2023-28302. Revisions of Agency Information Collection of a Previously Approved Collection; Request for Comments

AGENCY:

National Credit Union Administration (NCUA).

ACTION:

Notice of submission to the Office of Management and Budget.

SUMMARY:

As required by the Paperwork Reduction Act of 1995, The National Credit Union Administration (NCUA) is submitting the following extensions and revisions of currently approved collections to the Office of Management and Budget (OMB) for renewal.

DATES:

Written comments should be received on or before January 25, 2024 to be assured consideration.

ADDRESSES:

Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to www.reginfo.gov/​public/​do/​PRAMain. Find this particular information collection by selecting “Currently under 30-day Review—Open for Public Comments” or by using the search function.

FOR FURTHER INFORMATION CONTACT:

Copies of the submission may be obtained by contacting Mahala Vixamar at (703) 718–1155, emailing [e-mail], or viewing the entire information collection request at www.reginfo.gov.

SUPPLEMENTARY INFORMATION:

OMB Number: 3133–NEW.

Title: Supervisory Stress Test Annual Data Collection, 12 CFR part 702, subpart C.

Type of Review: New Collection.

Abstract: The NCUA Board (Board) has determined, to protect the National Credit Union Share Insurance Fund (NCUSIF) and the credit union system, that the largest Federally Insured Credit Unions (FICUs) should have systems and processes in place to monitor and maintain their capital adequacy. Subpart C of part 702 of NCUA's regulations codifies capital planning and stress testing requirements for federally insured credit unions with $10 billion or more in assets (covered credit unions). Covered credit unions are further delineated by asset tiers. Tier I are credit union with $10 billion or more in total assets, but less than $15 billion in total assets; tier II are credit union with $15 billion or more in total assets, but less than $20 billion in total assets; and tier III are credit union with $20 billion or more in total assets. Tier II and III credit unions are required to conduct supervisory stress tests and section 702.306 (b) codifies that NCUA reserves the right to conduct stress tests of covered credit unions at any time and where both NCUA and a covered credit union have conducted the tests, the results of NCUA's tests will determine whether the covered credit union has met the requirements of this subpart. To facilitate NCUA's ability to conduct supervisory stress test on covered credit unions, section 702.306(d) requires that covered credit unions must provide NCUA with any relevant qualitative or quantitative information requested by NCUA pertinent to capital plans or stress test under this part.

Affected Public: Private Sector: Not-for-profit institutions.

Estimated Number of Respondents: 12.

Estimated Number of Responses per Respondent: 1.

Estimated Total Annual Responses: 12.

Estimated Hours per Response: 20.

Estimated Total Annual Burden Hours: 240.

OMB Number: 3133–0061.

Title: Central Liquidity Facility, 12 CFR part 725.

Type of Review: Extension of a previously approved collection.

Abstract: Part 725 contains the regulations implementing the National Credit Union Central Liquidity Facility Act, subchapter III of the Federal Credit Union Act. The NCUA Central Liquidity Facility is a mixed-ownership Government corporation within NCUA. It is managed by the NCUA Board and is owned by its member credit unions. The purpose of the Facility is to improve the general financial stability of credit unions by meeting their liquidity needs and thereby encourage savings, support consumer and mortgage lending and provide basic financial resources to all segments of the economy. The Central Liquidity Facility achieves this purpose through operation of a Central Liquidity Fund (CLF). The collection of information under this part is necessary for the CLF to determine credit worthiness, as required by 12 U.S.C. 1795e(2).

Affected Public: Private Sector: Not-for-profit institutions.

Estimated Number of Respondents: 269.

Estimated Number of Responses per Respondent: 4.260.

Estimated Total Annual Responses: 1,146.

Estimated Hours per Response: 0.603.

Estimated Total Annual Burden Hours: 691.

OMB Number: 3133–0067.

Title: Corporate Credit Union Monthly Call Report and Annual Report of Officers.

Type of Review: Revision of a currently approved collection.

Abstract: Section 202(a)(1) of the Federal Credit Union Act (Act) requires federally insured credit unions to make reports of condition to the NCUA Board upon dates selected by it. Corporate credit unions report this information monthly on NCUA Form 5310, also known as the Corporate Credit Union Call Report. The financial and statistical information is essential to NCUA in carrying out its responsibility for supervising corporate credit unions. The Federal Credit Union Act, 12 U.S.C. 1762, specifically requires Federal credit unions to report the identity of credit union officials. Section 741.6(a) requires federally-insured credit unions to submit a Report of Officials annually to NCUA containing the annual certification of compliance with security requirements. The branch information is requested under the authority of § 741.6 of the NCUA Rules and Regulations. NCUA utilizes the information to monitor financial conditions in corporate credit unions, and to allocate supervision and examination resources.

Affected Public: Private Sector: Not-for-profit institutions.

Estimated Number of Respondents: 11.

Estimated Number of Responses per Respondent: 13.

Estimated Total Annual Responses: 143.

Estimated Hours per Response: 3.77.

Estimated Total Annual Burden Hours: 539.

Reason for Change: The 5310 Corporate Call Report, Profile, and Corporate Financial Performance Reports (CFPR) for calendar year 2024 have several changes that entail removal of references to Current Expected Credit Loss (CECL) early adoption language; removal of the Available for Sale Book Value references; additional supplemental information for charitable donation accounts, subordinated debt purchased from member credit unions, and additional information about CUSO investments; additional liquidity, weighted average life (WAL), and WAL with 50 percent prepayment information reporting, and Federal Reserve Bank Excess Balance Account reporting; clarification of Information System and Technology questions on the Profile form; and corresponding updates to the Corporate Financial Performance Report (CFPR), including a new template for aggregate CFPRs that shows weighted average ratios. These changes have not adjusted the current burden.

OMB Number: 3133–0199.

Title: Capital Planning and Stress Testing, 12 CFR 702–E.

Type of Review: Revision of a currently approved collection.

Abstract: To protect the National Credit Union Share Insurance Fund (NCUSIF) and the credit union system, the largest Federally Insured Credit Unions (FICUs) need to have systems and processes in place to monitor and maintain their capital adequacy. Subpart C of part 702 of NCUA's regulations codifies the capital planning and stress testing requirements for federally insured credit unions with $10 billion or more in assets (covered credit unions). NCUA issues these regulations under the authority of section 120(a) requiring their supervised institutions to conduct annual stress tests. Stress testing is needed to assess the potential impact of expected and stressed economic conditions on the consolidated earnings, losses, and capital of a covered credit union over the planning horizon, taking into account the current state of the covered credit union and the covered credit union's risks, exposures, strategies, and activities.

NCUA received one comment from the 60-Day Notice published at 88 FR 62604. The commenter requested that NCUA provide additional clarification regarding the use of the standard form results reporting templates for purposes of reporting results of internal capital planning and analysis. The commenter noted that multiple items requested in the SST schedules were not applicable to internal capital analysis conducted by the credit union. As an example, the commenter cited Stress Test Capital and the Stress Test Capital Ratio currently required to be reported in the standard form templates were not applicable to their internal capital planning and analysis. The commenter also stated they felt use of the standard form reporting templates was redundant and ineffective whereas their capital plan includes commentary, analysis and supporting schedules that bring important context to the results of that analysis.

NCUA agrees that some revision and clarification in the reporting instructions may be necessary to use the standard form results reporting templates for purposes of reporting results of both annual Supervisory Stress Testing results as well as results of internal capital adequacy assessment analysis and planning. We disagree, however, with the example provided by the commenter, because Section 702.304(b)(1) of the Rules and Regulations requires covered credit unions to include, as a mandatory element in their annual capital planning, “a quarterly assessment of the expected sources and levels of stress test capital over the planning horizon that reflects the covered credit union's financial state, size, complexity, risk profile, scope of operations, and existing level of capital, assuming both expected and unfavorable conditions”. The requirement to measure stress test capital as defined in section 702.302 of the Regulations aside, NCUA acknowledges that credit unions, as part of their internal capital adequacy assessment analysis and planning, may target different measures. NCUA has made revisions to the standard form templates to accommodate reporting of different capital measures in the balance sheet tab of the templates. Instructions and definitions were adjusted accordingly as well. Furthermore, NCUA disagrees with the commenter's statement that reporting results of internal capital analysis using the standard form templates would be inefficient and redundant as compared to the detailed analysis, commentary and supporting schedules contained in their annual capital plan. As stated in the initial PRA notification, reporting of internal capital analysis results in a standard form manner will allow NCUA to more efficiently and fairly review benchmarks and opine on the strength and reasonableness of credit unions analyses serving as the foundation of the capital adequacy assessment and planning. NCUA acknowledges there would be some initial burden placed on credit unions to revise and update systems and applications used to generate results of internal capital analysis in a form exportable to the reporting templates; however, NCUA believes that the benefits obtained in efficiency and fairness of review and assessment of capital analysis results outweigh these initial burdens.

The commenter also stated that NCUA's inclusion of investment data as part of the revised annual data request is duplicative because ONES credit unions submit other investment data on a quarterly basis. NCUA agrees with the commenter that ONES credit unions are required to submit some instrument-level investment data to the ONES supervisory team on a quarterly basis. However, this only covers a portion of credit union investment activities. The annual collection of investment data covered by the PRA notice also captures instrument-level investment information in credit union employee benefit and charitable donation accounts. These additional instrument-level investment data are needed to model the credit union's balance sheet and income statement under stress scenarios. This information has historically been collected by NCUA on an annual basis. While NCUA agrees that future efforts should work to combine both investment data collections, continuing to collect this data as part of the current annual collection is still needed.

Affected Public: Private Sector: Not-for-profit institutions.

Estimated Number of Respondents: 12.

Estimated Number of Responses per Respondent: 1.

Estimated Total Annual Responses: 12.

Estimated Hours per Response: 781.67.

Estimated Total Annual Burden Hours: 9,380.

Reason for Change: Burden increased due to the increase in the number of credit unions meeting the asset size threshold for capital planning and self-run stress testing and because of the updated self-run SST results reporting template, as well as reporting of internal capital analysis results on the updated template.

Request for Comments: Comments submitted in response to this notice will be summarized and included in the request for Office of Management and Budget approval. All comments will become a matter of public record. The public is invited to submit comments concerning: (a) whether the collection of information is necessary for the proper performance of the function of the agency, including whether the information will have practical utility; (b) the accuracy of the agency's estimate of the burden of the collection of information, including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of the information on the respondents, including the use of automated collection techniques or other forms of information technology.

By the National Credit Union Administration Board.

Melane Conyers-Ausbrooks,

Secretary of the Board.