[Federal Register Volume 81, Number 49 (Monday, March 14, 2016)]
[Proposed Rules]
[Pages 13607-13635]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-05089]



[[Page 13607]]

Vol. 81

Monday,

No. 49

March 14, 2016

Part V





Department of the Treasury





-----------------------------------------------------------------------





Office of the Comptroller of the Currency





-----------------------------------------------------------------------





12 CFR Parts 4, 5, 7, et al.





Economic Growth and Regulatory Paperwork Reduction Act of 1996 
Amendments; Proposed Rule

Federal Register / Vol. 81 , No. 49 / Monday, March 14, 2016 / 
Proposed Rules

[[Page 13608]]


-----------------------------------------------------------------------

DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Parts 4, 5, 7, 9, 10, 11, 12, 16, 18, 31, 150, 151, 155, 
162, 163, 193, 194, 197

[Docket ID OCC-2016-0002]
RIN 1557-AD95


Economic Growth and Regulatory Paperwork Reduction Act of 1996 
Amendments

AGENCY: Office of the Comptroller of the Currency, Treasury.

ACTION: Notice of proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: As part of its review under the Economic Growth and Regulatory 
Paperwork Reduction Act of 1996, the Office of the Comptroller of the 
Currency (OCC) is proposing to revise certain of its rules to remove 
outdated or otherwise unnecessary provisions. Specifically, the OCC is 
proposing to: Revise certain licensing rules related to chartering 
applications, business combinations involving Federal mutual savings 
associations, and notices for changes in permanent capital; clarify 
national bank director oath requirements; revise certain fiduciary 
activity requirements for national banks and Federal savings 
associations, including increasing the asset size limit for mini-funds; 
remove certain financial disclosure requirements for national banks; 
remove certain unnecessary regulatory reporting, accounting, and 
management policy requirements for Federal savings associations; revise 
the electronic activities provisions for Federal savings associations; 
integrate and update OCC rules for national banks and Federal savings 
associations relating to municipal securities dealers, Securities 
Exchange Act disclosure rules, and securities offering disclosure 
rules, including providing for the electronic submission of required 
filings and applying the less burdensome national bank rule to Federal 
savings associations; update and revise recordkeeping and confirmation 
requirements for national banks' and Federal savings associations' 
securities transactions; integrate and update rules relating to insider 
and affiliate transactions; and make other technical and clarifying 
changes.

DATES: Comments must be received on or before May 13, 2016.

ADDRESSES: Because paper mail in the Washington, DC area and at the OCC 
is subject to delay, commenters are encouraged to submit comments 
through the Federal eRulemaking Portal or email, if possible. Please 
use the title ``Economic Growth and Regulatory Paperwork Reduction Act 
of 1996 Amendments'' to facilitate the organization and distribution of 
the comments. You may submit comments by any of the following methods:
     Federal eRulemaking Portal--``Regulations.gov'': Go to 
http://www.regulations.gov/. Enter ``Docket ID OCC-2016-0002'' in the 
Search Box and click ``Search''. Results can be filtered using the 
filtering tools on the left side of the screen. Click on ``Comment 
Now'' to submit public comments.
     Click on the ``Help'' tab on the Regulations.gov home page 
to get information on using Regulations.gov, including instructions for 
submitting public comments.
     Email: [email protected].
     Mail: Legislative and Regulatory Activities Division, 
Office of the Comptroller of the Currency, 400 7th Street SW., Suite 
3E-218, Mail Stop 9W-11, Washington, DC 20219.
     Hand Delivery/Courier: 400 7th Street SW., Suite 3E-218, 
Mail Stop 9W-11, Washington, DC 20219.
     Fax: (571) 465-4326.
    Instructions: You must include ``OCC'' as the agency name and 
``Docket ID OCC-2016-0002'' in your comment. In general, OCC will enter 
all comments received into the docket and publish them on the 
Regulations.gov Web site without change, including any business or 
personal information that you provide such as name and address 
information, email addresses, or phone numbers. Comments received, 
including attachments and other supporting materials, are part of the 
public record and subject to public disclosure. Do not include any 
information in your comment or supporting materials that you consider 
confidential or inappropriate for public disclosure.
    You may review comments and other related materials that pertain to 
this rulemaking action by any of the following methods:
     Viewing Comments Electronically: Go to http://www.regulations.gov/. Enter ``Docket ID OCC-2016-0002'' in the Search 
box and click ``Search''. Comments can be filtered by Agency using the 
filtering tools on the left side of the screen.
     Click on the ``Help'' tab on the Regulations.gov home page 
to get information on using Regulations.gov, including instructions for 
viewing public comments, viewing other supporting and related 
materials, and viewing the docket after the close of the comment 
period.
    Viewing Comments Personally: You may personally inspect and 
photocopy comments at the OCC, 400 7th Street SW., Washington, DC. For 
security reasons, the OCC requires that visitors make an appointment to 
inspect comments. You may do so by calling (202) 649-6700, or, for 
persons who are deaf or hard of hearing, TTY, (202) 649-5597. Upon 
arrival, visitors will be required to present valid government-issued 
photo identification and submit to security screening in order to 
inspect and photocopy comments.
     Docket: You may also view or request available background 
documents and project summaries using the methods described above.

FOR FURTHER INFORMATION CONTACT: For additional information, contact 
Heidi Thomas, Special Counsel; or Rima Kundnani, Attorney, Legislative 
and Regulatory Activities Division, 202-649-5490, for persons who are 
deaf or hard of hearing, TTY, 202-649-5597, Office of the Comptroller 
of the Currency, 400 7th Street SW., Washington, DC 20219.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 2222 of the Economic Growth and Regulatory Paperwork 
Reduction Act of 1996 (EGRPRA) \1\ requires that, at least once every 
10 years, the Federal Financial Institutions Examination Council 
(FFIEC) and each appropriate Federal banking agency (Agency or, 
collectively, Agencies) represented on the FFIEC (the OCC, Federal 
Deposit Insurance Corporation (FDIC), and the Board of Governors of the 
Federal Reserve System (Federal Reserve Board)) conduct a review of the 
regulations prescribed by the FFIEC or Agency. The purpose of this 
review is to identify outdated or otherwise unnecessary regulatory 
requirements imposed on insured depository institutions.
---------------------------------------------------------------------------

    \1\ 12 U.S.C. 3311.
---------------------------------------------------------------------------

    In conducting this review, EGRPRA requires the Agencies to provide 
public notice and seek comment on one or more categories of regulations 
at regular intervals so that all Agency regulations are published for 
comment within a 10-year cycle. EGRPRA also directs the Agencies to 
categorize their regulations by type, publish the categories, and 
invite the public to identify areas of regulations that are ``outdated, 
unnecessary, or unduly burdensome.'' \2\
---------------------------------------------------------------------------

    \2\ Id. at 3311(a).
---------------------------------------------------------------------------

    Once the Agencies have published the categories of regulations for 
comment, EGRPRA requires the Agencies to publish a comment summary and

[[Page 13609]]

discuss the significant issues raised by the commenters. The statute 
also directs the Agencies to ``eliminate unnecessary regulations to the 
extent that such action is appropriate.'' \3\ Finally, EGRPRA requires 
the FFIEC to submit a report to Congress summarizing significant issues 
and their relative merits. The report also must analyze whether the 
Agencies can address these issues through regulatory change or whether 
legislative action is required.
---------------------------------------------------------------------------

    \3\ Id. at 3311(d)(2).
---------------------------------------------------------------------------

    The Agencies completed the first EGRPRA review in 2006. The current 
EGRPRA review process runs through December 31, 2016.
    As with the first EGRPRA review, the Agencies have elected to 
conduct this current review jointly. The Agencies have divided their 
regulations into 12 categories and published four Federal Register 
notices,\4\ each requesting public comment on three of these 
categories. Additionally, the Agencies held a series of six outreach 
meetings to provide an opportunity for bankers, consumer and community 
groups, and other interested parties to present their views on the 
Agencies' regulations directly to Agency principals, senior Agency 
management, and Agency staff.\5\
---------------------------------------------------------------------------

    \4\ See 79 FR 32172 (June 4, 2014); 80 FR 7980 (Feb. 13, 2015); 
80 FR 32046 (June 5, 2015), and 80 FR 79724 (Dec. 23, 2015). More 
information on the current EGRPRA process, including the Federal 
Register notices, outreach meetings, and public comments received, 
is available at http://egrpra.ffiec.gov/index.html.>
    \5\ These public outreach meetings took place in Los Angeles, 
California on December 2, 2014; Dallas, Texas on February 4, 2015; 
Boston, Massachusetts on May 4, 2015; Kansas City, Missouri on 
August 4, 2015 (which focused on rural banking issues), Chicago, 
Illinois on October 19, 2015; and Washington, DC on December 2, 
2015. These meetings were live streamed on the EGRPRA Web site to 
provide individuals throughout the country with the opportunity to 
watch and listen to the proceedings at no cost. Additionally, the 
outreach meetings in Kansas City, Chicago, and Washington, DC 
provided online viewers an opportunity to participate and provide 
comments via a real time text-chat feature.
---------------------------------------------------------------------------

    The OCC believes it is unnecessary to wait until the end of the 
EGRPRA process to act to reduce regulatory burden where possible. We 
already have incorporated a number of changes commenters proposed in 
response to the first EGRPRA notice into our recently finalized rule to 
integrate the OCC's national bank and Federal savings association 
licensing rules.\6\ In addition, the banking agencies, acting through 
the FFIEC, have sought comment on proposals to eliminate or revise 
several items on the Consolidated Reports of Condition (Call 
Report).\7\ The Agencies also are considering the feasibility of 
creating a streamlined version of the Call Report for community 
institutions. These Call Report initiatives are consistent with the 
feedback the OCC, FDIC, and Federal Reserve Board have received in this 
EGRPRA review.
---------------------------------------------------------------------------

    \6\ The OCC published this final rule on May 18, 2015, and it 
was effective on July 1, 2015. 80 FR 28346 (May 18, 2015).
    \7\ See 80 FR 56539 (Sept. 18, 2015).
---------------------------------------------------------------------------

    The OCC also supports specific legislative proposals that would 
eliminate regulatory burden. First, as senior OCC staff has testified 
before Congress,\8\ the OCC believes that it is appropriate to increase 
the number of healthy, well-managed community institutions that qualify 
for the 18-month examination cycle by raising the statutory threshold. 
Recently, Congress acted to do so by raising the statutory threshold 
from under $500 million in total assets to under $1 billion in total 
assets for 1-rated institutions, and by providing the Federal banking 
agencies with the discretion to raise the threshold for 2-rated 
institutions.\9\ The OCC, together with the FDIC and Federal Reserve, 
recently issued an interim final rule that exercises this 
discretion.\10\
---------------------------------------------------------------------------

    \8\ See ``Testimony of Toney Bland, OCC Senior Deputy 
Comptroller for Midsize and Community Bank Supervision, Before the 
Subcommittee on Financial Institutions and Consumer Credit, House 
Committee on Financial Services, United States House Of 
Representatives,'' April 23, 2015, http://www.occ.gov/news-issuances/congressional-testimony/2015/pub-test-2015-59-written.pdf.
    \9\ Congress included this proposal in the Fixing America's 
Surface Transportation (FAST) Act, Pub. L. 114-94, signed into law 
by the President on December 4, 2015.
    \10\ 81 FR 10063 (Feb. 29, 2016).
---------------------------------------------------------------------------

    Second, the OCC believes that Federal savings associations should 
have greater flexibility to expand their business model without 
changing their governance structure.\11\ This expanded business model 
would provide Federal savings associations with the flexibility to 
adapt to changing economic and business environments to meet the needs 
of their communities without the costs associated with changing 
charters. Finally, the OCC supports creating an exclusion from the 
Volcker Rule for community institutions.\12\
---------------------------------------------------------------------------

    \11\ See Id.
    \12\ See Id.
---------------------------------------------------------------------------

    This notice of proposed rulemaking (NPRM) represents another effort 
by the OCC to revise requirements imposed on national banks and Federal 
savings associations where possible and sensible in light of the EGRPRA 
mandate to identify outdated or otherwise unnecessary regulatory 
provisions. It reflects comments the OCC received on its rules 
published in the first three EGRPRA Federal Register notices and 
through the six EGRPRA outreach meetings. It also includes amendments 
to OCC rules derived from the OCC's most recent internal review of its 
rules to identify outdated or unnecessary provisions beyond those 
suggested by EGRPRA commenters. The amendments included in this 
proposed rule remove unnecessary or outdated provisions and streamline 
and simplify OCC rules, thereby reducing regulatory burden on national 
banks and Federal savings associations.
    We will continue to review the EGRPRA comments and if warranted 
would issue additional proposed rules to reflect these comments as well 
as those received on rules included in the fourth EGRPRA Federal 
Register notice. We note that some of the proposed amendments included 
in this NPRM would amend rules that are currently out for public 
comment as part of this fourth Federal Register notice.\13\ To ensure 
that any OCC rule finalizing this NPRM takes into account all comments 
we receive on these rules, the OCC will consider comments received on 
both this NPRM and the fourth EGRPRA notice when finalizing this 
rulemaking.
---------------------------------------------------------------------------

    \13\ These rules are the OCC's securities-related rules (12 CFR 
parts 10, 11, 12, 16, 151, 163.172, 193, 194, and 197) and insider 
and affiliate transactions rules (12 CFR part 31 and Sec. Sec.  
163.41 and 163.43).
---------------------------------------------------------------------------

    The proposals included in this rulemaking amend rules issued only 
by the OCC; they do not reflect comments submitted on rules the OCC has 
issued jointly with other agencies. We will address any modifications 
to interagency rules through a separate interagency rulemaking.

II. Description of the Proposal

Organization and Functions, Availability and Release of Information (12 
CFR Part 4)

    Twelve CFR part 4 describes the organization and functions of the 
OCC and sets forth the standards, policies, and procedures that the OCC 
applies in administering the Freedom of Information Act (FOIA) and 
requests for non-public OCC information, among other things. The OCC is 
proposing a number of technical amendments to these provisions.
    First, this proposal would update and correct the OCC address in 
several sections. Second, this proposal would update the title of 
certain OCC offices and positions. Specifically, the proposal would 
replace ``Licensing Department'' with ``Licensing Division,'' and 
``Disclosure Officer'' with ``Freedom of Information Act Officer'' in 
subparts A and B of part 4.
    Additionally, the OCC proposes to remove Sec.  4.11(b)(4). This 
section

[[Page 13610]]

provides that the OCC's FOIA rules, 12 CFR part 4, subpart B, do not 
apply to FOIA requests filed with the former Office of Thrift 
Supervision (OTS) before July 21, 2011. Instead, the FOIA rules of the 
former OTS apply to these requests. The OCC adopted this provision when 
it amended part 4 to reflect the transfer of certain powers, 
authorities, rights and duties of the OTS to the OCC pursuant to Title 
III of the Dodd-Frank Wall Street Reform and Consumer Protection Act 
(Dodd-Frank Act).\14\ There are no remaining open FOIA requests that 
had been submitted to the OTS prior to its abolishment. Therefore, this 
section is no longer necessary.
---------------------------------------------------------------------------

    \14\ Public Law 111-203, 124 Stat. 1376 (2010), codified at 12 
U.S.C. 371c.
---------------------------------------------------------------------------

    Further, 12 CFR 4.12(a) requires that OCC records be available to 
the public, except for the exempt records listed in paragraph (b). 
Twelve CFR 4.12(b)(10) exempts any OTS information similar to that 
listed in the exemptions in paragraphs (b)(1) to (b)(9) to the extent 
the information is in the possession of the OCC. For purposes of 
clarification, the OCC proposes to include in the general requirement 
in paragraph (a) that OTS records, in addition to OCC records, shall be 
made available to the public, and to remove the exemption in paragraph 
(b)(10).

Rules, Policies, and Procedures for Corporate Activities (12 CFR Part 
5)

    Twelve CFR part 5 sets forth the OCC's rules for corporate 
activities and filings. These rules were included in the first EGRPRA 
Federal Register request for comments and, as indicated above, the 
OCC's final rule integrating the OCC's national bank and Federal 
savings association licensing rules incorporated changes that reflect 
some of the comments received in response to that notice. The proposed 
amendments below reflect further review of these licensing rules by the 
OCC since the adoption of this final rule.
    Change in charter purpose or type (12 CFR 5.20, 5.53). The OCC is 
proposing to add provisions to Sec. Sec.  5.20 and 5.53 to clarify what 
type of application is to be used when an existing national bank or 
Federal savings association proposes to change the purpose and type of 
charter under which it operates. The OCC charters national banks and 
Federal savings associations that are authorized to conduct any 
activity permitted for a national bank or a Federal savings 
association, respectively (sometimes called ``full-service charters''). 
The OCC also charters national banks and Federal savings associations 
whose activities are limited to a special purpose. The most common 
types of special purpose institutions are (1) those whose operations 
are limited to those of a trust company and activities related thereto, 
and (2) those that conduct only a credit card business. Other special 
purpose charter types include: bankers' banks, community development 
banks, and cash management banks.
    When the OCC grants approval for a special purpose institution, the 
approval decision generally includes a condition requiring the 
institution to conduct only the limited activity. In addition, the 
institution's governing document--the articles of association in the 
case of a national bank or the charter in the case of a Federal savings 
association--limits the institution to the specific approved special 
purpose. If the institution later desires to expand the scope of its 
business, it must seek OCC approval. A later expansion to include 
additional business warrants a new review to determine if the 
institution has the financial and managerial resources to conduct the 
expanded business. Similarly, when an institution that has a full-
service charter later desires to limit itself to a special purpose and 
conduct only one business line, the OCC reviews the change to ascertain 
whether the institution could continue to operate safely and soundly 
after it narrows its focus and to evaluate the institution's proposed 
capital, staffing, business plan, and risk management systems.
    Previously, these filings to change the purpose of a charter had no 
established framework and the OCC addressed them on a case-by-case 
basis when an institution inquired. Recently revised Sec.  5.53 \15\ 
now covers transactions that are similar to a change in purpose and 
type of charter (i.e., transactions that involve substantial changes in 
an institution's assets, liabilities, or business lines). In fact, the 
changes to an institution's assets, liabilities, and business lines 
that would be involved in a change in the purpose of a charter likely 
already would be subject to a filing under Sec.  5.53. We therefore 
propose clarifying Sec.  5.53 to expressly add change in charter type 
to the transactions that are covered by Sec.  5.53. We also are 
proposing to add provisions to Sec.  5.20(l), where special purpose 
charters are discussed, to describe changes in charter purpose, set out 
the requirement for an application, and direct institutions to Sec.  
5.53 for the application to be used.
---------------------------------------------------------------------------

    \15\ The OCC amended Sec.  5.53 in July 2015. See 80 FR 28346 
(May 18, 2015).
---------------------------------------------------------------------------

    Business combinations involving Federal mutual savings associations 
(12 CFR 5.33). Twelve CFR 5.33 sets forth the provisions governing 
business combinations involving depository institutions within the 
OCC's jurisdiction, including Federal mutual savings associations. 
Paragraph (n)(2)(iii) of this section currently provides that if any 
combining Federal savings association is a mutual savings association, 
the resulting institution must be a mutually held savings association, 
unless the transaction is approved under 12 CFR part 192, which governs 
mutual to stock conversions, or involves a mutual holding company 
reorganization under 12 U.S.C. 1467a(o).\16\ Consequently, unless one 
of these two exceptions applies, the resulting institution may not be a 
mutually held state-chartered savings bank.\17\
---------------------------------------------------------------------------

    \16\ Section 10(o) of the HOLA.
    \17\ This paragraph is generally consistent with the rule as 
issued by the former OTS and originally republished by the OCC as 12 
CFR 146.2(a)(4). The OCC moved this provision to Sec.  5.33 in its 
licensing integration rule. See 80 FR 28346 (May 18, 2015).
---------------------------------------------------------------------------

    However, the merger authority set forth in 12 CFR 5.33(n)(2)(iii) 
is narrower than the merger authority granted to all Federal savings 
associations under the Home Owners' Loan Act (HOLA). Specifically, 
section 10(s) of the HOLA \18\ provides that ``[s]ubject to sections 
5(d)(3) and 18(c) of the Federal Deposit Insurance Act and all other 
applicable laws, any Federal savings association may acquire or be 
acquired by any insured depository institution.'' The statute, 
therefore, does not limit the resulting institution in such 
transactions to a savings association.\19\
---------------------------------------------------------------------------

    \18\ 12 U.S.C. 1467a(s).
    \19\ Section 5(i) of the HOLA (12 U.S.C. 1464(i)) provides that 
transactions involving the conversion of a Federal mutual savings 
association to a stock Federal savings association, and vice versa, 
must comply with OCC regulations. As indicated above, OCC 
regulations relating to mutual to stock conversions are set forth at 
12 CFR part 192. By limiting the resulting institution to a mutual 
institution, both the current rule and the proposed amendment ensure 
that combinations involving Federal mutual savings associations are 
consistent with the mutual to stock conversion regulations at 12 CFR 
part 192.
---------------------------------------------------------------------------

    Because of Sec.  5.33(n)(2)(iii), Federal mutual savings 
associations and mutual state-chartered savings banks wishing to 
combine must undertake a multi-step transaction. For example, a Federal 
mutual savings association generally may convert to a mutual state-
chartered savings association or a mutual state-chartered savings bank 
pursuant to section 5(i)(3) of the HOLA, and thereafter combine with a 
mutual state-chartered savings bank. Such a process, while 
accomplishing the same purpose as a direct merger, is more expensive

[[Page 13611]]

and time consuming than a direct merger and results in unnecessary 
regulatory burden for the institutions involved.
    Accordingly, the OCC is proposing to amend Sec.  5.33(n)(2)(iii) to 
permit a mutual depository institution insured by the FDIC, i.e. either 
a mutual savings association or a mutual savings bank, to be the 
resulting institution in a combination involving a Federal mutual 
savings association. This amendment would simplify combinations 
involving mutual savings banks, thereby reducing regulatory burden and 
costs associated with such transactions imposed under the current rule. 
We note that this amendment still would require the resulting 
institution to have a mutual charter so as not to implicate the mutual-
to-stock conversion regulations, 12 CFR part 192.
    The OCC also is proposing to amend 12 CFR 5.33(n)(2)(iii)(B) to 
allow a mutual Federal savings association to merge into an FDIC-
insured depository institution subsidiary of a state-chartered mutual 
holding company. Currently, under the exception, a mutual Federal 
savings association may merge into a subsidiary savings association of 
a section 10(o) mutual holding company, provided the depositors of the 
resulting association have membership rights in the mutual holding 
company.\20\ The exception does not allow the merger of a mutual 
Federal savings association into a state savings bank subsidiary of a 
mutual holding company that is established under state law.
---------------------------------------------------------------------------

    \20\ This type of transaction is deemed to be one type of mutual 
holding company reorganization.
---------------------------------------------------------------------------

    As a result, in order for the mutual Federal savings association to 
merge into a state savings bank subsidiary of a mutual holding company 
organized under state law, it must first convert to a state-chartered 
savings association or state-chartered savings bank, and then combine 
with the state-chartered savings bank. We propose to amend Sec.  
5.33(n)(2)(iii)(B) so that mergers of mutual Federal savings 
associations into subsidiaries of section 10(o) and non-section 10(o) 
mutual holding companies are treated similarly. As with the amendment 
to Sec.  5.33(n)(2)(iii) described above, the amendment would reduce 
regulatory burden and costs associated with such transactions imposed 
under the current rule.
    Changes in permanent capital (12 CFR 5.46). Under 12 CFR 5.46, a 
national bank must submit an application to the OCC and receive prior 
approval for certain increases or decreases to the bank's permanent 
capital accounts. In addition, a national bank must submit an after-
the-fact notice of all increases or decreases to the bank's permanent 
capital accounts. Furthermore, pursuant to 12 U.S.C. 57, the OCC must 
certify all increases to a national bank's permanent capital accounts 
resulting from cash or other assets for the increase to be considered 
valid. The purpose of these requirements is to inform the OCC whenever 
the bank's board of directors decides to change the capital structure 
of the institution, including when accepting additional funds from a 
parent holding company, issuing new shares or stock, or redeeming an 
existing issue of preferred stock.
    The OCC receives a number of applications and notices for changes 
to permanent capital that arise solely from applying U.S. generally 
accepted accounting principles (GAAP). For example, U.S. GAAP may allow 
a national bank to revalue certain balance sheet accounts, including 
permanent capital accounts, for a period after the conclusion of a 
merger or acquisition. As 12 U.S.C. 1831n generally requires all 
insured depository institutions, including national banks, to apply 
U.S. GAAP when preparing their financial statements, there is limited 
value in requiring licensing filings or certifications solely because 
the bank is complying with that statute by applying GAAP. These 
accounting adjustments often are not material and typically are 
reviewed by the bank's internal accounting staff and external auditors. 
In addition, many of the accounting adjustments relate back to 
transactions reviewed or approved by the OCC under other rules, such as 
mergers, acquisitions, or divestitures. Furthermore, these accounting 
adjustments do not result in increases from cash paid or other assets 
and therefore do not require certification by the OCC pursuant to 12 
U.S.C. 57.
    The OCC is proposing to amend Sec.  5.46 to create an exemption for 
national banks from the prior approval, notification, and certification 
requirements for all changes to permanent capital that result solely 
from application of U.S. GAAP, and do not otherwise involve the receipt 
of cash or other assets. However, the proposal still would require a 
notice for material accounting adjustments, which the proposal defines 
as an increase or decrease greater than 5 percent of the bank's total 
permanent capital prior to the adjustments in the most recent quarter, 
or if the national bank is subject to a letter, order, directive, 
written agreement, or otherwise that is related to changes in permanent 
capital. The national bank would need to provide the notice within 30 
days after the end of the quarter in which the accounting adjustment 
occurred, and include the amount of the adjustment, a description, and 
a cite to the applicable U.S. GAAP provision.
    The OCC is not proposing a similar change to Sec.  5.45, Increases 
in permanent capital of a Federal stock savings association. Section 
5.45 requires a Federal savings association to submit an application to 
the OCC and receive prior approval for increases to its permanent 
capital accounts under the same circumstances that national banks are 
required to submit an application under section 5.46(g)(1)(ii). 
However, unlike the national bank rule, Sec.  5.45 requires an after-
the-fact notice of the increase only if the savings association was 
required to obtain prior approval of the increase. In addition, there 
is no statutory requirement that the OCC certify the increase in 
capital. For these reasons, an amendment similar to the one proposed 
for Sec.  5.46 is not needed for Sec.  5.45.
    The OCC is proposing, however, a clarifying change to Sec.  
5.45(g)(4)(i). The current wording of that section creates confusion as 
to whether Federal savings associations increasing their permanent 
capital accounts must file notices for all increases, rather than only 
in the circumstances in which the savings association is required to 
obtain prior approval. In adopting this provision, the OCC intended the 
notice to be filed only in cases in which prior approval was required. 
Therefore, the proposal would amend Sec.  5.45(g)(4)(i) to specifically 
provide that an after-the-fact notice is required only if the capital 
increase was subject to prior approval by the OCC.
    Additional technical changes to 12 CFR part 5. The OCC is proposing 
additional technical changes to 12 CFR part 5. First, the proposed rule 
would amend Sec.  5.8, Public notice, to provide that the public notice 
of a licensing-related filing must include the closing date of the 30-
day public comment period only if this information is available at the 
time of publication. We are proposing this change because the OCC 
treats the comment period differently in business combinations than in 
other transactions. For other transactions, the comment period starts 
when the public notice is published. For business combinations, the 
comment period starts on the latest of the publication date, the date 
when the OCC makes the application available in the OCC's FOIA Reading 
Room, or the date when the OCC publishes the application in the OCC 
Weekly Bulletin. When the national bank or Federal savings

[[Page 13612]]

association files the application with the OCC and publishes the 
notice, it typically would not know when the other two events will 
occur, and so would not know the comment period closing-date for these 
transactions at the time the public notice is published. However, in 
order to assist the public in determining this date, the proposal also 
would require that the notice include a statement indicating that 
information about the transaction, including the comment period 
closing-date, may be found in the OCC's Weekly Bulletin.
    For a similar reason, the proposal would make a technical 
correction to paragraph (i) of 12 CFR 5.33, Business combinations 
involving a national bank or Federal savings association. In general, 
paragraph (i) provides that a business reorganization filing or a 
filing that qualifies for a streamlined application is deemed approved 
by the OCC on the latter of the 45th day after the OCC receives the 
application or the 15th day after the close of the public comment 
period. However, because the 30-day public comment period for business 
combinations starts on the later of the date that the filing is 
published in the OCC Weekly Bulletin or the date it is available in the 
OCC's FOIA Reading Room, and because this date will always be after the 
OCC receives the application, 15 days after the close of the public 
comment period always will be later than the 45th day after the OCC 
receives the application. Therefore, the reference to the 45-day period 
in Sec.  5.33(i) is unnecessary and confusing, and the proposal would 
remove it.
    Second, the proposed rule would correct inaccurate cross-references 
in paragraphs (j)(3) and (4) of Sec.  5.21, Federal mutual savings 
association charter and bylaws. Specifically, the references to 
paragraphs (j)(2) would be changed to paragraph (j)(3).
    Third, the proposed rule would correct an inaccurate cross-
reference in Sec.  5.33(o)(3)(i) by replacing the reference to 
paragraph (n)(3) to paragraph (o)(3).
    Fourth, the proposal would amend Sec.  5.50(f)(2)(ii)(E) by 
correcting an inaccurate cross-reference to the definition of the term 
``tax-qualified employee stock benefit plan.'' Specifically, the 
proposal would replace ``Sec.  192.2(a)(39)'' with ``Sec.  192.25.''
    Lastly, in Sec.  5.66, Dividends payable in property other than 
cash, the proposal would provide that a national bank must submit a 
request for prior approval of a non-cash dividend to the appropriate 
OCC licensing office. Currently, this section only provides that the 
OCC must approve a non-cash dividend but does not indicate where a bank 
must submit the request for approval. The only direction provided in 
OCC dividend rules as to where a dividend application should be filed 
is contained in Sec.  5.64(c)(3), which provides that a national bank 
submit its request for prior approval for cash dividends to the 
appropriate OCC supervisory office. Because the OCC reviews non-cash 
dividends in the appropriate licensing office, and not the appropriate 
supervisory office, the proposed amendment will remove any confusion as 
to where a bank must submit non-cash dividend applications.

National Bank and Federal Savings Association Director Provisions

    The OCC rules relating to national bank and Federal savings 
association directors, set forth in various provisions of 12 CFR parts 
7 and 163, were included in the third EGRPRA Federal Register request 
for comments. The OCC did not receive any comments on these provisions 
in response to this notice. However, after further review of these 
provisions, we are proposing the following amendments.
    National Bank Director Oaths (12 CFR 7.2008). Twelve U.S.C. 73 sets 
forth the requirements for national bank director oaths. Specifically, 
this statute requires that, when appointed or elected, each national 
bank director must take an oath that he or she will diligently and 
honestly administer the affairs of the bank, not knowingly violate or 
willingly permit to be violated any applicable laws, and is the owner 
in good faith of the requisite shares of stock and that the stock is 
not pledged as security for any loan or debt. The statute requires the 
oath to be notarized and immediately transmitted to the Comptroller and 
filed in the Comptroller's office for 10 years.
    Twelve CFR 7.2008 implements this statutory requirement. 
Specifically, Sec.  7.2008 provides that: (1) A notary public, 
including one who is a director but not an officer of the national 
bank, may administer the oath of directors; (2) each director attending 
the organization meeting must execute either a joint or individual 
oath, and a director not attending the organization meeting (the first 
meeting after the election of the directors) must execute the 
individual oath; (3) a director must take another oath upon re-
election, notwithstanding uninterrupted service; and (4) the national 
bank must file the original executed oaths of directors with the OCC 
and retain a copy in the bank's records in accordance with the 
Comptroller's Corporate Manual filing and recordkeeping instructions 
for executed oaths of directors. This provision also notes that 
appropriate sample oaths are located in the Comptroller's Corporate 
Manual.
    The OCC is proposing to amend Sec.  7.2008 to clarify when the 
director oath must be taken. As proposed, Sec.  7.2008 would require a 
director to execute either a joint or individual oath at the first 
meeting of the board of directors that the director attends after the 
director is appointed or elected. This amendment more closely follows 
the statute by referring to the appointment or election of a director. 
It also would remove the reference to ``organizational meeting,'' which 
the OCC believes does not adequately convey when a director must 
execute the oath in all cases, including when a director is appointed.
    The OCC also is proposing to remove obsolete references to the 
Comptroller's Corporate Manual and replace it with references to 
www.occ.gov,\21\ and to correct a spelling error.
---------------------------------------------------------------------------

    \21\ The OCC's Web site contains general instructions for filing 
the oath of directors and a sample individual oath and joint oath at 
http://www.occ.gov/publications/publications-by-type/licensing-manuals/index-licensing-manuals.html.
---------------------------------------------------------------------------

Fidelity Bonds (12 CFR part 7, Sec. Sec.  163.180, 163.190, and 
163.191)

    Fidelity bonds. Twelve CFR 7.2013 requires all national bank 
officers and employees to have adequate fidelity bond coverage. It also 
states that the bank's directors may be liable for losses incurred in 
the absence of such bonds and that directors should not serve as bond 
sureties. Furthermore, the rule provides that the bank's directors 
should determine the appropriate amount of bond coverage, premised on 
consideration of the bank's internal auditing safeguards, number of 
employees, deposit liabilities, and amount of cash and securities 
normally held by the bank.
    Twelve CFR 163.180(c), 163.190, and 163.191 contain the fidelity 
bond rules applicable to Federal savings associations. While Sec. Sec.  
163.190 and 7.2013 are similar, the Federal savings association rules 
are more prescriptive and apply not only to officers and employees, but 
also to directors and agents. In addition, under Sec.  163.190(b), the 
Federal savings association's management must determine the amount of 
coverage, based on the potential risk exposure. Section 163.190(c) also 
directs the Federal savings association to provide supplemental 
coverage beyond that provided by the insurance underwriter industry's 
standard forms if the board determines that additional coverage is 
warranted. Furthermore, Sec.  163.190(d) requires the Federal savings

[[Page 13613]]

association's board of directors to approve the association's bond 
coverage, with this approval documented in the board's minutes, and to 
review annually the adequacy of coverage. Section 163.191 provides an 
alternative means of calculating the bond coverage that is appropriate 
for a Federal savings association agent, in lieu of that provided for 
in Sec.  163.190. Finally, Sec.  163.180(c) states that a Federal 
savings association maintaining a bond required by Sec.  163.190 must 
promptly notify the bond company and file proof of loss for any covered 
loss that is greater than twice the bond's deductible amount.
    Certain of these Federal savings association fidelity bond rules 
are very detailed and many of the details are more appropriately 
addressed in guidance or left to the institution's judgment, as is 
currently the case for national banks. Therefore, the OCC is proposing 
to reduce unnecessary regulatory burden by removing Sec. Sec.  
163.180(c), 163.190 and 163.191 and applying Sec.  7.2013, as amended 
and as described below, to Federal savings associations.
    As a result of removing Sec.  163.190, Federal savings associations 
would no longer be required to maintain fidelity bonds for directors 
who do not also serve as officers or employees. The OCC proposes to 
remove this requirement because fidelity bond coverage generally is not 
available for directors unless they also are acting as officers or 
employees. In addition, the activities in which outside directors 
engage generally do not expose financial institutions to the types of 
losses covered by fidelity bonds.
    This proposal also would remove the Sec.  163.180(c) requirement 
that a Federal savings association notify its bond insurance company 
and file proof of loss for certain claims. The OCC finds this provision 
to be unnecessary. The terms of a fidelity bond contract itself require 
such notification, and it is a prudent business practice for a 
financial institution. Furthermore, the Risk Management and Insurance 
booklet of the Comptroller's Handbook states that ``[a]ll fidelity 
bonds require that a loss be reported to the bonding company within a 
specified time after a reportable item comes to the attention of 
management. Management should diligently report all potential claims . 
. . because failure to file a timely report may jeopardize coverage for 
that loss.''
    In addition, the proposal would modify the treatment of fidelity 
bond coverage for certain agents of Federal savings associations. 
Currently, Sec.  163.191 requires fidelity bond coverage for any agent 
who has control over or access to cash, securities, or other property 
of a Federal savings association. There is no comparable requirement 
for agents of national banks. Instead of a mandatory requirement for 
agent bonding, the OCC proposes to amend Sec.  7.2013 to provide that 
the boards of directors of both banks and savings associations should 
consider whether agents who have access to assets of a bank or savings 
association should also have fidelity bond coverage. The OCC recognizes 
that agents providing financial services, such as cash handling or 
payment processing, to a financial institution potentially expose that 
institution to significant risks. The OCC believes these risks and 
associated risk mitigation strategies, including the scope and size of 
fidelity bond coverage for agents, are best addressed by the board of 
directors.
    Finally, the OCC proposes to amend Sec.  7.2013(b), which currently 
provides that a national bank's board of directors should determine the 
appropriate amount of fidelity bond coverage. This language is in 
contrast to that in Sec.  163.190, which makes clear that this 
determination is mandatory. For safety and soundness reasons, the OCC 
believes that both national bank and Federal savings association boards 
of directors should be required to determine the appropriate bond 
coverage and proposes to amend Sec.  7.2013(b) to make clear that this 
determination is a mandatory requirement. The OCC also proposes to 
modify this section by allowing a board committee as an alternative to 
the entire board to assess fidelity bond coverage.

Fiduciary Activities (12 CFR Parts 9 and 150)

    Twelve CFR parts 9 and 150 set forth the standards that apply to 
the fiduciary activities of national banks and Federal savings 
associations, respectively. Parts 9 and 150 were included in the first 
EGRPRA Federal Register notice, and the OCC is proposing to revise 
these rules to reflect some of the public comments received.
    Sections 9.13 and 150.230 require a national bank or Federal 
savings association, respectively, to place all fiduciary account 
assets in the joint custody or control of no fewer than two of the 
fiduciary officers or employees designated by the bank's or savings 
association's board of directors or to maintain fiduciary investments 
off premises, if consistent with applicable law and if the bank 
maintains adequate safeguards and controls. The proposal would amend 
Sec.  9.13 and add a new Sec.  150.245 to provide relief for 
arrangements under which a national bank or Federal savings association 
is deemed a fiduciary solely because it provides investment advice for 
a fee concerning the purchase and sale of specific securities. If, 
under such an arrangement the bank or savings association is a 
fiduciary merely because it provides such advice and does not have 
investment discretion, the OCC does not believe that it should be 
required to have custody of the fiduciary assets. Specifically, the 
proposal would amend Sec.  9.13(a) to provide that a national bank that 
is deemed a fiduciary based solely on its provision of investment 
advice for a fee, as that capacity is defined in 12 CFR 9.101(a), is 
not required to serve as custodian when offering those fiduciary 
services. Similarly, new Sec.  150.245 would provide that a Federal 
savings association that is deemed a fiduciary based solely on its 
provision of investment advice for a fee, as that capacity is defined 
in 12 CFR 9.101(a), would not be required to maintain custody or 
control of fiduciary assets as set forth in Sec.  150.220 or 150.240.
    Section 9.14(a) provides that before a national bank may act as a 
private or court-appointed trustee in a state that requires 
corporations acting in such capacities to deposit securities with state 
authorities for the protection of private or court trusts, the bank 
must make a similar deposit with state authorities. If the state 
authorities refuse to accept the deposit, the bank must instead deposit 
the securities with the Federal Reserve Bank of the district in which 
the national bank is located. Section 150.490 contains a nearly 
identical requirement for Federal savings associations, except that 
savings associations must deposit the securities with state authorities 
or the applicable Federal Home Loan Bank. The proposal would amend 
Sec.  9.14(a) to permit national banks to deposit these securities 
either with the Federal Home Loan Bank of which the bank is a member or 
with the appropriate Federal Reserve Bank. Because Federal savings 
associations may not be members of a Federal Reserve Bank, the OCC 
cannot make a reciprocal amendment to Sec.  150.490.
    Section 9.18 permits a national bank, where consistent with 
applicable law, to invest assets that it holds as fiduciary in 
specified collective investment funds. Section 150.260 permits Federal 
savings associations also to invest funds in a fiduciary account in 
collective investment funds, and provides that in establishing and 
administering such funds, Federal savings associations must

[[Page 13614]]

comply with the requirements of Sec.  9.18. Therefore, the amendments 
to Sec.  9.18 proposed in this rulemaking also would apply to Federal 
savings associations.
    Section 9.18(b)(1) requires a national bank to establish and 
maintain each collective investment fund in accordance with a written 
plan approved by a resolution of the bank's board of directors or by a 
committee authorized by the board. This paragraph also requires the 
bank to make a copy of the plan available for public inspection at its 
main office during all banking hours and to provide a copy of the plan 
to any person who requests it.
    Among other things, one EGRPRA commenter requested that the OCC 
remove the requirement that a copy of the investment plan be available 
for public inspection at the bank's main office. The OCC finds that it 
is appropriate to provide the public access to this plan but agrees 
that requiring a bank to make the plan available for public inspection 
at its main office is unnecessarily burdensome and not the most 
efficient method for public inspection in today's electronic 
environment. Therefore, the proposal would instead require that the 
bank make a copy of the plan available to the public either at its main 
office or on its Web site. We are proposing to maintain the option for 
access to the plan at a main office for those small banks that may not 
have a Web site. The proposal also would clarify that a bank may 
satisfy the requirement to provide a copy of the plan to any person who 
requests it by providing it in either written or electronic form.
    Section 9.18(c)(2) of this section provides that a national bank 
may collectively invest assets that it holds as fiduciary in a mini-
fund. A mini-fund is a fund that is maintained by the bank for the 
collective investment of cash balances received or held by the bank in 
its capacity as trustee, executor, administrator, guardian, or 
custodian under the Uniform Gifts to Minors Act that the bank considers 
too small to be invested separately in an economically efficient 
manner. This section further provides that the total assets in a mini-
fund must not exceed $1,000,000 and the number of participating 
accounts must not exceed 100.
    An EGRPRA commenter requested that the OCC periodically adjust the 
asset limit for mini-funds in Sec.  9.18(c)(2) to account for inflation 
and economic growth. This commenter also noted that the current limit 
of $1 million was last updated in 1996 \22\ and suggested that the OCC 
raise the threshold to at least $1.5 million, which is the inflation-
adjusted value of $1 million in 1996 dollars.
---------------------------------------------------------------------------

    \22\ See 61 FR 68554 (Dec. 30, 1996).
---------------------------------------------------------------------------

    The OCC agrees with this commenter that this threshold is outdated 
and is proposing to amend Sec.  9.18(c)(2) to increase the threshold to 
$1,500,000, with an annual adjustment for inflation. This change will 
continue to make mini-funds a feasible investment option for national 
banks.

Municipal Securities Dealers (12 CFR Part 10) \23\
---------------------------------------------------------------------------

    \23\ As indicated above, the OCC's securities-related rules, 
including part 10, are included in the fourth EGRPRA Federal 
Register notice, the comment period for which closes on March 22, 
2016. To ensure that any OCC rule finalizing this NPRM takes into 
account all comments we receive on part 10, the OCC will consider 
comments received on both this NPRM and the fourth EGRPRA notice 
when finalizing this rulemaking.
---------------------------------------------------------------------------

    Part 10 requires that a national bank (or a separately identifiable 
department or division of a national bank) that acts as a municipal 
securities dealer, and an associated person that acts as a municipal 
securities principal or representative, file certain forms with the 
OCC. Specifically, Sec.  10.2 requires national banks to submit to the 
OCC Form MSD-4 (Uniform Application for Municipal Securities Principal 
or Municipal Securities Representative Associated with a Bank Municipal 
Securities Dealer) before associating with a municipal securities 
principal or municipal securities representative. Within 30 days of 
terminating such person's association with the bank, the bank must file 
with the OCC Form MSD-5 (Uniform Termination Notice for Municipal 
Securities Principal or Municipal Securities Representative Associated 
with a Bank Municipal Securities Dealer). Although there is no 
equivalent regulation applicable to Federal savings associations, these 
institutions and associated persons currently file these same forms 
with the OCC pursuant to Municipal Securities Rulemaking Board (MSRB) 
rules, as incorporated in an OTS Chief Counsel Opinion.\24\ In order to 
coordinate and harmonize the requirements applicable to these 
practices, the OCC proposes to codify this OTS opinion in OCC 
regulations by amending part 10 to include Federal savings 
associations. This proposed change would apply identical regulations to 
national banks and Federal savings associations without adding to or 
otherwise changing the requirements applicable to Federal savings 
associations. Furthermore, by codifying this filing in OCC rules 
instead of referring to it in an opinion letter, this change would more 
clearly identify this requirement for Federal savings associations.
---------------------------------------------------------------------------

    \24\ OTS Chief Counsel Opinion (OTS Op. Oct. 29, 2001) (noting 
that a Federal savings association engaged in municipal securities 
underwriting and dealing must comply with applicable laws and 
regulations, financial reporting requirements, and Municipal 
Securities Rulemaking Board (MSRB) rules). MSRB rules include 
requirements to file forms with the ``appropriate regulatory 
agency.'' See, e.g., MSRB Rule G-7. The Exchange Act provides that 
the OCC is the appropriate regulatory agency with respect to a 
municipal securities dealer that is a Federal savings association. 
15 U.S.C. 78c(a)(34)(A)(i).
---------------------------------------------------------------------------

    In addition, the OCC proposes other minor changes to clarify and 
update the current rule. First, the proposed rule would update the 
citation to MSRB Rule G-7(b) in Sec.  10.2(a) to reflect MSRB revisions 
to this rule. Second, Sec.  10.2(c) states that banks may obtain Forms 
MSD-4 and MSD-5 ``by contacting the OCC at 400 7th Street SW., 
Washington, DC 20219, Attention: Bank Dealer Activities.'' We propose 
amending Sec.  10.2(c) to instead allow national banks to obtain Forms 
MSD-4 and MSD-5 \25\ on http://www.banknet.gov/.\26\ Third, the 
proposal would replace the street address of the MSRB for where to 
obtain MSRB rules with the MSRB's internet address.
---------------------------------------------------------------------------

    \25\ We note that Forms MSD-4 and MSD-5 are uniform forms 
developed by the Federal Reserve Board, FDIC and OCC and that these 
forms expressly state that they be mailed to the appropriate 
regulatory agency. Therefore, the OCC cannot amend part 10 to 
provide for the electronic filing of these forms until the Federal 
Reserve Board, FDIC, and OCC jointly decide to permit electronic 
filing.
    \26\ BankNet is the OCC's secure Web site for communicating with 
and receiving information from national banks and Federal savings 
associations. BankNet is only available to OCC-regulated 
institutions and is not available to the public.
---------------------------------------------------------------------------

Securities Exchange Act Rules (12 CFR Parts 11, 194) \27\
---------------------------------------------------------------------------

    \27\ As indicated above, the OCC's securities-related rules, 
including parts 11 and 194, are included in the fourth EGRPRA 
Federal Register notice, the comment period for which closes on 
March 22, 2016. The OCC will consider comments received on both 
parts 11 and 194 in response to this NPRM and the fourth EGRPRA 
notice when finalizing this rulemaking.
---------------------------------------------------------------------------

    Twelve CFR parts 11 and 194 set forth the periodic reporting 
requirements for national banks and Federal savings associations, 
respectively, with securities registered under the Securities Exchange 
Act of 1934 (Exchange Act). In light of the similar statutory 
provisions that apply to national banks and Federal savings 
associations as implemented by these parts, the OCC proposes to remove 
part 194 and amend part 11 to include Federal savings associations. The 
proposed changes would reduce duplication and create efficiencies by 
establishing a single set of rules for all

[[Page 13615]]

entities supervised by the OCC with respect to the Exchange Act 
disclosure rules, while not changing the requirements applicable to 
national banks or Federal savings associations.
    Part 11 generally requires national banks with securities 
registered under sections 12(b) or 12(g) of the Exchange Act \28\ to 
comply with certain Exchange Act rules. The OCC notes that on April 5, 
2012, the Jumpstart Our Business Startups Act (JOBS Act) \29\ amended 
the Exchange Act and directed the Securities and Exchange Commission 
(SEC) to engage in various rulemakings. The OCC generally intends for 
part 11 to remain consistent with the Exchange Act and SEC rules. 
Therefore, the OCC is proposing one change as a result of the JOBS Act, 
as described in more detail below. In addition, the OCC is proposing to 
amend the filing instructions in Sec.  11.3 and to make technical, non-
substantive edits and clarifications, as also described below.
---------------------------------------------------------------------------

    \28\ 15 U.S.C. 78l(b), (g).
    \29\ Public Law 112-106, 126 Stat. 306 (2012).
---------------------------------------------------------------------------

    Authority and OMB control number (Sec.  11.1). Section 11.1 sets 
forth the authority of the OCC to issue rules for national banks with 
respect to the Exchange Act and sets forth the Office of Management and 
Budget (OMB) control number assigned to part 11 for purposes of the 
Paperwork Reduction Act. This proposal would amend this section to 
include the OCC's authority with respect to Federal savings 
associations. It also would remove the reference to the OMB control 
number, as it is not required to be included in regulatory text and the 
OCC has generally not included such numbers in recently published 
regulations. This removal is technical and does not affect the OCC's 
responsibilities under the PRA.
    Reporting requirements for registered national banks (Sec.  11.2). 
The OCC proposes to add a new paragraph (c) to Sec.  11.2 to state 
explicitly that references to registration requirements under the 
Securities Act of 1933 (Securities Act) pertain to the registration 
requirements under 12 CFR part 16. This proposed change clarifies the 
applicable requirements for national banks and Federal savings 
associations.
    Emerging growth company eligibility (Sec.  11.2). The JOBS Act 
amended the Exchange Act to create a new class of issuer known as an 
emerging growth company.\30\ An emerging growth company is defined 
generally as an issuer that had total annual gross revenues of less 
than $1 billion during its most recently completed fiscal year.\31\ The 
JOBS Act provides scaled disclosure provisions for emerging growth 
companies, including, among other things: (1) An exemption from proxy 
statement requirements concerning shareholder approval of executive 
compensation under section 14A of the Exchange Act; \32\ (2) an 
exemption from proxy statement requirements concerning disclosure of 
executive compensation versus performance under section 14(i) of the 
Exchange Act; \33\ (3) a limitation of applicable time periods for 
disclosures required under Regulation S-K \34\ for selected financial 
data; \35\ (4) treatment as a smaller reporting company for purposes of 
executive compensation disclosures required under Regulation S-K, Item 
402; \36\ and (5) an exemption from auditor attestation provisions 
concerning internal financial reporting controls required by the 
Sarbanes-Oxley Act of 2002.\37\
---------------------------------------------------------------------------

    \30\ JOBS Act, section 101(b), 126 Stat. 307.
    \31\ Exchange Act, section 3(a)(80) (15 U.S.C. 78c(a)(80)).
    \32\ Exchange Act, section 14A(e) (15 U.S.C. 78n-1(e)).
    \33\ Exchange Act, section 14(i) (15 U.S.C. 78n(i)).
    \34\ 17 CFR 210.1-01 et seq.
    \35\ Exchange Act, section 13(a) (15 U.S.C. 78m(a)).
    \36\ 12 CFR 229.402.
    \37\ 15 U.S.C. 7262(b).
---------------------------------------------------------------------------

    The JOBS Act and the Exchange Act contain exclusions from emerging 
growth company eligibility that are based on public offerings that an 
issuer makes under the Securities Act. First, the JOBS Act provides 
that an issuer is not eligible for emerging growth company status if it 
engaged in a public securities offering pursuant to an effective 
Securities Act registration statement on or before December 8, 
2011.\38\ Second, the Exchange Act, as amended by the JOBS Act, 
provides that an issuer may not remain an emerging growth company 
beyond the close of the fiscal year following the fifth anniversary of 
the issuer's first securities offering under a Securities Act 
registration statement.\39\ Because national banks and Federal savings 
associations file registration statements under OCC regulations rather 
than the Securities Act, these exclusions do not technically apply to 
banks and savings associations.
---------------------------------------------------------------------------

    \38\ JOBS Act, section 101(d), 126 Stat. 308.
    \39\ Exchange Act, section 3(a)(80) (15 U.S.C. 78c(a)(80)).
---------------------------------------------------------------------------

    The OCC proposes to add new paragraph (d) to Sec.  11.2 to clarify 
national bank and Federal savings association eligibility for emerging 
growth company treatment for those provisions of the Exchange Act that 
the OCC administers.\40\ The intent of this proposed change is to 
ensure equivalent treatment of banks and savings associations with non-
bank issuers. This proposed provision also would provide that a bank or 
savings association eligible for emerging growth company status may 
choose to forgo such exemption and instead comply with the requirements 
that apply to a bank or savings association that is not an emerging 
growth company. Furthermore, this proposed provision would provide 
that: (1) A bank or savings association is not an emerging growth 
company if it sold common equity securities on or before December 8, 
2011, pursuant to a registration statement or offering circular filed 
under 12 CFR part 16, part 197, or under the former OTS rule at 12 CFR 
563g; and (2) emerging growth company status for banks and savings 
associations terminates no later than the end of the fiscal year 
following the fifth anniversary of the first sale of its common equity 
securities pursuant to a registration statement or offering circular 
under 12 CFR parts 16, 197 or 563g.\41\ The OCC believes that this 
proposed change is consistent with its obligation under section 12(i) 
of the Exchange Act to issue substantially similar regulations as the 
SEC for those provisions of the Exchange Act for which it is vested 
authority with respect to banks and savings associations.
---------------------------------------------------------------------------

    \40\ Exchange Act, section 12(i) (15 U.S.C. 78l(i)).
    \41\ The JOBS Act and the Exchange Act, as amended by the JOBS 
Act, contain equivalent restrictions for non-banks. However, these 
restrictions are based on when an issuer files a registration 
statement under the Securities Act.
---------------------------------------------------------------------------

    Filing requirements and inspection of documents (Sec.  11.3). 
Several EGRPRA comments requested the OCC to permit national banks and 
Federal savings associations to submit OCC forms and reports 
electronically. The OCC agrees that electronic filings are more 
efficient and less costly for national banks and Federal savings 
associations, are more efficient for the OCC to review, and provide a 
quicker response time for banks and savings associations. The OCC 
currently permits the electronic submission of a number of filings, for 
example, Call Reports, and public welfare investment notifications and 
proposals. However, a number of OCC securities-related rules do not 
permit electronic submissions.
    Specifically, Sec.  11.3(a) requires national banks to submit by 
mail, fax, or otherwise four copies of all papers required to be filed 
with the OCC (pursuant to the Exchange Act or regulations thereunder) 
to the Securities and Corporate Practices (SCP) Division of the OCC. 
Through incorporation of SEC Rule 12b-11, part 194 requires

[[Page 13616]]

Federal savings associations to file three copies of Exchange Act 
filings with the SCP Division. We propose to amend Sec.  11.3(a)(1) to 
require instead that national banks and Federal savings associations 
submit one copy of their filings through electronic mail to the OCC at 
http://www.banknet.gov/.\42\
---------------------------------------------------------------------------

    \42\ As described elsewhere in this proposal, the OCC also 
proposes to amend part 16, Securities offering disclosure rules, to 
provide for electronic submissions.
---------------------------------------------------------------------------

    The proposed amendments to Sec.  11.3 also provide that documents 
may be signed electronically using the signature provision in SEC Rule 
12b-11.\43\ This rule provides that required signatures for Exchange 
Act filings may be signed using typed signatures or duplicated or 
facsimile versions of manual signatures. Where typed, duplicated, or 
facsimile signatures are used, each signatory to the filing is required 
to ``manually sign a signature page or other document authenticating, 
acknowledging or otherwise adopting his or her signature that appears 
in the filing.'' \44\ As provided by Rule 12b-11, the national bank or 
Federal savings association must retain this document for five years 
and, upon request, provide a copy to the OCC.
---------------------------------------------------------------------------

    \43\ 17 CFR 240.12b-11.
    \44\ Id.
---------------------------------------------------------------------------

    The OCC also proposes to amend Sec.  11.3(a)(1) to establish an 
exception to the general electronic filing requirement to permit the 
use of paper filings where unanticipated technical difficulties prevent 
the use of electronic filings. This exception is modeled on the SEC's 
General Rules and Regulations for Electronic Filings, Regulation S-T, 
Rule 201,\45\ which provides a temporary hardship exemption to the 
SEC's Electronic Data Gathering, Analysis, and Retrieval system (EDGAR) 
filing requirements in cases of unanticipated technical difficulties. 
Similar to Rule 201, the OCC notes that use of this exception should be 
extremely limited and should be relied upon only when unusual and 
unexpected circumstances create technical impediments to the use of 
electronic filings. However, this exception would not be available for 
statements of beneficial ownership that must be made through the 
FDICconnect platform, which requires electronic filings.\46\
---------------------------------------------------------------------------

    \45\ 17 CFR 232.201.
    \46\ See 70 FR 46403 (Aug. 10, 2005). FDICconnect is the secure 
Internet channel for FDIC-insured institutions to conduct business 
and exchange information with the FDIC.
---------------------------------------------------------------------------

    Current Sec.  11.3(a)(3)(i) provides that the date on which papers 
are actually received by the OCC shall be the date of filing, if the 
person or bank filing the papers has complied with all applicable 
requirements. The proposal updates this provision to conform with the 
electronic filing requirement. Specifically, proposed Sec.  
11.3(a)(3)(i) provides that an electronic filing whose submission is 
commenced on a nonholiday weekday on or before 5:30 p.m. Eastern 
Standard or Daylight Savings Time, whichever is currently in effect, 
would be deemed received by the OCC on the same business day. An 
electronic filing whose submission is commenced after 5:30 p.m. Eastern 
Standard or Daylight Savings Time, whichever is currently in effect, or 
on a Saturday, Sunday, or Federal holiday would be deemed received by 
the OCC on the next business day. The proposal also would add a new 
paragraph (a)(3)(iii) to Sec.  11.3 to provide that if an electronic 
filer in good faith attempts to file a document pursuant to this part 
in a timely manner but the filing is delayed due to technical 
difficulties beyond the electronic filer's control, the electronic 
filer may request that the OCC adjust the filing date. The OCC may 
grant the request if it appears that such adjustment is appropriate and 
consistent with the public interest and the protection of investors. 
These rules for dating an electronic filing, and for providing a waiver 
for technical difficulties with the filing, are also derived from SEC 
Regulation S-T.\47\
---------------------------------------------------------------------------

    \47\ 17 CFR 232.
---------------------------------------------------------------------------

    In addition, the OCC proposes the following technical amendments. 
First, the proposed rule would rename the paragraph heading of Sec.  
11.3(a)(3)(ii), Electronic filings, to Beneficial ownership filings. 
This provision currently establishes filing dates for statements of 
beneficial ownership that must be made through the FDICconnect 
platform.\48\ In light of the general electronic filing standard for 
part 11 filings proposed in this rulemaking, we believe that the 
heading of this section should be revised because electronic filing 
requirements are applied to all part 11 filings, not just those made 
under Sec.  11.3(a)(3)(ii).
---------------------------------------------------------------------------

    \48\ See 70 FR 46403 (Aug. 10, 2005).
---------------------------------------------------------------------------

    Second, the OCC proposes to delete paragraph (a)(4) of Sec.  11.3. 
This paragraph originally provided a mandatory compliance date of 
January 1, 2004 for 12 CFR part 11. However, as this date has now 
passed, this mandatory compliance date is no longer needed in the rule 
text.
    Third, the OCC proposes to amend Sec.  11.4(b), which currently 
provides that filing fees must be paid by check. To reflect the 
electronic filing of documents and the additional payment options now 
available, the proposed amendment would revise this section to provide 
that filing fees may be paid by means acceptable to the OCC, in 
addition to by check. We note that the OCC is not currently imposing 
any filing fees for part 11 filings and is not proposing any fees as 
part of this rulemaking.
    As a consequence of proposing to amend part 11 to include Federal 
savings associations, the OCC proposes to remove part 194 in its 
entirety. In so doing, the OCC notes that the removal of Sec.  194.3, 
which provides liability for certain forward-looking statements made by 
Federal savings associations, does not change the applicability of the 
requirements of this section for Federal savings associations. 
Specifically, the text of Sec.  194.3 is substantially similar to the 
SEC Rule 3b-6,\49\ which currently applies to national banks by 
reference in Sec.  11.2. Therefore, because the proposed part 11 (and 
its cross-reference to the SEC Rule 3b-6) would apply to Federal 
savings associations, the requirements imposed by current Sec.  194.3 
would continue to apply to Federal savings associations.
---------------------------------------------------------------------------

    \49\ 17 CFR 240.3b-6.
---------------------------------------------------------------------------

    Furthermore, we note that the removal of Sec. Sec.  194.801 and 
194.802, interpretations for Federal savings associations filing 
statements pursuant to the Exchange Act, is not intended to be a 
substantive change in how these filings are conducted. The 
interpretations included in these sections are now widely accepted and 
no longer need to be included in a rule. Therefore, the removal of 
these sections would not change how Federal savings associations 
prepare their reports.

Recordkeeping and Confirmation Requirements for Securities Transactions 
(12 CFR Parts 12, 151) \50\
---------------------------------------------------------------------------

    \50\ As indicated above, the OCC's securities-related rules, 
including parts 12 and 151, are included in the fourth EGRPRA 
Federal Register notice, the comment period for which closes on 
March 22, 2016. The OCC will consider comments received on parts 12 
and 151 in response to both this NPRM and the fourth EGRPRA notice 
when finalizing this rulemaking.
---------------------------------------------------------------------------

    Twelve CFR parts 12 and 151 establish recordkeeping and 
confirmation requirements for national banks and Federal savings 
associations, respectively, that engage in securities transactions for 
their customers. The OCC has reviewed these rules, and proposes the 
following amendments to eliminate regulatory burden and remove outdated 
or obsolete provisions.
    Definitions. The OCC is proposing to revise the definition of 
``municipal security'' at Sec. Sec.  12.2(i)(3) and 151.40 to remove an 
outdated citation to the Internal Revenue Code.

[[Page 13617]]

    Recordkeeping. Section 12.3 and subpart A of part 151 establish 
recordkeeping requirements for securities transactions conducted by 
national banks and Federal savings associations, respectively. Section 
151.60(b) prescribes more detailed procedures for record maintenance 
and storage for Federal savings associations than prescribed for 
national banks in Sec.  12.3(b). Specifically, Sec.  12.3(b) provides 
that the required records must clearly and accurately reflect the 
information required and provide an adequate basis for the audit of the 
information, and that record maintenance may include the use of 
automated or electronic records provided the records are easily 
retrievable, readily available for inspection, and capable of being 
reproduced in a hard copy. In addition to what is required for national 
banks, Sec.  151.60(b) imposes requirements related to indexing, paper 
storage, electronic storage, and the provision of records to examiners. 
The proposed rule would remove Sec.  151.60(b) and revise Sec.  
151.60(a) to include the less detailed maintenance and storage 
procedures found in the national bank rule. The OCC believes that this 
approach would provide a Federal savings association with more 
flexibility in making internal business decisions about record storage 
and maintenance.
    Current Sec.  151.60(c), redesignated in this proposal as Sec.  
151.60(b), provides that a Federal savings association may use a third-
party service provider to provide record storage or maintenance. The 
national bank rule does not include a similar third-party provision. 
The proposed rule would amend Sec.  12.3 to clarify that a national 
bank may use a third-party service provider for record storage and 
maintenance provided that the bank maintains effective oversight to 
ensure that the records are easily retrievable, are readily available 
for inspection, can be reproduced in a hard copy, and follow applicable 
OCC guidance.\51\ Therefore, the proposed rule provides, in both 
Sec. Sec.  12.3(b) and redesignated Sec.  151.60(b) that, if using a 
third-party service provider, the national bank or Federal savings 
association must maintain effective oversight of the third-party 
service provider to ensure records meet the requirements of Sec.  12.3 
or Sec. Sec.  151.50 and 151.60, respectively.
---------------------------------------------------------------------------

    \51\ See OCC Bulletin 2013-29, Third-Party Relationships: Risk 
Management Guidance (Oct. 30, 2013).
---------------------------------------------------------------------------

    Content and time of notification. Sections 12.4 and 151.70, 
respectively, require national banks and Federal savings associations 
that effect securities transactions for their customers to provide 
notifications of the transactions. The national bank or Federal savings 
association may choose among several types of notification. Pursuant to 
Sec. Sec.  12.4(a) and 151.90, a national bank or Federal savings 
association, respectively, may provide the customer a written notice 
that includes the information set forth in those sections. Sections 
12.5 and 151.100 permit a national bank or Federal savings association, 
respectively, to fulfill the notification requirement through 
alternative means that vary by the type of account. For transactions 
that use a registered broker-dealer, Sec.  151.80(a) allows the Federal 
savings association to satisfy the requirement of Sec.  151.70 by 
having the registered broker-dealer send the confirmation statement 
directly to the customer or by having the Federal savings association 
send a copy of the broker-dealer's confirmation to the customer. If the 
broker-dealer has the necessary account level information to send the 
confirmation directly to the customer, the Federal savings association 
need not send out an additional written notification of the 
transaction. In contrast, under Sec.  12.4(b), a national bank may send 
a copy of the broker-dealer's confirmation but is not expressly 
permitted to satisfy the requirement by having the broker-dealer send 
the confirmation directly to the customer.
    The OCC believes that most national banks and Federal savings 
associations, particularly community institutions, effect securities 
transactions for customers through registered broker-dealers. To avoid 
duplicative reporting to customers and to reduce burden on 
institutions, the OCC is proposing to amend Sec.  12.4(b) to follow the 
approach of Sec.  151.80. With this amendment, both national banks and 
Federal savings associations may direct a broker-dealer to mail 
confirmations to customers without requiring that a duplicate be sent 
by the bank or savings association, thereby reducing regulatory burden 
for national banks. This approach also would reduce confusion that may 
result when a customer receives duplicate confirmations for the same 
transaction from two different parties.
    In addition, the OCC proposes to amend Sec.  151.80 to reduce 
regulatory burden on Federal savings associations. Currently, Sec.  
151.80(b) requires a Federal savings association that receives or will 
receive remuneration from any source, including the customer, in 
connection with the transaction to provide the customer a statement of 
the source and amount of the remuneration in addition to the registered 
broker-dealer confirmation. The proposed rule would amend this 
provision to provide that, when such remuneration is determined by a 
written agreement between the Federal savings association and the 
customer, the savings association would not need to provide this 
remuneration statement for each securities transaction. This change 
would be consistent with Sec.  12.4(b), which does not require a 
national bank to provide a statement of the source and amount of 
remuneration in these circumstances.
    National bank disclosure of remuneration for mutual fund 
transactions. The OCC proposes to delete from its regulation the 
interpretation in Sec.  12.101, national bank disclosure of 
remuneration for mutual fund transactions. The OCC does not intend to 
change any existing practices. Instead, the OCC believes that this 
issue is obsolete because of recent SEC actions.\52\
---------------------------------------------------------------------------

    \52\ For example, the SEC now requires all mutual funds to 
disclose their fee structures in registration statements. http://www.sec.gov/about/forms/formn-1a.pdf.
---------------------------------------------------------------------------

    National bank use of electronic communications as customer 
notifications. Section 12.102 allows national banks to comply with many 
provisions of part 12 by using electronic communications with 
customers. Federal savings associations have a similar provision at 
Sec.  151.110. However, the use of electronic communications has become 
widespread and is provided for in State and Federal law, such as the 
Electronic Signatures in Global and National Commerce Act,\53\ which 
allows for electronic communications with customers. Therefore, we 
propose to remove these provisions because they are duplicative of 
existing law.
---------------------------------------------------------------------------

    \53\ 15 U.S.C. 7001 et seq.
---------------------------------------------------------------------------

Securities Offering Disclosures (12 CFR Parts 16, 197) \54\
---------------------------------------------------------------------------

    \54\ As indicated above, the OCC's securities-related rules, 
including parts 16 and 197, are included in the fourth EGRPRA 
Federal Register notice, the comment period for which closes on 
March 22, 2016. The OCC will consider comments received on parts 16 
and 197 in response to both this NPRM and the fourth EGRPRA notice 
when finalizing this rulemaking.
---------------------------------------------------------------------------

    Twelve CFR parts 16 and 197 set forth securities offering 
disclosure rules for national banks and Federal savings associations, 
respectively. These rules are based on the Securities Act \55\ and 
certain Securities Act rules, to the

[[Page 13618]]

extent appropriate for banks.\56\ In light of the similar provisions 
that apply to national banks and Federal savings associations, the OCC 
proposes to amend part 16 to include Federal savings associations and 
to remove part 197. In addition, the OCC is proposing to incorporate 
some provisions of part 197 into part 16, and to make technical changes 
to SEC citations included in part 16. The proposed amendments would 
reduce duplication and create efficiencies by establishing a single set 
of rules for all entities supervised by the OCC with respect to 
securities offerings. Furthermore, integrating savings associations 
into part 16 would clarify disclosure requirements for these 
institutions and provide them with additional exemptions, as described 
below.
---------------------------------------------------------------------------

    \55\ National bank and Federal savings association securities 
are generally exempt from the Securities Act. Securities Act, 
sections 3(a)(2) and (5) (15 U.S.C. 77c(a)(2) and (5)).
    \56\ 59 FR 54798 (Nov. 2, 1994) (``[Part 16] generally requires 
national bank securities offering documents to conform to the form 
for registration that the bank would use if it had to register the 
securities under the Securities Act. Accordingly, the final rule 
cross-references a number of provisions of the Securities Act and a 
number of SEC rules.'')
---------------------------------------------------------------------------

    The JOBS Act, addressed above in the discussion of part 11, amended 
the Securities Act and directed the SEC both to amend existing 
Securities Act rules and to write new rules to implement certain JOBS 
Act provisions. Generally, the JOBS Act seeks to ease securities 
offering disclosure requirements and periodic reporting obligations for 
certain issuers, including emerging growth companies.\57\ It also 
creates new Securities Act private placement exemptions for 
crowdfunding \58\ and small company capital formation.\59\ In addition, 
the JOBS Act includes provisions that reduce restrictions on certain 
research and communications concerning emerging growth company 
securities offerings.\60\
---------------------------------------------------------------------------

    \57\ As indicated in the discussion of Part 11, above, an 
emerging growth company is a new category of issuer created under 
the JOBS Act. Generally, an emerging growth company is an issuer 
that had total annual gross revenues of less than $1 billion during 
its most recently completed fiscal year. Securities Act section 
2(a)(19) (15 U.S.C. 77b(a)(19)). An emerging growth company is 
eligible to rely on certain scaled disclosure requirements for 
registration statements filed under the Securities Act. For example, 
an emerging growth company need not present more than two years of 
audited financial statements in a registration statement for an 
initial public offering. Securities Act section 7(a) (15 U.S.C. 
77g(a)). C.f. SEC Regulation S-X, Rule 3-02 (17 CFR 210.3-02) 
(requiring three years of audited financial statements). We note 
that under 12 CFR 16.15(e), the OCC does not generally require 
audited financial statements in securities offering documents for 
national banks in organization. An emerging growth company also is 
eligible for scaled disclosure requirements in the context of 
Exchange Act periodic reporting. A detailed discussion of this 
relief is set forth above in the discussion of part 11.
    \58\ Securities Act, section 4(a)(6) (15 U.S.C. 77d(a)(6)) 
(crowdfunding creates a registration exemption for offerings of up 
to $1 million, provided that individual investments do not exceed 
certain thresholds and the issuer satisfies other conditions in the 
JOBS Act).
    \59\ Securities Act, section 3(b) (15 U.S.C. 77c(b)) (directing 
the SEC to create a registration exemption for securities offerings 
of up to $50 million).
    \60\ Securities Act, sections 2(a)(3) and 5(d) (15 U.S.C. 
77b(a)(3) and 77e(d)).
---------------------------------------------------------------------------

    As with part 11, the OCC generally intends for part 16 to remain 
consistent with the Securities Act, including those provisions amended 
under the JOBS Act, and SEC rules. Current part 16 incorporates through 
cross-references various SEC rules that the JOBS Act directs the SEC to 
amend. Amendments to these SEC rules therefore would be incorporated 
into part 16 by virtue of these cross-references.\61\ However, the SEC 
has also adopted other rules to implement the JOBS Act.\62\ The OCC 
will review the rules to determine whether corresponding changes to 
part 16 are necessary. At this time, the OCC is not proposing specific 
changes to part 16 to incorporate the JOBS Act, with the exception of 
updated citations where appropriate.
---------------------------------------------------------------------------

    \61\ The SEC recently adopted amendments to Regulation A under 
the Securities Act to implement section 401 of the JOBS Act. 80 FR 
21806 (Apr. 20, 2015). The SEC also has adopted amendments to Rule 
506 of Regulation D and Rule 144A under the Securities Act to 
implement section 201(a) of the JOBS Act. 78 FR 44771 (July 24, 
2013). Part 16 refers to these rules through cross-references.
    \62\ See 80 FR 71387 (Nov. 16, 2015).
---------------------------------------------------------------------------

    Registration statement: Form and content. The OCC is proposing to 
replace the offering circular required under Sec.  197.2 and the 
corresponding form and content requirements of Sec.  197.7 with a 
registration statement and prospectus as currently required by 
Sec. Sec.  16.3 and 16.15 for national banks. Requiring the use of the 
same form by both national banks and Federal savings associations would 
provide a consistent set of disclosure standards and format for 
investors. In addition, this change would not impose any undue 
regulatory burden on Federal savings associations because these forms 
provide similar information to potential investors.
    As discussed in detail above, the JOBS Act provides for certain 
scaled registration statement disclosure requirements for an issuer 
that is an emerging growth company.\63\ Because the JOBS Act amended 
the Securities Act to add the emerging growth company definition and 
because the Securities Act generally does not apply to national bank or 
Federal savings association securities,\64\ the Securities Act emerging 
growth company definition does not apply to banks and savings 
associations. Additionally, current part 16 does not cross-reference 
the Securities Act definition for emerging growth company or otherwise 
define or incorporate the term.\65\
---------------------------------------------------------------------------

    \63\ We note that a national bank or Federal savings association 
that is a smaller reporting company under SEC Regulation S-K may 
already avail itself of certain scaled disclosure requirements in a 
registration statement. Generally, a national bank or Federal 
savings association with a public float of less than $75 million may 
qualify as a smaller reporting company. 17 CFR 229.10.
    \64\ Securities Act, sections 3(a)(2) and (5).
    \65\ 12 CFR 16.15(a) provides that a registration statement 
filed under part 16 ``must be on the form for registration . . . 
that the bank would be eligible to use were it required to register 
the securities under the Securities Act and must meet the 
requirements of the Commission regulations referred to in the 
applicable form for registration.'' Accordingly, to the extent the 
SEC updates applicable forms and regulations to implement JOBS Act 
emerging growth company provisions, a national bank or Federal 
savings association may utilize emerging growth company provisions. 
By way of example, part 16 does not define or explicitly cross-
reference the SEC's smaller reporting company definition in 
Regulation S-K. However, by virtue of 12 CFR 16.15, a national bank 
may rely on the scaled disclosure provisions for a smaller reporting 
company, since SEC registration statement forms incorporate the 
applicable Regulation S-K provisions.
---------------------------------------------------------------------------

    Communications not deemed an offer. Both Sec. Sec.  16.4 and 
197.2(b) provide that certain communications by national banks or 
Federal savings associations about their securities are not deemed to 
be offers. However, Sec.  16.4 more closely follows SEC regulations by 
additionally exempting summary prospectuses covered by SEC Rule 
431,\66\ notices of certain proposed unregistered offerings covered by 
SEC Rule 135c,\67\ publications or distributions of research reports by 
brokers or dealers covered by SEC Rules 138 and 139,\68\ and certain 
communications made after providing a prospectus. Amending part 16 to 
include Federal savings associations would afford them the additional 
communication exemptions under the SEC rules pursuant to Sec.  16.4, 
currently available to national banks.
---------------------------------------------------------------------------

    \66\ 17 CFR 230.431.
    \67\ 17 CFR 230.135c.
    \68\ 17 CFR 230.138 and 230.139.
---------------------------------------------------------------------------

    Exemptions. Section 16.5 provides exemptions to the general 
registration requirements for national bank securities under Sec.  
16.3. These exemptions significantly overlap with the Sec.  197.3 
exemptions to the registration requirements for Federal savings 
associations. However, Sec.  16.5(b) applies SEC Rules 152 \69\ 
(private placement exemption) and 152a \70\ (exemption for sales of 
certain fractional interests) to transactions exempt under section 4 of 
the Securities Act,\71\ while

[[Page 13619]]

Sec.  197.3(b) does not. By amending Sec.  16.5 to include Federal 
savings associations, the additional exemptions provided by these two 
SEC rules would apply to transactions by savings associations. This 
amendment would provide savings associations with additional 
flexibility when issuing securities, resulting in reduced costs and 
less regulatory burden for such issuances.
---------------------------------------------------------------------------

    \69\ 17 CFR 230.152.
    \70\ 17 CFR 230.152a.
    \71\ 15 U.S.C. 77d.
---------------------------------------------------------------------------

    The OCC notes that the JOBS Act amended section 4 of the Securities 
Act to create a private placement exemption for crowdfunding.\72\ The 
SEC recently has adopted rules to implement the private placement 
exemption for crowdfunding.\73\ National banks and Federal savings 
associations may not rely on the private placement exemption for 
crowdfunding in Securities Act section 4(a)(6) unless and until the OCC 
adopts rules implementing this provision for national banks and Federal 
savings associations or affirmatively adopts SEC rules that implement 
this provision. At this time, the OCC is not proposing to amend its 
rules to permit the private placement exemption for crowdfunding.
---------------------------------------------------------------------------

    \72\ Securities Act, section 4(a)(6) (15 U.S.C. 77d(a)(6)).
    \73\ 80 FR 71387 (Nov. 16, 2015).
---------------------------------------------------------------------------

    In addition, Sec.  16.5(f) specifically exempts transactions that 
satisfy the requirements of SEC Rule 701 \74\ regarding offers and 
sales of securities pursuant to certain compensatory benefit plans and 
contracts relating to compensation. Section 197.3 does not cross-
reference SEC Rule 701 but rather provides in Sec.  197.3(g) a narrower 
exemption for sales only to officers, directors or employees through an 
employee benefit plan or a dividend or interest reinvestment plan that 
has been approved by shareholders. In particular, Sec.  197.3(g) does 
not exempt sales made through compensatory benefit plans for 
consultants, advisors, and family members, as does SEC Rule 701.
---------------------------------------------------------------------------

    \74\ 17 CFR 230.701.
---------------------------------------------------------------------------

    By amending Sec.  16.5 to include Federal savings associations, the 
proposal would expand the exemption available for savings associations 
to cover all such sales exempted by SEC Rule 701. Although the OCC has 
not incorporated the Sec.  197.3(g) requirement regarding shareholder 
approval of compensation plans, Federal savings associations still must 
follow all applicable corporate governance requirements under their 
charter provisions. Additionally, national banks and Federal savings 
associations that are subject to the Federal proxy rules must comply 
with SEC rules issued under Exchange Act Section 14A\75\ concerning 
shareholder approval of executive compensation and golden parachute 
payments.
---------------------------------------------------------------------------

    \75\ 15 U.S.C. 78n-1. Section 951 of the Dodd-Frank Act added 
section 14A to the Exchange Act.
---------------------------------------------------------------------------

    In addition, the OCC notes that under paragraph (e) of Sec.  197.3 
certain collateralized securities issued by Federal savings 
associations are exempt from registration. We understand that Federal 
savings associations may have relied upon SEC Regulation D \76\ in 
addition to Sec.  197.3(e).\77\ Therefore, the OCC has not included 
Sec.  197.3(e) in the proposal because this exemption is unnecessary in 
light of the availability of the Regulation D private placement 
exemption in part 16.
---------------------------------------------------------------------------

    \76\ 17 CFR 230.501 et seq.
    \77\ 12 CFR 197.4(a).
---------------------------------------------------------------------------

    The proposal also would make technical changes to update the 
citations to SEC rules in Sec.  16.5(b) and (e).
    Sales of Nonconvertible Debt. The OCC proposes to apply Sec.  16.6, 
sales of nonconvertible debt, to Federal savings associations. While 
Federal savings associations have previously sold nonconvertible debt 
under similar restrictions through various interpretive letters, a 
single set of requirements is simpler and more efficient.
    Small issues. Section 16.8 provides an exemption for small issues 
of national bank securities under the SEC's Regulation A.\78\ 
Currently, Federal savings associations do not have a Regulation A 
exemption for small issuances. In order to provide comparable treatment 
for Federal savings associations that wish to issue small amounts of 
securities and remain exempt from filing registration statements and 
prospectuses, and to reduce regulatory burden, the OCC proposes to 
amend this provision to include savings associations.
---------------------------------------------------------------------------

    \78\ 17 CFR 230.251 et seq.
---------------------------------------------------------------------------

    Securities offered and sold in holding company dissolution. Section 
16.9 provides an exemption for securities offered and sold in a holding 
company dissolution. Part 197 does not contain a similar provision; 
however, savings associations have relied on SEC rules for these 
transactions pursuant to informal OTS staff guidance. The OCC proposes 
to apply Sec.  16.9 to securities issued by Federal savings 
associations to provide more certainty as to the applicability of the 
Sec.  16.9 exemption to these transactions.
    Effectiveness. Section 16.16 provides that a registration statement 
and amendments will become effective in accordance with Sec.  8(a) and 
(c) of the Securities Act and SEC Regulation C, 17 CFR part 230, which 
is the 20th day after filing or sooner if so determined by the OCC. 
Section 197.6 contains the same effective date but does not reference 
Regulation C. The Federal savings association rule also contains other 
provisions regarding a delay in effectiveness and provides that the OCC 
may pursue any remedy under section 5(d) of the HOLA if it appears that 
the offering circular contains any material misstatement or omission. 
In applying Sec.  16.16 to Federal savings associations, SEC regulation 
C would apply to Federal savings associations instead of these 
additional provisions included in Sec.  197.6.
    Sales of securities at an office of a savings association. Section 
197.17 provides that the sale of securities of a Federal savings 
association or its affiliates at an office of the savings association 
may only be made in accordance with the provisions of Sec.  163.76.\79\ 
Section 163.76 generally prohibits the offer or sale of debt or equity 
securities issued by a Federal savings association or an affiliate at 
an office of the association, unless the equity securities are issued 
by the association or the affiliate in connection with the 
association's conversion from the mutual to stock form of organization 
and certain conditions are met. The OCC is proposing to amend part 16 
by adding a new Sec.  16.10 to maintain this restriction on the sale of 
a Federal savings association's or affiliate's securities. Furthermore, 
new Sec.  16.10 cross-references Sec.  163.76.\80\
---------------------------------------------------------------------------

    \79\ Section 197.17 includes an inaccurate cross-reference to 
Sec.  197.76. We have provided the correct cross-reference in the 
discussion above and in the proposed rule. See proposed Sec.  16.10.
    \80\ The OCC may decide to move the restrictions contained in 
Sec.  163.76 to part 16 or to another OCC rule in a future 
rulemaking that integrates all of part 163.
---------------------------------------------------------------------------

    The OCC specifically requests that commenters opine on whether the 
OCC should remove the limitations on the offer or sale of debt or 
equity securities at an office of a Federal savings association in 
light of amendments to the Exchange Act made by the Gramm-Leach-Bliley 
Act,\81\ rules promulgated by the Financial Industry Regulatory 
Authority,\82\ and the Interagency Statement on Retail Sales of 
Nondeposit Investment Products, all of which govern securities 
activities conducted on the premises of OCC-regulated financial 
institutions \83\ In the

[[Page 13620]]

alternative, should the OCC amend part 16 to prohibit a national bank 
from offering or selling debt or equity securities issued by the bank 
or an affiliate at an office of the bank?
---------------------------------------------------------------------------

    \81\ See 15 U.S.C. 78c(a)(4). See also Regulation R, 17 CFR 
247.100 et seq.
    \82\ See FINRA Rule 3160.
    \83\ See OCC Bulletin 94-13, Non deposit Investment Sales 
Examination Procedures (Feb. 24, 1994) and OCC Bulletin 95-52. 
Retail Sales of Nondeposit Investment Products (Sept. 22, 1995).
---------------------------------------------------------------------------

    Filing requirements and inspection of documents. Sections 16.17 and 
197.5 require national banks and Federal savings associations, 
respectively, to submit by mail or otherwise four copies of all 
registration statements, offering documents, amendments, notices, or 
other documents to the SCP Division or, if related to a bank in 
organization or a de novo Federal savings association, to the 
appropriate district office. Similar to the proposed amendment to Sec.  
11.3, the OCC is proposing to amend Sec.  16.17 to require instead that 
banks and savings associations submit one copy of their filings through 
electronic mail to the SCP Division or the appropriate district office, 
as applicable. Pursuant to proposed Sec.  16.17(g), any filing of 
amendments or revisions to previously filed documents must include two 
copies, one of which must be marked to indicate clearly and precisely, 
by underlining or in some other appropriate manner, the changes made. 
Current Sec.  16.17(e) requires a total of four copies of amendments or 
revisions.
    The amendments to Sec.  16.17 also provide that documents may be 
signed electronically using the signature provision in SEC Rule 
402.\84\ This rule provides that required signatures for Securities Act 
filings may be typed or may be duplicated or facsimile versions of 
manual signatures. Where typed, duplicated, or facsimile signatures are 
used, each signatory to the filing is required to ``manually sign a 
signature page or other document authenticating, acknowledging or 
otherwise adopting his or her signature that appears in the filing.'' 
\85\ As provided by Rule 402, this document must be retained for five 
years and, upon request, a copy must be provided to the OCC.
---------------------------------------------------------------------------

    \84\ 17 CFR 230.402.
    \85\ Id.
---------------------------------------------------------------------------

    Current Sec. Sec.  16.17(d) and 197.1 provide the date on which 
papers are actually received by the OCC shall be the date of filing, if 
the person or bank filing the papers has complied with all applicable 
requirements. As with the proposed amendment to Sec.  11.3(a)(3)(i), 
the OCC proposes to update Sec.  16.17(d) to conform with the 
electronic filing requirement. Specifically, the proposed amendment 
provides that an electronic filing that is commenced on a nonholiday 
weekday on or before 5:30 p.m. Eastern Standard or Daylight Savings 
Time, whichever is currently in effect, would be deemed received by the 
OCC on the same business day. An electronic filing whose submission is 
commenced after 5:30 p.m. Eastern Standard or Daylight Savings Time, 
whichever is currently in effect, or on a Saturday, Sunday, or Federal 
holiday would be deemed received by the OCC on the next business day. 
We note, however, that paragraph (e) provides that with respect to any 
registration statement or any post-effective amendment filed pursuant 
to SEC Rule 462(b) (17 CFR 230.462(b)), the cut-off time would be 10 
p.m. to be consistent with corresponding SEC rules.
    As with proposed section Sec.  11.3(a)(3)(iii), proposed Sec.  
16.17(d) provides that if an electronic filer in good faith attempts to 
file a document pursuant to this part in a timely manner but the filing 
is delayed due to technical difficulties beyond the electronic filer's 
control, the electronic filer may request that the OCC adjust the 
filing date. The OCC may grant the request if it appears that such 
adjustment is appropriate and consistent with the public interest and 
the protection of investors. As indicated above, these rules for dating 
an electronic filing, and for providing a waiver for technical 
difficulties with the filing, are derived from SEC Regulation S-T.\86\
---------------------------------------------------------------------------

    \86\ 17 CFR 232.
---------------------------------------------------------------------------

    The OCC also is proposing to add a new Sec.  16.17(f) to establish 
an exception to the general electronic filing requirements that permits 
the use of paper filings where unanticipated technical difficulties 
prevent the use of electronic filings. This exception is modeled on SEC 
Regulation S-T, Rule 201,\87\ which provides a temporary hardship 
exemption to the SEC's EDGAR filing requirements in cases of 
unanticipated technical difficulties. Similar to Rule 201, the OCC 
notes that the use of this exception should be extremely limited and 
should be relied upon only when unusual and unexpected circumstances 
create technical impediments to the use of electronic filings.
---------------------------------------------------------------------------

    \87\ 17 CFR 232.201.
---------------------------------------------------------------------------

    Finally, the OCC is proposing technical changes to Sec.  16.17(h), 
currently Sec.  16.17(f), that would update a cross-reference to 12 CFR 
part 4.
    Use of prospectus. Section 16.18 provides that no person may use a 
prospectus or amendment declared effective by the OCC more than nine 
months after the effective date unless the information contained in the 
prospectus or amendment is as of a date not more than 16 months prior 
to the date of use. Furthermore, this section provides that no person 
may use a prospectus if an event arises or fact changes after the 
effective date that causes the prospectus to contain an untrue 
statement of material fact or to omit a material fact that causes the 
prospectus to be misleading until an amendment reflecting the event or 
change has been filed with and declared effective by the OCC. Section 
197.8 contains similar provisions for Federal savings associations. 
Therefore, applying Sec.  16.18 to Federal savings associations would 
not result in any changes for Federal savings associations.
    Withdrawal or abandonment. In general, Sec.  16.19 provides that a 
registration statement, amendment, or exhibit may be withdrawn prior to 
its effective date. Furthermore, this section provides that the OCC may 
deem abandoned a registration statement or amendment that has been on 
file with the OCC for nine months and has not become effective. Section 
197.11 contains the same provisions for Federal savings associations. 
Therefore, applying Sec.  16.19 to Federal savings associations would 
not result in any changes for Federal savings associations.
    Request for interpretive advice or no-objection letter. The 
proposal would amend Sec.  16.30 to update the cross-reference to where 
the address for filing a request for interpretive advice or a no-
objection letter may be found.
    Escrow requirement. For national banks, Sec.  16.31 provides the 
OCC with discretion to require the establishment of an escrow account, 
while Sec.  197.9 automatically requires an escrow account for Federal 
savings associations. By amending part 16 to include Federal savings 
associations and deleting Sec.  197.9, this proposal would remove the 
mandatory escrow requirement for Federal savings associations.
    Fraudulent transactions/unsafe or unsound practices. Section 16.32 
prohibits fraudulent transactions in the offer or sale of bank 
securities and deems such transactions to be an unsafe or unsound 
practice under 12 U.S.C. 1818. Section 197.10 contains a similar 
prohibition. However, Sec.  16.32 specifically cross-references the 
investor protections under section 17 of the Securities Act \88\ and 
references SEC Rule 175 \89\ on forward-looking statements. Although 
section 17 by its terms applies to Federal savings associations 
regardless of the OCC rule, neither it nor SEC Rule 175 is

[[Page 13621]]

referenced in Sec.  197.10. The OCC proposes to amend Sec.  16.32 to 
include Federal savings associations. As a result, part 16 would put 
Federal savings associations on notice that the Securities Act section 
17 investor protections apply. Furthermore, Federal savings 
associations would have the additional clarifying guidance on the 
liability of forward-looking statements provided by SEC Rule 175.
---------------------------------------------------------------------------

    \88\ 15 U.S.C. 77q.
    \89\ 17 CFR 230.175.
---------------------------------------------------------------------------

    Filing fees. Section 16.33 provides that filing fees, as provided 
for in the Notice of Comptroller of the Currency Fees published 
pursuant to 12 CFR 8.8, must accompany filings made pursuant to part 
16. The OCC proposes to amend Sec.  16.33(a) to provide that the OCC 
may require filing fees. In addition, the proposal would amend Sec.  
16.33(b) to provide that such fees may be paid by means acceptable to 
the OCC, in addition to by check, to reflect the additional payment 
options now available. The OCC is not currently imposing any filing 
fees for part 16 filings and is not proposing any fees as part of this 
rulemaking.
    Waiver and interpretive advice requests. The OCC is not proposing 
to include in part 16 the blanket waiver provisions contained in 
Sec. Sec.  197.14 and 197.15. However, the OCC would continue to 
provide interpretive advice or no-objection letters under the terms 
provided in Sec.  16.30. We also note that 12 CFR 100.2 provides that 
the Comptroller may, for good cause and to the extent permitted by 
statute, waive the applicability of any provision of 12 CFR parts 1 
through 197, with respect to Federal savings associations.
    Current and periodic reports. The OCC has not included in proposed 
part 16 the filing requirement contained in Sec.  197.18. Specifically, 
Sec.  197.18 requires a Federal savings association to file certain 
periodic reports with the OCC after its offering circular becomes 
effective, even if the savings association is not otherwise required to 
register its securities with the OCC under the Exchange Act. This 
filing requirement applies to Federal savings associations until the 
securities to which the savings association's offering circular relates 
are held of record by fewer than 300 persons in any fiscal year other 
than the fiscal year in which the offering circular becomes effective. 
The FDIC and the Federal Reserve Board have not imposed a comparable 
obligation on State banks, and the OCC removed this obligation on 
national banks in 2008.\90\ Instead, a State or national bank is 
subject to Exchange Act periodic and current reporting requirements if 
the bank's total assets exceed $10,000,000 and it has a class of equity 
security (other than an exempted security) held of record by 2,000 or 
more persons.\91\
---------------------------------------------------------------------------

    \90\ 73 FR 22216 (Apr. 24, 2008).
    \91\ Exchange Act, section 12(g) (15 U.S.C. 78l(g)), as amended 
by section 601(a) of the JOBS Act.
---------------------------------------------------------------------------

    As a result of this proposed amendment, a Federal savings 
association would be subject to Exchange Act periodic and current 
reporting requirements if it had total assets exceeding $10,000,000 and 
a class of equity security (other than an exempted security) held of 
record by 2,000 or more persons.\92\ This change would make the current 
and periodic reporting requirements for national banks and Federal 
savings associations identical. It also would reduce regulatory burden 
by eliminating such filing requirements for Federal savings 
associations with fewer than 1,200 holders of record.\93\ Financial 
information about a savings association would continue to be publicly 
available to investors through quarterly financial information, 
including balance sheets and statements of income, which is part of a 
savings association's Call Reports and is available at https://cdr.ffiec.gov/public/.
---------------------------------------------------------------------------

    \92\ Id.
    \93\ Id. National banks and Federal savings associations that 
are currently registered under section 12(g) of the Exchange Act and 
have 1,200 or more holders of record for a class of securities must 
continue to comply with current and periodic reporting requirements.
---------------------------------------------------------------------------

    Periodic sales reports. Under Sec.  197.12, Federal savings 
associations must file periodic reports on the sales of securities that 
are registered under Sec.  197.2 or that are otherwise exempt from 
registration under Sec.  197.4 (non-public offerings, including 
Regulation D and sales to 35 or more persons). National banks do not 
have to file similar reports. Furthermore, institutions generally sell 
securities for the purpose of increasing their capital. The OCC can 
review any increases to a Federal savings association's capital through 
the institution's quarterly Call Report, and therefore the periodic 
sales report provides limited additional value for supervision. 
Furthermore, Sec.  5.45, as added by the licensing integration rule, 
published on May 18, 2015, requires Federal savings associations 
subject to capital plans or other regulatory actions to file reports 
for increases in permanent capital, so the Securities Sales Report is 
redundant in cases that present the most supervisory risk.\94\ 
Therefore, the OCC proposes not to include in part 16 the Sec.  197.12 
requirement that Federal savings associations file reports on sales of 
securities.
---------------------------------------------------------------------------

    \94\ Section Sec.  5.46 requires national banks to file reports 
for increases in permanent capital.
---------------------------------------------------------------------------

    The OCC also is proposing a technical change throughout part 16. 
Specifically, the proposal would replace all references to 
``Commission'' with ``SEC.''

Disclosure of Financial and Other Information by National Banks (Part 
18)

    Twelve CFR part 18 sets forth annual financial disclosure 
requirements for national banks. Specifically, part 18 requires 
national banks to prepare annual disclosure statements as of December 
31 to be made available to bank security holders by March 31 of the 
following year. The rule specifies the types of information that must 
be included in the disclosure statements, which includes, at a minimum, 
certain information from the bank's Call Report. The Comptroller may 
require the inclusion of other information and the bank may include an 
optional narrative. Section 18.5 provides alternative ways a bank may 
meet the disclosure statement requirement. These alternatives include 
allowing Exchange Act registered banks to use the bank's annual report 
and allowing banks with audited financial statements to use those 
statements provided the statements include certain required 
information.
    Part 18 was included in the third EGRPRA Federal Register notice, 
and we did not receive any comments on this rule in response to this 
notice.
    The OCC is proposing to remove part 18 to reduce unnecessary 
burden. The information this part requires a national bank to disclose 
is contained in other publicly available documents, such as the Call 
Report and the Uniform Bank Performance Report. Part 18 is therefore 
duplicative and unnecessary. We note that the Federal Reserve Board and 
the former OTS rescinded similar regulations for state member banks and 
savings association, respectively. The OTS repealed 12 CFR 562.3 in 
December 1995 and the Federal Reserve Board eliminated 12 CFR 208.17 in 
1998.\95\
---------------------------------------------------------------------------

    \95\ 60 FR 66866 (December 27, 1995); 63 FR 37630 (July 13, 
1998).
---------------------------------------------------------------------------

Part 31 (Sec. Sec.  163.41, 163.43): Extensions of Credit to Insiders 
and Affiliate Transactions \96\
---------------------------------------------------------------------------

    \96\ Part 31 and Sec. Sec.  163.41 and 163.43 are included in 
the fourth EGRPRA Federal Register notice, the comment period for 
which closes on March 22, 2016. As indicated previously in this 
preamble, to ensure that any OCC rule finalizing this NPRM takes 
into account all comments we receive on part 31 and Sec. Sec.  
163.41 and 163.43, the OCC will consider comments received on both 
this NPRM and the fourth EGRPRA notice when finalizing this 
rulemaking.
---------------------------------------------------------------------------

    National banks and Federal savings associations must comply with 
rules of

[[Page 13622]]

the Federal Reserve Board regarding extensions of credit to insiders 
(Regulation O) \97\ and transactions with affiliates (Regulation 
W),\98\ which implement section 22 and sections 23A and 23B, 
respectively, of the Federal Reserve Act.\99\ Twelve CFR part 31 and 12 
CFR 163.41 and 163.43 address these transactions for national banks and 
Federal savings associations, respectively. Specifically, Sec.  31.2 
requires national banks to comply with Regulation O. Appendix A to part 
31 provides interpretive guidance on the application of Regulation W to 
deposits between affiliated banks. Sections 163.41 and 163.43 contain 
general statements that refer Federal savings associations to 
applicable regulations of the Federal Reserve Board, specifically, 
Regulation O and Regulation W.
---------------------------------------------------------------------------

    \97\ 12 CFR part 215.
    \98\ 12 CFR part 223.
    \99\ 12 U.S.C. 371c, 371c-1, 375a, and 375b. In general, section 
11 of the HOLA, 12 U.S.C. 1468, applies the sections 23A and 23B of 
the Federal Reserve Act to savings associations in the same manner 
and to the same extent as if the savings association were a member 
bank. But see 12 U.S.C. 375a(4).
---------------------------------------------------------------------------

    The OCC proposes to consolidate its rules that address insider 
lending and affiliate transactions by amending part 31 to state clearly 
that both national banks and Federal savings associations must comply 
with Regulation O and Regulation W and by removing Sec. Sec.  163.41 
and 163.43. Specifically, the proposed rule would add ``Federal savings 
associations'' to the text of Sec.  31.2 and add a new Sec.  31.3 to 
require both national banks and Federal savings associations to comply 
with the affiliate transaction requirements contained in part 223. In 
addition, new Sec.  31.3(b) clarifies that the OCC administers and 
enforces affiliate transaction requirements as they apply to national 
banks and Federal savings associations.
    Moreover, the OCC proposes to adopt new Sec.  31.3(c) to implement 
the statutory standards for authorizing an exemption from section 23A 
in accordance with section 608 of the Dodd-Frank Act. Section 608, 
which became effective on July 21, 2012, amends section 23A and section 
11 of the HOLA to authorize the OCC to exempt, by order, a transaction 
of a national bank or Federal savings association, respectively, from 
the affiliate transaction requirements of section 23A and section 11 of 
the HOLA if: (1) the OCC and the Federal Reserve Board jointly find the 
exemption to be in the public interest and consistent with the purposes 
of section 23A and section 11, as applicable, and (2) within 60 days of 
receiving notice of such finding, the FDIC does not object in writing 
to the finding based on a determination that the exemption presents an 
unacceptable risk to the Deposit Insurance Fund.\100\ In addition, in 
new Sec.  31.3(d), the OCC proposes to adopt procedures that a national 
bank and Federal savings association must follow for requesting such an 
exemption. These procedures are modeled after the Federal Reserve 
Board's existing procedures in Regulation W.
---------------------------------------------------------------------------

    \100\ See section 608(a)(4)(A)(iv) of the Dodd-Frank Act 
(exemptive authority for national banks) and section 608(c) of the 
Dodd-Frank Act (exemptive authority for Federal savings 
associations).
---------------------------------------------------------------------------

    Appendix A to part 31, which is specific to national banks, would 
remain unchanged. We propose to amend Appendix B, which contains a 
comparison between selected provisions of Regulation O and the OCC's 
lending limits rule, 12 CFR part 32, to include Federal savings 
associations and to make technical changes.
    Finally, we propose to amend the authority provision in Sec.  31.1 
to reference 12 U.S.C. 1463 and 1468 and to correct a duplicative 
reference to 12 U.S.C. 1817(k).
    It should be noted that the OCC may impose additional restrictions 
on any transaction between a Federal savings association or national 
bank and its affiliates that the OCC determines to be necessary to 
protect the safety and soundness of the institution.\101\ This 
authority is unaffected by and not addressed in this regulation.
---------------------------------------------------------------------------

    \101\ See, e.g., 12 U.S.C. 93a, 371c(f)(2)(B)(i), 481, 1831p-1, 
and 1468(a)(4).
---------------------------------------------------------------------------

Electronic Operations and Activities of Federal Savings Associations 
(12 CFR Part 155)

    Twelve CFR part 155 addresses the use of technology by Federal 
savings associations to deliver products and services. Specifically, 
Sec.  155.200 provides that a Federal savings association may use 
electronic means or facilities to perform any function, or provide any 
product or service, as part of an otherwise authorized activity. In 
addition, Sec.  155.200 permits Federal savings associations to use, or 
participate with others to use, electronic means or facilities to 
perform any function, or provide any product or service, as part of an 
authorized activity; and to market and sell, or participate with others 
to market and sell, electronic capacities and by-products to third 
parties in order to optimize the use of resources, if the savings 
association acquired or developed these capacities and by-products in 
good faith as part of providing financial services. These 
authorizations are similar to what is provided for national banks in 12 
CFR part 7, subpart E.
    Section 155.210 requires management of the savings association to 
take steps to identify, assess and mitigate potential risks, establish 
prudent internal controls, and implement security measures designed to 
prevent unauthorized access, prevent fraud, and comply with applicable 
security device requirements of part 168.
    Section 155.300(b) requires a Federal savings association to file a 
written notice with the OCC prior to establishing a transactional Web 
site and Sec.  155.310 provides the procedures for filing this notice. 
Finally, Sec.  155.300(c) requires a Federal savings association to 
follow any written procedures the OCC imposes with respect to any 
supervisory or compliance concerns regarding its use of electronic 
means or facilities.
    This proposal would remove Sec. Sec.  155.300 and 155.310. Part 155 
was included in the first EGRPRA Federal Register request for comments. 
In response to this request, we received comments recommending that the 
OCC remove the transactional Web site notice requirement in Sec.  
155.300(b). The OCC agrees that this notice is no longer necessary and 
this proposed rule would remove this notice requirement and the 
procedural details for this notice. Although not carried over in the 
proposed regulatory text, as stated in current Sec.  155.300(a), 
Federal savings associations are encouraged to discuss any planned new 
products or services that will use electronic means or facilities with 
their assigned OCC supervisory office.
    With respect to Sec.  155.300(c), pursuant to the OCC's safety and 
soundness authority, Federal savings associations are required to 
comply with any written procedures the OCC imposes for supervisory or 
compliance reasons. This provision therefore is unnecessary.
    Finally, the OCC proposes other non-substantive changes to update 
the rule and to present the regulatory provisions in a format more 
consistent with the OCC's other rules.

Regulatory Reporting Requirements for Federal Savings Associations (12 
CFR Part 162 and Sec.  163.180)

    Twelve CFR part 162 and Sec.  163.180(a), which set forth 
regulatory reporting and auditing standards and requirements for 
Federal savings associations, were included in the first EGRPRA Federal 
Register request for comments. Although the OCC did not

[[Page 13623]]

receive any comments on these rules, as part of the EGRPRA review 
process the OCC is proposing to revise 12 CFR part 162 and remove Sec.  
163.180(a) in order to eliminate duplicative requirements.
    Various Federal statutes impose reporting and audit requirements on 
Federal savings associations and national banks. Specifically, 12 
U.S.C. 161(a) provides that national banks must submit reports of 
condition to the Comptroller in accordance with the requirements of the 
Federal Deposit Insurance Act (FDI Act). Twelve U.S.C. 1464(v)(1) is 
the comparable statute for Federal savings associations. In addition, 
12 U.S.C. 1831m and FDIC implementing regulations at 12 CFR part 363 
require insured depository institutions above a specified asset 
threshold to have annual independent audits and to submit annual 
reports and audited financial statements to the FDIC and the 
appropriate Federal banking agency.\102\ These financial statements 
must be prepared in accordance with GAAP and such other disclosure 
requirements as the FDIC and the appropriate Federal banking agency may 
prescribe.\103\ The Interagency Policy Statement on External Audit 
Programs of Banks and Savings Associations (1999 Interagency Policy 
Statement) \104\ provides unified interagency guidance regarding 
independent external auditing programs of community banks and savings 
associations that are exempt from 12 CFR part 363 (i.e., institutions 
with less than $500 million in total assets) or that are not otherwise 
subject to audit requirements by order, agreement, statute, or agency 
regulations. Furthermore, 12 U.S.C. 1463(b)(1) requires the 
Comptroller, by regulation, to prescribe uniform accounting and 
disclosure standards for Federal savings associations' compliance with 
all applicable regulations.
---------------------------------------------------------------------------

    \102\ Among other requirements, 12 CFR part 363 requires insured 
depository institutions with total assets above certain thresholds 
to assess the effectiveness of internal controls over financial 
reporting, to establish independent audit committees, and to comply 
with related reporting requirements.
    \103\ Other statutes further clarify the use of GAAP by insured 
depository institutions. See, e.g., 12 U.S.C. 1831n(a)(2)(A) (the 
accounting principles applicable to reports or statements required 
to be filed with Federal banking agencies by insured depository 
institutions shall be uniform and consistent with GAAP) and 12 
U.S.C. 1831n(a)(2)(B) (in certain circumstances, the appropriate 
Federal banking agency or the FDIC may, with respect to such reports 
or statements, prescribe an accounting principle applicable to such 
institutions that is no less stringent than GAAP).
    \104\ See OCC Bulletin 99-37, Interagency Policy Statement on 
External Auditing Programs (Oct. 7, 1999) and 64 FR 52319 (Sept. 28, 
1999).
---------------------------------------------------------------------------

    As indicated above, 12 CFR part 162 and Sec.  163.180(a) set forth 
the regulatory reporting and auditing standards and requirements for 
savings associations. Specifically, Sec.  162.1 requires Federal 
savings associations to use forms prescribed by the OCC and to follow 
such regulatory reporting requirements as the OCC may require. This 
section also requires Federal savings associations and their affiliates 
to maintain accurate and complete records of all business transactions 
that support the regulatory reports submitted to the OCC and any 
financial reports prepared in accordance with GAAP. These records must 
be maintained in the United States and must be readily accessible by 
the OCC for examination and other supervisory purposes within five 
business days upon request by the OCC, at a location acceptable to the 
OCC.
    Section 162.2 sets forth the minimum requirements to be included in 
all reports to the OCC, including Call Reports. In general, these 
reports must incorporate GAAP, as well as additional safety and 
soundness requirements more stringent than GAAP that the Comptroller 
prescribes. Section 163.180(a) provides that Federal savings 
associations and their service corporations must submit periodic and 
other reports as required by the appropriate Federal banking agency. 
Both Sec. Sec.  162.1 and 162.2 implement the 12 U.S.C. 1463(b)(1) 
requirement, described above, that the OCC issue regulations 
prescribing uniform accounting and disclosure standards for Federal 
savings associations' compliance with all applicable regulations.
    Section 162.4 sets forth requirements and standards for audits of 
Federal savings associations. It generally provides that the OCC may 
require, at any time, an independent audit of a Federal savings 
association's financial statements when necessary for safety and 
soundness reasons. It further requires an independent audit if a 
Federal savings association receives a CAMELS rating of 3, 4, or 5, 
specifies qualifications for independent public accountants, and states 
that audit engagement letters provide the OCC with access to and copies 
of any work papers, policies, and procedures relating to the services 
performed.
    There are no comparable OCC regulations for national banks. 
However, the OCC applies and enforces the above-referenced statutory 
requirements, as well as the applicable FDIC reporting and auditing 
requirements, with respect to both national banks and Federal savings 
associations.
    The OCC proposes to remove the requirements contained in Sec. Sec.  
162.1 and 162.2. The OCC has adequate authority pursuant to its general 
examination authority to obtain records and reports from Federal 
savings associations, as well as national banks.\105\ Furthermore, the 
frequently changing nature of accounting standards and disclosures 
makes it impractical to codify detailed standards in a regulation.
---------------------------------------------------------------------------

    \105\ See 12 U.S.C. 1464(d)(1)(B) (Federal savings associations) 
and 12 U.S.C. 481 (national banks). See also 12 U.S.C. 1817.
---------------------------------------------------------------------------

    The OCC believes that the audit requirements of Sec.  162.4 and 
reporting requirements of Sec.  163.180(a) also are unnecessarily 
repetitive of other requirements and proposes to remove them. The OCC 
has adequate statutory authority to require reports and 12 CFR 363 
already specifies requirements for independent audits and auditors for 
both Federal savings associations and national banks. In addition, as 
with national banks, the agency does not believe that it is necessary 
to articulate this authority for Federal savings associations in a 
regulation.\106\ Rescission of Sec. Sec.  162.4 and 163.180(a) would 
not affect the OCC's ability, pursuant to our safety and soundness 
authority, to require at any time an independent audit of a Federal 
savings association or to access work papers and related documents 
prepared in connection with any audit of a Federal savings 
association.\107\
---------------------------------------------------------------------------

    \106\ See, e.g., 12 U.S.C. 1817(a)(3) and 12 CFR part 304 with 
respect to reports and 12 CFR part 363 and the Interagency Policy 
Statement on External Audit Programs of Banks and Savings 
Associations (64 FR 52319, Sept. 28, 1999) with respect to audits.
    \107\ See 12 U.S.C. 1831p-1.
---------------------------------------------------------------------------

    The OCC reminds Federal savings associations that rescinding Sec.  
162.4 also would not eliminate or affect the requirement that a savings 
association with $500 million or more in assets obtain an annual audit 
pursuant to 12 U.S.C. 1831m and 12 CFR part 363, nor would it minimize 
the importance of administering an external audit program. Furthermore, 
the OCC encourages all national banks and Federal savings associations, 
regardless of size, to have independent external reviews of their 
operations and financial statements and to establish audit committees 
made up entirely of outside directors. The form of that review can 
range from financial statement audits by independent public accountants 
to agreed-upon procedures (i.e., directors' examinations) performed by 
other independent and qualified persons. In particular, Federal savings 
associations should be familiar with 12 CFR part 363 and the 1999 
Interagency Policy

[[Page 13624]]

Statement, which apply to all insured depository institutions.
    However, we recognize that 12 U.S.C. 1463(b)(1) requires the 
Comptroller to prescribe by regulation uniform accounting and 
disclosure standards for Federal savings associations. To satisfy this 
requirement, the proposal provides that a Federal savings association 
shall incorporate U.S. GAAP and the disclosure standards included 
therein when complying with all applicable regulations, unless 
otherwise specified by statute or regulation or by the OCC. We believe 
that the guidance provided in proposed Sec.  162.1 satisfies the 
statutory requirement while being flexible enough to accommodate the 
evolving nature of the standards and disclosures. We note that we are 
proposing to reference GAAP as ``U.S. GAAP'' to clarify that the 
reference is to GAAP as used in the United States, in light of evolving 
global accounting standards. With respect to national banks, a similar 
regulation is not required by statute and would be redundant with other 
provisions that require compliance with GAAP, such as 12 U.S.C. 1831m 
and 1831n(a)(2), discussed above.

Section 163.161: Management and Financial Policies

    Section 163.161(a)(1) of title 12 generally requires each Federal 
savings association and each service corporation to be well-managed, to 
operate in a safe and sound manner, and to pursue financial policies 
that are safe and consistent with economical home financing and the 
purposes of savings associations. Section 163.161(a)(2) requires each 
Federal savings association and service corporation to maintain 
sufficient liquidity to ensure its safe and sound operations. Section 
163.161(b) addresses the compensation of Federal savings association 
and service corporation officers, directors, and employees.
    Federal savings associations, and national banks, are subject to 
many other regulations and guidance that require sound management and 
financial policies. Part 30 of the OCC's regulations contain guidelines 
establishing operational and managerial standards for safety and 
soundness applicable to national banks and Federal savings 
associations. Among other things, these Safety and Soundness 
Guidelines, which implement the statutory safety and soundness 
provisions at section 39 of the FDI Act,\108\ address executive 
compensation.\109\ In addition, the OCC, together with other Federal 
financial regulators, is conducting a rulemaking to implement section 
956 of the Dodd-Frank Act, which imposes enhanced requirements 
pertaining to incentive compensation for both national banks and 
Federal savings associations with over $1 billion in assets.\110\ 
Finally, the OCC, along with the other Federal banking agencies, issued 
a joint policy statement in 2010 that provides guidance for the sound 
management of liquidity risk. This policy statement is both more 
detailed and more current than the provisions of the regulation and is 
applicable to both national banks and Federal savings 
associations.\111\
---------------------------------------------------------------------------

    \108\ 12 U.S.C. 1831p-1.
    \109\ 12 CFR part 30, appendix A. The OCC, FDIC, and Federal 
Reserve Board also issued joint agency guidance on incentive 
compensation in 2010. See 75 FR 36395 (June 25, 2010).
    \110\ See 76 FR 21170 for the joint proposed rule. A final rule 
has not yet been issued.
    \111\ Interagency Policy Statement on Funding and Liquidity Risk 
Management, 75 FR 13656 (Mar. 13, 2010).
---------------------------------------------------------------------------

    The OCC has concluded that Sec.  163.161 duplicates these existing 
provisions applicable to Federal savings associations. Therefore, the 
OCC proposes to delete Sec.  163.161 in its entirety. We note that 
Sec.  163.161 was included in the third EGRPRA Federal Register notice 
and that we did not receive any comments on this section.

Financial Derivatives Transactions by Federal Savings Associations 
(Sec.  163.172) \112\
---------------------------------------------------------------------------

    \112\ Section 163.172 is included in the fourth EGRPRA Federal 
Register notice, the comment period for which closes on March 22, 
2016. As indicated previously in this preamble, the OCC will 
consider comments received on Sec.  163.172 in response to both this 
NPRM and the fourth EGRPRA notice when finalizing this rulemaking.
---------------------------------------------------------------------------

    Twelve CFR 163.172 states that a Federal savings association may 
engage in a transaction involving a financial derivative provided that 
the association is authorized to invest in the assets underlying the 
derivative, the transaction is safe and sound, and the association's 
board of directors and management satisfy certain prudential 
requirements. It also states that, in general, if a Federal savings 
association should engage in a financial derivative transaction, it 
should do so to reduce its risk exposure.
    Section 163.172(a) defines ``financial derivative'' as a financial 
contract whose value depends on the value of one or more underlying 
assets, indices, or reference rates. It states that the most common 
types of financial derivatives are futures, forward commitments, 
options, and swaps.
    The OCC proposes to replace the term ``forward commitment'' with 
``forward contract.'' A ``forward commitment'' generally refers to an 
agreement to loan funds in the future and is not a financial 
derivative. In contrast, a ``forward contract'' is a well-known type of 
financial derivative to which this rule should apply. This change would 
clarify any confusion caused by the wording of the current rule but we 
would not expect it to have a material effect on Federal savings 
associations or the securities marketplace.
    The OCC proposes other non-substantive changes to clarify the rule 
further and to present the regulatory provisions in a format more 
consistent with the OCC's other rules. It should be noted that the OCC 
does not have a comparable regulation governing national bank 
derivative transactions, but it has addressed these activities through 
interpretive letters.

Accounting Requirements (12 CFR part 193)

    Twelve U.S.C. 1463(b)(2)(A) requires savings associations to use 
GAAP in preparing reports to regulators. The Federal Home Loan Bank 
Board (FHLBB) originally issued part 563c in 1974 \113\ and the OTS 
readopted it as the successor agency to the FHLBB in 1989.\114\ The OCC 
republished this rule as 12 CFR part 193, without substantive changes, 
when it issued former OTS rules as OCC rules in 2011.\115\ Part 193 
requires Federal savings associations to make disclosures in financial 
statements filed in conversion applications or under the Securities 
Exchange Act. These disclosures are in addition to those required under 
GAAP.
---------------------------------------------------------------------------

    \113\ 39 FR 24223 (July 1, 1974).
    \114\ 54 FR 49627 (Nov. 30, 1989).
    \115\ 76 FR 48949 (Aug. 9, 2011).
---------------------------------------------------------------------------

    The OCC has determined that the additional financial disclosures 
required by part 193 are, in most cases, substantially similar to and 
largely repetitive of otherwise applicable public disclosure 
requirements that a Federal savings association or its holding company 
must satisfy under the Securities Act, the Exchange Act, or OCC 
regulations, as appropriate. Therefore, the OCC proposes to delete part 
193. Federal savings associations still will be required to follow GAAP 
reporting and disclosure requirements.\116\
---------------------------------------------------------------------------

    \116\ We note that in response to our interim final rule and 
request for comments on the republication of former OTS rules, the 
OCC received a comment letter requesting that it delete the 
reference to real estate investment trusts from Sec.  193.102. See 
Docket ID OCC-2011-0016. This comment is moot in light of our 
proposed removal of part 193 in its entirety.

---------------------------------------------------------------------------

[[Page 13625]]

III. Request for Comments

    The OCC encourages comment on any aspect of this proposal and 
especially on those issues noted in this preamble.

IV. Regulatory Analysis

Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act (RFA), an agency must 
prepare a regulatory flexibility analysis for all proposed and final 
rules that describes the impact of the rule on small entities.\117\ 
Under section 605(b) of the RFA, this analysis is not required if the 
head of the agency certifies that the rule will not have a significant 
economic impact on a substantial number of small entities and publishes 
its certification and a short explanatory statement in the Federal 
Register along with its rule.
---------------------------------------------------------------------------

    \117\ See 5 U.S.C. 601 et seq.
---------------------------------------------------------------------------

    The OCC currently supervises approximately 1,055 small 
entities.\118\ Because some of the proposal's provisions could impact 
any national bank and other provisions could impact any Federal savings 
association, the proposal could impact a substantial number of OCC-
supervised small entities.
---------------------------------------------------------------------------

    \118\ We base our estimate of the number of small entities on 
the Small Business Administration's (SBA) size thresholds for 
commercial banks and savings institutions, and trust companies, 
which are $550 million and $38.5 million, respectively. Consistent 
with the General Principles of Affiliation 13 CFR 121.103(a), we 
count the assets of affiliated financial institutions when 
determining if we should classify a bank we supervise as a small 
entity. We use December 31, 2014, to determine size because a 
``financial institution's assets are determined by averaging the 
assets reported on its four quarterly financial statements for the 
preceding year.'' See footnote 8 of the SBA's Table of Size 
Standards.
---------------------------------------------------------------------------

    If the proposal is implemented, we believe that substantially all 
of national banks' and Federal savings associations' direct costs will 
be associated with reviewing the amendments and, when necessary, 
modifying policies and procedures to correct any inconsistencies 
between banks' and savings associations' internal policies and the 
modified rules. We estimate that the monetized direct cost per national 
bank/Federal savings association will range from a low of approximately 
$1 thousand to a high of approximately $8 thousand. Using the upper 
bound average direct cost per national bank or Federal savings 
association, we believe the proposal might have a significant economic 
impact on approximately three OCC-supervised small entities, which is 
not a substantial number.\119\ Therefore, the OCC has concluded that 
the final rule does not have a significant economic impact on a 
substantial number of small entities supervised by the OCC.
---------------------------------------------------------------------------

    \119\ The OCC classifies the economic impact of total costs on a 
national bank or Federal savings association as significant if the 
total estimated costs in a single year are greater than 5 percent of 
total salaries and benefits or greater than 2.5 percent of total 
non-interest expense. We believe three is not a substantial number 
because it represents less than one percent of OCC-supervised small 
entities.
---------------------------------------------------------------------------

Unfunded Mandates Reform Act of 1995

    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) 
requires that an agency prepare a budgetary impact statement before 
promulgating a rule that includes a Federal mandate that may result in 
the expenditure by State, local, and tribal governments, in the 
aggregate, or by the private sector of $100 million or more in any one 
year. Under Title II of the UMRA, indirect costs, foregone revenues and 
opportunity costs are not included when determining if a mandate meets 
or exceeds UMRA's cost threshold. The UMRA does not apply to 
regulations that incorporate requirements specifically set forth in 
law. If a budgetary impact statement is required, section 205 of the 
UMRA also requires an agency to identify and consider a reasonable 
number of regulatory alternatives before promulgating a rule. Our 
estimated UMRA cost is less than $1 million.

Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995,\120\ the OCC may not 
conduct or sponsor, and a person is not required to respond to, an 
information collection unless the information collection displays a 
valid OMB control number. The OCC has submitted the information 
collection requirements imposed by this proposed rule to OMB for 
review, with the exception of requirements being removed or undergoing 
a nonmaterial change. Those collections will be submitted to OMB at the 
final rule stage.
---------------------------------------------------------------------------

    \120\ 44 U.S.C. 3501 et seq.
---------------------------------------------------------------------------

    Section 5.20(b) would be amended to codify the requirements now 
imposed in a scope up/scope down application under Sec.  5.53(v). 
Section 5.33(g)(4)(i) would be amended to eliminate the need for a 
prior waiver request for an FDIC-insured mutual depository institution 
as a resulting institution in a combination involving a Federal mutual 
savings association. A nonmaterial change will be filed with OMB for 
these revisions.
    Section 9.18(b)(1) would be revised to replace the requirement that 
a national bank make a copy of any collective investment fund plan 
available for public inspection at its main office with the requirement 
that the plan could instead be available to the public on its Web site. 
A nonmaterial change will be filed with OMB for this revision.
    Part 194 would be removed and Federal savings associations would 
follow part 11. Section 11.3 would be revised to require that fewer 
copies be filed and to allow electronic signatures. A nonmaterial 
change will be filed with OMB for these revisions.
    Section 12.4(b) would be amended to allow institutions to direct a 
broker-dealer to mail confirmations to customers without requiring a 
duplicate or other form of notification specified in Sec.  12.4 or 12.5 
to be sent by the institution. Sections 12.101 and 12.102 would remove 
the disclosure of remuneration for mutual fund transactions and 
electronic communications. Sections 151.60(a) and 151.60(b) would be 
amended to include the less detailed maintenance and storage procedures 
for customer securities transaction records found in part 12. Section 
151.60(b) also would be amended to allow use of a third-party service 
provider for records storage and maintenance. Section 151.80 would be 
amended to provide that a Federal savings association that has 
previously determined compensation in a written agreement with the 
customer would not need to provide a remuneration statement for each 
securities transaction. The Recordkeeping Requirements for Securities 
Transactions information collection covering parts 12 and 151 was 
submitted to OMB for review:
    Title: Recordkeeping Requirements for Securities Transactions.
    OMB Control No.: 1557-0142.
    Frequency of Response: On occasion.
    Affected Public: Businesses or other for-profit organizations.
    Estimated Number of Respondents:
    Current: 399.
    Revised: 399.
    Estimated Total Annual Burden:
    Current: 2,315 hours.
    Revised: 1,916 hours.
    Part 197 would be removed and Federal savings associations would 
follow part 16. In addition, Sec.  16.5 would be amended to provide 
additional exemptions for private placements and sales of certain 
fractional interests. The filing requirement in Sec.  197.18 for 
periodic reports on sales of securities would be removed and Federal 
savings associations with total assets exceeding $10,000,000 and a 
class of equity security (other than exempted security) held of record 
by 2,000 or more persons would be subject to Exchange Act periodic and 
current reporting requirements. Section 16.17 would reduce from four to 
one the number of

[[Page 13626]]

copies that must submitted of all registration statements, offering 
documents, amendments, notices, or other documents and from four to two 
the number of copies of amendments. In addition, documents may be 
signed electronically using the signature provision in SEC Rule 402. 
The Securities Offering Disclosure information collection covering 
parts 16 and 197 has been submitted to OMB for review:
    Title: Securities Offering Disclosure Rules.
    OMB Control No.: 1557-0120.
    Frequency of Response: On occasion.
    Affected Public: Businesses or other for-profit organizations.
    Estimated Number of Respondents:
    Current: 61.
    Revised: 37.
    Estimated Total Burden:
    Current: 1,310 hours.
    Revised: 814 hours.
    Part 18 would be removed and the related information collection, 
OMB Control No. 1557-0182, would be discontinued.
    Section 31.3(d) would be added to provide procedures to be followed 
when seeking exemption from 23A of the Federal Reserve Act. A request 
for a new control number for this collection has been submitted to OMB:
    Title: Extensions of Credit to Insiders and Transactions with 
Affiliates.
    OMB Control No.: 1557-NEW.
    Frequency of Response: On occasion.
    Affected Public: Businesses or other for-profit organizations.
    Estimated Number of Respondents: 1 respondent.
    Estimated Total Annual Burden: 10 hours.
    The notice requirement in Sec.  155.310, requiring a Federal 
savings association to file a written notice with the OCC at least 30 
days prior to establishing a transactional Web site, would be removed 
under the proposed rule. Therefore, OMB Control No. 1557-0301, covering 
Sec.  155.310, will be discontinued at the final rule stage.
    The proposed rule would remove duplicative reporting requirements 
found in Sec. Sec.  162.1 and 162.4. The General Reporting and 
Recordkeeping information collection covering part 162 has been 
submitted to OMB for review:
    Title: General Reporting and Recordkeeping.
    OMB Control No.: 1557-0266.
    Frequency of Response: On occasion.
    Affected Public: Businesses or other for-profit organizations.
    Estimated Number of Respondents:
    Current: 500.
    Revised: 500.
    Estimated Total Annual Burden:
    Current: 68,345 hours.
    Revised: 67,845 hours.
    Comments are invited on:
    (a) Whether the collections of information are necessary for the 
proper performance of the functions of the OCC, including whether the 
information has practical utility;
    (b) The accuracy of the OCC's estimates of the burden of the 
collections of information;
    (c) Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    (d) Ways to minimize the burden of the 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.

V. Redesignation Tables

----------------------------------------------------------------------------------------------------------------
                       Subject                                Current rule                 Proposed rule.
----------------------------------------------------------------------------------------------------------------
Electronic Notice for Securities Transactions.......  12 CFR 151.110..............  Removed.
Transactions with Affiliates........................  163.41......................  Sec.   31.3.
Loans by savings associations to their executive      163.43......................  Sec.   31.2.
 officers, directors and principal shareholders.
Management and Financial Policies...................  163.161.....................  Removed.
Periodic Reports....................................  12 CFR 163.180(a)...........  Removed.
Notification of Loss and Reports of Increase in       12 CFR 163.180(c)...........  Sec.   7.2013.
 Deductible Amount of Bond.
Bonds for Directors, Officers, Employees, and         12 CFR 163.190..............  Sec.   7.2013.
 Agents; Form of and Amount of Bonds.
Bonds for Agents....................................  12 CFR 163.191..............  Sec.   7.2013.
Accounting Requirements.............................  12 CFR part 193.............  Removed.
Securities of Federal Savings Associations..........  12 CFR part 194.............  12 CFR part 11.
    Requirements under certain sections of the        Sec.   194.1................  Sec.   11. 2.
     Securities Exchange Act of 1934.                                               Sec.   11.3.
                                                                                    Sec.   11.4.
    Liability for certain statements by Federal       Sec.   194.3
     savings associations.
    Form and content of financial statements........  Sec.   194.210..............  Sec.   11.2.
    Application of this subpart.....................  Sec.   194.801
    Description of business.........................  Sec.   194.802
Securities Offerings................................  12 CFR part 197.............  12 CFR part 16.
    Definitions.....................................  Sec.   197.1................  Sec.   16.2.
    Offering circular requirement...................  Sec.   197.2(a).............  Sec.   16.3(a).
    --In General....................................
        --Communications not deemed an offer........  Sec.   197.2(b).............  Sec.   16.4.
        --Preliminary offering circular.............  Sec.   197.2(c).............  Sec.   16.3(b).
    Exemptions......................................  Sec.   197.3................  Sec.   16.5.
    Non-public offering.............................  Sec.   197.4................  Sec.   16.7.
    Filing and signature requirements...............  Sec.   197.5................  Sec.   16.17.
    Effective date..................................  Sec.   197.6................  Sec.   16.16.
    Form, content, and accounting...................  Sec.   197.7................  Sec.   16.15.
    Use of the offering circular....................  Sec.   197.8................  Sec.   16.18.
    Escrow requirement..............................  Sec.   197.9................  Sec.   16.31.
    Unsafe or unsound practices.....................  Sec.   197.10...............  Sec.   16.32.
    Withdrawal or abandonment.......................  Sec.   197.11...............  Sec.   16.19.
    Securities sale report..........................  Sec.   197.12
    Public disclosure and confidential treatment....  Sec.   197.13...............  Sec.   16.17(f).
    Waiver..........................................  Sec.   197.14
    Requests for interpretive advice or waiver......  Sec.   197.15...............  Sec.   16.30.

[[Page 13627]]

 
    Delayed or continuous offering and sale of        Sec.   197.16
     securities.
    Sales of securities at an office of a savings     Sec.   197.17...............  Sec.   16.10.
     association.
    Current and periodic reports....................  Sec.   197.18
    Approval of the security........................  Sec.   197.19
    Filing of copies of offering circulars in         Sec.   197.21
     certain exempt offerings.
    Form for Securities Sale Report (Appendix A)....  Sec.   197, Appendix A
----------------------------------------------------------------------------------------------------------------

List of Subjects

12 CFR Part 4

    Administrative practice and procedure, Freedom of information, 
Individuals with disabilities, Minority businesses, Organization and 
functions (Government agencies), Reporting and recordkeeping 
requirements, Women.

12 CFR Part 5

    Administrative practice and procedure, Federal savings 
associations, National banks, Reporting and recordkeeping requirements, 
Securities.

12 CFR Part 7

    Computer technology, Credit, Insurance, Investments, Federal 
savings associations, National banks, Reporting and recordkeeping 
requirements, Securities, Surety bonds.

12 CFR Part 9

    Estates, Investments, National banks, Reporting and recordkeeping 
requirements, Trusts and trustees.

12 CFR Part 10

    Federal savings associations, National banks, Reporting and 
recordkeeping requirements, Securities.

12 CFR Part 11

    Confidential business information, Federal savings associations, 
National banks, Reporting and recordkeeping requirements, Securities.

12 CFR Part 12

    National banks, Reporting and recordkeeping requirements, 
Securities.

12 CFR Part 16

    Federal savings associations, National banks, Reporting and 
recordkeeping requirements, Securities.

12 CFR Part 18

    National banks, Reporting and recordkeeping requirements.

12 CFR Part 31

    Credit, Federal savings associations, National banks, Reporting and 
recordkeeping requirements.

12 CFR Part 150

    Administrative practice and procedure, Reporting and recordkeeping 
requirements, Federal savings associations, Trusts and trustees.

12 CFR Part 151

    Reporting and recordkeeping requirements, Federal savings 
associations, Securities, Trusts and trustees.

12 CFR Part 155

    Accounting, Consumer protection, Electronic funds transfers, 
Reporting and recordkeeping requirements, Federal savings associations.

12 CFR Part 162

    Accounting, Reporting and recordkeeping requirements, Federal 
savings associations.

12 CFR Part 163

    Accounting, Administrative practice and procedure, Advertising, 
Conflict of interests, Crime, Currency, Investments, Mortgages, 
Reporting and recordkeeping requirements, Savings associations, 
Securities, Surety bonds.

12 CFR Part 193

    Accounting, Federal savings associations, Securities.

12 CFR Part 194

    Authority delegations (Government agencies), Reporting and 
recordkeeping requirements.

12 CFR Part 197

    Reporting and recordkeeping requirements, Federal savings 
associations, Securities.

    For the reasons set forth in the preamble, and under the authority 
of 12 U.S.C. 93a and 5412(b)(2)(B), chapter I of title 12 of the Code 
of Federal Regulations is proposed to be amended as follows:

PART 4--ORGANIZATION AND FUNCTIONS, AVAILABILITY AND RELEASE OF 
INFORMATION, CONTRACTING OUTREACH PROGRAM, POST-EMPLOYMENT 
RESTRICTIONS FOR SENIOR EXAMINERS

0
1. The authority citation for part 4 is revised to read as follows:

    Authority: 12 U.S.C. 1, 93a, 1820(d), 3301, 5321, 5412, and 
5414. Subpart A also issued under 5 U.S.C. 552. Subpart B also 
issued under 5 U.S.C. 552; E.O. 12600 (3 CFR 1987 Comp., p. 235). 
Subpart C also issued under 5 U.S.C. 301, 552; 12 U.S.C. 161, 481, 
482, 484(a), 1442, 1462a, 1463, 1464, 1817(a)(2) and (3), 1818(u) 
and (v), 1820(d)(6), 1820(k), 1821(c), 1821(o), 1821(t), 1831m, 
1831p-1, 1831o, 1867, 1951 et seq., 2601 et seq., 2801 et seq., 2901 
et seq., 3101 et seq., 3401 et seq.; 15 U.S.C. 77uu(b), 78q(c)(3); 
18 U.S.C. 641, 1905, 1906; 29 U.S.C. 1204; 31 U.S.C. 5318(g)(2), 
9701; 42 U.S.C. 3601; 44 U.S.C. 3506, 3510. Subpart D also issued 
under 12 U.S.C. 1833e. Subpart E is also issued under 12 U.S.C. 
1820(k).


Sec.  4.11  [Amended]

0
2. Section 4.11 is amended by removing paragraph (b)(4).


Sec.  4.12  [Amended]

0
3. Section 4.12 is amended by:
0
a. In paragraph (a), removing the phrase ``OCC records'' and replacing 
it with the phrase ``OCC and Office of Thrift Supervision (OTS) 
records'';
0
b. In paragraph (b)(8), adding ``and'' at the end;
0
c. In paragraph (b)(9), removing ``; and'' at the end and adding in its 
place a period; and
0
d. Removing paragraph (b)(10).


Sec.  4.14  [Amended]

0
4. Section 4.14(c) is amended by:
0
a. Removing the phrase ``Disclosure Officer'', and adding in its place 
the phrase ``Freedom of Information Act Officer'';
0
b. Removing ``Large Bank Supervision'' and replacing it with the phrase 
``the Large Bank Supervision Department''; and
0
c. Removing the phrase ``Licensing Department'', and adding in its 
place the phrase ``Licensing Division''.


Sec.  4.15  [Amended]

0
5. Section 4.15(b) is amended by removing the phrase ``Disclosure 
Officer'', and adding in its place the phrase ``Freedom of Information 
Act Officer''.


Sec.  4.17  [Amended]

0
6. Section 4.17(c) is amended by removing the phrase ``Communications 
Division, Office of the Comptroller of the Currency, 400 7th Street 
SW., Washington, DC 20219'', and adding in its place the phrase 
``Financial

[[Page 13628]]

Management, Accounts Receivable, Office of the Comptroller of the 
Currency, 400 7th Street SW., Washington, DC 20219''.


Sec.  4.18  [Amended]

0
7. Section 4.18 is amended by:
0
a. In paragraph (a), removing the word ``Department'' and replacing it 
with the word ``Division'', wherever it appears; and
0
b. In paragraph (b), removing the phrase ``Disclosure Officer'', and 
adding in its place the phrase ``Freedom of Information Act Officer''.

PART 5--RULES, POLICIES, AND PROCEDURES FOR CORPORATE ACTIVITIES

0
8. The authority citation for part 5 continues to read as follows:

    Authority: 12 U.S.C. 1 et seq., 24a, 93a, 215a-2, 215a-3, 481, 
1462a, 1463, 1464, 2901 et seq., 3907, and 5412(b)(2)(B).


Sec.  5.8  [Amended]

0
9. Section 5.8 is amended in paragraph (b) by:
0
a. Adding the phrase ``(if known at the time of publication of the 
notice)'' after the phrase ``the closing date of the public comment 
period''; and
0
b. Adding the phrase ``that the public may find information about the 
filing, (including the closing date of the comment period) in the OCC's 
Weekly Bulletin available at www.occ.gov,'' before the phrase ``and any 
other information that the OCC requires''.
0
10. Section 5.20 is amended by:
0
a. Adding a sentence at the end of paragraph (b);
0
b. Adding a sentence at the end of paragraph (c);
0
c. Reesignating the text in paragraph (l) as paragraph (l)(1) and 
adding a heading; and
0
d. Adding paragraph (l)(2).
    The revisions and additions read as follows:


Sec.  5.20  Organizing a national bank or Federal savings association

* * * * *
    (b) * * * An existing national bank or Federal savings association 
desiring to change the purpose of its charter shall submit an 
application and obtain prior OCC approval.
    (c) * * * This section also describes the requirements for an 
existing national bank or Federal savings association to change the 
purpose of its charter and refers such institutions to Sec.  5.53 for 
the procedures to follow.
* * * * *
    (l) Special purpose institutions--(1) In general. * * *
    (2) Changes in charter purpose. An existing national bank or 
Federal savings association whose activities are limited to a special 
purpose that desires to change to another special purpose, to add 
another special purpose, or to no longer be limited to a special 
purpose charter shall submit an application and obtain prior OCC 
approval under Sec.  5.53. An existing national bank or Federal savings 
association whose activities are not limited that desires to limit its 
activities and become a special purpose institution shall submit an 
application and obtain prior OCC approval under Sec.  5.53.


Sec.  5.21  [Amended]

0
11. Section 5.21 is amended by:
0
a. In paragraph (j)(3)(i)(B), removing the phrase ``paragraph (j)(2)'' 
and replacing it with the phrase ``paragraph (j)(3)'';
0
b. In paragraphs (j)(3)(ii) and (iii), removing the phrase ``paragraph 
(j)(2)(i)(A)'' wherever it appears and replacing it with the phrase 
``paragraph (j)(3)(i)(A)'';
0
c. In paragraph (j)(4), removing the phrase ``paragraph (j)(2)(i)'' and 
replacing it with the phrase ``paragraph (j)(3)(i)''; and
0
d. In paragraph (j)(4), removing the phrase ``paragraph (j)(2)(ii)'' 
and replacing it with the phrase ``paragraph (j)(3)(ii)''.


Sec.  5.33  [Amended]

0
12. Section 5.33 is amended by:
0
a. In paragraph (i), removing the phrase ``the 45th day after the 
application is received by the OCC, or the 15th day after the close of 
the comment period, whichever is later,'' and adding in its place the 
phrase ``the 15th day after the close of the comment period,'';
0
b. In paragraph (n)(2)(iii), removing the phrase ``mutually held 
savings association,'' and adding in its place the phrase ``mutually 
held depository institution that is insured by the FDIC,'';
0
c. In paragraph (n)(2)(iii)(B), adding the phrase ``or a similar 
transaction under state law'' at the end of the sentence; and
0
d. In paragraph (o)(3)(i), removing the phrase ``paragraph (n)(3)'' and 
adding in its place the phrase ``paragraph (o)(3)''.


Sec.  5.45  [Amended]

0
13. Section 5.45 is amended in paragraph (g)(4)(i) introductory text by 
removing the word ``After'' and adding in its place the phrase ``If 
prior approval is required pursuant to Sec.  5.45(g), after''.
0
14. Section 5.46 is amended by adding paragraph (i)(6) to read as 
follows:


Sec.  5.46  Changes in permanent capital

* * * * *
    (i) * * *
    (6) Exception for accounting adjustments. (i) Changes to the 
permanent capital accounts that result solely from application of U.S. 
generally accepted accounting principles are not subject to the prior 
approval or notice requirements in paragraphs (i)(1), (i)(3), or (i)(4) 
of this section, as applicable.
    (ii) Within 30 days after the end of the quarter in which the 
adjustment occurred, a bank must notify the OCC if the accounting 
adjustment resulted in an increase or decrease to permanent capital in 
an amount greater than 5% of the bank's total permanent capital prior 
to the adjustments; or, if the bank is subject to a letter, order, 
directive, written agreement, or otherwise related to changes in 
permanent capital. The notification must include the amount and 
description of the adjustment, including the applicable provision of 
U.S. GAAP.
* * * * *


Sec.  5.50  [Amended]

0
15. Section 5.50 is amended in paragraph (f)(2)(ii)(E) by removing 
``Sec.  192.2(a)(39)'' and adding in its place ``Sec.  192.25''.
0
16. Section 5.53 is amended by:
0
a. Removing the word ``or'' at the end of paragraph (c)(1)(iii);
0
b. Removing the period at the end of paragraph (c)(1)(iv) and adding in 
its place ``; or''; and
0
c. Adding a paragraph (c)(1)(v); and
0
d. Revising paragraph (d)(3)(ii).
    The addition and revision read as follows:


Sec.  5.53  Substantial asset change by a national bank or Federal 
savings association.

* * * * *
    (c) * * *
    (1) * * *
    (v) Any change in the purpose of the charter of the national bank 
or Federal savings association as described in Sec.  5.20(l)(2).
    (d) * * *
    (3) * * *
    (ii) Additional factors. The OCC's review of any substantial asset 
change that involves the purchase or other acquisition or other 
expansions of the bank's or savings association's operations or that 
involves a change in the purpose of the bank's or association's 
charter, as described in Sec.  5.20(l)(2), will include, in addition to 
the foregoing factors, the factors governing the organization of a bank 
or savings association under Sec.  5.20.
* * * * *
0
17. Section 5.66 is amended by adding a sentence between the first and 
second sentences to read as follows:

[[Page 13629]]

Sec.  5.66  Dividends payable in property other than cash.

    * * * A national bank shall submit a request for prior approval of 
a noncash dividend to the appropriate OCC licensing office. * * *

PART 7--ACTIVITIES AND OPERATIONS

0
18. The authority citation for part 7 is revised to read as follows:

    Authority: 12 U.S.C. 1 et seq., 25b, 71, 71a, 92, 92a, 93, 93a, 
95(b)(1), 481, 484, 1462a, 1463, 1464, 1465, 1818 and 5412(b)(2)(B).

0
19. Section 7.2008 is amended by revising paragraphs (b) and (c) to 
read as follows:


Sec.  7.2008  Oath of directors.

* * * * *
    (b) Execution of the oath. Each director shall execute either a 
joint or individual oath at the first meeting of the board of directors 
that the director attends after the director is appointed or elected. A 
director shall take another oath upon re-election, notwithstanding 
uninterrupted service. Appropriate sample oaths may be found in the 
Charter Booklet of the Comptroller's Licensing Manual available at 
www.occ.gov.
    (c) Filing and recordkeeping. A national bank must file the 
original executed oaths of directors with the appropriate OCC licensing 
office, as defined in 12 CFR 5.3(c), and retain a copy in the bank's 
records.
0
20. Section 7.2013 is amended by:
0
a. Revising paragraph (a) and paragraph (b) introductory text; and
0
b. In paragraph (b)(4), by adding the phrase ``or savings association'' 
after the word ``bank''.
    The revisions read as follows:


Sec.  7.2013  Fidelity bonds covering officers and employees.

    (a) Adequate coverage. All officers and employees of a national 
bank or Federal savings association must have adequate fidelity bond 
coverage. The failure of directors to require bonds with adequate 
sureties and in sufficient amount may make the directors liable for any 
losses that the bank or savings association sustains because of the 
absence of such bonds. Directors should not serve as sureties on such 
bonds. Directors should consider whether agents who have access to 
assets of the bank or savings association should also have fidelity 
bond coverage.
    (b) Factors. The board of directors of the national bank or Federal 
savings association, or a committee thereof, must determine the amount 
of such coverage, premised upon a consideration of factors, including:
* * * * *

PART 9--FIDUCIARY ACTIVITIES OF NATIONAL BANKS

0
21. The authority citation for part 9 continues to read as follows:

    Authority: 12 U.S.C. 24 (Seventh), 92a, and 93a; 15 U.S.C. 78q, 
78q-1, and 78w.

0
22. Section 9.13 is amended by adding a sentence at the end of 
paragraph (a) to read as follows:


Sec.  9.13  Custody of fiduciary assets.

    (a) * * * A bank that is deemed a fiduciary based solely on its 
provision of investment advice for a fee, as that capacity is defined 
in Sec.  9.101(a), is not required to serve as custodian when offering 
those fiduciary services.
* * * * *


Sec.  9.14  [Amended]

0
23. Section 9.14 is amended in paragraph (a) by adding the phrase ``or 
Federal Home Loan Bank'' after the phrase ``with the Federal Reserve 
Bank''.
0
24. Section 9.18 is amended:
0
a. In paragraph (b)(1) by revising the second sentence; and
0
b. In paragraph (c)(2) by:
0
i. Removing ``$1,000,000'' and adding in its place ``$1,500,000''; and
0
ii. Adding a sentence at the end.
    The revision and addition reads as follows:


Sec.  9.18  Collective investment funds.

    (b) * * *
    (1) * * * The bank shall make a copy of the Plan available either 
for public inspection at its main office during all banking hours or on 
its Web site and shall provide a written or electronic copy of the Plan 
to any person who requests it. * * *
* * * * *
    (c) * * *
    (2) * * * The OCC shall adjust this $1,500,000 threshold amount on 
January 1 of every year by the percentage increase in the Consumer 
Price Index for Urban Wage Earners and Clerical Workers (CPI-W) that 
was in effect on the preceding June 1, rounded to the nearest $100 
increment, and make this adjusted amount available to the public.
* * * * *

PART 10--MUNICIPAL SECURITIES DEALERS

0
25. The authority citation for part 10 is revised to read as follows:

    Authority: 12 U.S.C. 93a, 481, 1462a, 1464(c), 1818, and 
5412(b)(2)(B); 15 U.S.C. 78o-4(c)(5) and 78q-78w.

0
26. Amend Sec.  10.1 by:
0
a. Adding the phrase ``or Federal savings association'' after the word 
``bank'', wherever it appears;
0
b. In paragraph (b), removing the phrase ``to be'' and replacing it 
with the phrase ``will be'';
0
c. In paragraph (b), removing footnote 1; and
0
d. Adding a sentence at the end of paragraph (b).
    The addition reads as follows.


Sec.  10.1  Scope.

* * * * *
    (b) * * * MSRB rules may be obtained at www.msrb.org.


Sec.  10.2  [Amended]

0
27. Amend Sec.  10.2 by:
0
a. In paragraph (a):
0
i. Adding ``or Federal savings association'' after the phrase 
``national bank'', wherever it appears; and
0
ii. Removing the phrase ``Rule G-7(b)(i)-(x)'' and replacing it with 
the phrase ``Rule G-7(b)'';
0
b. In paragraph (b):
0
i. Removing the word ``must'' and replacing it with the phrase ``or 
Federal savings association shall''; and
0
ii. Removing the phrase ``the bank as a municipal'' and replacing it 
with the phrase ``the national bank or Federal savings association as a 
municipal''; and
0
c. In paragraph (c), removing the phrase ``by contacting the OCC at 400 
7th Street SW., Washington, DC 20219, Attention: Bank Dealer 
Activities'' and adding in its place ``at http://www.banknet.gov/''.

PART 11--SECURITIES EXCHANGE ACT DISCLOSURE RULES

0
28. The authority citation for part 11 is revised to read as follows:

    Authority: 12 U.S.C. 93a, 1462a, 1463, 1464 and 5412(b)(2)(B); 
15 U.S.C. 78j-1(m), 78m, 78n, 78p, 78w, 78l, 7241, 7242, 7243, 7244, 
7261, 7262, 7264, and 7265.

0
29. Section 11.1, including the section heading, is revised to read as 
follows:


Sec.  11.1  Authority.

    The Office of the Comptroller of the Currency (OCC) is vested with 
the powers, functions, and duties otherwise vested in the Securities 
and Exchange Commission (SEC) to administer and enforce the provisions 
of sections 10A(m), 12, 13, 14(a), 14(c), 14(d), 14(f), and 16 of the 
Securities Exchange Act of 1934, as amended (Exchange Act) (15 U.S.C. 
78j-1(m), 78l, 78m, 78n(a), 78n(c), 78n(d), 78n(f), and 78p), and 
sections 302, 303, 304, 306, 401(b), 404, 406, and 407 of the Sarbanes-
Oxley Act of 2002 (Sarbanes-Oxley Act), as

[[Page 13630]]

amended (15 U.S.C. 7241, 7242, 7243, 7244, 7261, 7262, 7264, and 7265), 
for national banks and Federal savings associations with one or more 
classes of securities subject to the registration provisions of 
sections 12(b) and (g) of the Exchange Act (registered national banks 
or registered Federal savings associations). Further, the OCC has 
general rulemaking authority under 12 U.S.C. 93a, 1462a, 1463, and 
1464, to promulgate rules and regulations concerning the activities of 
national banks and Federal savings associations.
0
30. Section 11.2, including the section heading, is revised to read as 
follows:


Sec.  11.2  Reporting requirements for registered national banks and 
Federal savings associations.

    (a) Filing, disclosure and other requirements.--(1) General. Except 
as otherwise provided in this section, a national bank or Federal 
savings association whose securities are subject to registration 
pursuant to section 12(b) or section 12(g) of the Exchange Act (15 
U.S.C. 78l(b) and (g)) shall comply with the rules, regulations, and 
forms adopted by the SEC pursuant to:
    (i) Sections 10A(m), 12, 13, 14(a), 14(c), 14(d), 14(f), and 16 of 
the Exchange Act (15 U.S.C. 78j-1(m), 78l, 78m, 78n(a), (c), (d) and 
(f), and 78p); and
    (ii) Sections 302, 303, 304, 306, 401(b), 404, 406, and 407 of the 
Sarbanes-Oxley Act (codified at 15 U.S.C. 7241, 7242, 7243, 7244, 7261, 
7262, 7264, and 7265).
    (2) [Reserved]
    (b) References to the Securities Exchange Commission, SEC, or 
Commission. Any references to the ``Securities and Exchange 
Commission,'' the ``SEC,'' or the ``Commission'' in the rules, 
regulations and forms described in paragraph (a)(1) of this section 
with respect to securities issued by registered national banks or 
registered Federal savings associations shall be deemed to refer to the 
OCC unless the context otherwise requires.
    (c) References to registration requirements. For national banks and 
Federal savings associations, any references to registration 
requirements under the Securities Act of 1933 and its accompanying 
rules in the rules, regulations, and forms described in paragraph 
(a)(1) of this section mean the registration requirements in 12 CFR 
part 16.
    (d) Emerging growth company eligibility--(1) General. A national 
bank or Federal savings association that meets the criteria to qualify 
as an emerging growth company under section 3(a)(80) of the Exchange 
Act (15 U.S.C. 78c(a)(80)) shall be eligible for treatment as an 
emerging growth company for purposes of any rule, regulation or form 
described in paragraph (a)(1) of this section, except as provided in 
paragraph (d)(3) of this section.
    (2) Opt-in right. With respect to an exemption provided to a 
national bank or Federal savings association that is an emerging growth 
company under this part, the bank or savings association may choose to 
forgo such exemption and instead comply with the requirements that 
apply to a bank or savings association that is not an emerging growth 
company.
    (3) Exclusions. A national bank or Federal savings association that 
otherwise meets the definition of emerging growth company in section 
3(a)(80) of the Exchange Act (15 U.S.C. 78c(a)(80)) shall not be 
considered an emerging growth company for purposes of this part if:
    (i) The first sale of its common equity securities pursuant to an 
effective registration statement or offering circular occurred on or 
before December 8, 2011; or
    (ii) It has reached the last day of its fiscal year following the 
fifth anniversary of the date of the first sale of its common equity 
securities pursuant to an effective registration statement or offering 
circular.
0
31. Section 11.3 is amended by:
0
a. Revising paragraphs (a)(1) and (a)(3)(i) and the heading to 
paragraph (a)(3)(ii);
0
b. Adding a paragraph (a)(3)(iii);
0
c. Removing paragraph (a)(4); and
0
d. Removing the phrase ``, at the address listed in paragraph (a) of 
this section'' in paragraph (b) and adding in its place the phrase ``, 
at the address listed on www.occ.gov.''.
    The revisions read as follows:


Sec.  11.3  Filing requirements and inspection of documents.

    (a) Filing requirements--(1)(i) In general. Except as otherwise 
provided in this section, all papers required to be filed with the OCC 
pursuant to the Exchange Act or regulations thereunder shall be 
submitted to the Securities and Corporate Practices Division of the OCC 
electronically at http://www.banknet.gov/. Documents may be signed 
electronically using the signature provision in SEC Rule 12b-11 (17 CFR 
240.12b-11).
    (ii) Electronic filing exception. If a national bank or Federal 
savings association experiences unanticipated technical difficulties 
preventing the timely preparation and submission of an electronic 
filing, other than the filings described in paragraph (a)(3)(ii) of 
this section, the bank may, upon notice to the OCC's Securities and 
Corporate Practices Division, file the subject filing in paper format 
no later than one business day after the date on which the filing was 
to be made. Paper filings should be submitted to the Securities and 
Corporate Practices Division, Office of the Comptroller of the Currency 
at the address provided at www.occ.gov.
* * * * *
    (3) Date of filing--(i) General. The date of filing is the date the 
OCC receives the filing, provided the person, bank, or savings 
association submitting the filing has complied with all applicable 
requirements. An electronic filing that is submitted on a business day 
by direct transmission commencing on or before 5:30 p.m. Eastern 
Standard or Daylight Savings Time, whichever is currently in effect, 
would be deemed received by the OCC on the same business day. An 
electronic filing that is submitted by direct transmission commencing 
after 5:30 p.m. Eastern Standard or Daylight Savings Time, whichever is 
currently in effect, or on a Saturday, Sunday, or Federal holiday, 
would be deemed received by the OCC on the next business day.
    (ii) Beneficial ownership filings. * * *
    (iii) Adjustment of filing date. If an electronic filer in good 
faith attempts to file a document pursuant to this part in a timely 
manner but the filing is delayed due to technical difficulties beyond 
the electronic filer's control, the electronic filer may request that 
the OCC adjust the filing date of such document. The OCC may grant the 
request if it appears that such adjustment is appropriate and 
consistent with the public interest and the protection of investors.
* * * * *
0
32. Section 11.4 is amended by revising paragraph (b) to read as 
follows:


Sec.  11.4  Filing fees.

* * * * *
    (b) Fees must be paid by check payable to the Comptroller of the 
Currency or by other means acceptable to the OCC.

PART 12--RECORDKEEPING AND CONFIRMATION REQUIREMENTS FOR SECURITIES 
TRANSACTIONS

0
33. The authority citation for part 12 continues to read as follows:

    Authority: 12 U.S.C. 24, 92a, and 93a.


Sec.  12.1  [Amended]

0
34. Section 12.1 is amended:
0
a. In paragraph (c)(1) by removing the phrase ``Securities and Exchange

[[Page 13631]]

Commission'' and adding in its place the phrase ``Securities and 
Exchange Commission (SEC)''; and
0
b. By removing the phrase ``Securities and Exchange Commission'' in 
paragraph (c)(2)(iii) and the phrase ``Securities and Exchange 
Commission (SEC)'' in paragraph (c)(2)(v), and adding ``SEC'' in their 
place.
0
35. Sections 12.2 is amended by:
0
a. In paragraph (g)(3) by removing the phrase ``Securities and Exchange 
Commission'' and adding in its place ``SEC''; and
0
b. Revising paragraphs (i)(3) to read as follows.


Sec.  12.2  Definitions.

* * * * *
    (i) * * *
    (3) A security that is an industrial development bond.
* * * * *
0
36. Section 12.3 is amended by adding a third sentence at the end of 
paragraph (b), to read as follows:


Sec.  12.3  Recordkeeping.

* * * * *
    (b) * * * A national bank may contract with a third-party service 
provider to maintain the records, provided that the bank maintains 
effective oversight of the third-party service provider to ensure the 
records meet the requirements of this section.
0
37. Section 12.4 is amended by revising paragraph (b) to read as 
follows:


Sec.  12.4  Content and time of notification.

* * * * *
    (b) Copy of the registered broker/dealer's confirmation. A copy of 
the confirmation of a registered broker/dealer relating to the 
securities transaction, which the bank may direct the registered 
broker/dealer to send directly to the customer; and, if the customer or 
any other source will provide remuneration to the bank in connection 
with the transaction and a written agreement between the bank and the 
customer does not determine the remuneration, a statement of the source 
and amount of any remuneration that the customer or any other source is 
to provide the bank.


Sec.  12.7  [Amended]

0
38. Section 12.7(d) is amended by removing the phrase ``Securities and 
Exchange Commission (SEC)'' adding in its place ``SEC''.


Sec.  12.9  [Amended]

0
39. Section 12.9(b)(2) is amended by removing the phrase ``Securities 
and Exchange Commission (SEC)'' and adding in their place ``SEC''.

Interpretations [Removed]


Sec. Sec.  12.101 through 12.102  [Removed]

0
40. The undesignated center heading ``Interpretations'' and Sec. Sec.  
12.101 and 12.102 are removed.

PART 16--SECURITIES OFFERING DISCLOSURE RULES

0
41. The authority citation for part 16 is revised to read as follows:

    Authority: 12 U.S.C. 1 et seq., 93a, 1462a, 1463, 1464, and 
5412(b)(2)(B).

0
42. Section 16.1 is amended by:
0
a. Revising paragraph (a); and
0
b. In paragraphs (b) and (c), removing the word ``bank'' wherever it 
appears and replacing it with the phrase ``national bank or Federal 
savings association''.
    The revision reads as follows:


Sec.  16.1  Authority, purpose, and scope.

    (a) Authority. This part is issued under the rulemaking authority 
of the Comptroller of the Currency (OCC) for national banks in 12 
U.S.C. 1 et seq., and 93a, and for Federal savings associations in 12 
U.S.C. 1462a, 1463, 1464, and 5412(b)(2)(B).
* * * * *
0
43. Section 16.2 is amended by:
0
a. In paragraph (a), removing the phrase ``Commission Rule'' and adding 
in its place ``SEC Rule'';
0
b. Removing paragraphs (b), (c), and (j) and redesignating paragraphs 
(d) through (f) as paragraphs (b) through (d), respectively; 
redesignating paragraphs (g) and (h) as paragraphs (f) and (g), 
respectively; and redesignating paragraphs (k) through (n) as 
paragraphs (j) through (m), respectively;
0
c. In newly designated paragraph (b), remove ``2(12)'' and ``77b(12))'' 
and add ``2(a)(12)'' and ``77b(a)(12))'', respectively, in their 
places;
0
d. In newly redesignated paragraph (c), remove ``78a through 78jj'' and 
add ``78a et seq.'' in its place;
0
e. Adding new paragraphs (e), (h), and (n);
0
f. In newly redesignated paragraph (g) and paragraph (i), removing the 
word ``bank'' and replacing it with the phrase ``national bank or 
Federal savings association'';
0
g. In newly redesignated (j);
0
i. Removing ``2(2)'' and ``77b(2))'' and adding ``2(a)(2)'' and 
``77b(a)(2))'', respectively, in their places; and
0
ii. Removing the word ``bank'' and replacing it with the phrase 
``national bank and a Federal savings association'';
0
h. In newly redesignated (m), removing ``2(3)'' and ``77b(3))'' and 
adding ``2(a)(3)'' and ``77b(a)(3))'', respectively, in their places;
0
i. In paragraph (o), removing ``through 77aa'' and adding ``et seq.'' 
in its place;
0
j. In paragraph (p), removing ``2(1)'' and ``77b(1))'' and adding 
``2(a)(1)'' and ``77b(a)(1))'', respectively, in their places; and
0
k. In paragraph (q);
0
i. Removing ``2(11)'', ``77b(11))'', and ``2(11)'', and adding 
``2(a)(11)'', ``77b(a)(11))'', and ``2(a)(11)'', respectively, in their 
places; and
0
ii. Removing the phrase ``Commission Rules'' and adding in its place 
``SEC Rules''.
    The additions read as follows:


Sec.  16.2  Definitions.

* * * * *
    (e) Federal savings association means an existing Federal savings 
association chartered under section 5 of the Home Owners' Loan Act 
(HOLA) (12 U.S.C. 1464 et seq.) or a Federal savings association in 
organization.
* * * * *
    (h) National bank means an existing national bank, a national bank 
in organization, or a Federal branch or agency of a foreign bank.
* * * * *
    (n) SEC means the Securities and Exchange Commission. When used in 
the rules, regulations, or forms of the SEC referred to in this part, 
the term ``SEC'' shall be deemed to refer to the OCC.
* * * * *


Sec.  16.3  [Amended]

0
44. Section 16.3 is amended by:
0
a. In paragraphs (a) introductory text and (b) introductory text, by 
removing the word ``bank'' and replacing it with the phrase ``national 
bank or Federal savings association''; and
0
b. In paragraph (c):
0
i. By removing ``Commission Rule'' and replacing it with ``SEC Rule'';
0
ii. By removing the citation ``section 4(3)'' and replacing it with the 
citation ``section 4(a)(3)''; and
0
iii. By removing the word ``bank'' and replacing it with the phrase 
``national bank and Federal savings association''.


Sec.  16.4  [Amended]

0
45. Section 16.4 is amended by removing the phrase ``Commission Rule'' 
and replacing it with the phrase ``SEC Rule'' wherever it occurs.
0
46. Section 16.5 is amended by:
0
a. Revising the introductory text and paragraphs (a), (b), and (e);
0
b. In paragraph (f), removing the phrase ``Commission Rule'' and 
replacing it with the phrase ``SEC Rule''; and
0
c. In paragraph (g), removing the phrase ``Commission Regulation'' and

[[Page 13632]]

replacing it with the phrase ``SEC Regulation''.
    The revisions read as follows.


Sec.  16.5  Exemptions.

    The registration statement and prospectus requirements of Sec.  
16.3 of this part do not apply to an offer or sale of national bank or 
Federal savings association securities:
    (a) If the securities are exempt from registration under section 3 
of the Securities Act (15 U.S.C. 77c), but only by reason of an 
exemption other than section 3(a)(2) (exemption for bank securities), 
section 3(a)(5) (exemption for savings association securities), section 
3(a)(11) (exemption for intrastate offerings), and section 3(a)(12) 
(exemption for bank holding company formation) of the Securities Act.
    (b) In a transaction exempt from registration under section 4 of 
the Securities Act (15 U.S.C. 77d). SEC Rules 152 and 152a (17 CFR 
230.152 and 230.152a) (which apply to sections 4(a)(2) and 4(a)(1) of 
the Securities Act) apply to this part;
* * * * *
    (e) In a transaction that satisfies the requirements of SEC Rule 
144, 144A, or 236 (17 CFR 230.144, 230.144A, or 230.236);
* * * * *
0
47. Section 16.6 is amended by:
0
a. In paragraph (a) introductory text removing the word ``bank'' and 
replacing it with the phrase ``national bank or Federal savings 
association'';
0
b. Revising paragraphs (a)(1) and (5);
0
c. In paragraph (a)(3), removing the word ``bank'' and replacing it 
with the phrase ``national bank or Federal savings association''; and
0
d. In paragraph (b), removing the phrase ``Commission Rule'' and 
replacing it with the phrase ``SEC Rule'' wherever it occurs.
    The revisions read as follows:


Sec.  16.6  Sales of nonconvertible debt.

    (a) * * *
    (1) The national bank or Federal savings association issuing the 
debt has securities registered under the Exchange Act or is a 
subsidiary of a holding company that has securities registered under 
the Exchange Act;
* * * * *
    (5) Prior to or simultaneously with the sale of the debt, each 
purchaser receives an offering document that contains a description of 
the terms of the debt, the use of proceeds, and method of distribution, 
and incorporates the national bank's or Federal savings association's 
latest Consolidated Reports of Condition and Income (Call Report) and 
the national bank's, Federal savings association's, or the holding 
company's Forms 10-K, 10-Q, and 8-K (17 CFR part 249) filed under the 
Exchange Act; and
* * * * *


Sec.  16.7  [Amended]

0
48. Section 16.7 is amended by:
0
a. Removing the phrase ``Commission Regulation'' and replacing it with 
the phrase ``SEC Regulation'', wherever it appears;
0
b. In paragraphs (a) introductory text and (b), by removing the word 
``bank'' and replacing it with the phrase ``national bank or Federal 
savings association'';
0
c. In paragraph (b), removing the phrase ``Commission Rule'' and 
replacing it with the phrase ``SEC Rule''; and
0
d. In paragraph (c), by removing the word ``bank'' and replacing it 
with the phrase ``national bank or Federal savings association''.


Sec.  16.8  [Amended]

0
49. Section 16.8 is amended:
0
a. By removing the phrase ``Commission Regulation'' and replacing it 
with the phrase ``SEC Regulation'', wherever it appears;
0
b. In paragraph (a), by removing the word ``bank'' and replacing it 
with the phrase ``national bank or Federal savings association''; and
0
c. In paragraph (b), by removing the word ``Commission's'' and 
replacing it with the word ``SEC's''.
0
50. Section 16.9 is amended by:
0
a. Revising paragraph (a); and
0
b. In the introductory text and paragraphs (b) through (d), by removing 
the word ``bank'' and replacing it with the phrase ``national bank or 
Federal savings association'', wherever it appears.
    The revision reads as follows:


Sec.  16.9  Securities offered and sold in holding company dissolution.

* * * * *
    (a) The offer and sale of national bank or Federal savings 
association issued securities occurs solely as part of a dissolution in 
which the security holders exchange their shares of stock in a holding 
company that had no significant assets other than securities of the 
bank or savings association, for bank or savings association stock;
* * * * *
0
51. Section 16.10 is added to read as follows:


Sec.  16.10  Sales of securities at an office of a Federal savings 
association.

    Sales of securities of a Federal savings association or its 
affiliates at an office of a Federal savings association may be made 
only in accordance with the provisions of 12 CFR 163.76. For the 
purpose of this section, ``affiliate'' has the same meaning as in 12 
CFR 161.4.


Sec.  16.15  [Amended]

0
52. Section 16.15 is amended by:
0
a. In paragraph (a):
0
i. Removing the word ``Commission's'' and replacing it with the word 
``SEC's''; and;
0
ii. Removing the phrase ``Commission regulations'' and replacing it 
with the phrase ``SEC regulations'';
0
b. In paragraph (b), by removing the phrase ``Commission Regulation'' 
and replacing it with the phrase ``SEC Regulation'';
0
c. In paragraphs (a) and (d), by removing the word ``bank'' and 
replacing it with the phrase ``national bank or Federal savings 
association''; and
0
d. In paragraph (e), by adding the phrase ``or Federal savings 
association'' after the word ``bank'', wherever it appears.


Sec.  16.16  [Amended]

0
53. Section 16.16 is amended in paragraph (a) by removing the phrase 
``Commission Regulation'' and replacing it with the phrase ``SEC 
Regulation''.
0
54. Section 16.17 is revised to read as follows:


Sec.  16.17  Filing requirements and inspection of documents.

    (a) Except as otherwise provided in this section, all registration 
statements, offering documents, amendments, notices, or other documents 
must be filed with the OCC's Securities and Corporate Practices 
Division electronically at http://www.banknet.gov/. Documents may be 
signed electronically using the signature provision in SEC Rule 402 (17 
CFR 230.402).
    (b) All registration statements, offering documents, amendments, 
notices, or other documents relating to a national bank or Federal 
savings association in organization must be filed with the appropriate 
district office of the OCC at http://www.banknet.gov/.
    (c) Where this part refers to a section of the Securities Act or 
the Exchange Act or an SEC rule that requires the filing of a notice or 
other document with the SEC, that notice or other document must be 
filed with the OCC.
    (d) Provided the person filing the document has complied with all 
requirements regarding the filing, including the submission of any fee 
required under Sec.  16.33, the date of filing of the document is the 
date the OCC

[[Page 13633]]

receives the filing. An electronic filing that is submitted on a 
business day by direct transmission commencing on or before 5:30 p.m. 
Eastern Standard or Daylight Savings Time, whichever is currently in 
effect, would be deemed received by the OCC on the same business day. 
An electronic filing that is submitted by direct transmission 
commencing after 5:30 p.m. Eastern Standard or Daylight Savings Time, 
whichever is currently in effect, or on a Saturday, Sunday, or Federal 
holiday, would be deemed received by the OCC on the next business day. 
If an electronic filer in good faith attempts to file a document with 
the OCC in a timely manner but the filing is delayed due to technical 
difficulties beyond the electronic filer's control, the electronic 
filer may request that the OCC adjust the filing date of such document. 
The OCC may grant the request if it appears that such adjustment is 
appropriate and consistent with the public interest and the protection 
of investors.
    (e) Notwithstanding paragraph (d) of this section, any registration 
statement or any post-effective amendment thereto filed pursuant to SEC 
Rule 462(b) (17 CFR 230.462(b)) shall be deemed received by the OCC on 
the same business day if its submission commenced on or before 10 p.m. 
Eastern Standard Time or Eastern Daylight Savings Time, whichever is 
currently in effect, and on the next business day if its submission 
commenced after 10 p.m. Eastern Standard or Daylight Savings Time, 
whichever is currently in effect, or any time on a Saturday, Sunday, or 
Federal holiday.
    (f) Electronic filing exception. If a national bank or Federal 
savings association experiences unanticipated technical difficulties 
preventing the timely preparation and submission of an electronic 
filing, the bank or savings association may, upon notice to the OCC's 
Securities and Corporate Practices Division or district office, as 
appropriate, file the subject filing in paper format no later than one 
business day after the date on which the filing was to be made. Paper 
filings should be submitted to the OCC's Securities and Corporate 
Practices Division or appropriate district office, at the address 
provided at www.occ.gov.
    (g) Any filing of amendments or revisions must include two copies, 
one of which must be marked to indicate clearly and precisely, by 
underlining or in some other appropriate manner, the changes made.
    (h) The OCC will make available for public inspection copies of the 
registration statements, offering documents, amendments, exhibits, 
notices or reports filed pursuant to this part at the address 
identified in Sec.  4.14 of this chapter.
0
55. Section 16.30 is amended by revising paragraph (a) to read as 
follows:


Sec.  16.30  Request for interpretive advice or no-objection letter.

* * * * *
    (a) File a copy of the request, including any supporting 
attachments, with the OCC's Securities and Corporate Practices Division 
at the address provided at www.occ.gov;
* * * * *
0
56. Section 16.32 is amended:
0
a. By revising the title; and
0
b. In paragraph (a) introductory text and paragraph (a)(3) by removing 
the word ``bank'' and replacing it with the phrase ``national bank or 
Federal savings association''; and
0
c. In paragraph (d), removing the phrase ``Commission Rule'' and 
replacing it with the phrase ``SEC Rule''.
    The revision reads as follows.


Sec.  16.32  Fraudulent transactions and unsafe or unsound practices.

* * * * *
0
57. Section 16.33 is revised to read as follows:


Sec.  16.33  Filing fees.

    (a) The OCC may require filing fees to accompany certain filings 
made under this part before it will accept those filings. The OCC 
provides an applicable fee schedule in the Notice of Comptroller of the 
Currency Fees published pursuant to Sec.  8.8 of this chapter.
    (b) Filing fees must be paid by check payable to the Comptroller of 
the Currency or by other means acceptable to the OCC.

PART 18 [REMOVED]

0
58. Remove part 18.

PART 31--EXTENSIONS OF CREDIT TO INSIDERS AND TRANSACTIONS WITH 
AFFILIATES

0
59. The authority citation for part 31 is revised to read as follows:

    Authority: 12 U.S.C. 93a, 375a(4), 375b(3), 1463, 1467a(d), 
1468, 1817(k), and 5412(b)(2)(B).
0
60. Section 31.1 is revised to read as follows:


Sec.  31.1  Authority.

    This part is issued pursuant to 12 U.S.C. 93a, 375a(4), 375b(3), 
1463, 1467a(d), 1468, 1817(k), and 5412(b)(2)(B), as amended.


Sec.  31.2  [Amended]

0
61. Section 31.2 is amended by:
0
a. In paragraph (a):
0
i. Removing the phrase ``A national bank and its'', and adding in its 
place the phrase ``National banks, Federal savings associations, and 
their''; and
0
ii. Adding ``(Regulation O)'' to the end of the sentence; and
0
b. In paragraph (b), adding ``, Federal savings associations,'' after 
the word ``banks''.
0
62. Add Sec.  31.3 to read as follows:


Sec.  31.3  Affiliate transactions requirements.

    (a) General rule. National banks and Federal savings associations 
shall comply with the provisions contained in 12 CFR part 223 
(Regulation W).
    (b) Enforcement. The Comptroller of the Currency administers and 
enforces affiliate transactions requirements as they apply to national 
banks and Federal savings associations.
    (c) Standard for exemptions. The OCC may, by order, exempt 
transactions or relationships of a national bank or Federal savings 
association from the requirements of section 23A and section 11 of the 
Home Owners' Loan Act (HOLA), as applicable, and 12 CFR part 223 if:
    (1) The OCC, jointly with the Federal Reserve Board, finds the 
exemption to be in the public interest and consistent with the purposes 
of section 23A or section 11 of the HOLA, as applicable; and
    (2) The FDIC, within 60 days of receiving notice of such joint 
finding, does not object in writing to the finding based on a 
determination that the exemption presents an unacceptable risk to the 
Deposit Insurance Fund.
    (d) Procedures for exemptions. A national bank or Federal savings 
association may request an exemption from the requirements of section 
23A or section 11 of the HOLA, as applicable, and 12 CFR part 223 for a 
national bank or Federal savings association by submitting a written 
request to the Deputy Comptroller for Licensing with a copy to the 
appropriate Federal Reserve Bank. Such a request must:
    (1) Describe in detail the transaction or relationship for which 
the national bank or Federal savings association seeks exemption;
    (2) Explain why the OCC should exempt the transaction or 
relationship;
    (3) Explain how the exemption would be in the public interest and 
consistent with the purposes of section 23A or section 11 of the HOLA, 
as applicable; and
    (4) Explain why the exemption does not present an unacceptable risk 
to the Deposit Insurance Fund.
0
63. Appendix B to part 31 is amended by:

[[Page 13634]]

0
a. Revising the title;
0
b. Revising the introductory note;
0
c. Removing the references ``part 31'', ``Part 31'', and ``Parts 31 and 
32'' and adding in their place the references ``part 215'', ``Part 
215'', and ``parts 32 and 215'', respectively, wherever they appear;
0
d. Under the heading ``Definition of `Loan or Extension of Credit''', 
in the first sentence under ``Renewals'', removing the phrase ``will be 
applied in the same manner'' and adding in its place the phrase ``are 
equivalent''; and
0
e. Under the heading ``Combination/Attribution Rules'' in the fourth 
sentence, under ``Loans to corporate groups'', removing the word 
``until'' and adding in its place the word ``unless''.
    The revisions read as follows:

Appendix B to Part 31--Comparison of Selected Provisions of Parts 32 
and 215

    Note: This appendix compares certain provisions of 12 CFR part 
32 with those of 12 CFR part 215. As used in this appendix, the term 
``bank'' refers to both national banks and Federal savings 
associations.

* * * * *

PART 150--FIDUCIARY POWERS OF FEDERAL SAVINGS ASSOCIATIONS

0
64. The authority citation for part 150 continues to read as follows:

    Authority: 12 U.S.C. 1462a, 1463, 1464, 5412(b)(2)(B).
0
65. Section 150.245 is added to read as follows:


Sec.  150.245  When is a fiduciary not required to maintain custody or 
control of fiduciary assets?

    If you are deemed a fiduciary based solely on your provision of 
investment advice for a fee, as that capacity is defined in 12 CFR 
9.101(a), you are not required to maintain custody or control of 
fiduciary assets as set forth in Sec.  150.220 or 150.240.

PART 151-RECORDKEEPING AND CONFIRMATION REQUIREMENTS FOR SECURITIES 
TRANSACTIONS

0
66. The authority citation for part 151 continues to read as follows:

    Authority: 12 U.S.C. 1462a, 1463, 1464, 5412(b)(2)(B).
0
67. Paragraph (3) in the definition of Municipal security in Sec.  
151.40 is revised to read as follows:


Sec.  151.40  What definitions apply to this part?

* * * * *
    Municipal security means:
* * * * *
    (3) A security that is an industrial development bond.
* * * * *
0
68. Section 151.60 is revised to read as follows:


Sec.  151.60  How must I maintain my records?

    (a) In general. The records required by Sec.  151.50 must clearly 
and accurately reflect the information required and provide an adequate 
basis for the audit of the information. Record maintenance may include 
the use of automated or electronic records provided the records are 
easily retrievable, readily available for inspection, and capable of 
being reproduced in a hard copy.
    (b) Use of third party. You may contract with third-party service 
providers to maintain the records required by this section, provided 
that you maintain effective oversight of the third-party vendor to 
ensure records meet the requirements of Sec.  150.50 and this section.
0
69. Revise Sec.  151.80(b) to read as follows:


Sec.  151.80  How do I provide a registered broker-dealer confirmation?

* * * * *
    (b) Unless you have determined remuneration in a written agreement 
with the customer, if you have received or will receive remuneration 
from any source, including the customer, in connection with the 
transaction, you must provide a statement of the source and amount of 
the remuneration in addition to the registered broker-dealer 
confirmation described in paragraph (a) of this section.


Sec.  151.110  [Removed]

0
70. Section 151.110 is removed.
0
71. Part 155 is revised to read as follows:

PART 155--ELECTRONIC OPERATIONS

Sec.
155.100 Scope.
155.200 Use of electronic means and facilities.
155.210 Requirements for using electronic means and facilities.

    Authority: 12 U.S.C. 1462a, 1463, 1464, 5412(b)(2)(B).


Sec.  155.100  Electronic activities of Federal savings associations.

    This part describes how a Federal savings association may provide 
products and services through electronic means and facilities.


Sec.  155.200  Use of electronic means and facilities.

    (a) General. A Federal savings association may use, or participate 
with others to use, electronic means or facilities to perform any 
function, or provide any product or service, as part of an authorized 
activity. Electronic means or facilities include, but are not limited 
to, automated teller machines, automated loan machines, personal 
computers, the Internet, telephones, and other similar electronic 
devices.
    (b) Other. To optimize the use of resources, a Federal savings 
association may market and sell, or participate with others to market 
and sell, electronic capacities and by-products to third-parties, if 
the savings association acquired or developed these capacities and by-
products in good faith as part of providing financial services.


Sec.  155.210  Requirements for using electronic means and facilities.

    To use electronic means and facilities under this subpart, a 
Federal savings association's management must:
    (a) Identify, assess, and mitigate potential risks and establish 
prudent internal controls; and
    (b) Implement security measures designed to ensure secure 
operations. Such measures must be adequate to:
    (1) Prevent unauthorized access to the savings association's 
records and its customers' records;
    (2) Prevent financial fraud through the use of electronic means or 
facilities; and
    (3) Comply with applicable security devices requirements of part 
168 of this chapter.
0
72. Part 162 is revised to read as follows:

PART 162--ACCOUNTING AND DISCLOSURE STANDARDS

Sec.
162.1 Accounting and disclosure standards.

    Authority: 12 U.S.C. 1463, 5412(b)(2)(B).


Sec.  162.1  Accounting and disclosure standards.

    A Federal savings association shall follow U.S. generally accepted 
accounting principles (GAAP) and the disclosure standards included 
therein when complying with all applicable regulations, unless 
otherwise required by statute, regulation, or the OCC.

PART 163--SAVINGS ASSOCIATIONS--OPERATIONS

0
73. The authority citation for part 163 continues to read as follows:

    Authority: 12 U.S.C. 1462a, 1463, 1464, 1467a, 1817, 1820, 1828, 
1831o, 3806, 5101 et seq., 5412(b)(2)(B); 31 U.S.C. 5318; 42 U.S.C. 
4106.


Sec.  163.41  [Removed]

0
74. Remove Sec.  163.41.

[[Page 13635]]

Sec.  163.43  [Removed]

0
75. Remove Sec.  163.43.


Sec.  163.161  [Removed and reserved]

0
76. Remove and reserve Sec.  163.161.
0
77. Section 163.172 is amended by:
0
a. In paragraph (a), revising the paragraph heading and removing the 
word ``commitments'' and adding the word ``contracts'' in its place;
0
b. Revising paragraph (b), the heading to paragraph (c) and paragraph 
(c)(1);
0
c. In paragraph (c)(2), removing the word ``you'' and adding in its 
place the phrase ``a savings association'';
0
d. In paragraphs (c)(2) through (4) removing the word ``Your'', 
wherever it appears, and adding in its place the word ``The'';
0
e. In paragraph (c)(3)(ii), removing the word ``your'' and adding in 
its place the phrase ``the savings association's'';
0
f. Revising the heading to paragraph (d);
0
g. In paragraph (d)(1), removing the word ``Management'' and adding in 
its place the phrase ``The management of a Federal savings 
association''; and
0
h. Revising paragraph (e).
    The revisions read as follows.


Sec.  163.172  Financial derivatives.

    (a) Definition. * * *
    (b) Permissible financial derivatives transactions. A Federal 
savings association may engage in a transaction involving a financial 
derivative if the savings association is authorized to invest in the 
assets underlying the financial derivative, the transaction is safe and 
sound, and the requirements in paragraphs (c) through (e) of this 
section are met. In general, a savings association that engages in a 
transaction involving a financial derivative should do so to reduce its 
risk exposure.
    (c) Board of directors' responsibilities. (1) A Federal savings 
association's board of directors is responsible for effective oversight 
of financial derivatives activities.
* * * * *
    (d) Management responsibilities. * * *
    (e) Recordkeeping requirement. A Federal savings association must 
maintain records adequate to demonstrate compliance with this section 
and with its board of directors' policies and procedures on financial 
derivatives.


Sec.  163.180  [Amended]

0
78. Section 163.180 is amended by removing and reserving paragraphs (a) 
and (c).


Sec.  163.190  [Removed]

0
79. Remove Sec.  163.190.


Sec.  163.191  [Removed]

0
80. Remove Sec.  163.191.

PART 193 [REMOVED]

0
81. Remove part 193.

PART 194--[REMOVED]

0
82. Remove part 194.

PART 197 [REMOVED]

0
83. Remove part 197.

    Dated: March 2, 2016.
Thomas J. Curry,
Comptroller of the Currency.
[FR Doc. 2016-05089 Filed 3-11-16; 8:45 am]
BILLING CODE 4810-01-P