Proposed Agency Information Collection Activities; Comment Request (November 30, 2020)

Summary

A joint notice of the OCC, the Board of Governors of the Federal Reserve System and the FDIC proposing to extend for three years, with revision, the FFIEC 031, FFIEC 041 and FFIEC 051 Consolidated Reports of Condition and Income (Call Reports). It gives burden estimates by agency: 1,111 national banks and federal savings associations under OMB Control No. 1557-0081, 739 state member banks under 7100-0036 and 3,263 insured state nonmember banks and state savings associations under 3064-0052. The agencies state that the proposed change to the measurement date for the total asset thresholds that set additional reporting requirements, for report dates in 2021 only, will not change the approved burden estimates. The notice is dated on or about November 24, 2020.

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SUPPLEMENTARY INFORMATION:

I. Report Summary

The agencies propose to extend for three years, with revision, the FFIEC 031, FFIEC 041, and FFIEC 051 Call Reports.

Report Title: Consolidated Reports of Condition and Income (Call Report).

Form Number: FFIEC 031 (Consolidated Reports of Condition and Income for a Bank with Domestic and Foreign Offices), FFIEC 041 (Consolidated Reports of Condition and Income for a Bank with Domestic Offices Only), and FFIEC 051 (Consolidated Reports of Condition and Income for a Bank with Domestic Offices Only and Total Assets Less Than $5 Billion).

Frequency of Response: Quarterly. ( printed page 76660)

Affected Public: Business or other for-profit.

Type of Review: Revision and extension of currently approved collections.

OCC:

OMB Control No.: 1557-0081.

Estimated Number of Respondents: 1,111 national banks and federal savings

associations.

Estimated Average Burden per Response: 41.92 burden hours per quarter to file.

Estimated Total Annual Burden: 186,292 burden hours to file.

Board:

OMB Control No.: 7100-0036.

Estimated Number of Respondents: 739 state member banks.

Estimated Average Burden per Response: 45.40 burden hours per quarter to file.

Estimated Total Annual Burden: 134,202 burden hours to file.

FDIC:

OMB Control No.: 3064-0052.

Estimated Number of Respondents: 3,263 insured state nonmember banks and state savings associations.

Estimated Average Burden per Response: 39.96 burden hours per quarter to file.

Estimated Total Annual Burden: 521,558 burden hours to file.

The estimated average burden hours collectively reflect the estimates for the FFIEC 031, the FFIEC 041, and the FFIEC 051 reports for each agency. When the estimates are calculated by type of report across the agencies, the estimated average burden hours per quarter are 85.81 (FFIEC 031), 55.20 (FFIEC 041), and 35.27 (FFIEC 051). The agencies believe the change to the measurement date for the total asset thresholds used to determine additional reporting requirements for report dates in 2021 only that is proposed in this notice will not result in a change in the burden estimates currently approved by OMB. These estimates do not include increases in burden for report dates in 2021 that would have resulted from institutions growing above asset thresholds within the Call Report because these institutions would now be afforded threshold relief. Instead, the agencies periodically reevaluate their burden estimates based on the data items that are regularly completed by institutions. Therefore, the burden estimates for these reports would remain the same if these revisions are finalized. The estimated burden per response for the quarterly filings of the Call Report is an average that varies by agency because of differences in the composition of the institutions under each agency's supervision ( e.g., size distribution of institutions, types of activities in which they are engaged, and existence of foreign offices).

Type of Review: Extension and revision of currently approved collections.

Legal Basis and Need for Collections

The Call Report information collections are mandatory: 12 U.S.C. 161 (national banks), 12 U.S.C. 324 (state member banks), 12 U.S.C. 1817 (insured state nonmember commercial and savings banks), and 12 U.S.C. 1464 (federal and state savings associations). At present, except for selected data items and text, these information collections are not given confidential treatment.

Banks and savings associations submit Call Report data to the agencies each quarter for the agencies' use in monitoring the condition, performance, and risk profile of individual institutions and the industry as a whole. Call Report data serve a regulatory or public policy purpose by assisting the agencies in fulfilling their shared missions of ensuring the safety and soundness of financial institutions and the financial system and protecting consumer financial rights, as well as agency-specific missions affecting national and state-chartered institutions, such as conducting monetary policy, ensuring financial stability, and administering federal deposit insurance. Call Reports are the source of the most current statistical data available for identifying areas of focus for on-site and off-site examinations. Among other purposes, the agencies use Call Report data in evaluating institutions' corporate applications, including interstate merger and acquisition applications for which the agencies are required by law to determine whether the resulting institution would control more than 10 percent of the total amount of deposits of insured depository institutions in the United States. Call Report data also are used to calculate institutions' deposit insurance assessments and national banks' and federal savings associations' semiannual assessment fees.

II. Current Action

During 2020, relief measures enacted by Congress through the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) [ 1 ] in response to the strains on the U.S. economy and disruptions to the financial markets as a result of COVID-19 have led to unprecedented growth at many institutions, including loans made through the Paycheck Protection Program (PPP). This rapid growth has caused the assets of some institutions to rise above certain asset-based thresholds, and may cause other community institutions to do so in the near future. Much of this growth, especially growth related to PPP lending, is likely to be temporary, and the increase in assets currently held by an institution may not reflect a change in the institution's longer-term risk profile.

The Call Report contains various total asset thresholds that are measured annually as of the June 30 report date and trigger additional reporting requirements once crossed, generally starting with the Call Reports for the first calendar quarter of the next calendar year. These thresholds include the $100 million, $300 million, $1 billion, $5 billion, and $10 billion in total asset threshold within the Call Reports. The agencies are particularly focused on these total asset thresholds set at $10 billion or less, as these thresholds could impact a significant number of smaller community institutions. These institutions may have fewer resources to implement systems changes and incur transition costs to comply with the additional reporting requirements associated with crossing one of those thresholds.

Many community institutions may have unexpectedly crossed these total asset thresholds during 2020 due to participation in CARES Act relief programs or other COVID-19-related stimulus activities, which would otherwise trigger additional reporting obligations starting in calendar year 2021. The agencies expect some of these institutions may fall below the relevant total asset threshold as of June 30, 2021, for example, after forgiveness of PPP loans and redemption of borrowings obtained through the Board's PPP liquidity facility. The agencies do not want to create a short-term increase in burden on these community institutions to comply with the additional reporting for a single year. For community institutions that remain above a total asset threshold as of the June 30, 2021, measurement date, the one-year reporting relief the agencies propose below would assist those institutions in focusing on COVID-19-related stimulus activities in the near term while providing additional time to comply with any additional reporting requirements starting in 2022 rather than 2021.

The agencies are not proposing to permit an alternate measurement date for larger total asset thresholds within the Call Reports, as the additional data items required at higher total assets ( printed page 76661) thresholds have increased relevance for agency supervisory monitoring. The agencies also are not proposing to permit an alternate measurement date for other asset thresholds tied to specific activities, such as thresholds based on trading assets, mortgage banking activities, or securitization activities, as levels of these activities generally would not be impacted by an institution's participation in various COVID-19-related stimulus activities.

A. FFIEC 051 Eligibility

The agencies have adopted rules establishing criteria for eligibility to use the FFIEC 051 Call Report. [ 2 ] The current Call Report instructions permit an institution to file the FFIEC 051 version of the Call Report if it meets certain criteria consistent with those rules. One criterion is that an institution must have total consolidated assets of $5 billion or less in its Call Report as of June 30, 2020, when evaluating eligibility to use the FFIEC 051 for report dates in calendar year 2021. Due to the asset growth considerations discussed above, the agencies have revised their rules on FFIEC 051 eligibility [ 3 ] and are proposing to temporarily revise the instructions for the FFIEC 051 to permit an institution to use the lesser of the total consolidated assets reported in its Call Report as of December 31, 2019, or June 30, 2020, when evaluating eligibility to use the FFIEC 051 for report dates in calendar year 2021. An institution must still meet the other criteria for eligibility for the FFIEC 051 in the Call Report instructions. The banking agencies also reserve the right to require an institution otherwise eligible to use the FFIEC 051 to file the FFIEC 041 instead based on supervisory needs. The agencies are proposing this relief for calendar year 2021 only. An institution would be required to use the total consolidated assets it reports in its Call Report as of June 30, 2021, when determining eligibility to use the FFIEC 051 in calendar year 2022, consistent with the existing instructions for the FFIEC 051.

B. Community Bank Leverage Ratio Eligibility

The agencies also have adopted rules permitting institutions that meet certain criteria to use the community bank leverage ratio (CBLR) framework to measure their regulatory capital. [ 4 ] The agencies have revised these rules [ 5 ] to allow institutions that temporarily exceed the $10 billion total asset threshold in those rules to use the CBLR framework from December 31, 2020, to December 31, 2021, provided they meet the other qualifying criteria for this framework. Institutions that elect to use the CBLR framework under this temporary relief would report CBLR information in Call Report Schedule RC-R, Part I, except that item 32 (Total assets) on that schedule should reflect the lesser of the institution's total assets as of December 31, 2019, or as of the quarter-end report date.

C. Call Report Data Item Thresholds

All three versions of the Call Report also include total asset thresholds for reporting certain additional data items. Reporting of these data items in a given calendar year is determined based on whether an institution has crossed the total asset threshold based on the total consolidated assets reported as of June 30 of the prior year. For the reasons described above, the agencies propose to permit an institution to use the lesser of the total consolidated assets reported in its Call Report as of December 31, 2019, or June 30, 2020, when determining whether the institution has crossed a total asset threshold to report additional data items in its Call Reports for report dates in calendar year 2021. The agencies are proposing this relief for calendar year 2021 only. An institution would be required to use the total consolidated assets reported in its Call Report as of June 30, 2021, when determining whether it must complete any additional items subject to the total asset threshold in calendar year 2022. As noted above, the regulatory reporting burden relief is limited to community institutions with total asset thresholds up to $10 billion, as these thresholds are most relevant for community institutions.

The Call Report total asset thresholds that would be impacted by this proposed change in measurement date are:

- For the FFIEC 041 and FFIEC 051 only, the $100 million threshold to report “Other borrowed money” in Schedule RC-K, item 13.
- For the FFIEC 041 and FFIEC 051 only, the $300 million threshold [ 6 ] to report additional agricultural lending information in Schedule RI, Memorandum item 6; Schedule RI-B, Part I, Memorandum item 3; Schedule RC-C, Memorandum item 1.f.(5); Schedule RC-K, Memorandum item 1; and Schedule RC-N, Memorandum items 1.f.(5) and 4.
- For the FFIEC 031 and FFIEC 041 only, the $300 million threshold to report certain information on credit card lines in Schedule RC-L, items 1.b.(1) and (2).
- For the FFIEC 041 only, the $300 million threshold to report cash and balances due from depository institutions in Schedule RC-A; certain derivatives information in Schedule RI, Memorandum item 10, and Schedule RC-N, Memorandum item 6; and certain additional loan information in Schedule RI-B, Part I, Memorandum items 2.a, 2.c, and 2.d; Schedule RC-C, Part I, items 2.a, 2.b, 2.c, 4.a, 4.b, 9.b.(1), 9.b.(2), 10.a, and 10.b, column A; Schedule RC-C, Part I, Memorandum items 1.e.(1), 1.e.(2), and 5; and Schedule RC-N, Memorandum items 1.e.(1), 1.e.(2), and 3.a through 3.d.
- The $1 billion threshold to report components of deposit fee income in Schedule RI, Memorandum items 15.a through 15.d; disaggregated credit loss allowance data in Schedule RI-C; components of transaction and nontransaction savings consumer deposit account products in Schedule RC-E, Memorandum items 6.a, 6.b, 7.a.(1), 7.a.(2), 7.b.(1), and 7.b.(2); and estimated uninsured deposits in Schedule RC-O, Memorandum item 2.
- For the FFIEC 031 and FFIEC 041 only, the $1 billion threshold to report information on certain income from mutual funds and annuities in Schedule RI, Memorandum item 2; and financial and performance standby letters of credit conveyed to others in Schedule RC-L, items 2.a and 3.a.
- For the FFIEC 031 and FFIEC 041 only, the $10 billion threshold to report additional information on derivatives in Schedule RI, Memorandum items 9.a and 9.b, and Schedule RC-L, items 16.a and 16.b.(1) through 16.b.(8); holdings of asset-backed securities and structured financial products in Schedule RC-B, Memorandum items 5.a through 5.f and 6.a through 6.g; and securitizations in Schedule RC-S, items 6 and 10, and Memorandum items 3.a.(1), 3.a.(2), 3.b.(1), and 3.b.(2).
- For the FFIEC 031 only, the $10 billion threshold to report additional information on deposits in foreign offices in Schedule RC-E, Part II. ( printed page 76662)

III. Request for Comment

Public comment is requested on all aspects of this joint notice. Comment is specifically invited on:

(a) Whether the proposed revisions to the collections of information that are the subject of this notice are necessary for the proper performance of the agencies' functions, including whether the information has practical utility;

(b) The accuracy of the agencies' estimates of the burden of the information collections as they are proposed to be revised, including the validity of the methodology and assumptions used;

(d) Ways to minimize the burden of information collections on respondents, including through the use of automated collection techniques or other forms of information technology; and

(e) Estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.

Comments submitted in response to this joint notice will be shared among the agencies.

Theodore J. Dowd,

Deputy Chief Counsel, Office of the Comptroller of the Currency.

Board of Governors of the Federal Reserve System.

Michelle Taylor Fennell,

Deputy Associate Secretary of the Board.

Dated at Washington, DC, on or about November 24, 2020.

Federal Deposit Insurance Corporation.

James P. Sheesley,

Assistant Executive Secretary.

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