[Federal Register Volume 60, Number 106 (Friday, June 2, 1995)]
[Notices]
[Pages 28787-28790]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-13443]
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FEDERAL RESERVE SYSTEM
Agency Forms Under Review
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Notice.
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BACKGROUND: On June 15, 1984, the Office of Management and Budget (OMB)
delegated to the Board of Governors of the Federal Reserve System
(Board) its approval authority under the Paperwork Reduction Act of
1980, as per 5 CFR 1320.9, to approve of and assign OMB control numbers
to collection of information requests and requirements conducted or
sponsored by the Board under conditions set forth in 5 CFR 1320.9.
Board-approved collections of information will be incorporated into the
official OMB inventory of currently approved collections of
information. A copy of the OMB 83-I and supporting statement and the
approved collection of information instruments will be placed into
OMB's public docket files. The following forms, which are being handled
under this delegated authority, have received initial Board approval
and are hereby published for comment. At the end of the comment period,
the proposed information collections, along with an analysis of
comments and recommendations received, will be submitted to the Board
for final approval under OMB delegated authority.
DATES: Comments must be submitted on or before July 1, 1995.
ADDRESSES: Comments, which should refer to the OMB Docket number (or
Agency form number in the case of a new information collection that has
not yet been assigned an OMB number), should be addressed to Mr.
William W. Wiles, Secretary, Board of Governors of the Federal Reserve
System, 20th and C Streets, N.W., Washington, D.C. 20551, or delivered
to the Board's mail room between 8:45 a.m. and 5:15 p.m., and to the
security control room outside of those hours. Both the mail room and
the security control room are accessible from the courtyard entrance on
20th Street between Constitution Avenue and C Street, N.W. Comments
received may be inspected in room M-P-500 between 9:00 a.m. and 5:00
p.m., except as provided in section 261.8 of the Board's Rules
Regarding Availability of Information, 12 CFR 261.8(a).
A copy of the comments may also be submitted to the OMB desk
officer for the Board: Milo Sunderhauf, Office of Information and
Regulatory Affairs, Office of Management and Budget, New Executive
Office Building, Room 3208, Washington, D.C. 20503.
FOR FURTHER INFORMATION CONTACT: A copy of the proposed form and
instructions, the Paperwork Reduction Act Submission (OMB 83-I),
supporting statement, and other documents that will be placed into
OMB's public docket files once approved may be requested from the
agency clearance officer, whose name appears below.
Mary M. McLaughlin, Federal Reserve Board Clearance Officer (202-
452-3829), Division of Research and Statistics, Board of Governors of
the Federal Reserve System, Washington, D.C. 20551. For the hearing
impaired only, Telecommunications Device for the Deaf (TDD) Dorothea
Thompson (202-452-3544), Board of Governors of the Federal Reserve
System, Washington, D.C. 20551.
Proposal to approve under OMB delegated authority the extension,
with revision, of the following reports:
1. Report title: Registration Statement for Persons who Extend
Credit Secured by Margin Stock, Deregistration Statement for Persons
Registered Pursuant to Regulation G, and Annual Report.
Agency form numbers: FR G-1, FR G-2, and FR G-4 [[Page 28788]]
OMB Docket number: 7100-0011
Frequency: On occasion
Reporters: Individuals and businesses
Annual reporting hours: 1,478
Estimated average hours per response: 1.90
Number of respondents: 778
Small businesses are affected.
General description of report: This information collection is
mandatory (15 U.S.C. 78g). The FR G-1 and FR G-4 are given confidential
treatment (5 U.S.C. 552(b)(4)). The FR G-2 does not request
confidential information.
Abstract: Regulation G was adopted in response to concerns of the
Federal Reserve and the Securities Exchange Commission that unregulated
lenders were circumventing the margin requirements of Regulations T and
U. These reports are event-generated and are filed with the appropriate
Federal Reserve Bank. The proposed revisions include a further
breakdown of an existing item regarding employee stock option,
purchase, and ownership plans on the FR G-1 and FR G-4, the addition of
the registrant's telephone number to the FR G-2, and clarifications to
the existing reporting instructions for the FR G-1 and FR G-4. The
proposed revisions are expected to have no appreciable effect on
respondent burden for these reports.
Proposal to approve under OMB delegated authority the extension,
without revision, of the following reports:
1. Report title: Statement of Purpose for an Extension of Credit
Secured by Margin Stock by a Person Subject to Registration under
Regulation G.
Agency form number: FR G-3
OMB Docket number: 7100-0018
Frequency: On occasion
Reporters: Individuals and businesses
Annual reporting hours: 2,240
Estimated average hours per response: .16
Number of respondents: 700
Small businesses are affected.
General description of report: This information collection is
mandatory (15 U.S.C. 78g). Since the FR G-3 is not filed with the
Federal Reserve, no issue of confidentiality arises.
Abstract: Regulation G was adopted in response to concerns of the
Federal Reserve and the Securities Exchange Commission that unregulated
lenders were circumventing the margin requirements of Regulations T and
U. This report is event-generated and is not filed with the Federal
Reserve System but retained by the lender. The report is needed to
ensure that a Regulation G lender does not extend credit to purchase or
carry securities in excess of the amount permitted by the Federal
Reserve Board pursuant to Regulation G and to ensure that a borrower
does not violate Regulation X.
2. Report title: Agreement of Domestic and Foreign Nonmember Banks.
Agency form number: FR T-1, T-2
OMB Docket number: 7100-0191
Frequency: On occasion
Reporters: Nonmember Banks
Annual reporting hours: .50
Estimated average hours per response: .50
Number of respondents: 1
Small businesses are not affected.
General description of report: This information collection is
mandatory (15 U.S.C. 78h) and is not given confidential treatment.
Abstract: The Federal Reserve adopted Regulation T, ``Credit by
Brokers and Dealers,'' in 1934 to regulate extension of credit by and
to brokers and dealers; it also covers related transactions within the
Federal Reserve's authority under the act. It imposes, among other
obligations, initial margin requirements and payment rules on
securities transactions. Pursuant to Section 8 of the Securities
Exchange Act of 1934 and Regulation T, domestic and foreign banks that
are not members of the Federal Reserve System are required to file a FR
T-1, T-2 with the appropriate Federal Reserve Bank in the event that
they wish to extend credit to brokers/dealers using exchange-traded
securities as collateral. In addition, the form must be filed by
foreign nonmember banks that issue letters of credit used as deposits
against borrowings of securities by brokers-dealers. The FR T-1, T-2
requires a domestic or foreign nonmember bank to state that it is a
``bank'' as defined in section 3(a)(6) of the Securities Exchange Act
of 1934, and list the state or country in which it was organized and
the location of its principal place of business. No substantive changes
are being proposed to the FR T-1, T-2. However, the Federal Reserve
proposes to add the phrase ``(indicate state for domestic bank or
country for foreign bank)'' to explicitly state this requirement of
Regulation T.
3. Report title: Statement of Purpose of Extension of Credit by a
Creditor (under Regulation T).
Agency form number: FR T-4
OMB Docket number: 7100-0019
Frequency: On occasion
Reporters: Individuals and businesses
Annual reporting hours: 42
Estimated average hours per response: .17
Number of respondents: 250
Small businesses are affected.
General description of report: This information collection is
mandatory (15 U.S.C. 78g). Because the FR T-4 is not filed with the
Federal Reserve, no issue of confidentiality arises.
Abstract: The Federal Reserve adopted Regulation T, ``Credit by
Brokers and Dealers,'' in 1934 to regulate extension of credit by and
to brokers and dealers; it also covers related transactions within the
Federal Reserve's authority under the act. It imposes, among other
obligations, initial margin requirements and payment rules on
securities transactions. Regulation T presumes that any extension of
credit by a broker/dealer to a customer is made for the purpose of
purchasing, trading, or carrying securities, and thus is subject to the
Board's margin requirements. Customers and creditors are required to
complete and retain the FR T-4 in the event that the customer can rebut
the presumption and the creditor is thereby permitted to extend credit
in excess of the amount otherwise permitted under Regulation T. The FR
T-4 solicits information from borrowers regarding the purpose of each
loan, and from creditors identifying collateral. No changes are
proposed for the FR T-4 reporting form.
4. Report title: Statement of Purpose for an Extension of Credit
Secured by Margin Stock.
Agency form number: FR U-1
OMB Docket number: 7100-0115
Frequency: On occasion
Reporters: Individuals and businesses
Annual reporting hours: 157,853
Estimated average hours per response: .07
Number of respondents: 10,637
Small businesses are not affected.
General description of report: This information collection is
mandatory (15 U.S.C. 78g). Since the FR U-1 is not filed with the
Federal Reserve no issue of confidentiality arises.
Abstract: In 1936, the Federal Reserve adopted Regulation U,
``Credit by Banks for the Purpose of Purchasing or Carrying Margin
Stock,'' as a companion to Regulation T which applies to securities
credit extended by brokers/dealers. Regulation U imposes restrictions
upon ``banks'' (as defined in section 221.2(b) of Regulation U) that
extend credit for the purpose of buying or carrying margin stock if the
credit is secured directly or indirectly by margin stock. Banks may not
extend more than the minimum loan value of the collateral securing such
credit, as set by the Federal Reserve in section 221.8 of Regulation U.
Regulation U requires that a purpose statement be completed and
retained in the event that a bank extends credit in an amount exceeding
$100,000 [[Page 28789]] secured directly or indirectly by margin stock.
In all cases, the FR U-1 collects the following loan information
from the borrower:
(1) The amount of credit being obtained; and
(2) Whether the loan is to purchase or carry margin stocks and, if
not, the purpose of the loan. If the borrower affirms that the purpose
of the loan is to purchase or carry margin stocks, the bank provides
the following collateral information in Part II:
(3) The number of shares of stock serving as collateral;
(4) The name of the stock (issue);
(5) The market price per share;
(6) The date and source of valuation (not required if market value
is obtained from regularly published information in a journal of
general circulation or from an automated quotation system);
(7) The total market value per issue; and
(8) The amount of any other collateral securing the loan. No
substantive changes are proposed for the FR U-1 reporting form.
However, the Federal Reserve proposes to
(i) Revise the phrase ``maximum loan value of margin stock is ...
per cent'' for items 1 and 2 of Part II to ``maximum loan value of
margin stock is 50 per cent,'' and
(ii) Add the phrase ``or from an automated quotation system.'' to
the note below item 3.
5. Report title: Written Security Program for State Member Banks.
Agency form number: FR 4004
OMB Docket number: 7100-0112
Frequency: Annual
Reporters: State member banks
Annual reporting hours: 484
Estimated average hours per response: 0.5
Number of respondents: 968
Small businesses are affected.
General description of report: This recordkeeping requirement is
mandatory (12 U.S.C. Secs. 1882(a), 248(a)(1), and 325). Because
written security programs are maintained at state member banks, no
issue of confidentiality under the Freedom of Information Act arises.
Abstract: The Congress adopted the Bank Protection Act of 1968 (12
U.S.C. 1882) to promulgate rules establishing minimum standards for
banks as to the installation, maintenance, and operation of security
devices and procedures to discourage robberies, burglaries, and
larcenies and to assist in the identification and apprehension of
persons who commit such acts.
In response to the passage of the Bank Protection Act (Act), each
of the federal financial institution supervisory agencies established
minimum standards for security devices and procedures. The requirements
established by the Board of Governors of the Federal Reserve System in
1969 for state member banks are contained in Regulation P. In the
regulation, the Federal Reserve requires the board of directors of each
state member bank to designate a security officer to assume the
responsibility for the development, administration, and maintenance of
a written security program. The original Act also contained provisions
requiring financial institutions to submit periodic reports to their
primary federal supervisory agency with respect to the installation,
maintenance, and operation of security devices and the development of
security procedures.
The Financial Institutions Reform, Recovery, and Enforcement Act of
1989 (FIRREA) includes provisions that amend the Act: eliminating the
requirement that each bank submit periodic reports to its regulator,
but retaining the requirement that each bank maintain a written
security program. The Federal Reserve amended Regulation P in 1991 to
reflect this change. Each state member bank must maintain a written
security program in its records. This program should include a
requirement to install security devices and should establish procedures
that satisfy minimum standards in the regulation, with the security
officer determining the need for additional security devices and
procedures based on the location of the banking office. No changes are
being proposed to the recordkeeping requirement.
6. Report title: Annual Report on Status of Disposition of Assets
Acquired in Satisfaction of Debts Previously Contracted.
Agency form number: FR 4006
OMB Docket number: 7100-0129
Frequency: Annual
Reporters: Bank holding companies that have acquired assets or shares
through foreclosure in the ordinary course of collecting a debt
previously contracted.
Annual reporting hours: 3,000
Estimated average hours per response: 5
Number of respondents: 600
Small businesses are affected.
General description of report: This information collection is
mandatory (12 U.S.C. 1843(c)(2) and 1844(c) and may be given
confidential treatment upon request (5 U.S.C. 552(b)(4)).
Abstract: The Federal Reserve has statutory responsibility for
regulation and supervision of bank holding companies (BHCs) under the
Bank Holding Company Act of 1956, as amended (Act). Under the Act, the
Federal Reserve must ensure that impermissible assets are divested in a
manner consistent with the statute. The Act sets forth the time frame
within which assets and shares acquired in collecting a debt previously
contracted (DPC) must be divested.
The Federal Reserve does not require BHCs to obtain prior approval
for their acquisition of DPC shares or assets so long as they divest
them within two years of the date of their initial acquisition. If the
BHC is unsuccessful in divesting them within the two-year period, it
must request and obtain approval to continue to hold them. The Board
may extend the initial two-year period for up to three additional one-
year periods. Further, for real estate or other DPC assets that are
demonstrated to have value and marketability characteristics similar to
real estate, the Board may permit additional extensions for up to five
years (for a total of ten years).
The Federal Reserve does require that the BHC make good faith
efforts to dispose of DPC shares or assets and notify it annually of
the progress being made with respect to their disposition. Beginning
two years after the date of acquisition of DPC assets or shares, the
BHC must report annually to the Federal Reserve on its efforts to
divest them.
The Federal Reserve uses the information to determine:
(1) Whether a BHC has made timely, good faith efforts to comply
with the requirements of the Act; and
(2) The effect that the sale or retention of the property will have
on the organization. This report serves to identify potentially unsound
situations and to encourage timely compliance with the divestiture
requirement as contained in the statutes and regulation. The Federal
Reserve monitors the BHC's efforts to effect an orderly divestiture,
and may require divestiture before the end of the approved period if
supervisory concerns warrant such action.
The reporting requirement only applies to those BHCs that fail to
divest DPC shares or assets within two years. They must file an annual
report on their efforts to accomplish divestiture of the shares or
assets. The report must describe the efforts made to date to effect
divestiture (including reasons for any delay in the pace of
divestiture), and must include financial and descriptive data with
respect to assets as well as the sales price of divested assets.
Affected BHCs file the annual report on their progress toward
divestiture with their district Federal Reserve Bank. The due date for
the report is based on the date the BHC acquired the DPC
[[Page 28790]] assets or shares. The BHC submits the information in a
letter format, which is neither stored electronically nor published. No
changes are being proposed to the FR 4006 reporting requirement.
Board of Governors of the Federal Reserve System, May 25, 1995
William W. Wiles,
Secretary of the Board.
[FR Doc. 95-13443 Filed 6-1-95; 8:45AM]
Billing Code 6210-01-F
