2017-24309. Agency Information Collection Activities: Revision of an Approved Information Collection; Comment Request; Company-Run Annual Stress Test Reporting Template and Documentation for Covered Institutions With Total Consolidated Assets of $50 ...

AGENCY:

Office of the Comptroller of the Currency, Treasury (OCC).

ACTION:

Notice and request for comment.

SUMMARY:

The OCC, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other federal agencies to take this opportunity to comment on a continuing information collection, as required by the Paperwork Reduction Act of 1995 (PRA).

In accordance with the requirements of the PRA, the OCC may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number.

The OCC is soliciting comment concerning a revision to a regulatory reporting requirement for national banks and federal savings associations titled, “Company-Run Annual Stress Test Reporting Template and Documentation for Covered Institutions with Total Consolidated Assets of $50 Billion or More under the Dodd-Frank Wall Street Reform and Consumer Protection Act.”

DATES:

Comments must be received by January 8, 2018.

ADDRESSES:

Because paper mail in the Washington, DC area and at the OCC is subject to delay, commenters are encouraged to submit comments by email, if possible. Comments may be sent to: Legislative and Regulatory Activities Division, Office of the Comptroller of the Currency, Attention: 1557-0319, 400 7th Street SW., Suite 3E-218, Washington, DC 20219. In addition, comments may be sent by fax to [phone] or by electronic mail to [e-mail]. You may personally inspect and photocopy comments at the OCC, 400 7 Street SW., Washington, DC 20219. For security reasons, the OCC requires that visitors make an appointment to inspect comments. You may do so by calling [phone] or, for persons who are deaf or hearing impaired, TTY, [phone]. Upon arrival, visitors will be required to present valid government-issued photo identification and submit to security screening in order to inspect and photocopy comments.

All comments received, including attachments and other supporting materials, are part of the public record and subject to public disclosure. Do not include any information in your comment or supporting materials that you consider confidential or inappropriate for public disclosure.

FOR FURTHER INFORMATION CONTACT:

Shaquita Merritt, OCC Clearance Officer, [phone] or, for persons who are deaf or hearing impaired, TTY, [phone], Legislative and Regulatory Activities Division, Office of the Comptroller of the Currency, 400 7 St. SW., Washington, DC 20219. In addition, copies of the templates referenced in this notice can be found on the OCC's Web site under News and Issuances (http://www.occ.treas.gov/​tools-forms/​forms/​bank-operations/​stress-test-reporting.html).

SUPPLEMENTARY INFORMATION:

The OCC is requesting comment on the following revision to an approved information collection:

Title: Company-Run Annual Stress Test Reporting Template and Documentation for Covered Institutions with Total Consolidated Assets of $50 Billion or More under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

OMB Control No.: 1557-0319.

Description: Section 165(i)(2) of the Dodd-Frank Wall Street Reform and Consumer Protection Act ^[1] (Dodd-Frank Act) requires certain financial companies, including national banks and federal savings associations, to conduct annual stress tests ^[2] and requires the primary financial regulatory agency ^[3] of those financial companies to issue regulations implementing the stress test requirements.^[4] A national bank or federal savings association is a “covered institution” and therefore subject to the stress test requirements if its total consolidated assets are more than $10 billion. Under section 165(i)(2), a covered institution is required to submit to the Board of Governors of the Federal Reserve System (Board) and to its primary financial regulatory agency a report at such time, in such form, and containing such information as the primary financial regulatory agency may require.^[5] On October 9, 2012, the OCC published in the Federal Register a final rule implementing the section 165(i)(2) annual stress test requirement.^[6] This rule describes the reports and information collections required to meet the reporting requirements under section 165(i)(2). These information collections will be given confidential treatment (5 U.S.C. 552(b)(4)) to the extent permitted by law.

In 2012, the OCC first implemented the reporting templates referenced in the final rule. See 77 FR 49485 (August 16, 2012) and 77 FR 66663 (November 6, 2012). The OCC is now revising the reporting templates as described below.

The OCC intends to use the data collected to assess the reasonableness of the stress test results of covered institutions and to provide forward-looking information to the OCC regarding a covered institution's capital adequacy. The OCC also may use the results of the stress tests to determine whether additional analytical techniques and exercises could be appropriate to identify, measure, and monitor risks at the covered institution. The stress test results are expected to support ongoing improvement in a covered institution's stress testing practices with respect to its internal assessments of capital adequacy and overall capital planning.

The OCC recognizes that many covered institutions with total consolidated assets of $50 billion or more are required to submit reports using Comprehensive Capital Analysis and Review (CCAR) reporting form FR Y-14A.^[7] The OCC also recognizes the Board has proposed to modify the FR Y-14A and, to the extent practical, the OCC will keep its reporting requirements consistent with the Board's FR Y-14A in order to minimize burden on covered institutions.^[8] Therefore, the OCC is proposing to revise its reporting requirements to mirror the Board's proposed FR Y-14A for covered institutions with total consolidated assets of $50 billion or more. In addition to the changes that parallel the Board's proposed changes to the FR Y-14A, the OCC is also proposing two other changes. First, the proposal would modify the OCC supplemental schedule. Second, the proposal would allow federal savings associations to comply with the reporting requirements applicable to subsidiaries of large, noncomplex holding companies, as defined by the Board. These proposed changes are described in more detail below.

Proposed Revisions to Reporting Templates That Mirror Changes Proposed by the Board

The proposed revisions to the DFAST-14A reporting templates consist of the following:

• Eliminating two schedules, the Regulatory Capital Transitions Schedule and Retail Repurchase Exposures Schedule;
• Adding one item to the counterparty worksheet of the summary schedule to collect information of Funding Valuation Adjustments (FVAs) for firms subject to the Global Market Shock;
• Eliminating references to the term “extraordinary items” to align with Federal Accounting Standards Board (FASB) Subtopic 255-30; and
• Modifying instructions to clarify reporting of “Credit Loss Portion” and “Non-Credit Loss Portion” information for Available for Sale/Held to Maturity (AFS/HTM) worksheets in the summary schedule.

OCC Supplemental Schedule

In 2017, the OCC introduced a supplemental schedule that collects additional information not included in the FR Y-14A. The proposed revisions include modifications to the OCC supplemental schedule. These modifications to the supplemental schedule consist of clarifying instructions as well as adding, deleting, and modifying existing data items. The total number of items in the supplemental schedule would be reduced by approximately half, reflecting the OCC's commitment to reducing the reporting burden. In particular, the proposed revisions would delete existing data items on Allowance for Loan and Lease Loss data and Provisions data. The OCC periodically reviews its data collection to identify necessary fields that no longer support the OCC's supervisory objectives, and the allowance and provision fields were identified for elimination as part of this review. The proposed revisions would also eliminate the materiality thresholds for the reporting of certain items. Only national banks that are subsidiaries of large, complex firms, as defined by the Board, are required to complete the supplemental schedule, and the OCC believes that it is appropriate and manageable for these larger national banks to report these items.

Federal Savings Associations

Beginning in 2017, the Board and the OCC allowed institutions that were subsidiaries of large, non-complex holding companies, as defined by the Board, to comply with simplified reporting requirements and not complete certain sub-schedules of the FR Y-14A and DFAST-14A reporting forms. The proposed revisions would allow federal savings associations that qualify as over $50 billion covered institutions to comply with these simplified reporting requirements.

Savings and loan holding companies are not currently required to submit the Board's FR Y-14A reporting forms. Similarly, the Board's capital plan rule includes a definition for “large and noncomplex bank holding compan[ies]” but does not include a parallel definition for savings and loan holding companies. Accordingly, savings and loan holding companies and federal savings associations that have the same characteristics as other large and noncomplex firms would not technically qualify for the simplified reporting requirements. The proposed revisions would modify the DFAST-14A reporting forms and instructions to provide that all federal savings associations may comply with these simplified reporting requirements. This change would promote parity between national banks and federal savings associations that have similar size profiles and economic characteristics.

Type of Review: Revision.

Affected Public: Businesses or other for-profit.

Estimated Number of Respondents: 23.

Estimated Total Annual Burden: 16,466 hours.

The OCC believes that the systems covered institutions use to prepare the FR Y-14 reporting templates to submit to the Board will also be used to prepare the reporting templates described in this notice. Comments submitted in response to this notice will be summarized and included in the request for OMB approval. All comments will become a matter of public record. Comments are invited on:

(a) Whether the collection of information is necessary for the proper performance of the functions of the OCC, including whether the information has practical utility;

(b) The accuracy of the OCC's estimate of the burden of the collection of information;

(c) Ways to enhance the quality, utility, and clarity of the information to be collected;

(d) Ways to minimize the burden of the collection 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.

Dated: November 2, 2017.

Karen Solomon,

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

Footnotes

1.  Pub. L. 111-203, 124 Stat. 1376, July 2010.

2.  12 U.S.C. 5365(i)(2)(A).

3.  12 U.S.C. 5301(12).

4.  12 U.S.C. 5365(i)(2)(C).

5.  12 U.S.C. 5365(i)(2)(B).

6.  77 FR 61238 (October 9, 2012) (codified at 12 CFR part 46).

7.  http://www.federalreserve.gov/​reportforms.

8.  82 FR 26793 (June 6, 2017).