60 
days on the implementation of the Treasury Securities and Agency Debt 
and Mortgage-Backed Securities Reporting Requirements. The comment 
period for this notice expired on March 22, 2021.

Detailed Discussion of Public Comments

    The Board received two public comments on the proposed FR 2956. One 
commenter raised a few technical questions regarding Market Participant 
Identity (MPID) as applied to reporting depository institutions under 
this information collection. To provide greater clarity, the Board 
anticipates FINRA will assign MPIDs to depository institutions subject 
to TRACE reporting and include these MPIDs in the Participant Master, 
which is available to all TRACE reporting participants. Depository 
institutions that are required to report and have a non-FINRA-member 
subscriber MPID(s) (for contra use only) will be reassigned a reporting 
MPID, which will be communicated to the corresponding covered 
alternative trading system(s) (ATS). Depository institutions that 
operate an ATS and are required to report will receive a reporting MPID 
for the ATS distinct from that of a trading desk. Depository 
institutions that are not required to report and are ATS subscribers 
will continue to be identified in ATS trade reports using their current 
MPIDs.
    One commenter also questioned whether depository institutions would 
be eligible to enter into Uniform Service Agreements with broker-
dealers and other depository institutions. The Board notes that 
depository institutions would be required to enter into the 
Participation Agreement, as do FINRA members, to use the TRACE system. 
In addition, depository institutions may enter into, and provide to 
FINRA, a Uniform Services Agreement executed with another depository 
institution or broker-dealer.
    In addition, the Board received two comments on the scope and 
applicability of the reporting requirement. As explained in the 
``General description of report'' section of this notice, only a 
depository institution that files a Notice of Government Securities 
Broker or Government Dealer Activities Form (Form G-FIN; OMB No. 7100-
0224) with average daily transaction volumes of over $100 million for 
U.S. Treasury debt, or over $50 million for agency-issued debt and MBS, 
during the prior fiscal year will be subject to the proposed reporting 
requirements. Consistent with TRACE reporting by FINRA members and the 
intent of this collection, reporting institutions will be required to 
report all Treasury transactions that they are party to, regardless of 
whether the institution is acting in a dealer capacity or whether 
activity was with clients inside or outside the United States. The 
reporting requirements will include all departments or divisions of a 
reporting institution.
    The Board received a comment requesting clarification on the 
supervisory and enforcement authority of the collection. As explained 
in the ``Legal authorization and confidentiality'' section of this 
notice, section 11 of the Federal Reserve Act authorizes the Board to 
require reports from depository institutions. This collection is being 
adopted under that authority and nothing in the proposed information 
collection alters or modifies the supervisory and enforcement authority 
of the Federal banking agencies over the depository institutions that 
are subject to the reporting. The Board is using FINRA as its data 
collection provider and utilizing its TRACE platform.
    The Board received a comment requesting clarification about the 
dissemination of Treasury trades as a result of this proposed 
information collection. The statement about inclusion of depository 
institution data in TRACE data products available to market 
participants referred to existing real time and aggregate data products 
and not the creation of new ones.

[[Page 59718]]

    The Board also received comments on the implementation timeline 
and, in particular, how coordinating with FINRA on its own proposed 
changes would be beneficial. Commenters noted the importance of enough 
lead time prior to reporting to allow for systems to be implemented or 
updated as needed. The Board understands the balance between minimizing 
compliance burdens on depository institutions as well as the critical 
need to gain insight into this segment of the Treasury securities and 
agency-issued debt and MBS markets. As a result, the Board intends to 
provide appropriate lead time to permit depository institutions the 
necessary time to prepare before the initial reporting under this 
collection will be required. In addition, the Board anticipates that 
any modifications adopted by FINRA and incorporated in the Board's 
reporting requirement in the future will also provide ample lead time 
to prepare to comply with any proposed modifications. In response to 
these comments, the Board is adopting an implementation timeline for 
first reporting under this collection of September 1, 2022.

    Board of Governors of the Federal Reserve System, October 21, 
2021.
Michele Taylor Fennell,
Deputy Associate Secretary of the Board.
[FR Doc. 2021-23432 Filed 10-27-21; 8:45 am]
BILLING CODE 6210-01-P