Agency Information Collection Activities: Announcement of Board Approval Under Delegated Authority and Submission to OMB With Request for Comment
Federal Information & News Dispatch, Inc. |
Citation: "79 FR 59264"
Page Number: "59264"
"Notices"
SUMMARY: Notice is hereby given of the final approval of a proposed information collection by the
On
DATES: Comments are to be submitted on or before
ADDRESSES: You may submit comments identified by FR Y-14A/Q/M, by any of the following methods:
* Agency Web site: http://www.federalreserve.gov. Follow the instructions for submitting comments on the http://www.federalreserve.gov/apps/foia/proposedregs.aspx.
* Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.
* Email: [email protected]. Include the OMB control number in the subject line of the message.
* Fax: 202-452-3819 or 202-452-3102.
* Mail: Robert deV. Frierson, Secretary,
All public comments are available from the Board's Web site at http://www.federalreserve.gov/apps/foia/proposedregs.aspx as submitted, except as necessary for technical reasons. Accordingly, your comments will not be edited to remove any identifying or contact information. Public comments may also be viewed electronically or in paper in Room MP-500 of the
Additionally, commenters may send a copy of their comments to the OMB Desk Officer--
FOR FURTHER INFORMATION CONTACT: Federal Reserve Board Acting Clearance Officer--
OMB Desk Officer--Shagufta Ahmed--
Final approval under OMB delegated authority of the extension for three years, with revision of the following report:
Report Title: Capital Assessments and Stress Testing information collection.
OMB Control Number: 7100-0341.
Effective Dates:
Frequency: Annually, semi-annually, quarterly and monthly.
Reporters: Any top-tier U.S. bank holding company (BHC) that has
Estimated Annual Reporting Hours: FR Y-14A: Summary, 67,848 hours; Macro scenario, 2,046 hours; Operational Risk, 456 hours; Regulatory capital transitions, 759; and Regulatory capital instruments, 660 hours. FR Y-14Q: Securities risk, 1,584 hours; Retail risk, 2,112 hours; Pre-provision net revenue (PPNR), 93,852 hours; Wholesale corporate loans, 8,556 hours; Wholesale commercial real estate (CRE) loans, 8,280 hours; Trading risk, 69,336 hours; Regulatory capital transitions, 3,036 hours; Regulatory capital instruments, 5,280 hours; Operational risk, 6,600 hours; Mortgage Servicing Rights (MSR) Valuation, 1,152 hours; Supplemental, 528 hours; and Retail Fair Value Option/Held for Sale (Retail FVO/HFS), 1,408 hours; Counterparty credit risk (CCR), 16,632 hours; and Balances, 2,112 hours; FR Y-14M: Retail 1st lien mortgage, 171,360 hours; Retail home equity, 165,240 hours; and Retail credit card, 110,160 hours. FR
Estimated Average Hours Per Response: FR Y-14A: Summary, 1,028 hours; Macro scenario, 31 hours; Operational Risk, 12 hours; Regulatory capital transitions, 23; and Regulatory capital instruments, 20 hours. FR Y-14Q: Securities risk, 12 hours; Retail risk, 16 hours; PPNR, 711 hours; Wholesale corporate loans, 69 hours; Wholesale CRE loans, 69 hours; Trading risk, 1,926 hours; Regulatory capital transitions, 23 hours; Regulatory capital instruments, 40 hours; Operational risk, 34 hours; MSR Valuation, 24 hours; Supplemental, 4 hours; and Retail FVO/HFS, 16 hours; CCR, 441 hours; and Balances, 16 hours; FR Y-14M: Retail 1st lien mortgage, 510 hours; Retail home equity, 510 hours; and Retail credit card, 510 hours. FR
Number of Respondents: 33.
General Description of Report: The FRY-14 series of reports are authorized by section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), which requires the Federal Reserve to ensure that certain bank holding companies (BHCs) and nonbank financial companies supervised by the Federal Reserve are subject to enhanced risk-based and leverage standards in order to mitigate risks to the financial stability of
As these data are collected as part of the supervisory process, they are subject to confidential treatment under exemption 8 of the Freedom of Information Act (FOIA) (5 U.S.C. 552(b)(8)). In addition, commercial and financial information contained in these information collections may be exempt from disclosure under exemption 4 of FOIA (5 U.S.C. 552(b)(4)). Such exemptions would be made on a case-by-case basis.
Abstract: The data collected through the FR Y-14A/Q/M schedules provide the Federal Reserve with the additional information and perspective needed to help ensure that large BHCs have strong, firm-wide risk measurement and management processes supporting their internal assessments of capital adequacy and that their capital resources are sufficient given their business focus, activities, and resulting risk exposures. The annual Comprehensive Capital Analysis and Review (CCAR) exercise is also complemented by other Federal Reserve supervisory efforts aimed at enhancing the continued viability of large BHCs, including continuous monitoring of BHCs' planning and management of liquidity and funding resources and regular assessments of credit, market and operational risks, and associated risk management practices. Information gathered in this data collection is also used in the supervision and regulation of these financial institutions. In order to fully evaluate the data submissions, the Federal Reserve may conduct follow up discussions with or request responses to follow up questions from respondents, as needed.
The semi-annual FR Y-14A collects large BHCs' quantitative projections of balance sheet, income, losses, and capital across a range of macroeconomic scenarios and qualitative information on methodologies used to develop internal projections of capital across scenarios. /1/ The quarterly FR Y-14Q collects granular data on BHCs' various asset classes and PPNR for the reporting period. The monthly FR
FOOTNOTE 1 BHCs that must re-submit their capital plan generally also must provide a revised FR Y-14A in connection with their resubmission. END FOOTNOTE
Current Actions: On
Summary of Comments
The Federal Reserve received eight comment letters addressing the proposed changes to this information collection, including one from a BHC, one from an individual, and six from trade associations. Many of the comments received requested clarification of the instructions for the information to be reported, or were technical in nature. These comments will be addressed in the final FR Y-14A/Q/M reporting forms and instructions. Other comments requested clarification, but did not include sufficient information. The Federal Reserve will discuss these with the appropriate commenters to determine the clarifications that should be made.
The Federal Reserve also received several comments not directly related to the proposed revisions to the FR
General Comments
In general, commenters expressed concerns about the timing of implementing new items, the overall expansion of the information collection, alignment with the Consolidated Financial Statements for Bank Holding Companies (FR Y-9C) (OMB No. 7100-0128), the expansion of the reporting panel, and the details of proposed items on the Operational Risk and Counterparty Schedules of the FR Y-14Q. Specifically, several commenters stated that given the scale and granularity of certain proposed changes, the associated effective date of
Commenters provided views on proposed changes relating to the collection of regulatory capital components under the revised capital framework. As discussed in the FR Y-14A/Q/M proposal, these changes were intended to better align the regulatory capital components that appear on the FR Y-9C proposal. /2/ Following the IFR, the Federal Reserve sought comment on changes to the FR Y-9C, which included two additional line items that were not included in the proposed FR
FOOTNOTE 2 The proposal indicated that "the Federal Reserve may modify the proposed revisions to the FR
In regard to the expansion of the reporting panel to include BHCs relying on Supervision and Regulation Letter SR 01-01 ("SR 01-01 BHCs"), /3/ commenters stated that an effective date of
FOOTNOTE 3 Application of the Board's Capital Adequacy Guidelines to Bank Holding Companies Owned by Foreign Banking Organizations. END FOOTNOTE
FOOTNOTE 4 See 12 CFR 225.8(c)(2)(i), 12 CFR 252.43(b)(2), and 12 CFR 122.53(b)(2). END FOOTNOTE
Numerous commenters objected to the proposed data items on the FR Y-14Q Operational Risk schedule regarding legal reserves for closed/settled litigation with settlements above
Finally, commenters expressed concern over the level of detail in the proposed changes to the Counterparty schedule, particularly the portions that subset by both agreement and asset category. The Federal Reserve views collecting more detailed counterparty data critical to assessing the reasonableness of the BHC's model-based estimates used as key inputs to supervisory stress test as well as ensuring the comparability of results across BHCs. However, the Federal Reserve also recognizes the potential operational difficulty in providing granular counterparty information by asset category for each netting agreement. Therefore, the Federal Reserve will provide an additional 30-day public comment period in the final
FR Y-14A
The majority of comments received regarding the FR Y-14A requested clarification of item definitions and will be addressed in the final instructions. However, as noted in the initial
Schedule A--Summary
A.1.c.2--Standardized RWA. In order to align with the proposed schedule HC-R of the FR Y-9C, the Federal Reserve will add the following two line items: All other on-balance sheet securitization exposures; and Off-balance sheet securitization exposures.
Schedule D--Regulatory Capital Transitions
In order to align with the proposed schedule HC-R of the FR Y-9C, the Federal Reserve will add the following two line items: All other on-balance sheet securitization exposures; and Off-balance sheet securitization exposures. Additionally, commenters requested that the Federal Reserve revise the proposed instructions regarding the calculation of the supplementary leverage ratio (SLR). The proposed instructions were based on the proposal issued by Board,
FOOTNOTE 5 "Regulatory Capital Rules:
FR Y-14Q
The majority of comments received regarding the FR Y-14Q requested clarification of item definitions, and the Federal Reserve will address these comments in the final instructions. Some comments, however, resulted in modification to data items and are addressed below.
Schedule A--Retail (A.1 to A.10)
One commenter requested that the Federal Reserve clarify whether or not historical data must be submitted for items related to charge-offs and recoveries whose definitions were proposed to be redefined to be consistent with the FR Y-9C. The Federal Reserve notes that historical data are not required to be submitted for such items at this time.
Schedule A.2--
One commenter expressed concern about being able to provide the loan-to-value (LTV) segmentation variable based on the wholesale instead of retail value of the vehicle for the
Schedule B--Securities
One commenter identified a possible duplicative request for information between items 3 and 14 on the proposed schedule B.3 related to the effective portion of hedges included in amortized cost basis. The Federal Reserve agrees that the request could be seen as duplicative and will modify item 14 accordingly. Another commenter stated that proposed items 14 and 15 of the same schedule are irrelevant and difficult to provide given that they request information regarding gains and losses of hedging instruments since inception of the hedging positions. The Federal Reserve will modify both items to include information regarding gains and losses during the reporting quarter. Finally, a commenter recommended that the Federal Reserve add a field that collects estimates of bond ratings for instruments with no CUSIP number based on issuer-specific information, similar to what was collected from certain firms during CCAR 2014. The Federal Reserve will consider adding such information to a future proposal.
Schedule D--Regulatory Capital Transitions
Similar to the FR Y-14A Regulatory Capital Transitions schedule, two line items will be added in order to align with the proposed schedule HC-R of the FR Y-9C: All other on-balance sheet securitization exposures; and Off-balance sheet securitization exposures. Additionally, line item definitions will be revised in accordance with the Supplementary Leverage Ratio final rule, as described above.
Schedule F--Trading
The Federal Reserve will revise the instruction that provides that BHCs may report these data as-of the most recent date that corresponds to their weekly internal risk reporting cycle as long as it falls before the as-of-date. Specifically, to provide additional flexibility, these instructions will be modified to state that the Federal Reserve may provide for a different weekly period over which data may be reported. For instance, the Federal Reserve may exercise this authority where the weekly period would include a quarter-end, a holiday, or a financial emergency that could distort the reported results.
Schedule H--Wholesale
A commenter noted that providing only "Yes" and "No" options for the Prepayment Penalty Flag item might not be sufficient, because the terms of prepayment penalties can vary significantly between firms and may include provisions that substitute for prepayment penalties. Another commenter requested clarification on whether this item should include loans which at any point included a prepayment penalty. The Federal Reserve agrees that other forms of prepayment penalties should be captured and will expand the options to the Prepayment Penalty Flag item to include an option to identify loans that at some point had some form of prepayment penalty. The same commenter also recommended adding an option to the Guarantor Flag item to capture instances of partial government guarantee. The Federal Reserve notes that option two of that item captures instances of partial government guarantee. Additionally, in response to comments about the timing of the changes, the Federal Reserve will move the effective date from
Schedule K--Supplemental
A commenter noted that the information currently collected in columns F (Auto Leases) and G (Non-Auto Leases) is included in the proposed FR Y-14Q Balances Schedule and recommended removing those columns and moving the remaining information from Schedule K to the proposed FR Y-14Q Balances Schedule. The Federal Reserve agrees that the information in columns F and G of Schedule K is contained in the FR Y-14Q Balances Schedule and will remove those columns. However, the Federal Reserve believes moving the remaining information from Schedule K to the FR Y-14Q Balances Schedule would unnecessarily change the format of the information collection and not give institutions ample time to program their systems for these changes. Therefore, the Federal Reserve will keep the remaining information on Schedule K.
Schedule L--Counterparty
Several commenters expressed concern about the level of granularity, increase in frequency, and timing of the proposed addition of the Derivative Profile by Counterparty and Aggregate sub-schedule and expansion of the Securities Financing Transactions (SFT) Profile by Counterparty and Aggregate sub-schedule. More detailed counterparty data would allow the Federal Reserve to assess the reasonableness of the BHC's model-based estimates used as key input to supervisory stress tests, and ensure the comparability of results across BHCs. However, in order to reduce reporting burden while the comment period is extended, the Federal Reserve will change the legal-entity, netting-agreement level of reporting on tables L.5.2 and L.6.2 to a consolidated counterparty level. Additionally, the Federal Reserve will remove the sub-asset categories on table L.5.2 at this time. The Federal Reserve will consider any additional comments received during the extended public comment period and incorporate changes, as appropriate, before finalizing these data items.
FR
The majority of comments received regarding the FR
Schedule A--Domestic First Lien Closed-end 1-4 Family Residential Loan
One commenter noted that reporting information regarding first lien home equity loans would require significant time and effort because such a category of loans does not exist on the FR Y-9C, and that no industry standard exists for first lien home equity loans. In response the Federal Reserve will remove the item Home Equity Loan Flag.
SUPPLEMENTARY INFORMATION:
Request for Comment on Information Collection Proposal
Abstract: As mentioned above, the Federal Reserve will provide an additional 30-day public comment period for the collection of counterparty agreement-level/asset-category data, to request further information on the data items listed below. If the Federal Reserve receives no relevant comments, the revisions will be finalized, effective
Counterparty
1. Is there difficulty in providing information in Tables L.5.1 and L.6.1 and if so what is/are the difficult(ies)?
2. Is there difficulty in providing counterparty transaction information at a netting set level, as in Tables L.5.2 and L.6.2? If so, what are the difficulties with regard to internal systems or the netting agreements themselves?
3. Is there difficulty in providing counterparty transaction information segmented by asset categories in general? If so, what are the difficulties with regard to internal systems or the asset categories/sub-categories proposed?
4. Do respondents have counterparty transactions, either derivatives or securities financing transactions (SFTs), which are not part of a master agreement? If so please provide details about the internal management of these transactions, especially with regard to collateral.
All comments will become a matter of public record. Written comments should address the accuracy of the burden estimates and ways to minimize burden including the use of automated collection techniques or the use of oth er forms of information technology as well as other relevant aspects of the information collection request.
Board of Governors of the
Robert deV. Frierson,
Secretary of the Board.
[FR Doc. 2014-23346 Filed 9-30-14;
BILLING CODE 6210-01-P
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