Request for Public Comment on Agency Information Collection Proposals - District Notice 00-77 - Dallas
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Request for Public Comment on Agency Information Collection Proposals - District Notice 00-77 - Dallas


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Federal Reserve Bankll★Kof DallasDALLAS, TEXAS 75265-5906December 13, 2000Notice 00-77TO: The Chief Executive Officer of eachfinancial institution and others concernedin the Eleventh Federal Reserve DistrictSUBJECTRequest for Public Comment onAgency Information Collection ProposalsDETAILSOn June 15, 1984, the Office of Management and Budget (OMB) delegated to theBoard of Governors of the Federal Reserve System its authority to approve and assign OMBcontrol numbers to collection of information requests and requirements conducted or sponsoredby the Board. The following information collections, which are being handled under this del-egated authority, have received initial Board approval and are published for public comment:•W hether the proposed collections of information are necessary for the properperformance of the Federal Reserve’s functions, including whether the informa-tion has practical utility;• The accuracy of the Federal Reserve’s estimate of the burden of the proposedinformation collections, including the validity of the methodology and assump-tions used;•W ays to enhance the quality, utility, and clarity of the information to be collected;and•W ays to minimize the burden of information collections on respondents, includ-ing through the use of automated collection techniques or other forms of informa-tion technology.For additional copies, bankers and others are encouraged to use one of the following toll-free numbers in contacting ...



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Federal Reserve Bank
of Dallas
December 13, 2000
Notice 00-77
TO: The Chief Executive Officer of each
financial institution and others concerned
in the Eleventh Federal Reserve District
Request for Public Comment on
Agency Information Collection Proposals
On June 15, 1984, the Office of Management and Budget (OMB) delegated to the
Board of Governors of the Federal Reserve System its authority to approve and assign OMB
control numbers to collection of information requests and requirements conducted or sponsored
by the Board. The following information collections, which are being handled under this del-
egated authority, have received initial Board approval and are published for public comment:
•W hether the proposed collections of information are necessary for the proper
performance of the Federal Reserve’s functions, including whether the informa-
tion has practical utility;
• The accuracy of the Federal Reserve’s estimate of the burden of the proposed
information collections, including the validity of the methodology and assump-
tions used;
•W ays to enhance the quality, utility, and clarity of the information to be collected;
•W ays to minimize the burden of information collections on respondents, includ-
ing through the use of automated collection techniques or other forms of informa-
tion technology.
For additional copies, bankers and others are encouraged to use one of the following toll-free numbers in contacting the Federal
Reserve Bank of Dallas: Dallas Office (800) 333-4460; El Paso Branch Intrastate (800) 592-1631, Interstate (800) 351-1012;
Houston Branch Intrastate (800) 392-4162, Interstate (800) 221-0363; San Antonio Branch Intrastate (800) 292-5810.- 2 -
The Board must receive comments by January 16, 2001. Please address comments to
Jennifer J. Johnson, Secretary, Board of Governors of the Federal Reserve System, 20th and C
Streets, N.W., Washington, DC 20551. Also, you may mail comments electronically to All comments should refer to the OMB control number or
agency form number.
A copy of the Board’s notice as it appears on page 69525–36, Vol. 65, No. 223 of the
Federal Register dated November 17, 2000, is attached.
For more information, please contact Dorsey Davis, (214) 922-6051, in the
Banking Supervision Department. For additional copies of this Bank’s notice, contact the
Public Affairs Department at (214) 922-5254 or access District Notices on our web site at Register/Vol. 65, No. 223/Friday, November 17, 2000/Notices 69525
to the settlement. The Agency will Discussion Agendamay be hand-delivered to the Water
consider all comments received and Docket, Room EB57, 401 M Street, SW,
Memorandum and resolution re: Final
may modify or withdraw its consent to Washington, D.C. 20460. Issues may
Regulation Prescribing Consumer
the settlement if comments received also be submitted electronically to OW-
Protections for Bank Sales of Insurance.
disclose facts or considerations which Information should be
The meeting will be held in the Boardindicate that the settlement is submitted as a WP5.1, 6.1 and/or 8.0 or
Room on the sixth floor of the FDICinappropriate, improper, or inadequate. an ASCII file with no form of
Building located at 550 17th Street, NW,The Agency’s response to any encryption.
Washington, DC.comments received will be available for
FOR FURTHER INFORMATION CONTACT: Ms. The FDIC will provide attendees withpublic inspection at One Congress
Mary Manibusan, Health and Ecological auxiliary aids (e.g., sign languageStreet, Boston, MA 02214–2023.
Criteria Division (4304), US EPA, Ariel interpretation) required for this meeting.
DATES: Comments must be submitted on Rios Building, 1200 Pennsylvania Those attendees needing such assistance
or before December 18, 2000. Avenue NW, Washington, D.C. 20460; should call (202) 416–2089 (Voice);
ADDRESSES: Comments should be (202) 260–3688; (202) 416–2007 (TTY), to make
addressed to the Regional Hearing Clerk, necessary arrangements.
U.S. Environmental Protection Agency, Requests for further information,SUPPLEMENTARY INFORMATION: The
Region I, One Congress Street, Suite concerning the meeting may be directedEnvironmental Protection Agency
1100, Mailcode RAA, Boston, to Mr. Robert E. Feldman, Executivepublished in the Federal Register of
Massachusetts 02203 and should refer Secretary of the Corporation, at (202)October 12, 2000 (65 FR 60664), that
to: In re: Nashua River Asbestos Site, 898–6757.scientific and technical information that
U.S. EPA Docket No. I–99–0044.
pertains to the development of a revised Dated: November 14, 2000.
FOR FURTHER INFORMATION CONTACT: A Ambient Water Quality Criterion for Federal Deposit Insurance Corporation.
copy of the proposed settlement may be Methylmercury should be received Robert E. Feldman,obtained from Steven Schlang, U.S. within 30 days of the Federal Register
Executive Secretary.Environmental Protection Agency, publication date of October 12, 2000. In
[FR Doc. 00–29548 Filed 11–4–00; 5:03 pm]Region I, Office of Environmental response to public interest, the
BILLING CODE 6714–01–MStewardship, One Congress Street, Suite Environmental Protection Agency has
1100, Mailcode SES, Boston, MA granted a fifteen day extension to the
02114–2023. public comment period.
Dated: September 29, 2000.
Richard Cavagnero,
Director, Office of Science and Technology.
Acting Director, Office of Site Remediation Agency Information Collection
[FR Doc. 00–29504 Filed 11–16–00; 8:45 am]
& Restoration. Activities: Proposed Collection;
[FR Doc. 00–29509 Filed 11–16–00; 8:45 am] Comment Request
AGENCY: Board of Governors of the
Federal Reserve System.
Sunshine Act Meeting[FRL–OW–6903–2]
On June 15, 1984, the Office of
Pursuant to the provisions of theNotice of Intent To Develop Ambient Management and Budget (OMB)
‘‘Government in the Sunshine Act’’ (5Water Quality Criteria for Protection of delegated to the Board of Governors of
U.S.C. 552b), notice is hereby given that the Federal Reserve System (Board) itsHuman Health—Methylmercury; Notice
the Federal Deposit Insurance approval authority under the Paperworkof Reopening to Public Comment
Corporation’s Board of Directors will Reduction Act, as per 5 CFR 1320.16, toPeriod
meet in open session at 10 a.m. on approve of and assign OMB control
AGENCY: Environmental Protection Tuesday, November 21, 2000, to numbers to collection of information
Agency (EPA). consider the following matters: requests and requirements conducted or
ACTION: Notice of reopening to public Summary Agenda: No substantive sponsored by the Board under
comment period. discussion of the following items is conditions set forth in 5 CFR 1320
anticipated. These matters will be Appendix A.1. Board-approved
SUMMARY: This notice informs the public resolved with a single vote unless a collections of information are
that the period for the submission of member of the Board of Directors incorporated into the official OMB
scientific and technical information for requests that an item be moved to the inventory of currently approved
the development of the revised Ambient discussion agenda. collections of information. Copies of the
Water Quality Criterion for Disposition of minutes of previous OMB 83–Is and supporting statements
Methylmercury is extended. Board of Directors’ meetings. and approved collection of information
DATES: The comment period has been Summary reports, status reports, and instruments are placed into OMB’s
extended fifteen days to November 27, reports of actions taken pursuant to public docket files. The Federal Reserve
2000. authority delegated by the Board of may not conduct or sponsor, and the
ADDRESSES: Send an original and three Directors. respondent is not required to respond
copies of any written significant Memorandum and resolution re: to, an information collection that has
scientific information to W–00–29 Interim Rule (amending Appendix C to been extended, revised, or implemented
Comment Clerk, Water Docket, Ariel Part 325) to Revise the Risk-Based on or after October 1, 1995, unless it
Rios 1200 Pennsylvania Ave., N.W. Capital Treatment for Securities displays a currently valid OMB control
Washington, D.C. 20460. Comments Borrowing Transactions. number.
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Request for Comment on Information Current actions: The Federal Reserveweb site ( Draft
Collection Proposals proposes to implement numerouscopies of the proposed forms, the
revisions that will streamline thePaperwork Reduction Act SubmissionThe following information
(OMB 83–I), supporting statement, and existing reporting requirements. These
collections, which are being handled
other documents that will be placed into eliminations and reductions in detail
under this delegated authority, have
OMB’s public docket files once will help the Federal Reserve achievereceived initial Board approval and are
approved may be requested from the the objective set forth in Section 307(c)hereby published for comment. At the
agency clearance officer, whose name of the Riegle Community Developmentend of the comment period, the
appears below. and Regulatory Improvement Act ofproposed information collections, along
Mary M. West, Federal Reserve Board 1994, which directs the bankingwith an analysis of comments and
Clearance Officer (202–452–3829), agencies to review the information thatrecommendations received, will be
Division of Research and Statistics, institutions currently report in the Callsubmitted to the Board for final
Board of Governors of the Federal Report and the bank holding companyapproval under OMB delegated
Reserve System, Washington, DC 20551. (BHC) reports and eliminate existingauthority. Comments are invited on the
Telecommunications Device for the Deaf reporting requirements that are notfollowing:
(TDD) users may contact Diane Jenkins warranted for safety and soundness ora. whether the proposed collections of
(202–452–3544), Board of Governors of other public policy purposes.information is necessary for the proper
the Federal Reserve System, As part of the streamlining process,performance of the Federal Reserve’s
Washington, DC 20551. the Federal Reserve proposes severalfunctions; including whether the
reporting changes that will introduceinformation has practical utility; Proposal To Approve Under OMB
more uniformity to certain aspects ofb. the accuracy of the Federal Delegated Authority the Revision,
regulatory reporting. These changesReserve’s estimate of the burden of the Without Extension, of the Following
would provide more uniformity withinproposed information collections, Reports
the holding company reports and alsoincluding the validity of the 1. Report title: Consolidated Financial would bring several items into closermethodology and assumptions used; Statements for Bank Holding alignment with the Call Report and thec. ways to enhance the quality, utility, Companies. Thrift Financial Report. For example,and clarity of the information to be Agency form number: FR Y–9C. standard loan categories would be usedcollected; and OMB control number: 7100–0128. for all of the schedules that collect loand. ways to minimize the burden of Frequency: Quarterly.
information. However, not all loan-information collections on respondents, Reporters: Bank holding companies.
related items are needed on allincluding through the use of automated Annual reporting hours: 231,474.
schedules for supervisory purposes.collection techniques or other forms of Estimated average hours per response:
Other proposed modifications to theinformation technology. 33.45.
BHC reports are intended to make itsNumber of respondents: 1,730.DATES: Comments must be submitted on
form and content more closely resembleSmall businesses are affected.or before January 16, 2001.
the manner in which information isGeneral description of report: This
ADDRESSES: Comments, which should presented in financial statements thatinformation collection is mandatory (12
refer to the OMB control number or banks prepare in accordance withU.S.C. 1844(c)). Confidential treatment
agency form number, should be generally accepted accountingis not routinely given to the data in
addressed to Jennifer J. Johnson, principles (GAAP) for other financialthese reports. However, confidential
Secretary, Board of Governors of the reporting purposes.treatment for the reporting information,
Federal Reserve System, 20th and C In addition to streamlining thein whole or in part, can be requested in
Streets, N.W., Washington, DC 20551, existing FR Y–9C reportingaccordance with the instructions to the
submitted by electronic mail to requirements by eliminatingform. Currently data reported on the FR, or information that is no longer ofY–9C, Schedule HC–H, Column A,
delivered to the Board’s mail room significant value, the Federal Reserve isrequiring information of ‘‘assets past
between 8:45 a.m. and 5:15 p.m., and to also endeavoring to improve thedue 30 through 89 days and still
the security control room outside of relevance of the FR Y–9C by identifyingaccruing’’ and memoranda item 2 are
those hours. Both the mail room and the new types of information that areconfidential pursuant to Section (b)(8)
security control room are accessible considered critical to the Federalof the Freedom of Information Act 5
from the courtyard entrance on 20th Reserves’ supervisory data needs goingU.S.C. 552(b)(8).
Street between Constitution Avenue and Abstract: The FR Y–9C consists of forward. In so doing, the Federal
C Street, N.W. Comments received may standardized consolidated financial Reserve has focused primarily on new
be inspected in room M–P–500 between statements similar to commercial bank activities and other recent developments
9:00 a.m. and 5:00 p.m., except as Report of Condition and Income (Call that may expose institutions to new or
provided in section 261.14 of the Report) (FFIEC 031–034; OMB No. different types of risk.
Board’s Rules Regarding Availability of 7100–0036). The FR Y–9C is filed Furthermore, by proposing the
Information, 12 CFR 261.14(a). quarterly by top-tier bank holding following new reporting requirements at
A copy of the comments may also be companies that have total assets of $150 the same time as the FR Y–9C
submitted to the OMB desk officer for million or more and by lower-tier bank streamlining changes, BHCs will be able
the Board: Alexander T. Hunt, Office of holding companies that have total to make all of the necessary systems
Information and Regulatory Affairs, consolidated assets of $1 billion or changes at one time. However, the new
Office of Management and Budget, New more. In addition, multibank holding reporting requirements would be
Executive Office Building, Room 3208, companies with total consolidated implemented on the same schedule as
Washington, DC 20503. assets of less than $150 million with the Call Report. The Federal Reserve
FOR FURTHER INFORMATION CONTACT: debt outstanding to the general public or believes that combining these various
Draft copies of the proposed reporting engaged in certain nonbank activities types of revisions into a single package
forms may be obtained at the Board’s must file the FR Y–9C. should result in lower start-up costs and
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reporting burden for BHCs from a 4. A new item for ‘‘Other equity Memoranda schedule is intended to
system’s perspective. capital components’’ would be added to eliminate this inconsistency.
the equity capital section of the balanceThe Federal Reserve proposes to make Schedule HC–B, Part I—Loans and
sheet. This item would include treasurythe following changes to the FR Y–9C, Leases
stock and unearned Employee Stockexcept for new information on
1. The definition of ‘‘Construction andOwnership Plan shares, which, undersecuritization activities, effective with
land development’’ loans (item 1.a) and,GAAP, are to be reported in a contra-the March 31, 2001, reporting date.
hence, the definitions for the otherequity account on the balance sheet.Proposed new information on
categories of loans secured by real estateThese items will continue to be reportedsecurtization activities would be
(items 1.b through 1.e) would be revisedseparately in the proposed revisedeffective with the June 30, 2001,
to make them consistent with reportingregulatory capital schedule. This changereporting date.
requirements in this area for savingswill make the equity capital section
Changes Related to Proposed Changes associations as reported on the Thriftmore consistent with GAAP and with
1to the Call Report Financial Report. The FR Y–9Cthe equity capital section of the balance
instructions for ‘‘Construction and landsheet in the proposed bank Call ReportSchedule HC—Consolidated Balance
development’’ loans currently directand the Thrift Financial Report.Sheet
BHCs to exclude from this loan category
Schedule HC–A—Securities1. Move ‘‘Loans and leases held for loans to acquire and hold vacant land
sale’’ onto the balance sheet as a 1. Add new items on fair value and and construction loans with original
separate category under item 4, ‘‘Loans amortized cost information for six maturities greater than 60 months.
and lease financing receivables.’’ This categories of asset-backed securities that These two types of loans are instead
change will bring the FR Y–9C balance are currently included in the items for reported as loans secured by farmland,
sheet presentation of these loans into ‘‘Debt securities.’’ The six categories 1–4 family residential properties,
conformity with GAAP. Loans and multifamily residential properties, orthat would be reported on Schedule
leases held for sale are currently HC–A, item 5, are securities backed by: nonfarm nonresidential properties, as
included on the balance sheet in item a. credit card receivables, b. home appropriate. The definitions for the five
4.a, ‘‘Loans and leases, net of unearned equity lines, c. auto loans, d. other categories of ‘‘Loans secured by real
income,’’ together with loans that the consumer loans, e. commercial and estate’’ would be revised so that land
holding company has the intent and industrial loans, and f. all other loans. loans and long-term construction loans
ability to hold for the foreseeable future The Federal Reserve proposes to collect are reported in a recaptioned item 1.a,
or until maturity or payoff. However, information to facilitate more effective ‘‘Construction, land development, and
loans and leases held for sale are assessments of BHC credit and other other land loans.’’
separately identified in the loan exposures related to their portfolios of 2. The separate loan categories for
schedule in Schedule HC–B, part I, asset-backed securities. Currently, ‘‘Loans to depository institutions’’ and
Memorandum item 3. Loans and leases virtually all non-mortgage asset-backed ‘‘Acceptances of other banks’’ (items 3
held for sale would continue to be securities are reported in two FR Y–9C and 4, respectively) would be combined.
reported with the holding company’s items, i.e., Schedule HC–A, items 4.a 3. Item 6.a, column A, ‘‘Credit cards
other loans in the loan schedule and 5.a, U.S. and foreign ‘‘Debt and related plans’’ to individuals for
(Schedule HC–B, part I). securities.’’ The proposed segregation of household, family, and other personal
specific categories of asset-backed expenditures, would be split into2. Item 4.c, ‘‘Allocated transfer risk
securities from ‘‘Debt securities’’ would separate loan categories for ‘‘Creditreserve,’’ would be deleted from the
promote risk-focused supervision by cards’’ and ‘‘Other revolving creditbalance sheet, but would be reported in
enhancing the Federal Reserves’ ability plans.’’the new regulatory capital schedule,
to assess credit exposures and asset 4. A single Memorandum item for thewhich is discussed below. BHCs would
concentrations. total amount of a BHC’s ‘‘Loans andreport their loans and leases net of any
2. Memoranda items 4.a., ‘‘Net leases restructured and in complianceallocated transfer risk reserve in the
unrealized holding losses on available- with modified terms’’ would replace theloan schedule (Schedule HC–B, part I).
for-sale equity securities with readily multiple Memorandum items in which3. Items 27.e, ‘‘Net unrealized holding
determinable fair values’ and 4.c., BHCs must currently report informationgains (losses) on available-for-sale
‘‘Amount of net unrealized holding about such restructured creditssecurities,’’ 27.f, ‘‘Accumulated net
gains on available for sale equity (Memorandum items 1.a through 1.h.)gains (losses) on cash flow hedges,’’ and
securities’’ would be moved to the new Restructured loans secured by 1–427.g, ‘‘Cumulative foreign currency
regulatory capital schedule, which is family residential properties andtranslation adjustments,’’ would be
discussed below. restructured consumer loans would becombined and reported as
3. Memoranda item 9.c, ‘‘All other excluded from the revised‘‘Accumulated other comprehensive
equity securities,’’ (equity securities2 Memorandum item.income.’’ This change would conform
without readily determinable fair 5. A new Memoranda item 3, ‘‘Loansthe presentation of the equity capital
values), would be moved to a new secured by real estate to non-U.S.section of the FR Y–9C balance sheet to
Schedule HC–F—Other Assets. These addressees (domicile)’’ would be addedFASB Statement No. 130, Reporting
equity securities are outside the scope of in order to enhance the FederalComprehensive Income.
FASB Statement No. 115, Accounting Reserve’s ability to evaluate the
for Certain Investments in Debt and performance of real estate loans by
1 Schedule lettering and titles used throughout
Equity Securities. Therefore, including addressee.this notice refer to existing schedules. However, the
them in the FR Y–9C with available-for- 6. The filing criteria for Part II,Federal Reserve also proposes to alter schedule
order and schedule titles to align with the Call sale securities in Schedule HC–A, albeit Trading Assets and Liabilities, would be
Report. at historical cost rather than at fair modified. BHCs that report a quarterly
2 The first two of these components of value, has not been consistent with average for trading assets of $2 million
‘‘Accumulated other comprehensive income’’
GAAP. Moving equity securities without or more (new proposed item 4.a,would be separately identified in the proposed new
regulatory capital schedule. readily determinable fair values to the Schedule HC–E) as of the March 31st
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report date of the current calendar year item 3.b will no longer have any reporting the quarterly sales volume for
would complete Schedule HC–B, Part II. relevance in 2001. these proprietary products.
Analysis of quarter-end trading assets 6. Part III, items 4.c.(1) and (2) for the 5. Item 22, ‘‘Net unamortized realized
gross positive and gross negative fair deferred gains (losses) on off-balance-data indicate that using this reporting
values of derivatives held for purposes sheet derivative contracts included inthreshold would provide adequate
other than trading that are not marked assets and liabilities reported incoverage of BHCs actively involved in
to market would be deleted because of Schedule HC,’’ would be and would be comparable to the
the effect of FASB Statement No. 133.coverage of bank trading activity Schedule HC–H—Past Due andIn addition, items on Schedule HC–Fproposed for the Call Report. In Nonaccrual Loans, Lease Financingwould be renumbered and formatted toaddition, Part II, Trading Assets and Receivables, Placements, and Otherbetter align with the order of itemsLiabilities, would be formatted as a Assetspresented on Schedule RC–L, Off-separate Schedule HC–D, to be
1. The presentation of loan categoryBalance-Sheet Items, on the Call Report.consistent with presentation in the Call
information would be modified to betterReport. Schedule HC–G—Memoranda match the loan schedule (HC–B) as
Schedule HC–F—Off-Balance-Sheet 1. The scope of item 14, ‘‘Income proposed by moving the current
Items earned, not collected on loans,’’ would breakdown of loans secured by real
be expanded to cover all ‘‘Accrued estate from the Memoranda section of1. The two-way breakout of Part I,
interest receivable,’’ and the item would Schedule HC–H, item 4, to item 1 ofitem 2, ‘‘Standby letters of credit and
be included on a new ‘‘Other Assets’’ Schedule HC–H, and item 5.a would beforeign office guarantees,’’ between item
schedule discussed below. Broadening redefined to exclude related plans,2.a.(1), ‘‘To U.S. addressees,’’ and
this category to include interest earned, which would be reported in item 5.b. In2.a.(2), ‘‘To non-U.S. addressees,’’
not collected on earning assets other addition BHCs would separately reportwould be eliminated and replaced with
than loans would be more consistent their past due and nonaccrual loansa single combined item.
with the typical presentation of accrued secured by real estate in foreign offices.2. Part II, Item 3, ‘‘Securities
interest receivable in financial Also the presentation order and certainborrowed,’’ would no longer be
statements prepared for other financial item captions would be revised to bettercollected from all BHCs. Instead, the
reporting purposes. align with Schedule RC–N, Past Dueamount of borrowed securities that
2. Memorandum item 19, ‘‘Deferred and Nonaccrual Loans, Leases, andexceed 10 percent of total equity
tax assets in excess of regulatory capital3 Other Assets, on the Call would be reported in
limits,’’ would be retitled as 2. Memorandum item 6.b,renumbered item 9, ‘‘All other
‘‘Disallowed deferred tax assets’’ and ‘‘Replacement cost of [past duesignificant off-balance-sheet items.’’
moved to the revised regulatory capital derivative] contracts with a positive3. The information collected in Part II,
schedule (Schedule HC–R), which is replacement cost,’’ would be deleted.items 5.a, 5.b, and 5.c on the
discussed below. This proposed change Once BHCs adopt FASB Statement No.outstanding principal balance of and
is part of an effort by the Federal 133, Accounting for Derivativeamount of recourse on three categories
Reserve to place all items collected Instruments and Hedging Activities, allof financial asset transfers would be
principally for regulatory capital of their derivative contracts will bemoved from Schedule HC–F and
calculation purposes in a revised carried on the balance sheet at fairincorporated into the proposed new
value. Since the replacement cost of aregulatory capital schedule rather thanschedule on securitization and asset sale
derivative contract is its fair value andhaving these items scattered acrossactivities, which is discussed below.
its book value will also be its fair value,various FR Y–9C schedules as they are4. Part II, Item 6.b, ‘‘Participations in
Memorandum items 6.a., ‘‘Book value ofat present.acceptances acquired by the reporting
3. Items 17.a through 17.d, in which amounts carried as assets,’’ and 6.bBHC,’’ and Memorandum item 1,
banks report a six-way breakdown of the would duplicate each other. The caption‘‘Participations in unused
‘‘Outstanding principal balance of 1–4 for Memorandum item 6.a would becommitments’’ would be deleted from
family residential mortgage loans revised to read ‘‘Fair value of amountsSchedule HC–F, and information would
serviced for others’ would be moved carried as assets.’’be collected only on the proposed new
3. Eliminating confidential treatmentfrom Schedule HC–G and condensedregulatory capital schedule discussed
for certain past due and nonaccrualinto a two-way servicing breakdown inbelow. Memorandum item 1 would be
data: The Federal Reserve proposes tothe proposed new schedule onredefined to collect information on
eliminate the confidential treatment forsecuritization and asset sale activities,commitments with an original maturity
items past due 30 to 89 days andwhich is discussed below.exceeding one year on the new
4. Items 20.a through 20.f, which restructured items beginning withregulatory capital schedule.
collect data on quarterly sales of amounts reported as of March 31, 2001.5. Part III, Item 3.b for the gross
annuities, mutual funds, and An important public policy issue for thenotional amount of derivative contracts
proprietary products, would be Federal Reserve has been how to useheld for purposes other than trading that
eliminated. In place of these items, each market discipline to complementare not marked to market would be
BHC would respond to a ‘‘yes’’ or ‘‘no’’ supervisory resources. Market disciplinedeleted. All derivative contracts,
question asking whether it sells private relies on market participants havingincluding those held for purposes other
label or third party mutual funds and information about the risks andthan trading, will be marked to market
annuities. In addition, BHCs would financial condition of bankingonce a BHC adopts FASB Statement No.
report the total assets under the organizations. The FR Y–9C, in133, Accounting for Derivative
reporting BHC’s management in particular, is widely used by securitiesInstruments and Hedging Activities,
proprietary mutual funds and annuities. analysts, rating agencies, and largewhich is effective for fiscal years
For BHCs with proprietary mutual funds institutional investors as sources ofbeginning after June 15, 2000. Thus,
and annuities, reporting the amount of BHC-specific data. Disclosure that
assets under management should be increases transparency should lead to3 As described below, the Federal Reserve
proposes to eliminate this reporting threshold. significantly less burdensome than more accurate market assessments of
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risk and value. This, in turn, should capital schedule. The proposed Overall, the Federal Reserve believes
result in more effective market schedule will also more directly that the proposed revisions to the
discipline on BHCs. correspond to the proposed commercial regulatory capital schedule provide a
Despite this emphasis on market bank Regulatory Capital schedule on the rational, systematic approach to
discipline, the Federal Reserve currently Call Report. Schedule HC–I would also reporting the elements of capital as well
accords confidential treatment to the be retitled ‘‘Regulatory Capital’’ and as the components of risk-weighted
information BHCs report in Schedule relabeled Schedule HC–R. assets. The proposed approach should
HC–H of the FR Y–9C on the amounts offer both enhanced and efficientIn general, the proposed revised
of their loans, leases, and other assets reporting for both BHCs and users of theformat would use a systematic, step-by-
that are past due 30 to 89 days and still FR Y–9C report.step building block approach under
accruing and on the amount of which BHCs would report the various Schedule HC–S—Securitization and
restructured loans and leases that are components and adjustments that Asset Sale Activities
past due 90 days or more and still determine Tier 1, Tier 2, and total
The Federal Reserve proposes toaccruing or in nonaccrual status. This is capital, as well as risk-weighted assets.
revise and expand the informationthe only financial information currently This means that all regulatory capital
collected in the FR Y–9C to facilitatecollected on the FR Y–9C that is treated ratios—the Tier 1 leverage ratio, the Tier
more effective analysis of the impact ofas confidential on an individual BHC 1 risk-based capital ratio, and the total
securitization and asset sale activitiesbasis. In contrast, the information BHCs risk-based capital ratio—would be
on BHC credit exposures. In this regard,report on the amounts of their loans, derived directly from the items that
the Federal Reserve proposes toleases, and other assets that are 90 days BHCs report on this schedule. These
introduce a separate new scheduleor more past due and still accruing or ratios would also be disclosed in the
(Schedule HC–S) effective with the Junethat are in nonaccrual status has been schedule. The carrying values of all on-
30, 2001, reporting date that wouldpublicly available. The Federal Reserve balance-sheet asset values and the face
comprehensively capture informationproposes to make all past due and value or notional amount of most off-
related to BHC securitization and assetrestructured loan and lease information balance-sheet items used in the capital
sale activities. At present, the FR Y–9Cpublicly available in order to give the calculations would function as ‘‘control
includes several items in variouspublic, including BHCs, more complete totals’’ and banks would allocate these
schedules that are used to assess BHCinformation on the level of and trends amounts to the appropriate risk weight
involvement in securitization and assetin asset quality at individual categories in accordance with the risk-
sale activities. The items generally focusinstitutions. based capital guidelines.
Some banking organizations have on the securitization and sale of 1–4
Existing items in Part III require theheld that information on loans, leases family residential mortgages and
reporting of the major capitaland other assets that are past due 30 to consumer loans. However, over the past
categories—Tier 1, Tier 2, Tier 3, and few years, the scope and volume of BHC89 days is not a reliable indicator of
total risk-based capital—as well as risk- asset securitization activities havefuture loan losses or of general asset
weighted assets and average total assets, expanded significantly beyond thequality. They further note that market
which is used in the Tier 1 leverage traditional 1–4 family residentialdiscipline would be reduced, rather
ratio. The amounts reported in thesethan enhanced, by the release of mortgage and consumer loan areas into
existing items should be the amountsinformation that is highly susceptible to other areas, most notably into the areas
determined by BHCs for their ownmisinterpretation to the extent that it of home equity and commercial lending.
internal capital analyses consistent with Under this proposal, BHCs involvedcould cause an unjustifiable loss of
the applicable capital standards. These in securitization and asset sale activitiesfunding to the industry. However,
items (Part III items 1.a through 4) are would report quarter-end (or year-to-banking supervisors have consistently
so-called self-reported capital items. date) data for seven loan categoriesfound information on loans and leases
The first part of the proposed revised similar to the manner in which theypast due 30 to 89 days to be helpful in
regulatory capital schedule would report their loan portfolios. These dataidentifying banks with emerging asset
essentially replicate the steps that BHCs would cover 1–4 family residentialquality problems. Therefore the Federal
are already going through to determine loans, home equity lines, credit cardReserve believes that such information
the major capital categories on a self- receivables, auto loans, other consumeris a useful indicator of general asset
reported basis and therefore should not loans, commercial and industrial loans,quality and would not represent
impose significant additional reporting and all other loans and leases. For eachmisleading information to the public.
burden. Moreover, to facilitate this loan category, BHCs would report: (1)Moreover, BHCs have the option to
proposed step-by-step building block The outstanding principal balance ofinclude in their notes to the balance
approach to computing these capital assets sold and securitized withsheet a brief narrative statement that
categories, the Federal Reserve proposes servicing retained or with recourse orprovides explanatory comments about
to move a number of items that are seller-provided credit enhancements, (2)any data disclosure which they feel may
collected principally for regulatory the maximum amount of creditbe subject to misinterpretation, the text
capital calculation purposes from their exposure arising from recourse or creditof which is available to the public.
currently scattered locations in other FR enhancements to securitization
Schedule HC–I—Risked-Based Capital Y–9C schedules to their more logical structures (separately for those
The Federal Reserve proposes to position in the proposed revised capital sponsored by the reporting institution
revise the risk-based capital schedule schedule. For example, as previously and those sponsored by other
(Schedule HC–I) by incorporating many discussed the item for ‘‘Deferred tax institutions), (3) the past due amounts
of the reporting concepts of the FR Y– assets in excess of regulatory capital and charge-offs and recoveries on the
9C’s optional regulatory capital limits’’ that is currently collected in underlying securitized assets, (4) the
worksheet. All top-tier BHCs with total Schedule HC–G—Memoranda, would amount of any commitments to provide
consolidated assets of $150 million or now be included in the proposed liquidity to the securitization structures,
more would continue to be required to revised Schedule HC–I (and retitled as (5) the outstanding principal balance of
complete the entire revised regulatory ‘‘Disallowed deferred tax assets’’). assets sold with servicing retained or
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with recourse or seller-provided credit reported in the FR Y–9C, would begin income categories to those currently
enhancements that have not been to be reported as of June 30, 2001, collected in the FR Y–9C income
securitized, (6) the amount of ownership consistent with the proposed reporting statement (Schedule HI). Noninterest
(or seller’s) interests carried as securities for Schedule RC–S. income has grown substantially over the
or loans, and (7) the maximum amount last few years as a source of revenue for
Schedule HI—Consolidated Income
of credit exposure arising from assets BHCs. A more detailed breakdown of
sold with recourse or seller-provided noninterest income would provide the
2. Report the combined amount of tax-credit enhancements that have not been Federal Reserve with valuable
exempt loan and lease income in asecuritized. A limited amount of supervisory information on the amount
single income statement item,information would also be collected on and type of fee-generating activities
Memoranda item 3. This would mean within the BHC.BHC credit exposures to asset-backed
that, going forward, the body of thecommercial paper conduits. For the These categories were selected in part
income statement (Schedule HI) wouldhome equity line, credit card receivable, based on a review of noninterest income
contain only two items for interest and information currently reported by BHCsand the commercial and industrial loan
fee income from loans (item 1.a.(1), ‘‘In in Schedule HI, Memoranda items 5 andcategories, BHCs would also report the
domestic offices’’ and item 1.a.(2), ‘‘In 6. In these items, BHCs must itemizeamount of any ownership (or seller’s)
foreign offices, Edge and Agreement and describe, using their owninterests in securitizations that are
subsidiaries, and IBFs’’) and a single terminology, their most significantcarried as securities and the past due
item (item 1.b) for income from lease categories of ‘‘Service charges,amounts and charge-offs and recoveries
financing receivables. commissions, and fees’’ and ‘‘Otheron the assets underlying these seller’s
2. The breakout of interest income on noninterest income.’’ Two of theinterests.
balances due from depositoryAt present, BHCs report certain proposed new income statement
institutions (by domestic versus foreigninformation related to securitizations, categories represent items, or
offices) would be eliminated. Currently, modifications of items, for whichasset sales, and servicing in current
this information is reported in ScheduleSchedule HC–F—Off-Balance Sheet specific preprinted captions currently
HI, items 1.c.(1) and 1.c.(2). GoingItems and Schedule HC–G— appear in Schedule HI (Memoranda
forward, there would only be a totalMemoranda. To avoid the loss of this items 6.a and 6.b). As a result, these
reported for this information.information until the delayed effective items would no longer be reported in
4. The number of categories ofdate of new Schedule RC–S, these the Memoranda section of Schedule HI.
securities income that BHCs areexisting items will be moved into and The categories of noninterest income
required to report would be reduced.reported in the Memoranda section of that would be added as specific items
BHCs would report their income for theSchedule HC–S for the March 31, 2001, on the FR Y–9C income statement are:
three following categories of securitiesreport date. These existing items and (1) Investment banking, advisory,
in the body of the income statement: (a) brokerage, and underwriting fees andwhat will happen to them after they are
collected in the March 31, 2001, FR Y– U.S. Treasury securities and U.S. commissions, (2) venture capital
9C are as follows: government agency obligations, (b) revenue, (3) net servicing fees, (4) net
1. Schedule HC–F, items 5.a.(1) and Mortgage-backed securities, and (c) All securitization income, (5) insurance
(2) and items 5.b.(1) and (2)—in which other securities. BHCs would report commissions and fees, (6) net gains
BHCs report the outstanding principal their ‘‘Income on tax-exempt securities (losses) on sales of loans, (7) net gains
balance and amount of recourse issued by states and political (losses) on sales of other real estate
exposure on (a) ‘‘First lien 1–4 family subdivisions in the U.S.’’ in a new owned, and (8) net gains (losses) on
residential mortgage loans’’ and (b) income statement Memorandum item 4 sales of other assets (excluding
‘‘Other financial assets’’ that have been rather than in the income statement securities). The current income
transferred with recourse and are treated statement item for ‘‘Other service(Schedule HI) itself.
as sold—will be collected in Schedule 5. Item 2.c, ‘‘Interest on borrowed charges, commissions, and fees’’ (item
HC–S, Memorandum items 4.a.(1) and funds,’’ would be retitled ‘‘Interest on 5.b.(2)) would be discontinued. The new
(2) and items 4.b(1) and (2), for the final trading liabilities and other borrowed noninterest income items would
time as of March 31, 2001. money.’’ The instructions for this item provide greater comparability among the
2. Schedule HC–F, items 5.c.(1) and also would be clarified to include categories of noninterest income
(2)—in which BHCs report the trading liabilities. currently reported by BHCs. Some of the
outstanding principal balance and 6. Item 4.a, ‘‘Provision for credit proposed noninterest income categories
amount of retained recourse on ‘‘Small losses,’’ would be revised so that it would represent the only information
business obligations transferred with includes only the provision for loan and provided in the FR Y–9C on certain
recourse under Section 208 of the Riegle lease losses. BHCs would report any activities. By collecting more detailed
Community Development and provision for credit losses on off- noninterest income data, the
Regulatory Improvement Act of 1994’’— balance-sheet exposures in item 7.e, significance of each of these activities
will be collected in Schedule HC–S, ‘‘Other noninterest expense’’ and they can be compared to other income-
Memorandum items 1.a and 1.b, as of would itemize and describe this generating activities of the BHC.
March 31, 2001, and thereafter. 9. New item 7.c, ‘‘Amortizationprovision in Memoranda item 7, if it is
3. Schedule HC–G, item 17—in which expense of intangible assets,’’ would besignificant.
BHCs provide a six-way breakdown of 7. Item 4.b, ‘‘Provision for allocated added to the income statement
the ‘‘Outstanding principal balance of transfer risk,’’ would be eliminated as a (Schedule HI).
1–4 family residential mortgage loans 10. In Schedule HI—Memoranda, thespecific income statement item. BHCs
serviced for others’’ by type of servicing threshold for itemizing and describingwould report any provision for allocated
contract—will be collected in significant components of ‘‘Othertransfer risk in ‘‘Other noninterest
condensed form in Schedule HC–S, noninterest income’’ and ‘‘Otherexpense’’ and itemize and describe it in
Memorandum items 2.a and 2.b, as of noninterest expense’’ in items 6 and 7Memoranda item 7 if it is significant.
March 31, 2001, and thereafter. In 8. Noninterest income: Board staff would be changed to 1 percent of the
addition item 2.c, which is not currently proposes to add several new noninterest total of interest income and noninterest
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income from the current threshold of 10 accounting principles from prior years,’’ GAAP. At present, BHCs report the
percent of other noninterest income and and item 12, ‘‘Corrections of material balance of the allowance as ‘‘originally
10 percent of other noninterest expense, accounting errors from prior years,’’ and reported’’ in their previous year-end FR
respectively. This revised threshold is designate the combined items as item 2, Y–9C report in item 1. The effects of any
consistent with the Securities and ‘‘Restatements due to corrections of amendments to the previous year-end
Exchange Commission’s threshold for material accounting errors and changes FR Y–9C on the allowance as originally
the disclosure by bank holding in accounting principles,’’ of revised reported are included in item 3,
companies of components of other Schedule HI–A. The next item in ‘‘Adjustments.’’ Item 1 would be revised
noninterest income and expense. revised Schedule HI–A (item 3) would to eliminate the need to report these
11. Similar to the reporting revision then be captioned ‘‘Balance end of adjustments from amended FR Y9–C
proposed to Schedule HC–B, Part II, previous calendar year as restated.’’ reports in item 3. Thus, BHCs would
Trading Assets and Liabilities, the filing 2. Items 13.a, ‘‘Change in net report the ‘‘Balance most recently
criteria for Memoranda item 9, ‘‘Trading unrealized holding gains (losses) on reported at end of previous year’’ for the
available-for-sale securities,’’ 13.b.,revenue,’’ would be revised to require year-end allowance for loan and lease
BHCs to complete Memoranda item 9 ‘‘Change in accumulated net gains losses in item 1.
only if they report a quarterly average (losses) on cash flow hedges,’’ and 18, 3. Schedule HI–B, Part II,
for trading assets of $2 million or more ‘‘Foreign currency translation Memorandum item 1, ‘‘Credit losses on
as of the March 31st report date for the adjustments’’ would be combined and off-balance-sheet derivative contracts,’’
current calendar year. replaced by an item for ‘‘Other would be retitled ‘‘Credit losses on
12. The instructions for Memorandum comprehensive income.’’ This item derivatives’’ and moved to Schedule HI,
items 10.a through 10.c that request would also include any minimum memoranda item 11.
BHCs to disclose the impact of pension liability adjustment recognized
Other Revisions Not Related to Callderivatives held for purposes other than during the year-to-date in accordance
Report Changestrading on interest income, interest with GAAP, which BHCs currently have
expense, and noninterest income to report elsewhere in Schedule HI–A. The following proposed revisions are
(expense) would be revised. For Identifying ‘‘Other comprehensive not directly related to the proposed Call
reporting beginning in 2001 when FASB income’’ in the changes in equity capital Report changes for March 2001. Most of
Statement No. 133, Accounting for schedule is consistent with FASB these changes are proposed to provide
Derivative Instruments and Hedging Statement No. 130, Reporting greater consistency with current Call
Activities, is in effect, all derivatives Comprehensive Income. Report items that are not part of the
would be reported on the balance sheet In addition, Schedule HI–A would be March 2001 revisions.
at fair value and the accounting for fair renumbered and certain captions would
Schedule HC—Consolidated Balancevalue and cash flow hedges under be modified to better align with the
SheetStatement No. 133 differs from current Changes in Equity Capital schedule on
hedge accounting practices. the Call Report. 1. To better align the presentation of
In addition, certain item captions the FR Y–9C Balance Sheet with that ofSchedule HI–B—Charge-Offs and
would be modified to better align with the Call Report Balance Sheet,Recoveries on Loans and Leases and
similar information reported on the components of item 7, ‘‘Other real estateChanges in Allowance for Credit Losses
bank Call Report Income Statement. owned,’’ and item 10, ‘‘Intangible
1. The presentation of loan category assets,’’ and line items 16, ‘‘CommercialSchedule HI–A—Changes in Equity information would be modified to better paper,’’ and 17, ‘‘Other borrowed moneyCapital match the loan schedule (HC–B) as with a remaining maturity of more than
1. The manner in which the previous proposed by moving the current one year’’ would be moved to the
year-end balance of equity capital is breakdown of loans secured by real Memoranda schedule.
reported in this schedule so that it better estate from the Memoranda section of 2. Item 20, ‘‘Mandatory convertible
corresponds with how this balance is Schedule HI–B, item 1, to item 1 of securities,’’ with a two-way breakout
presented in financial statements Schedule HI–B, and item 5.a would be between item 10.a, ‘‘Equity contract
prepared in accordance with GAAP. At redefined to exclude related plans notes, gross’’ and item 10.b, ‘‘Equity
present, BHCs must report the ‘‘Equity which would be reported in item 5.b. In commitment notes, gross’’ would be
capital end of previous calendar year’’ addition BHCs would also separately eliminated. Information on mandatory
in the FR Y–9C in item 1. If the BHC has report their charge-offs and recoveries of convertible securities would be
filed any amendments to this previous loans secured by real estate in foreign included in item 21, ‘‘Subordinated
year-end FR Y–9C report that affected offices. Also the presentation order and notes and debentures.
its originally reported total equity certain item captions would be revised In addition, items on Schedule HC
capital, these equity capital adjustments to align with the Charge-Offs and would be renumbered and certain line
are reported in item 2, and the amended Recoveries schedule on the Call Report. item captions modified to better align
equity capital balance for the previous 2. The scope of Part II would be with information reported on the Call
year-end is reported in item 3. The revised to cover changes in the Report Balance Sheet.
Federal Reserve proposes to eliminate allowance for loan and lease losses
Schedule HC–A—Securitiesitem 2 and, in effect, have BHCs report rather than the entire allowance for
what is now reported in item 3 as their credit losses. In addition, similar to the 1. Memoranda item 7, ‘‘U.S.
previous year-end equity capital proposal discussed above for Schedule government agency and corporation
balance. Thus, as Schedule HI–A would HI–A—Changes in Equity Capital, the obligations (exclude mortgage-backed
be revised, BHCs would report ‘‘Equity manner in which the previous year-end securities)’’ would be moved to
capital most recently reported for the balance of the allowance is reported in Schedule HC–A, as item 2. Currently a
end of the previous calendar year’’ in Schedule HI–B, Part II, would be two-way breakout of this item is
item 1. The Federal Reserve also changed so that it better corresponds collected for such securities ‘‘Issued by
proposes to combine item 11, with its presentation in financial U.S. government agencies’’ (Memoranda
‘‘Cumulative effect of changes in statements prepared in accordance with item 7.a) and for securities ‘‘Issued by
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U.S. government-sponsored agencies’’ Schedule HC–B—Loans and Lease Similarly, the two-way breakdown of
Financing Receivables deferred tax liabilities captured in items(Memoranda item 7.b) from BHCs with
1.b.(1), ‘‘IRS loan loss provision,’’ andtotal consolidated assets of $1 billion or 1. The three-way breakout for item 8,
item 1.b.(2), ‘‘Other,’’ would bemore. These two items would replace ‘‘All other loans,’’ would be collapsed to
eliminated in favor of a single item forthe total reported for U.S. government a single item, eliminating items 8.a,
‘‘Net deferred tax liabilities’’ and wouldagency and corporate obligations ‘‘Taxable obligations (other than
be included on a new ‘‘Othercurrently reported in item 2 and would securities) of states and political
Liabilities’’ schedule discussed reported by all BHCs. This change subdivisions in the U.S.’’ and 8.b, ‘‘Tax
2. Item 3, ‘‘Number of full-timewould provide for consistency in exempt obligations (other than
equivalent employees’’ would be movedreporting with the Call Report Schedule
to Schedule HI, Income Statement,RC–B, Securities. subdivisions in the U.S.’’ This change
memoranda item 5, to be consistentwould provide for consistency in2. Memoranda item 8, ‘‘Mortgage-
with presentation in the Call Report.reporting with the Call Report Loanbacked securities (MBS),’’ with the
3. Item 7.a, ‘‘Amount of cash items inschedule.breakout between ‘‘Pass-through
process of collection netted againstIn addition, items from Schedule HC–securities’’ (item 8.a) and ‘‘Other
deposit liabilities in reporting ScheduleB would be renumbered to align withmortgage-backed securities (include
HC,’’ item 8, ‘‘Reciprocal demandthe presentation order on the CallCMOs, REMICs, and stripped MBS)’’
balances with depository institutionsReport Loan schedule.(item 8.b) would be moved to Schedule
(other than commercial banks in the
HC–A, new item 4. These items would Schedule HC–F—Derivatives and Off- U.S.),’’ and item 16, ‘‘Please describe
then be reported by all BHCs, rather Balance-Sheet Items and list below separately the dollar
than by BHCs with total consolidated
amount outstanding of assets removed1. Item 2, ‘‘Financial standby letters of
assets of $1 billion or more. FR Y–9C from the reporting company’s balancecredit,’’ and item 2.a, ‘‘Amount of
data show that BHCs of $1 billion or sheet (Schedule HC) in connection withfinancial standby letters of credit
more in total assets have long been assets netted against liabilities whenconveyed to others’’ would be added to
actively involved in mortgage-backed there exists a legal right of offset’’ wouldprovide for consistency in reporting this
securities. For 1999, mortgage-backed be information with
securities represented 45 percent of the similar items collected on the Call Schedule HC–I—Risked Based Capitaltotal securities portfolio for BHCs of $1 Report, and to tie information reported
billion or more in total assets. Call 1. Schedule HC–I, Part I, Memorandain Schedule HC–F with off-balance-
Report data show that, for commercial item 6, ‘‘Fair value of mortgage servicingsheet information proposed in Schedule
banks between $150 million and $1 assets,’’ would be retitled as ‘‘EstimatedHC–R, item 44, ‘‘Financial standby
billion in total assets, mortgage-backed fair value of mortgage servicing assets’’letters of credit.’’
securities represented nearly 30 percent and moved to Schedule HC–M,2. Item 3, ‘‘Performance standby
of their total securities portfolio in 1999. Memoranda item 18.a(1).letters of credit,’’ and item 3.a, ‘‘Amount
Given the suspected significance of BHC of performance standby letters of credit Schedule HC–IC—Additional Detail oninvolvement in this activity at all levels, conveyed to others’’ would be added to Capital Componentsthe Federal Reserve proposes to collect provide for consistency in reporting this
mortgage-backed security information Items on Schedule HC–IC would beoff-balance-sheet information with
from all FR Y–9C respondents. All included in the Memoranda section ofsimilar items collected on the Call
commercial banks currently file this the revised risk-based capital schedule.Report, and to tie information reported
information on the Call Report. In addition, the Federal Reservein Schedule HC–F with off-balance-
proposes the following changes.sheet information proposed in Schedule3. Collect a new item 7, ‘‘Investments
1. Item 1.a.(4), ‘‘Other items includedHC–R, item 45, ‘‘Performance standbyin mutual funds and other equity
in ‘Minority interest in consolidatedletters of credit.’’securities with readily determinable fair
subsidiaries and similar items,’ on3. Item 9, ‘‘Other significant off-values’ from all FR Y–9C respondents in
Schedule HC subject to limits in Tier 1balance-sheet items (exclude off-order to assure the completeness and
capital,’’ would be added to provide forbalance-sheet derivatives) that exceedcontinuity of the reporting of BHC
a more complete disclosure of elements10% of total equity capital’’ would besecurity holdings given the proposed
incorporated into the calculation of Tierretitled as ‘‘All other off-balance-sheetchanges to Memoranda items 7 and 8.
1 capital.items (exclude derivatives)’’ to captureCurrently this information (Memoranda
2. Item 1.b., ‘‘Auction rate preferredall other off-balance-sheet exposures toitem 9.a) is collected only from BHCs
stock and any other perpetual preferredprovide for consistency in reporting thiswith total consolidated assets of $1
stock deemed by the Federal Reserve tooff-balance-sheet information with thebillion or more. All commercial banks
be eligible for Tier 2 capital only,’’ itemsimilar item collected on the Call Reportcurrently file this information on the
2., ‘‘Total perpetual debt, undedicatedand would provide analysts a completeCall Report.
portions of mandatory convertiblemeasure of the risk associated with
4. Item 3.a, ‘‘Taxable securities’’ and securities and long-term preferred stockthese exposures.
item 3.b, ‘‘Tax exempt securities,’’ with an original maturity of 20 years or
Schedule HC–G—Memorandawould be combined. The caption would more that qualify for supplementary
read ‘‘Securities issued by states and 1. The two-way breakdown of capital (after discounting),’’ and item 3,
political subdivisions in the U.S.’’ deferred tax assets captured in item ‘‘Intermediate preferred stock with an
5. Items reported for U.S. securities 1.a.(1), ‘‘IRS loan loss provision,’’ and original weighted-average maturity of 5
(item 4) and Foreign securities (item 5) item 1.a.(2), ‘‘Other,’’ would be years or more; subordinated debt with
would be modified to collect only U.S. eliminated in favor of a single item for an original weighted average maturity of
debt securities and Foreign debt ‘‘Net deferred tax assets’’ and the item 5 years or more; or unsecured long-term
securities for consistency with the Call would be included on a new ‘‘Other debt issued by BHC prior to March 12,
Report. Assets’’ schedule discussed below. 1988, that qualified as secondary capital
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