2019-25842. Agency Information Collection Activities: Announcement of Board Approval Under Delegated Authority and Submission to OMB

AGENCY:

Board of Governors of the Federal Reserve System.

SUMMARY:

The Board of Governors of the Federal Reserve System (Board) is adopting a proposal to extend for three years, with revision, the Report of Selected Balance Sheet Items for Discount Window Borrowers (FR 2046; OMB No. 7100-0289). The revisions are applicable immediately.

FOR FURTHER INFORMATION CONTACT:

Federal Reserve Board Clearance Officer—Nuha Elmaghrabi—Office of the Chief Data Officer, Board of Governors of the Federal Reserve System, Washington, DC 20551, [phone].

Office of Management and Budget (OMB) Desk Officer—Shagufta Ahmed—Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Room 10235, 725 17th Street NW, Washington, DC 20503, or by fax to [phone].

A copy of the Paperwork Reduction Act (PRA) OMB submission, including the reporting form and instructions, supporting statement, and other documentation will be placed into OMB's public docket files. These documents also are available on the Federal Reserve Board's public website at https://www.federalreserve.gov/​apps/​reportforms/​review.aspx or may be requested from the agency clearance officer, whose name appears above.

SUPPLEMENTARY INFORMATION:

On June 15, 1984, OMB delegated to the Board authority under the PRA to approve and assign OMB control numbers to collections of information conducted or sponsored by the Board. Board-approved collections of information are incorporated into the official OMB inventory of currently approved collections of information. Copies of the PRA Submission, supporting statements, and approved collection of information instrument(s) are placed into OMB's public docket files.

Final Approval Under OMB Delegated Authority of the Extension for Three Years, With Revision, of the Following Information Collection

Report title: Report of Selected Balance Sheet Items for Discount Window Borrowers.

Agency form number: FR 2046.

OMB control number: 7100-0289.

Effective Date: Immediately.

Frequency: On occasion.

Respondents: Depository institutions.

Estimated number of respondents: Primary and Secondary Credit, 1; Seasonal Credit, 83; Seasonal Credit, borrower in questionable financial condition, 1.

Estimated average hours per response: Primary and Secondary Credit, 0.75 hours; Seasonal Credit, 0.25 hours; Seasonal Credit, borrower in questionable financial condition, 0.75 hours.

Estimated annual burden hours: Primary and Secondary Credit, 1 hour; Seasonal Credit, 376 hours; Seasonal Credit, borrower in questionable financial condition, 1 hour.

General description of report: The balance sheet data collected on the FR 2046 report from certain institutions that borrow from the discount window are used to monitor discount window borrowing. The Board's Regulation A, Extensions of Credit by Federal Reserve Banks (12 CFR 201), requires that Reserve Banks review balance sheet data in determining whether to extend credit and to help ascertain whether undue use is made of such credit. The FR 2046 report is primarily used to assess appropriate use of seasonal credit. Certain depository institutions that borrow from the discount window report on the FR 2046 certain balance sheet data for a period that encompasses the dates of borrowing.

Legal authorization and confidentiality: The FR 2046 report is authorized pursuant to sections 4(8), 10B, and 19(b)(7) of the Federal Reserve Act (“FRA”), 12 U.S.C. 301, 347b, and 461(b)(7), respectively, which authorize Federal Reserve Banks to provide discounts or advances to a member bank or other depository institution and to demand notes secured to the satisfaction of each Reserve Bank, and authorize the Board to establish rules and regulations under which a Reserve Bank may extend such credit. Specifically, section 4(8) of the FRA, 12 U.S.C. 301, requires each Reserve Bank to keep itself informed of the general character and amount of the loans and investments of a depository institution “with a view to ascertaining whether undue use is being made of bank credit,” and instructs that, “in determining whether to grant or refuse advances, rediscounts, or other credit accommodations, the Federal Reserve Bank shall give consideration to such information.” Section 4(8) of the FRA also authorizes the Board to “prescribe regulations further defining . . . the conditions under which discounts, advancements, and the accommodations may be extended to member banks.” Section 10B of the FRA, 12 U.S.C. 347b, permits Federal Reserve Banks to make advances to member banks “under rules and regulations prescribed by the Board.” Section 19(b)(7) of the FRA, 12 U.S.C. 461(b)(7), provides that any depository institutions that hold reservable deposits are entitled to the same discount and borrowing privileges as member banks.

In addition, section 9(6) of the FRA, 12 U.S.C. 324, which requires state member banks to file reports of condition and of the payment of dividends with the Federal Reserve, provides authority to collect balance sheet information from state member banks. Sections 2A and 11 of the FRA, 12 U.S.C. 225a and 248(a)(2) and (i), respectively, as well as section 7(c)(2) of the International Banking Act, 12 U.S.C. 3105(c)(2), authorize the Board to collect balance sheet data from domestically chartered commercial banks and U.S. branches and agencies of foreign banks.

The Federal Reserve publishes aggregate data on discount window lending, which does not identify individual borrowers. In addition, the Dodd-Frank Wall Street Reform and Consumer Protection Act requires the Board to publish certain information on individual discount window borrowers and transactions (i.e., the identity of the borrower, the amount that was borrowed, the interest rate, and the types and amounts of collateral or assets pledged) after approximately a two year lag.^[1] The FR 2046 report is considered confidential until the fact that the institution borrowed from the discount window is disclosed. Until this point, the release of this report would reveal confidential commercial information about the borrower (i.e., the fact that the institution borrowed from the discount window, as only borrowers are required to file this form), which is reasonably likely to cause substantial harm to the competitive position of the institution that submitted the report if the institution is prematurely identified. Thus, the report is kept confidential under exemption 4 of the Freedom of Information Act (“FOIA”), 5 U.S.C. 552(b)(4), which protects from disclosure “trade secrets and commercial or financial information obtained from a person [that is] privileged or confidential.” Once the fact that an institution borrowed from the discount window is disclosed, the FR 2046 report is no longer considered confidential in the event a FOIA request is received.

Current actions: On July 19, 2019, the Board published a notice in the Federal Register (84 FR 34890) requesting public comment for 60 days on the extension, with revision, of the FR 2046. The Board proposed to update data element definitions to account for the introduction of the FFIEC 051 reporting form. In addition, the face of the FR 2046 report will be updated to (1) reflect all of the legal statutes that authorize the collection of the report; (2) indicate that the report is “authorized” (not “required”) by law; and (3) clarify that, if the report is requested under the FOIA, the report will be treated as confidential unless the borrower's identity has already been disclosed pursuant to the two year lag provided under the Dodd-Frank Wall Street Reform and Consumer Protection Act.^[2] The comment period for this notice expired on September 17, 2019. The Board did not receive any comments. The revisions will be implemented as proposed.

Board of Governors of the Federal Reserve System, November 22, 2019.

Michele Taylor Fennell,

Assistant Secretary of the Board.

Footnotes

1.  See 12 U.S.C. 248(s).

2.  12 U.S.C. 248(s).