[Federal Register Volume 76, Number 130 (Thursday, July 7, 2011)]
[Notices]
[Pages 39981-39989]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-17100]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
FEDERAL RESERVE BOARD
FEDERAL DEPOSIT INSURANCE CORPORATION
DEPARTMENT OF THE TREASURY
Office of Thrift Supervision
Agency Information Collection Activities; Submission for OMB
Review; Joint Comment Request
AGENCIES: Office of the Comptroller of the Currency (OCC), Treasury;
Board of Governors of the Federal Reserve System (Board); Federal
Deposit Insurance Corporation (FDIC); and Office of Thrift Supervision
(OTS), Treasury.
ACTION: Notice of information collection to be submitted to OMB for
review and approval under the Paperwork Reduction Act of 1995.
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SUMMARY: In accordance with the requirements of the Paperwork Reduction
Act (PRA) of 1995 (44 U.S.C. chapter 35), the OCC, the Board, the FDIC,
and the OTS (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
[[Page 39982]]
Management and Budget (OMB) control number. The agencies, under the
auspices of the Federal Financial Institutions Examination Council
(FFIEC), on February 8, 2011, requested public comment for 60 days on
their proposal to require savings associations currently filing the
Thrift Financial Report (TFR) to convert to filing the Consolidated
Reports of Condition and Income (Call Report) beginning with the
reporting period ending on March 31, 2012 (76 FR 7082).
In addition, the Board published a notice of its intent to require
savings and loan holding companies (SLHCs) to submit to the Board all
regulatory reports that are currently required to be filed by bank
holding companies (BHCs), beginning with the reporting period ending on
March 31, 2012 (76 FR 7091). The Board is considering the comments it
received on the notice of its intent for SLHC reporting and will issue
its proposal for reporting by SLHCs on or after July 21, 2011, which is
the date that supervision of SLHCs is transferred from the OTS to the
Board.
The TFR and the Call Report are currently approved collections of
information. Seven comment letters were received on the proposal. In
addition, the agencies met with two commenters as described later in
this notice. After considering the comments received on the proposal,
the agencies hereby give notice of their plan to proceed with the
proposed conversion to the Call Report and will submit the proposal to
OMB for review and approval.
DATES: Comments must be submitted on or before August 8, 2011.
ADDRESSES: Interested parties are invited to submit written comments to
any or all of the agencies. All comments, which should refer to the OMB
control number(s), will be shared among the agencies. As described
later in this notice, the OTS will be abolished on July 21, 2011 and
its functions transferred to the other agencies. Hence, comments
submitted on or after July 21, 2011 should be addressed to any or all
of the agencies other than OTS.
OCC: You should direct all written comments to: Communications
Division, Office of the Comptroller of the Currency, Mailstop 2-3,
Attention: 1557-0081, 250 E Street, SW., Washington, DC 20219. In
addition, comments may be sent by fax to (202) 874-5274, or by
electronic mail to [email protected],gov. You may personally
inspect and photocopy comments at the OCC, 250 E Street, SW.,
Washington, DC 20219. For security reasons, the OCC requires that
visitors make an appointment to inspect comments. You may do so by
calling (202) 874-4700. Upon arrival, visitors will be required to
present valid government-issued photo identification and to submit to
security screening in order to inspect and photocopy comments.
Board: You may submit comments, which should refer to
``Consolidated Reports of Condition and Income (FFIEC 031 and 041),''
by any of the following methods:
Agency Web Site: http://www.federalreserve.gov. Follow the
instructions for submitting comments on the http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
E-mail: [email protected]. Include
reporting form number in the subject line of the message.
FAX: (202) 452-3819 or (202) 452-3102.
Mail: Jennifer J. Johnson, Secretary, Board of Governors
of the Federal Reserve System, 20th Street and Constitution Avenue,
NW., Washington, DC 20551.
All public comments are available from the Board's Web site at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as submitted,
unless modified for technical reasons. Accordingly, your comments will
not be edited to remove any identifying or contact information. Public
comments may also be viewed electronically or in paper in Room MP-500
of the Board's Martin Building (20th and C Streets, NW.) between 9 a.m.
and 5 p.m. on weekdays.
FDIC: You may submit comments, which should refer to ``Consolidated
Reports of Condition and Income, 3064-0052,'' by any of the following
methods:
Agency Web Site: http://www.fdic.gov/regulations/laws/federal/propose.html. Follow the instructions for submitting comments
on the FDIC Web site.
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
E-mail: [email protected]. Include ``Consolidated Reports
of Condition and Income, 3064-0052'' in the subject line of the
message.
Mail: Gary A. Kuiper, (202) 898-3877, Counsel, Attn:
Comments, Room F-1072, 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 550 17th Street Building (located on F
Street) on business days between 7 a.m. and 5 p.m.
Public Inspection: All comments received will be posted without
change to http://www.fdic.gov/regulations/laws/federal/propose.html
including any personal information provided. Comments may be inspected
at the FDIC Public Information Center, Room E-1002, 3501 Fairfax Drive,
Arlington, VA 22226, between 9 a.m. and 5 p.m. on business days.
OTS: You may submit comments, identified by ``1550-0023 (TFR:
Conversion to Call Report),'' by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
E-mail address: [email protected].
Please include ``1550-0023 (TFR: Conversion to Call Report)'' in the
subject line of the message and include your name and telephone number
in the message.
Fax: (202) 906-6518.
Mail: Information Collection Comments, Chief Counsel's
Office, Office of Thrift Supervision, 1700 G Street, NW., Washington,
DC 20552, Attention: ``1550-0023 (TFR: Conversion to Call Report).''
Hand Delivery/Courier: Guard's Desk, East Lobby Entrance,
1700 G Street, NW., from 9:00 a.m. to 4:00 p.m. on business days,
Attention: Information Collection Comments, Chief Counsel's Office,
Attention: ``1550-0023 (TFR: Conversion to Call Report).''
Instructions: All submissions received must include the agency name
and OMB Control Number for this information collection. All comments
received will be posted without change to the OTS Internet Site at
http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1, including any
personal information provided.
Docket: For access to the docket to read background documents or
comments received, go to http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1. In addition, you may inspect comments
at the Public Reading Room, 1700 G Street, NW., by appointment. To make
an appointment for access, call (202) 906-5922, send an e-mail to
public.info@ots.treas.gov">public.info@ots.treas.gov, or send a facsimile transmission to (202)
906-7755. (Prior notice identifying the materials you will be
requesting will assist us in serving you.) The OTS schedules
appointments on business days between 10 a.m. and 4 p.m. In most cases,
appointments will be
[[Page 39983]]
available the next business day following the date we receive a
request.
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, or by fax to (202) 395-6974.
FOR FURTHER INFORMATION CONTACT: For further information about the
proposal discussed in this notice, please contact any of the agency
clearance officers whose names appear below.
In addition, copies of the reporting forms and instructions for the
FFIEC 031, Consolidated Reports of Condition and Income for a Bank with
Domestic and Foreign Offices, can be obtained at the FFIEC's Web site
(http://www.ffiec.gov/forms031.htm).
Copies of the reporting forms and instructions for the FFIEC 041,
Consolidated Reports of Condition and Income for a Bank with Domestic
Offices Only, can be obtained at the FFIEC's Web site (http://www.ffiec.gov/forms041.htm).
Copies of the reporting forms and instructions for the TFR can be
obtained at the OTS's Web site (http://www.ots.treas.gov/?p=ThriftFinancialReports).
OCC: Mary Gottlieb, OCC Clearance Officer, (202) 874-5090,
Legislative and Regulatory Activities Division, Office of the
Comptroller of the Currency, 250 E Street, SW., Washington, DC 20219.
Board: Cynthia Ayouch, Acting Federal Reserve Board Clearance
Officer, (202) 452-3829, Division of Research and Statistics, 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.
FDIC: Gary A. Kuiper, Counsel, (202) 898-3877, Legal Division,
Federal Deposit Insurance Corporation, 550 17th Street, NW.,
Washington, DC 20429.
OTS: Ira L. Mills, OTS Clearance Officer, at
[email protected], (202) 906-6531, or facsimile number (202) 906-
6518, Regulations and Legislation Division, Chief Counsel's Office,
Office of Thrift Supervision, 1700 G Street, NW., Washington, DC 20552.
SUPPLEMENTARY INFORMATION: The agencies are proposing to revise the
reporting panel for the Call Report and to cease collection of data
through all schedules of the TFR beginning with the reporting period
ending on March 31, 2012. The Call Report is currently an approved
collection of information for the OCC, the Board, and the FDIC. The TFR
is currently an approved collection of information for the OTS.
1. Report Title: Consolidated Reports of Condition and Income (Call
Report).
Form Number: Call Report: FFIEC 031 (for banks with domestic and
foreign offices) and FFIEC 041 (for banks with domestic offices only).
Frequency of Response: Quarterly.
Affected Public: Business or other for-profit.
OCC
OMB Number: 1557-0081.
Current
Estimated Number of Respondents: 1,427 national banks.
Estimated Time per Response: 53.38 burden hours.
Estimated Total Annual Burden: 304,693 burden hours.
Proposed
Estimated Number of Respondents: 2,091 (1,427 national banks and
664 federal savings associations).
Estimated Time per Response: National banks: 53.38 burden hours per
quarter to file.
Federal savings associations: 53.38 burden hours per quarter to
file and 188 burden hours for the first year to convert systems and
conduct training.
Estimated Total Annual Burden: National banks: 304,693 burden hours
to file.
Federal savings associations: 141,777 burden hours to file; plus
124,832 burden hours for the first year to convert systems and conduct
training.
Total: 571,302 burden hours.
Board
OMB Number: 7100-0036.
Current
Estimated Number of Respondents: 826 state member banks.
Estimated Time per Response: 55.19 burden hours.
Estimated Total Annual Burden: 182,348 burden hours.
Proposed
No change.
FDIC
OMB Number: 3064-0052.
Current
Estimated Number of Respondents: 4,687 insured state nonmember
banks.
Estimated Time per Response: 40.47 burden hours.
Estimated Total Annual Burden: 758,732 burden hours.
Proposed
Estimated Number of Respondents: 4,747 (4,687 insured state
nonmember banks and 60 state savings associations).
Estimated Time per Response: State nonmember banks: 40.47 burden
hours per quarter to file.
State savings associations: 40.47 burden hours per quarter to file
and 188 burden hours for the first year to convert systems and conduct
training.
Estimated Total Annual Burden: State nonmember banks: 758,732
burden hours to file.
State savings associations: 9,713 burden hours to file; plus 11,280
burden hours for the first year to convert systems and conduct
training.
Total: 779,725 burden hours.
The estimated time per response for the Call Report is an average
that varies by agency because of differences in the composition of the
institutions under each agency's supervision (e.g., size distribution
of institutions, types of activities in which they are engaged, and
existence of foreign offices). The average reporting burden for the
Call Report is estimated to range from 17 to 700 hours per quarter,
depending on an individual institution's circumstances.
2. Report Title: Thrift Financial Report (TFR).
Form Number: OTS 1313 (for savings associations).
Frequency of Response: Quarterly; Annually.
Affected Public: Business or other for-profit.
OTS
OMB Number: 1550-0023.
Current
Estimated Number of Respondents: 724 savings associations.
Estimated Time per Response: 60.3 hours average for quarterly
schedules and 2.0 hours average for schedules required only annually
plus recordkeeping of an average of one hour per quarter.
Estimated Total Annual Burden: 178,973 burden hours.
Proposed
Estimated Number of Respondents: Not applicable.
Estimated Time per Response: Not applicable.
Estimated Total Annual Burden: Not applicable.
The burden estimates in this notice above are for the quarterly
filings of the TFR and the Call Report. In addition to those filings,
savings associations would incur an initial burden of converting
systems and training staff to prepare and file the Call Report in place
of the TFR
[[Page 39984]]
as proposed. Accordingly, the burden estimates above in this notice for
savings associations also include the time to convert to filing the
Call Report, including necessary systems changes and training staff on
Call Report preparation and filing, which is estimated to average 188
hours.
As a general statement, larger institutions and those with more
complex operations would expend a greater number of hours than smaller
institutions and those with less complex operations. An institution's
use of service providers for the information and accounting support of
key functions, such as credit processing, transaction processing,
deposit and customer information, general ledger, and reporting should
result in lower burden hours for converting to the Call Report.
Institutions with staff having experience in preparing and filing the
Call Report should incur lower initial burden hours for converting to
the Call Report from the TFR.
A summary of the estimated initial burden hours for savings
associations regarding the proposed conversion to the Call Report from
the TFR is presented below.
Estimated Initial Burden of Proposal:
Estimated Number of Institutions: 724 savings associations.
Estimated Time per Institution: 188 burden hours.
Estimated Total Burden: 136,112 burden hours.
General Description of Reports
These information collections are mandatory pursuant to: 12 U.S.C.
161 (for national banks), 12 U.S.C. 324 (for state member banks), 12
U.S.C. 1817 (for insured state nonmember commercial and savings banks),
and 12 U.S.C. 1464 (for savings associations). At present, except for
selected data items, the Call Report and TFR are not given confidential
treatment.
Abstract
Institutions submit Call Report and TFR data to the agencies each
quarter for the agencies' use in monitoring the condition, performance,
and risk profile of individual institutions and the bank and savings
association industries as a whole. Call Report and TFR data provide the
most current statistical data available for evaluating institutions'
corporate applications, for identifying areas of focus for both on-site
and off-site examinations, and for monetary and other public policy
purposes. The agencies use Call Report and TFR data in evaluating
interstate merger and acquisition applications to determine, as
required by law, whether the resulting institution would control more
than ten percent of the total amount of deposits of insured depository
institutions in the United States. Call Report and TFR data also are
used to calculate all institutions' deposit insurance and Financing
Corporation assessments, and national banks' and savings associations'
assessments.
Effect of Recent Legislation
The Dodd-Frank Wall Street Reform and Consumer Protection Act,
Public Law 111-203 (the Dodd-Frank Act) was enacted into law on July
21, 2010. Title III of the Dodd-Frank Act abolishes the OTS, provides
for its integration with the OCC effective as of July 21, 2011 (the
``transfer date''), and transfers the OTS's functions to the OCC, the
Board, and the FDIC. Under Title III of the Dodd-Frank Act, all
functions of the OTS relating to federal savings associations and
rulemaking authority for all savings associations are transferred to
the OCC. All functions of the OTS relating to state-chartered savings
associations (other than rulemaking) are transferred to the FDIC. All
functions of the OTS relating to supervision of SLHCs (including
rulemaking) are transferred to the Board.
After careful review, the agencies believe that having common
financial reports and reporting processes among all FDIC-insured
entities would be more efficient and would lead to more uniform
comparisons of financial condition, performance, and trends among
regulated institutions. For these reasons, the OTS is proposing to
eliminate the TFR, and the agencies are proposing to require savings
associations to adopt the reporting routines and processes required of
all other FDIC-insured banks and savings institutions.
Section 5(v)(1) of the Home Owners' Loan Act (12 U.S.C. 1464
(v)(1)) does not contain a specific requirement for collection of
financial information from savings associations in the TFR format.
Rather, the statute provides broad authority for the OTS to determine
the requirements of periodic reports and information needs. Therefore,
there is no statutory impediment to requiring savings associations to
convert from the TFR to the Call Report.
Current Actions
I. Overview
On February 8, 2011, the agencies proposed to implement changes to
savings associations' data reporting requirements beginning with the
reporting period ending on March 31, 2012 (76 FR 7082). These changes
are intended to provide data needed for reasons of safety and soundness
or other public purposes. The proposed changes would require savings
associations to cease filing the TFR and commence filing the Call
Report beginning on the March 31, 2012, report date. After considering
the comments received on the proposal, the agencies plan to proceed
with the proposed conversion from the TFR to the Call Report for
savings associations beginning on the March 31, 2012, report date.
II. Proposal To Require Savings Associations To File Call Report
A. Discussion of Comments
The agencies collectively received comments from five savings
associations and from two bank/thrift trade associations regarding the
agencies' February 8, 2011 proposal to convert to the Call Report from
the TFR. None of the commenters took exception to the general proposal
to have savings associations currently regulated by the OTS begin
reporting regulatory financial data using the Call Report instead of
the TFR sometime after the transfer date of July 21, 2011. However,
there were comments received on some specific aspects of the proposed
report conversion. Below is a discussion of the more specific comments.
The comments received from the individual savings associations all
related to the proposal to eliminate the collection of data on Schedule
Consolidated Maturity/Rate (Schedule CMR), and with it, the elimination
of the OTS Interest Rate Risk Model (OTS IRR Model). One savings
association supported Schedule CMR elimination noting that it used an
internal model to monitor interest rate risk and it was a burden to
reconcile the results of its own model to that of the OTS IRR Model.
Four savings associations commented that they supported continuation of
Schedule CMR since they relied on the OTS IRR Model to help monitor
interest rate risk.
In making the final determination about Schedule CMR and the OTS
IRR Model, the agencies carefully considered these comments as well as
comments received by the OTS in response to its 2007 Advance Notice of
Proposed Rulemaking (72 FR 64003, November 14, 2007) \1\ regarding a
possible conversion to the Call Report. The majority of comments
received by the OTS in response to the 2007 proposal supported
elimination of the
[[Page 39985]]
IRR Model and collection of Schedule CMR. The reasons cited by savings
associations supporting the elimination of Schedule CMR were based on
the burden of generating the data necessary to complete that schedule
and the fact that they had adopted other models to help measure and
monitor interest rate risk.
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\1\ Link to November 14, 2007 proposal published at 72 FR 64003:
http://www.ots.treas.gov/_files/commenttopics/8f697712-0718-411f-a004-470f790edf80.pdf.
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The agencies also considered that existing rules, regulations, and
overall supervisory approaches for savings associations will be
realigned to parallel those applied to all other FDIC-insured
institutions. Specifically with regard to monitoring interest rate
risk, savings associations will be expected to have their own resources
to measure and monitor interest rate risk. This measurement should
address earnings at risk as well as capital at risk to interest rate
movements, as described in the agencies' 2010 Advisory on Interest Rate
Risk Management (Interagency Advisory). The Web links for the general
interest rate risk management policies and guidelines of the agencies
(other than the OTS) are as follows:
http://www.ffiec.gov/press/pr042398.htm
http://www.fdic.gov/news/news/press/2010/pr1002.pdf
http://www.fdic.gov/regulations/laws/rules/5000-4200.html
http://www.fdic.gov/regulations/safety/manual/section7-1_toc.html
http://www.federalreserve.gov/boarddocs/SRLETTERS/1996/sr9613.htm
http://www.federalreserve.gov/BoardDocs/SupManual/trading/200901/3000p2.pdf
http://www.occ.gov/news-issuances/bulletins/2010/bulletin-2010-1a.pdf
http://www.occ.gov/news-issuances/bulletins/1998/bulletin-1998-20.html
http://www.occ.gov/static/publications/handbook/irr.pdf
The OTS IRR Model does not provide measurement of both earnings at risk
and capital at risk to interest rate movements, so extending reporting
of Schedule CMR would not facilitate savings associations' movement
toward full compliance with the Interagency Advisory. Numerous vendors
and other sources are available to assist institutions in establishing
processes to fully measure interest rate risk exposure, as evidenced by
existing commercial and state-chartered savings banks of all asset
sizes that effectively measure and monitor interest rate risk
independently of, but subject to supervisory oversight by, their
regulator. After considering all the issues, the agencies have decided
to proceed with the elimination of Schedule CMR as proposed beginning
with the March 31, 2012 reporting period.
The February 8, 2011 notice also proposed that the filing of
Schedule CMR for the remainder of 2011 would be optional for savings
associations that have a ``1'' or ``2'' rating for their most recent
composite rating under the Uniform Financial Institutions Rating System
(UFIRS), a ``1'' or ``2'' rating for their most recent UFIRS
Sensitivity component rating, and the means to adequately monitor and
assess interest rate risk through internal processes pursuant to
current regulatory guidance and expectations.
The agencies decided to modify the proposed 2011 optional filing of
Schedule CMR for these savings associations. Rather than making the
filing of Schedule CMR optional for savings associations that have a
``1'' or ``2'' rating for their most recent UFIRS composite rating, a
``1'' or ``2'' rating for their most recent UFIRS Sensitivity component
rating, and the means to adequately monitor and assess interest rate
risk through internal processes, savings associations that meet these
criteria should not file Schedule CMR after the end of the June 30,
2011 reporting period. All other savings associations must continue to
file Schedule CMR through the December 31, 2011 reporting period.
Additional comments were received from two bank/thrift trade
associations. Both of the trade associations requested a one-year
extension for the conversion of the TFR to the Call Report from the
proposed implementation date of the reporting period ending March 31,
2012, to an implementation date of the reporting period ending March
31, 2013. The trade associations cited various burden concerns as a
general basis for the one-year extension request.
The agencies met with representatives from the two trade
associations on May 11, 2011, to discuss in more detail their comments
regarding the report conversion proposal. Both trade associations
reiterated the concerns expressed in their comment letters. In the
comment letters and during the May 11, 2011, meeting, both trade
associations mentioned the coinciding burden associated with the
Board's notice of intent to require SLHCs to begin filing the same
regulatory reports required of BHCs. The Board is considering the
comments received on its notice of intent and plans to issue a proposal
for comment regarding SLHC reporting on or after the July 21, 2011,
transfer date.
The agencies carefully considered the trade associations' comments
regarding the TFR-to-Call Report conversion proposal. The agencies
realize the report conversion is a key consideration of the thrift
industry and have already taken several measures to help address these
concerns and ease the conversion from the TFR to the Call Report.
One of the most significant measures to assist with the report
conversion process is the transfer of the entire OTS Financial
Reporting Division (FRD) staff to the FDIC effective with the transfer
date. The FRD staff currently responds to savings association TFR
questions and is the primary contact for savings associations with
questions regarding TFR content issues as well as technical filing
issues. The FRD staff currently has caseloads of savings associations
and the transfer of FRD staff as a unit will help provide savings
associations with consistency by having the same points of contact
throughout the report conversion process. Experienced Call Report staff
will also be readily available to assist institutions with report
content and filing issues throughout the transition and on an ongoing
basis.
In addition, on February 3, 2011, the OTS announced it would
curtail all proposed changes to the TFR for 2011 that would increase
the differences between the TFR and the Call Report (Final Notice 76 FR
6191).\2\ This decision was made to help reduce the burden of the
proposed report conversion.
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\2\ Link to the February 3, 2011, Final Notice published at 76
FR 6191: http://www.ots.treas.gov/_files/4830087.pdf.
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Also to help savings associations with the conversion to the Call
Report, the OTS published on February 15, 2011,\3\ a ``mapping'' of
data items reported on the TFR to comparable items reported on the Call
Report. The mapping further identified the Call Report data items that
are not reported in the TFR. The mapping schema is available on the
OTS's Web site at http://www.ots.treas.gov/_files/4830092.pdf. The
mapping schema was also placed on the FFIEC's Web site under Call
Report Forms at http://www.ffiec.gov/ffiec_report_forms.htm.
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\3\ Link to CEO Letter 379: http://www.ots.treas.gov/_files/25379.pdf.
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The two trade associations expressed appreciation for the mapping
between the reports mentioned above. They also commented that there
were a large number of data items that did not map between the two
reports. The trade associations observed the large number was primarily
attributable to the greater number of data items currently collected on
the Call Report compared to the number of data items collected on the
[[Page 39986]]
TFR. Further, the trade associations indicated the large number of data
items that do not map between the reports may be evidence that the
proposed report conversion could prove difficult for savings
associations.
The agencies believe the number of data items that do not map
between the two reports reflects: (1) a larger number of data items
reported on the Call Report than on the TFR; and (2) the greater number
of large, complex institutions reporting information using the Call
Report rather than the TFR.
As of March 31, 2011, there were 7,574 FDIC-insured banks and
savings institutions--724 were savings associations reporting data to
the OTS using the TFR and the remainder (6,850) were FDIC-insured
commercial banks and state-chartered savings banks reporting data to
their respective regulatory agency using the Call Report. Of the 724
savings associations, four had assets greater than $50 billion, and
none had assets greater than $100 billion. Of the 6,850 institutions,
32 had assets greater than $50 billion, and four had assets greater
than $100 billion.
The fact that the thrift industry (TFR filers) is generally smaller
and has fewer large, complex institutions than the other banks and
savings institutions insured by the FDIC as a group (Call Report
filers), has allowed the OTS to obtain needed supervisory information
from individual savings associations rather than add data items to the
TFR. This was especially the case where information was needed for
activities unique to certain larger, more complex thrift institutions.
In contrast, obtaining similar information for supervisory purposes
through the Call Report was more efficient for Call Report filers since
there was likely a greater number of institutions engaged in complex
activities. This was due to the fact there are approximately nine times
the number of Call Report filers as there are TFR filers. In addition,
there are a greater number of large institutions filing the Call
Report.
The inclusion in the Call Report of schedules from which to obtain
information from complex activities, for example securitization
activities, as opposed to the collection of similar information outside
the TFR collection process for savings associations, resulted in a
large number of items that did not map from the Call Report to the TFR.
Call Report items designed to collect information from institutions
engaged in complex activities would not need to be reported for the
vast majority of savings associations.
Further, the Call Report uses an asset size-based approach to some
schedules whereby institutions exceeding a certain asset size are
required to report additional data. The asset size thresholds in many
Call Report schedules are either $300 million or $1 billion. As of
March 31, 2011, 64 percent of savings associations had assets less than
$300 million; 86 percent of savings associations had assets less than
$1 billion. Hence, the additional reporting required of larger
institutions in many Call Report schedules would not apply to the
majority of savings associations.
For these reasons, the agencies believe focusing on the number of
Call Report data items that do not map to the TFR may lead to the
inaccurate conclusion that the proposed conversion to the Call Report
from the TFR would impose significant additional burden on all savings
associations.
The two trade associations also commented that the burden
estimates, specifically the estimates under the heading ``Initial
Burden Estimates,'' in the February 8, 2011 notice announcing the
proposed reporting conversion, underestimate the actual number of hours
that may be required for the conversion.
The initial burden estimates in the February 8, 2011 notice were
based on a telephone survey conducted by the OTS of certain savings
associations that changed charters from an OTS-supervised institution
to a commercial bank or a non-OTS supervised state savings bank during
the period from January 1, 2008, through June 30, 2010. Hence, these
institutions had to convert from reporting on the TFR to reporting on
the Call Report. Their actual experience implementing a report
conversion from the TFR to the Call Report was thought to be valuable
information for estimating the initial burden for this proposal.
A total of 22 OTS-supervised savings associations changed charters
during the period reviewed. Six of the 22 savings associations changed
charters to facilitate an acquisition or merger into another
institution. Two of the 22 savings associations engaged in trust
activities only. Of the remaining 14 savings associations, nine were
contacted by the OTS and asked for their estimate of the total hours
expended--including systems work and training for the new reporting--in
converting from the TFR to the Call Report.
The estimates included two extremes. One institution estimated zero
hours were expended on the report conversion. This institution
indicated they used a service provider for general ledger and other
reporting purposes that had both TFR filers and Call Report filers as
clients. Hence, the conversion to the Call Report was very simple and
required zero hours by the institution to implement the report
conversion.
At the other extreme was one institution's estimate of 720 hours
(600 hours for the TFR-to-Call Report conversion and 120 hours for the
TFR Schedule HC-to-bank holding company conversion). However, this
institution experienced significant growth through acquisitions in the
two years prior to its charter change. Hence, some of the hours
estimated for report conversion may have been attributable to systems
coordination among acquired entities. Nevertheless, this institution's
estimate was included in the calculation of the average number of hours
used to estimate the initial burden of report conversion.\4\
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\4\ Excluding the two extremes, the range of hours was 40 hours
to 360 hours. If both the high-end and low-end extremes were
excluded, the average number of estimated burden hours would be 130
hours.
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It is typical in calculating averages to exclude extremes from the
low end and the high end. For conservatism, only the estimate of zero
hours was excluded in calculating the average number of estimated hours
for initial burden published in the February 8, 2011 notice. Further,
some institutions could not specifically differentiate between the
hours spent on the TFR-to-Call Report conversion and the hours spent on
the holding company report conversion. These institutions either did
not separately track hours for each process or viewed the conversion
for both reports as one effort. Again for conservatism, we elected to
include total hours estimated from institutions (hours related to the
TFR-to-Call Report conversion plus hours related to the holding company
report conversion) for estimating the initial burden hours included in
the February 8, 2011 notice.
As presented in the notice published February 8, 2011, the average
number of hours estimated for converting from the TFR to the Call
Report was 188 hours. The agencies believe this is a fair estimate of
the initial burden of the proposal.
The trade associations also commented that the conversion from the
TFR to the Call Report, as proposed, would be burdensome on the systems
of savings associations and that vendors of software for generating and
reporting Call Reports may have difficulty helping savings associations
with the report conversion. It was further stated by one of the
commenters that ``each savings
[[Page 39987]]
association would have to evaluate each reporting line item, find where
in their institution the information may be obtained, and create
systems and procedures to provide the required information.''
The agencies carefully reviewed the service providers currently
used by savings associations to help manage information and operation
systems. The FDIC also surveyed several Call Report software filing
vendors to help determine the overall difficulty of the proposed
conversion from a vendor perspective.
As stated in the February 8, 2011 notice, there are currently nine
vendors offering software meeting the technical specifications for
producing Call Report data files that are able to be processed by the
FFIEC's Central Data Repository (CDR).\5\ Based on an analysis by the
OTS, approximately 60 percent of savings associations use one of the
nine vendors to generate their general ledgers. Another 20 percent of
savings associations use one of the nine vendors as their service
provider for a system other than their general ledger, such as systems
for customer information files, loan processing and underwriting, loan
servicing, or asset/liability management.
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\5\ The list of these nine vendors can be found on the last page
of the FFIEC's most recent quarterly Call Report Supplemental
Instructions found at http://www.ffiec.gov/ffiec_report_forms.htm.
In addition, individual institutions may choose to develop their own
Call Report preparation software that meets these technical
specifications.
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Based on a survey of Call Report software vendors, these vendors
already have a mapping of data items between the Call Report and the
TFR. Hence, it does not appear that individual savings associations
would generally need to conduct their own systems mapping of TFR data
items to comparable Call Report items for filing the Call Report. The
agencies believe this survey finding, together with the large
percentage of savings associations already using the services of
vendors familiar with both the TFR and the Call Report, would appear to
help mitigate the overall difficulty of the proposed conversion.
One of the trade associations commented there will be costs
associated with the report conversion and these costs may rise
dramatically if the conversion implementation occurs as proposed. The
agencies agree there will be costs associated with the report
conversion. The OTS developed TFR reporting software and provided that
software free-of-charge to savings associations to file the TFR. In
contrast, Call Report filers typically use commercially available
software to file the Call Report.
However, the agencies do not agree the costs may rise dramatically
if the conversion implementation occurs as proposed. Inquiries were
made of vendors regarding the costs of reporting software, both initial
costs and ongoing costs, as part of the survey of Call Report software
vendors discussed above. The survey results indicated the costs of the
Call Report filing software are not significant and average
approximately $1,000 for the initial set-up and $1,000 per year
depending on institution asset size.\6\ Further, vendors indicated that
the method used to obtain the filing software is simple and
straightforward. Moreover, since most savings associations already use
some services from vendors that also provide Call Report filing
software, the efforts needed by vendors to provide Call Report filing
software to the majority of savings associations is limited.
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\6\ These costs may vary depending on asset size as indicated,
as well as modules, options, or additional services requested.
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The agencies carefully considered all of the burden issues raised
by the two trade associations as reasons for requesting a one-year
delay of the report conversion implementation. Based on the agencies'
analyses of burden issues and surveys or discussions with service
providers and savings association executives, the agencies have decided
to proceed with the conversion of the TFR to the Call Report beginning
with the reporting period ending March 31, 2012, as proposed.
The agencies also considered that existing rules, regulations, and
overall examination and supervisory approaches for savings associations
will be realigned to parallel those applied to all other FDIC-insured
banks and savings institutions. Many of these rules, regulations, and
examination and supervisory approaches rely on information gathered
from the Call Report. Moreover, the primary models, monitoring tools
and data reports used in conducting off-site financial monitoring and
onsite examinations--such as the Uniform Bank Performance Report
(UBPR)--are produced from Call Report data. Hence, to help ensure that
overall supervision and supervisory evaluations are consistent among
all FDIC-insured banks and savings institutions, the agencies believe
it is vital to have all FDIC-insured banks and savings institutions use
the same supervisory financial report and filing processes beginning in
2012.
There were several other comments submitted by the two trade
associations. Both trade associations requested the agencies allow
early adoption of the Call Report by savings associations. The agencies
considered this request and have agreed to allow savings associations
to adopt the Call Report early for report dates following the transfer
date of July 21, 2011.\7\ The agencies request that savings
associations planning to file a Call Report in 2011 for the last two
reporting periods, or the last reporting period, should notify their
primary federal regulator (and state regulator where applicable) and
the FRD analyst assigned to their institution at least two weeks before
the Call Report due date which is 30 calendar days after the quarter-
end report date. This will allow for the necessary systems adjustments
to the CDR for Call Report collection and processing. Once a savings
association has elected to adopt the Call Report early in 2011, it must
continue to file the Call Report for the remainder of the early
adoption period, and such Call Reports will be subject to all
applicable data standards and requirements.
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\7\ Savings associations that adopt the Call Report early in
2011 should not file TFR Schedule CMR unless required to do so by
their primary regulator. In most cases, the filing of Schedule CMR
for savings associations that early adopt the Call Report would be
required if the institution does not yet have the means to
adequately measure and monitor interest rate risk. Additionally,
savings associations that adopt the Call Report early in 2011, would
still need to submit all other existing OTS regulatory reports and
would be required by the Board to file TFR Schedule HC through the
December 31, 2011 reporting period. As mentioned above in this
notice, the Board is considering the comments received on its notice
of intent and plans to issue a proposal for comment regarding SLHC
reporting on or after the July 21, 2011, transfer date.
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One trade association requested the agencies consider allowing
institutions to file Call Reports based on their fiscal years rather
than the requirement to file on a calendar year basis as currently
required. According to data collected in the Call Report on
institutions' fiscal years, there are about 200 current Call Report
filers with fiscal years that do not align with the calendar year. The
agencies know of no institutions--including those with fiscal years
that do not align with the calendar year--for which filing the Call
Report using the calendar year presents filing problems. Therefore, all
institutions will be requested to file the Call Report on a calendar
year basis.
The agencies encourage feedback regarding their progress with the
report conversion process. Savings associations should feel free to
contact their FRD analyst, supervisory caseload manager, regional
director, or contacts listed on this notice about report conversion
issues.
[[Page 39988]]
Further, the agencies will continue to meet with savings
association managers through various venues. During these meetings,
managers are encouraged to discuss issues related to the implementation
of the report conversion.
B. Report Preparation Training
Converting to the Call Report may require OTS-regulated savings
associations to obtain specific training for their staff concerning the
preparation and completion of the Call Report. Such training is offered
on a regular basis by independent trade and professional organizations.
As stated above, the agencies have provided a ``mapping'' of TFR
items to Call Report items to help reduce the initial burden of report
conversion. As also stated in the February 8, 2011 notice, there are
some differences between the Call Report and TFR, examples of which are
described below. Given these and other reporting differences, savings
associations are encouraged to familiarize themselves with the Call
Report instructions and to seek training opportunities for report
preparation staff as soon as possible. Web links to the Call Report
forms and instructions are provided above in this notice.
Some reporting differences between the TFR and the Call Report
include the following:
1. In the TFR, data are reported for the quarter ending on the
report date in Schedule SO--Consolidated Statement of Operations, the
Summary of Changes in Savings Association Equity Capital in Schedule
SI--Supplemental Information, Schedule VA--Consolidated Valuation
Allowances and Related Data, and Schedule CF--Consolidated Cash Flow
Information. In the comparable schedules of the Call Report, data are
reported on a calendar year-to-date basis, regardless of an
institution's fiscal year-end.
2. Previously submitted TFRs can be amended only for 135 days after
the end of the quarter for which an amended report is being filed
electronically. In general, amendments to previously submitted Call
Reports can be filed for up to five years after the report date,
including amendments required by an institution's primary federal bank
supervisory authority when a report as previously submitted contains
significant errors with respect to the categorization of data items or
material errors with respect to the recognition and measurement of an
event or transaction.
3. In the Average Balance Sheet Data section of TFR Schedule SI--
Supplemental Information, savings associations report average balance
sheet data for the quarter that, at a minimum, must be computed based
on balances at month-end. However, savings associations may choose to
compute these data based on other than month-end balances, such as
daily or weekly balances. In Call Report Schedule RC-K--Quarterly
Averages, institutions must report averages on a daily or weekly basis
only.
4. Savings associations can report specific valuation allowances in
TFR Schedule VA-Consolidated Valuation Allowances and Related Data.
Comparable reporting is not available in the Call Report. For example,
for Call Report purposes, institutions take and report charge-offs on
individual loans rather than creating specific valuation allowances.
The agencies are also participating in various conferences and tele-
briefings to help assist savings associations with the transition to
the Call Report. The members of the FFIEC's Task Force on Reports are
also available to answer questions that savings associations have on
the Call Report. Additionally, questions regarding the Call Report can
be directed to the sources listed at the bottom of the following
Financial Institution Letter: http://www.fdic.gov/news/news/financial/2011/fil11019.html.
C. Timing
Savings associations currently regulated by the OTS would begin
filing the Call Report as of the March 31, 2012, report date. Savings
associations are permitted to convert early to the Call Report for
report dates following the transfer date of July 21, 2011, as described
above in this notice. However, as described above in this notice,
savings associations that early adopt the Call Report would still need
to submit Schedule HC of the TFR along with all other existing OTS
regulatory reports through the December 31, 2011, reporting period. The
agencies request that savings associations planning to begin filing the
Call Report in 2011 notify their primary federal regulator (and state
regulator where applicable) and the FRD analyst assigned to their
institution at least two weeks before the Call Report due date, which
is 30 calendar days after the quarter-end report date. Savings
associations would file the same Call Report required of commercial
banks and state-chartered savings banks not currently regulated by the
OTS. Web links to the Call Report forms and instructions are provided
above in this notice.
Savings associations that do not convert to the Call Report prior
to the March 31, 2012, report date will continue to submit TFRs,
including Schedules HC and CMR (unless an institution meets the
requirements discussed above in this notice to discontinue reporting
Schedule CMR after the end of the June 30, 2011 reporting period), and
all other existing OTS regulatory reports through the December 31,
2011, reporting period, using the processing, editing, and validating
system currently in use, which is the Electronic Filing System
established by the OTS.
D. Filing Process
OTS-regulated savings associations use OTS-developed proprietary
software to file TFRs. Call Reports for other FDIC-insured institutions
are filed one of two ways, both using institution-acquired software.
These two filing processes are described below:
1. An institution may use computer software to prepare its report
and then submit the report directly to the CDR, an Internet-based
system for data collection at https://cdr.ffiec.gov/CDR/; or
2. The institution may complete its reports in paper form and
arrange with a software vendor or another party to convert its paper
reports into an electronic format that can be processed by the CDR. The
software vendor or another party then must electronically submit the
data file containing the bank's Call Report to the CDR.
A list of providers offering software meeting the technical
specifications for producing Call Report data files that are able to be
processed by the CDR can be found on the last page of the FFIEC's most
recent quarterly Call Report Supplemental Instructions found at http://www.ffiec.gov/ffiec_report_forms.htm. In addition, individual
institutions may choose to develop their own Call Report preparation
software that meets these technical specifications. The agencies will
provide specific information on the requirements to those institutions
interested in pursuing this option.
In summary, after considering the comments received on the
proposal, the agencies plan to proceed with the reporting changes
proposed and will submit the proposal to OMB for review and approval.
Request for Comment
Public comment is requested on all aspects of this joint notice.
Comments are invited on:
(a) Whether the proposed revisions to the collections of
information that are the subject of this notice are necessary
[[Page 39989]]
for the proper performance of the agencies' functions, including
whether the information has practical utility;
(b) The accuracy of the agencies' estimates of the burden of the
information collections as they are proposed to be revised, 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 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 joint notice will be shared
among the agencies. All comments will become a matter of public record.
Dated: June 29, 2011.
Michele Meyer,
Assistant Director, Legislative and Regulatory Activities Division,
Office of the Comptroller of the Currency.
Board of Governors of the Federal Reserve System, dated: June
30, 2011.
Jennifer J. Johnson,
Secretary of the Board.
Dated at Washington, DC, this 1st day of July 2011.
Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
Dated: July 1, 2011.
Ira L. Mills,
Paperwork Clearance Officer, Office of Chief Counsel, Office of Thrift
Supervision.
[FR Doc. 2011-17100 Filed 7-6-11; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 6714-01-P; 6720-01-P