92 Federal Register / Vol. 86, No. 1 / Monday, January 4, 2021 / Notices 

1An SLHC must file one or more of the FR Y– 

9 family of reports unless it is: (1) A grandfathered 

unitary SLHC with primarily commercial assets and 

thrifts that make up less than five percent of its 

consolidated assets; or (2) a SLHC that primarily 

holds insurance-related assets and does not 

otherwise submit financial reports with the SEC 

pursuant to section 13 or 15(d) of the Securities 

Exchange Act of 1934. 

Webinar registration page and provided 

call-in information. 

Joyce B. Stone, 

Assistant Corporate Secretary. 

[FR Doc. 2020–29156 Filed 12–30–20; 11:15 am] 

BILLING CODE 6690–01–P 

FEDERAL RESERVE SYSTEM 

Change in Bank Control Notices; 

Acquisitions of Shares of a Bank or 

Bank Holding Company 

The notificants listed below have 

applied under the Change in Bank 

Control Act (Act) (12 U.S.C. 1817(j)) and 

§ 225.41 of the Board’s Regulation Y (12 

CFR 225.41) to acquire shares of a bank 

or bank holding company. The factors 

that are considered in acting on the 

applications are set forth in paragraph 7 

of the Act (12 U.S.C. 1817(j)(7)). 

The public portions of the 

applications listed below, as well as 

other related filings required by the 

Board, if any, are available for 

immediate inspection at the Federal 

Reserve Bank(s) indicated below and at 

the offices of the Board of Governors. 

This information may also be obtained 

on an expedited basis, upon request, by 

contacting the appropriate Federal 

Reserve Bank and from the Board’s 

Freedom of Information Office at 

https://www.federalreserve.gov/foia/ 

request.htm. Interested persons may 

express their views in writing on the 

standards enumerated in paragraph 7 of 

the Act. 

Comments regarding each of these 

applications must be received at the 

Reserve Bank indicated or the offices of 

the Board of Governors, Ann E. 

Misback, Secretary of the Board, 20th 

Street and Constitution Avenue NW, 

Washington, DC 20551–0001, not later 

than January 19, 2021. 

A. Federal Reserve Bank of Chicago 

(Colette A. Fried, Assistant Vice 

President) 230 South LaSalle Street, 

Chicago, Illinois 60690–1414: 

1. Timothy Schams, La Crosse, 

Wisconsin; to acquire voting shares of 

River Holding Company, Stoddard, 

Wisconsin, and thereby indirectly 

acquire voting shares of River Bank, 

Stoddard, Wisconsin, and Wisconsin 

River Bank, Sauk City, Wisconsin. 

B. Federal Reserve Bank of 

Minneapolis (Chris P. Wangen, 

Assistant Vice President), 90 Hennepin 

Avenue, Minneapolis, Minnesota 

55480–0291: 

1. Angela K. Rassas, Potomac Falls, 

Virginia; Dianne K. Johnson, as a trustee 

of the Dianne K. Johnson Trust and the 

Mignon L. Johnson Trust, all of Forest 

Lake, Minnesota; Scott C. Johnson, 

individually and as trustee of the Edsel 

F. Johnson Disclaimer Trust, both of 

Stillwater, Minnesota; Jill E. King, Arden 

Hills, Minnesota; and Mackenzie L. 

Farrill, Hudson, Wisconsin; to join the 

Johnson Family Group, a group acting in 

concert, to retain voting shares of 

Marine Bancshares, Inc., and thereby 

indirectly retain voting shares of 

Security State Bank of Marine, both of 

Marine on St. Croix, Minnesota. 

C. Federal Reserve Bank of Dallas 

(Robert L. Triplett III, Senior Vice 

President) 2200 North Pearl Street, 

Dallas, Texas 75201–2272: 

1. William Alexander O’Brien, 

Amarillo, Texas; to acquire voting 

shares of BOC Bank, McLean, Texas. 

Board of Governors of the Federal Reserve 

System, December 28, 2020. 

Ann Misback, 

Secretary of the Board. 

[FR Doc. 2020–29030 Filed 12–31–20; 8:45 am] 

BILLING CODE 6210–01–P 

FEDERAL RESERVE SYSTEM 

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 Financial 

Statements for Holding Companies (FR 

Y–9 reports; OMB Control Number 

7100–0128) and the Consolidated 

Report of Condition and Income for 

Edge and Agreement Corporations (FR 

2886b; OMB Control Number 7100– 

0086). The new revisions to these 

reports are effective as of March 31, 

2021. The Board is also finalizing the 

following revisions that were previously 

approved on an interim basis: Revisions 

to the definition of ‘‘savings deposits’’ 

in the FR Y–9C and FR 2886b 

instructions associated with the 

amendments to the Board’s Regulation 

D (Reserve Requirements of Depository 

Institutions), collection of two new 

temporary data items on loan 

modifications consistent with section 

4013(d)(2) of the Coronavirus Aid, 

Relief and Economic Security (CARES) 

Act, and collection of four new 

temporary data items related to the an 

interim final rule implementing the 

Paycheck Protection Program Liquidity 

Facility (PPPLF). These changes became 

effective June 30, 2020. 

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, (202) 

452–3829. 

Office of Management and Budget 

(OMB) Desk Officer—Will Bestani— 

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 

(202) 395–6974. 

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. Boardapproved collections of information are 

incorporated into the official OMB 

inventory of currently approved 

collections of information. The OMB 

inventory, as well as copies of the PRA 

Submission, supporting statements, and 

approved collection of information 

instrument(s) are available at https://

www.reginfo.gov/public/do/PRAMain. 

These documents are also 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. 

Final Approval Under OMB Delegated 

Authority of the Extension for Three 

Years, With Revision of the Following 

Information Collections: 

(1) Report title: Financial Statements 

for Holding Companies. 

Agency form numbers: FR Y–9C, FR 

Y–9LP, FR Y–9SP, FR Y–9ES, and FR 

Y–9CS. 

OMB control number: 7100–0128. 

Frequency: Quarterly, semiannually, 

and annually. 

Respondents: Bank holding 

companies (BHCs), savings and loan 

holding companies (SLHCs), securities 

holding companies, and U.S. 

intermediate holding companies (IHCs) 

(collectively, holding companies).1

Estimated number of respondents: 

FR Y–9C (non-advanced approaches 

holding companies) with less than $5 

billion in total assets—124, 

Federal Register / Vol. 86, No. 1 / Monday, January 4, 2021 / Notices 93 

2 12 U.S.C. 1844. 

3 12 U.S.C. 5311(a)(1) and 5365; Section 165(b)(2) 

of Title I of the Dodd-Frank Act, 12 U.S.C. 

5365(b)(2), refers to ‘‘foreign-based bank holding 

company.’’ Section 102(a)(1) of the Dodd-Frank Act, 

12 U.S.C. 5311(a)(1), defines ‘‘bank holding 

company’’ for purposes of Title I of the Dodd-Frank 

Act to include foreign banking organizations that 

are treated as bank holding companies under 

section 8(a) of the International Banking Act, 12 

U.S.C. 3106(a). The Board has required, pursuant to 

section 165(b)(1)(B)(iv) of the Dodd-Frank Act, 12 

U.S.C. 5365(b)(1)(B)(iv), certain foreign banking 

organizations subject to section 165 of the DoddFrank Act to form U.S. intermediate holding 

companies. Accordingly, the parent foreign-based 

organization of a U.S. IHC is treated as a BHC for 

purposes of the BHC Act and section 165 of the 

Dodd-Frank Act. Because section 5(c) of the BHC 

Act authorizes the Board to require reports from 

subsidiaries of BHCs, section 5(c) provides 

additional authority to require U.S. IHCs to report 

the information contained in the FR Y–9 series of 

reports. 

4 12 U.S.C. 1850a(c)(1)(A). 

5 5 U.S.C. 552(b)(4). 

6 5 U.S.C. 552(b)(8). 

7 5 U.S.C. 552(b)(4). 

8See 12 U.S.C. 1464(v)(2). 

9Exemption 8 of the Freedom of Information Act 

(FOIA) specifically exempts from disclosure 

Continued 

FR Y–9C (non advanced approaches 

holding companies) with $5 billion or 

more in total assets—218, 

FR Y–9C (advanced approaches 

holding companies)—9, 

FR Y–9LP—416, 

FR Y–9SP—3,739, 

FR Y–9ES—78, 

FR Y–9CS—236. 

Estimated average hours per response: 

Reporting 

FR Y–9C (non advanced approaches 

holding companies) with less than $5 

billion in total assets—35.72; 

FR Y–9C (non advanced approaches 

holding companies) with $5 billion or 

more in total assets—44.92; 

FR Y–9C (advanced approaches 

holding companies)—50.14; 

FR Y–9LP—5.27; 

FR Y–9SP—5.40; 

FR Y–9ES—0.50; 

FR Y–9CS—0.50. 

Recordkeeping 

FR Y–9C—1; 

FR Y–9LP—1; 

FR Y–9SP—0.50; 

FR Y–9ES—0.50; 

FR Y–9CS—0.50. 

Estimated annual burden hours: 

Reporting 

FR Y–9C (non advanced approaches 

holding companies) with less than $5 

billion in total assets—17,715; 

FR Y–9C (non advanced approaches 

holding companies) with $5 billion or 

more in total assets—39,166; 

FR Y–9C (advanced approaches 

holding companies)—1,805; 

FR Y–9LP—8,769; 

FR Y–9SP—40,381; 

FR Y–9ES—39; 

FR Y–9CS—472. 

Recordkeeping 

FR Y–9C—1,404; 

FR Y–9LP—1,664; 

FR Y–9SP—3,739; 

FR Y–9ES—39; 

FR Y–9CS—472. 

General description of report: The FR 

Y–9 family of reporting forms continues 

to be the primary source of financial 

data on holding companies that 

examiners rely on in the intervals 

between on-site inspections. The Board 

requires holding companies to provide 

standardized financial statements to 

fulfill the Board’s statutory obligation to 

supervise these organizations. Financial 

data from these reporting forms are used 

to detect emerging financial problems, 

to review performance and conduct preinspection analysis, to monitor and 

evaluate capital adequacy, to evaluate 

holding company mergers and 

acquisitions, and to analyze a holding 

company’s overall financial condition to 

ensure the safety and soundness of its 

operations. The FR Y–9C, FR Y–9LP, 

and FR Y–9SP serve as standardized 

financial statements for the holding 

companies. The FR Y–9ES is a financial 

statement for holding companies that 

are Employee Stock Ownership Plans. 

The Board uses the voluntary FR Y–9CS 

(a free-form supplement) to collect 

additional information deemed to be 

critical and needed in an expedited 

manner. Holding companies file the FR 

Y–9C on a quarterly basis, the FR Y–9LP 

quarterly, the FR Y–9SP semiannually, 

the FR Y–9ES annually, and the FR Y– 

9CS on a schedule that is determined 

when this supplement is used. 

Legal authorization and 

confidentiality: The reporting and 

recordkeeping requirements associated 

with the FR Y–9 series of reports are 

authorized for BHCs pursuant to section 

5 of the Bank Holding Company Act 

(‘‘BHC Act’’); 2 for SLHCs pursuant to 

section 10(b)(2) and (3) of the Home 

Owners’ Loan Act, 12 U.S.C. 1467a(b)(2) 

and (3), as amended by sections 369(8) 

and 604(h)(2) of the Dodd-Frank Wall 

Street and Consumer Protection Act 

(‘‘Dodd-Frank Act’’); for IHCs pursuant 

to section 5 of the BHC Act, as well as 

pursuant to sections 102(a)(1) and 165 

of the Dodd-Frank Act; 3 and for 

securities holding companies pursuant 

to section 618 of the Dodd-Frank Act.4

Except for the FR Y–9CS report, which 

is expected to be collected on a 

voluntary basis, the obligation to submit 

the remaining reports in the FR Y–9 

series of reports and to comply with the 

recordkeeping requirements set forth in 

the respective instructions to each of the 

other reports, is mandatory. 

With respect to the FR Y–9C report, 

Schedule HI’s Memorandum item 7.g, 

‘‘FDIC deposit insurance assessments,’’ 

Schedule HC–P’s item 7.a, 

‘‘Representation and warranty reserves 

for 1–4 family residential mortgage 

loans sold to U.S. government agencies 

and government sponsored agencies,’’ 

and Schedule HC–P’s item 7.b, 

‘‘Representation and warranty reserves 

for 1–4 family residential mortgage 

loans sold to other parties’’ are 

considered confidential commercial and 

financial information. Such treatment is 

appropriate under exemption 4 of the 

Freedom of Information Act (‘‘FOIA’’),5

because these data items reflect 

commercial and financial information 

that is both customarily and actually 

treated as private by the submitter, and 

which the Board has previously assured 

submitters will be treated as 

confidential. It also appears that 

disclosing these data items may reveal 

confidential examination and 

supervisory information, and in such 

instances, the information also would be 

withheld pursuant to exemption 8 of the 

FOIA,6 which protects information 

related to the supervision or 

examination of a regulated financial 

institution. 

In addition, for both the FR Y–9C 

report and the FR Y–9SP report, 

Schedule HC’s Memorandum item 2.b, 

the name and email address of the 

external auditing firm’s engagement 

partner, is considered confidential 

commercial information and protected 

by exemption 4 of the FOIA,7 if the 

identity of the engagement partner is 

treated as private information by 

holding companies. The Board has 

assured respondents that this 

information will be treated as 

confidential since the collection of this 

data item was proposed in 2004. 

Additionally, items on the FR Y–9C, 

Schedule HC–C regarding loans 

modified under section 4013 of the 

CARES Act (Memorandum item 16.a, 

‘‘Number of Section 4013 loans 

outstanding’’, and Memorandum item 

16.b, ‘‘Outstanding balance of Section 

4013 loans’’) are considered 

confidential. While the Board generally 

makes institution-level FR Y–9C report 

data publicly available, the Board 

believes the disclosure of these items at 

the holding company level would not be 

in the public interest.8 Such information 

is permitted to be collected on a 

confidential basis, consistent with 5 

U.S.C. 552(b)(8).9 Holding companies 

94 Federal Register / Vol. 86, No. 1 / Monday, January 4, 2021 / Notices 

information ‘‘contained in or related to 

examination, operating, or condition reports 

prepared by, on behalf of, or for the use of an 

agency responsible for the regulation or supervision 

of financial institutions.’’ 

10The FR Y–9CS is a supplemental report that 

may be utilized by the Board to collect additional 

information that is needed in an expedited manner 

from holding companies. The information collected 

on this supplemental report is subject to change as 

needed. Generally, the FR Y–9CS report is treated 

as public. However, where appropriate, data items 

on the FR Y–9CS report may be withheld under 

exemptions 4 or 8 of the FOIA, 5 U.S.C. 552(b)(4) 

and (8). 

11 12 CFR part 261. 

12 5 U.S.C. 552(b)(8). 

13 5 U.S.C. 552(b)(4). 

14 85 FR 40646 (July 7, 2020). 

15 85 FR 63553 (October 8, 2020). 

may be reluctant to offer modifications 

under section 4013 if information on 

these modifications are publicly 

available, as analysts, investors, and 

other users of public FR Y–9C report 

information may penalize an institution 

for using the relief provided by the 

CARES Act. 

Aside from the data items described 

above, the remaining data items 

collected on the FR Y–9C report and the 

FR Y–9SP report are generally not 

accorded confidential treatment. The 

data items collected on FR Y–9LP, FR 

Y–9ES, and FR Y–9CS 10 reports, are 

also generally not accorded confidential 

treatment. As provided in the Board’s 

Rules Regarding Availability of 

Information,11 however, a respondent 

may request confidential treatment for 

any data items the respondent believes 

should be withheld pursuant to a FOIA 

exemption. The Board will review any 

such request to determine if confidential 

treatment is appropriate, and will 

inform the respondent if the request for 

confidential treatment has been granted 

or denied. 

To the extent the instructions to the 

FR Y–9C, FR Y–9LP, FR Y–9SP, and FR 

Y–9ES reports each respectively direct 

the financial institution to retain the 

workpapers and related materials used 

in preparation of each report, such 

material would only be obtained by the 

Board as part of the examination or 

supervision of the financial institution. 

Accordingly, such information is 

considered confidential pursuant to 

exemption 8 of the FOIA.12 In addition, 

the workpapers and related materials 

may also be protected by exemption 4 

of the FOIA, to the extent such financial 

information is treated as confidential by 

the respondent.13

(2) Report title: Consolidated Report 

of Condition and Income for Edge and 

Agreement Corporations. 

Agency form number: FR 2886b. 

OMB control number: 7100–0086. 

Frequency: Quarterly and annually. 

Reporters: Edge and agreement 

corporations. 

Estimated annual reporting hours: 

Banking: Edge and agreement 

corporations (quarterly): 586; 

Banking: Edge and agreement 

corporations (annually): 16; 

Investment: Edge and agreement 

corporations (quarterly): 1,034; 

Investment: Edge and agreement 

corporations (annually): 79. 

Estimated average hours per response: 

Banking: Edge and agreement 

corporations (quarterly): 15.77; 

Banking: Edge and agreement 

corporations (annually): 15.87; 

Investment: Edge and agreement 

corporations (quarterly): 11.81; 

Investment: Edge and agreement 

corporations (annually): 10.82. 

Number of respondents: 

Banking: Edge and agreement 

corporations (quarterly): 9; 

Banking: Edge and agreement 

corporations (annually): 1; 

Investment: Edge and agreement 

corporations (quarterly): 21; 

Investment: Edge and agreement 

corporations (annually): 7. 

General description of report: The FR 

2886b reporting form is filed quarterly 

and annually by banking Edge and 

agreement corporations and investment 

(nonbanking) Edge and agreement 

corporations (collectively, ‘‘Edges or 

Edge corporations’’). The mandatory FR 

2886b comprises a balance sheet, an 

income statement, two schedules 

reconciling changes in capital and 

reserve accounts, and 11 supporting 

schedules. The Board uses the FR 2886b 

data to help plan and target the scope 

of examinations of Edges and to 

evaluate applications from Edge 

corporations. Data from the FR 2886b 

are also used to monitor aggregate 

institutional trends, such as growth in 

assets and the number of offices, 

changes in leverage, and the types and 

locations of customers and to monitor 

and identify present and potential 

problems with Edge corporations. 

Legal authorization and 

confidentiality: Sections 25 and 25A of 

the Federal Reserve Act authorize the 

Federal Reserve to collect the FR 2886b 

(12 U.S.C. 602, 625). The obligation to 

report this information is mandatory. 

For Edge and Agreement corporations 

engaged in banking, current Schedules 

RC–M (with the exception of item 3) 

and RC–V are held confidential 

pursuant to exemption 4 of FOIA (12 

U.S.C. 552(b)(4)). For Edge and 

Agreement corporations not engaged in 

banking, only information collected on 

Schedule RC–M (with the exception of 

item 3) are given confidential treatment 

pursuant to exemption 4 of FOIA (12 

U.S.C. 552(b)(4)). 

Current actions: On July 7, 2020, the 

Board published a notice 14 to 

temporarily revise the FR Y–9C to 

collect four new data items related to 

Paycheck Protection Program (PPP) 

loans and the PPPLF. Also, as part of 

this notice, the Board temporarily 

revised the FR Y–9C to collect two new 

data items related to section 4013 of the 

CARES act. 

On October 8, 2020, the Board 

published a separate notice 15 to 

propose a number of revisions to the FR 

Y–9C, FR Y–9LP, and FR Y–9SP related 

to U.S. GAAP effective for reports with 

a March 31, 2021, as-of date, except for 

proposed revisions related to last-oflayer hedging, which were proposed to 

become effective following the adoption 

and implementation of a final standard 

by the Financial Accounting Standards 

Board (FASB). For holding companies 

that have adopted Accounting 

Standards Codification (ASC) Topic 

326, Financial Instruments—Credit 

Losses, the Board proposed in the 

October 2020 notice to add new 

Memorandum item 7, ‘‘Provisions for 

credit losses on off-balance sheet credit 

exposures,’’ to Schedule HI–B, Part II, 

Changes in allowances for Credit Losses. 

This line item would have enhanced 

transparency and differentiate between 

the provisions attributable to on-and offbalance sheet credit exposures reported 

in item 4, ‘‘Provisions for loan and lease 

losses’’ on the FR Y–9C income 

statement. As part of the GAAP-related 

changes, the Board also proposed new 

Memorandum item 8 to Schedule HI–B, 

Part II, ‘‘Changes in Allowances for 

Credit Losses’’, to the FR Y–9C report. 

The description of the memorandum 

item would have been ‘‘Estimated 

amount of expected recoveries of 

amounts previously written off included 

within the allowance for credit losses on 

loans and leases held for investment 

(included in item 7, column A, ‘Balance 

end of current period,’ above).’’ In 

proposing this reporting change, the 

Board noted that, under ASC Topic 326, 

holding companies could in some 

circumstances reduce the amount of the 

allowance for credit losses that would 

otherwise be calculated for a pool of 

assets with similar risk characteristics, 

which includes charged-off assets, by 

the estimated amount of expected 

recoveries of amounts written off on 

these assets. 

In this same October notice, the Board 

proposed to finalize, on an interim 

basis, revisions to the definition of 

‘‘savings deposits’’ in the FR Y–9C and 

FR 2886b instructions that are 

Federal Register / Vol. 86, No. 1 / Monday, January 4, 2021 / Notices 95 

16 85 FR 23445 (April 28, 2020). 

17 85 FR 44361 (July 22, 2020). 

associated with the amendments to the 

Board’s Regulation D (Reserve 

Requirements of Depository Institutions) 

published April 28, 2020.16 The 

temporarily-approved revisions permit, 

but do not require, depository 

institutions to immediately suspend 

enforcement of the six-transfer limit on 

convenient transfers for savings deposits 

and to allow their customers to make an 

unlimited number of convenient 

transfers and withdrawals from their 

savings deposits. The General 

Instructions for FR Y–9C Schedule HC– 

E, Deposit Liabilities, and FR 2886b 

Schedule RC–E, Deposit Liabilities, 

were revised to state that if an 

institution chooses to suspend 

enforcement of the six-transfer limit on 

a ‘‘savings deposit,’’ the institution may 

continue to report that account as a 

‘‘savings deposit’’ or may instead choose 

to report that account as a ‘‘transaction 

account’’ based on an assessment of 

certain characteristics of the account. 

Also as part of the October notice, the 

Board proposed to revise the General 

Instructions for FR Y–9C Schedule HC– 

E and FR 2886b Schedule RC–E to state 

that where the reporting institution has 

suspended the enforcement of the sixtransfer limit rule on an account that 

otherwise meets the definition of a 

savings deposit, the institution must 

report such deposits as a ‘‘savings 

deposit’’ (and as a ‘‘nontransaction 

account’’) or a ‘‘transaction account’’ 

based on an assessment of certain 

criteria. 

The comment period for the July 2020 

notice ended on September 8, 2020. The 

Board did not receive any comments on 

this proposal, and the revisions will be 

implemented as proposed, with the new 

data items being collected through 

December 31, 2021. 

The comment period for the October 

2020 notice expired on December 7, 

2020. The Board received a comment 

from a banker’s association on this 

proposal. Comments were also received 

on a comparable proposal involving the 

Consolidated Reports of Condition and 

Income (Call Report) (FFIEC 031, FFIEC 

041and FFIEC 051; OMB Control 

Number 7100–0036).17 The Board has 

taken the comments from the proposed 

changes to the Call Report into 

consideration in finalizing the proposed 

FR Y–9C and FR 2886b changes. The 

revisions to the FR Y–9C and FR 2886b 

will be implemented as proposed, with 

certain modifications described below. 

The effective date of the proposed 

revisions to the FR Y–9C and FR 2886b 

instructions regarding the definition of 

‘‘savings deposits’’ is December 31, 

2020. The effective date for all other 

changes is March 31, 2021. 

Comments Received on Provision for 

Credit Losses on Off-Balance Sheet 

Credit Exposures 

The lone commenter on the October 

2020 notice noted the potential impact 

on other reports beyond the FR Y–9C of 

the GAAP change related to provision 

for credit losses on off-balance sheet 

credit exposures. These other reports 

include the FR Y–7N (OMB Control 

Number 7100–0125), FR Y–11 (OMB 

Control Number 7100–0244), FR 2314 

(OMB Control Number 7100–0073), FR 

2886b (OMB Control Number 7100– 

0086), and FR 2644 (OMB Control 

Number 7100–0075). 

The Board will consider conforming 

changes to the forms and instructions 

for the FR 2886b, FR Y–7N, FR Y–11, 

and FR 2314 in the future. Any such 

changes would be proposed by the 

Board through a separate Federal 

Register notice pursuant to the 

Paperwork Reduction Act. The Board 

does not intend to make conforming 

changes to the FR 2644 since this report 

is only comprised of balance sheet items 

and this GAAP-related change only 

impacts income statement items. 

Comments Received on Final 

Regulation D Reporting Revisions 

The Board did not receive comments 

on the proposal to finalize the 

temporarily-approved revisions to the 

FR Y–9C and FR 2886b instructions 

regarding the definition of ‘‘savings 

deposits’’ associated with the 

amendments to the Board’s Regulation 

D. The changes were effective as of June 

30, 2020. 

The commenter on the October 2020 

notice raised several concerns with the 

proposed changes related to the 

definition of ‘‘savings deposits’’ and the 

assessment criteria to remove certain 

optional reporting, and requested a 

clarification on the definition of ‘‘retail 

sweep arrangements.’’ The commenter 

recommended that the revisions be 

consistent across reports. Specifically, 

the commenter recommended that 

savings deposits be classified 

consistently as transaction or 

nontransaction accounts across reports. 

The commenter stated that the 

differences in the treatment of savings 

deposits would require firms to report 

savings deposits as nontransaction 

accounts on the Call Reports, FR Y–9C, 

and FR 2886b, while the same deposits 

would be classified as a transaction 

account on the Report of Transaction 

Accounts, Other Deposits and Vault 

Cash (FR 2900; OMB Control Number 

7100–0087). The commenter 

recommended that the Board provide 

clear and consistent definitions of 

‘‘savings deposits,’’ ‘‘transaction 

accounts,’’ and ‘‘nontransaction 

accounts.’’ In response to the 

commenter’s recommendation, the 

Board will continue to maintain the 

requirement to report ‘‘savings 

deposits’’ as a component of 

nontransaction accounts on the FR Y– 

9C and FR 2886b in order to maintain 

consistency with the Call Report. The 

Board will also maintain the definition 

of ‘‘transaction accounts’’ and 

‘‘nontransaction accounts’’ as currently 

stated in the FR Y–9C and FR 2886b 

instructions, which is consistent with 

the Call Report instructions. It is 

important to note the Call Report and 

FR Y–9C are principal sources of 

financial data used for supervision and 

regulation of the banking industry 

whereas the primary purpose of the FR 

2900 report is to collect data for the 

construction of the monetary aggregates. 

Secondly, regarding the proposed 

changes to the assessment criteria for 

‘‘savings deposits,’’ the commenter 

recommended that a depositor’s 

eligibility to hold a NOW account 

should not be included in the criteria 

assessment to determine the reporting 

treatment for savings deposits for which 

the numeric limits on transfers and 

withdrawals have been removed. The 

commenter noted that ‘‘if a firm does 

not offer NOW accounts, they would be 

required to report savings deposits as 

NOW accounts, ATS accounts, or 

telephone and preauthorized transfer 

accounts (and as transaction accounts) 

based on a depositor’s eligibility to hold 

such account’’ and ‘‘for firms that do not 

offer NOW accounts, the data necessary 

to determine a depositor’s eligibility for 

NOW accounts would not be readily 

available.’’ In addition, the commenter 

noted that this reporting treatment 

would be inconsistent with the 

Regulation D definition of savings 

deposits, as NOW account eligibility is 

not a component of the definition. The 

commenter believed that gathering the 

data necessary to distinguish these 

depositors from other savings account 

holders solely for regulatory reporting 

purposes would create business and 

systems challenges. The Board agrees 

with the commenter that the depositor’s 

eligibility to hold a NOW account 

should not be included in the 

assessment criteria for classification as a 

‘‘savings deposit,’’ as such reporting 

would not be consistent with the 

Regulation D definition of savings 

deposits. Therefore, the Board will 

remove the depositor’s eligibility to 

96 Federal Register / Vol. 86, No. 1 / Monday, January 4, 2021 / Notices 

18 85 FR 54577 (Nov. 2, 2020). 19 85 FR 74784. 

hold a NOW account from the 

assessment criteria. The Board and the 

other federal banking agencies have 

proposed comparable revisions to the 

Call Report. 

Additionally, the commenter 

recommended that the effective date of 

the proposed revisions to the FR Y–9C 

and the FR 2886b definition of ‘‘savings 

deposits’’ be delayed from December 31, 

2020, until June 30, 2021, to better align 

with the proposed effective dates of the 

FR 2900 18 and the Report of Foreign 

(Non-U.S.) Currency Deposits (FR 2915; 

OMB Control Number 7100–0087). The 

commenter noted that aligning the 

timing of the revisions would give firms 

additional time to implement any 

further changes made by the Board and 

other agencies in light of the comments 

received. In response to the 

commenter’s recommendation, the 

Board has deferred the effective date of 

the proposed revisions that requires a 

depository institution to report each 

account as a ‘‘savings deposit’’ or a 

‘‘transaction account’’ based on the 

institution’s assessment of account 

characteristics and removes the 

optionality in reporting savings deposits 

as either a ‘‘savings deposit’’ or a 

‘‘transaction account’’ if the institution 

suspended the enforcement of the sixtransfer limit until March 31, 2021. 

Choosing March 31, 2021 as the 

proposed effective date will align the FR 

Y–9C and FR 2886b Regulation D 

revisions with the Call Report and will 

provide institutions additional time to 

implement any necessary changes. The 

timing of the FR Y–9C changes was 

chosen to match the Call Report to allow 

for consistent quarterly reporting. 

Lastly, the commenter requested 

clarification on how institutions should 

report the components of retail sweep 

arrangements on the FR Y–9C report. 

Specifically, the commenter asked 

whether institutions should continue to 

report the nontransaction components 

of, or savings deposits in, retail sweep 

arrangements as nontransaction 

accounts. If not, the commenter asked 

whether institutions should strictly 

follow the proposed assessment criteria 

for the treatment of accounts where the 

transfer limit has been removed. In 

response to the comment, the Board has 

modified the description of retail sweep 

arrangements in the FR Y–9C 

instructions to remove references to 

transaction and nontransaction 

components. Further, the instructions 

will indicate that institutions should not 

follow the proposed assessment criteria 

for the treatment of accounts for which 

the transfer limit has been removed. 

Instead, the instructions will note that 

institutions that offer valid retail sweep 

programs must report each component 

of the retail sweep arrangement based 

on the customer account agreement 

established by the depository 

institution. The instructions will also 

note that two key criteria must be met 

for a valid retail sweep program. These 

criteria are: (1) A depository institution 

must establish by agreement with its 

customer two distinct, legally separate 

accounts; and (2) the swept funds must 

actually be moved between the 

customer’s accounts on the depository 

institution’s official books and records 

as of the close of business on the day(s) 

on which the depository institution 

intends to report the funds as being in 

separate accounts. These modifications 

are consistent with modifications to the 

Call Report instructions made in 

response to a similar comment.19

Modifications to Proposed 

Memorandum Item 8 of Schedule HI–B, 

Part II, ‘‘Changes in Allowances for 

Credit Losses’’ 

As discussed above, the Board 

proposed to add a new Memorandum 

item 8 to Schedule HI–B, Part II, to 

collect the estimated amount of 

expected recoveries of amounts 

previously written off included within 

the allowance for credit losses on loans 

and leases held for investment. The 

Board did not receive any comments on 

this aspect of the proposal, and will 

adopt this revision. However, the Board 

has decided to collect this new 

Memorandum item only from holding 

companies with $5 billion or more in 

total consolidated assets. The Board 

decided to limit this collection to such 

holding companies in order to minimize 

burden, consistent with a number of 

other FR Y–9C items that are not 

required from holding companies with 

less than $5 billion in total assets. 

Proposed Revisions Related to Last-ofLayer Hedging 

In the October 2020 notice, the Board 

proposed to make certain revisions to 

the FR Y–9C related to the last-of-layer 

method of hedge accounting standards. 

This proposal would have implemented 

in the FR Y–9C revisions related to a 

project added to the FASB agenda to 

expand last-of-layer hedging to multiple 

layers, thereby providing more 

flexibility to entities when applying 

hedge accounting to a closed portfolio of 

prepayable assets. The Board proposed 

for these revisions to become effective 

following the adoption and 

implementation of a final standard on 

this matter by FASB. 

Because FASB has not yet adopted a 

final standard regarding last-of-layer 

hedging, the Board has not adopted the 

proposed FR Y–9C revisions associated 

with this topic at this time. The Board 

will consider whether to finalize the 

proposed revisions related to last-oflayer hedging when FASB adopts a final 

standard. 

Additional Instructional Matters 

The agencies addressed several 

additional instructional matters in the 

final Call Report notice. The Board will 

make comparable clarifying changes to 

the FR Y–9 reports for consistency 

purposes as discussed in detail below. 

1. Uncollectible Accrued Interest 

Receivable Under ASC Topic 326 

In April 2019, the Financial 

Accounting Standards Board (FASB) 

issued ASU No. 2019–04, ‘‘Codification 

Improvements to Topic 326, Financial 

Instruments—Credit Losses, Topic 815, 

Derivatives and Hedging, and Topic 

825, Financial Instruments,’’ which 

amended ASC Topic 326 to allow an 

institution to make certain accounting 

policy elections for accrued interest 

receivable balances, including a 

separate policy election, at the class of 

financing receivable or major securitytype level, to charge off any 

uncollectible accrued interest receivable 

by reversing interest income, 

recognizing credit loss expense (i.e., 

provision expense), or a combination of 

both. The Glossary entry for ‘‘Accrued 

Interest Receivable’’ in the FR Y–9C 

report instructions currently references 

the following accounting policy 

elections in ASU 2019–04: 

• Holding companies may elect to 

separately present accrued interest 

receivable from the associated financial 

asset, and the accrued interest 

receivable is presented net of an 

allowance for credit losses (ACL), if any; 

and 

• Holding companies that charge off 

uncollectible accrued interest receivable 

in a timely manner, i.e., in accordance 

with the Glossary entry for ‘‘Nonaccrual 

Status,’’ may elect, at the class of 

financing receivable or the major 

security-type level, not to measure an 

ACL for accrued interest receivable. 

Although this Glossary entry does not 

currently provide for the ASU’s separate 

accounting policy election for the 

charge-off of uncollectible accrued 

interest receivable at the class of 

financing receivable or major securitytype level, this election is specifically 

addressed in the Interagency Policy 

Statement on Allowances for Credit 

Federal Register / Vol. 86, No. 1 / Monday, January 4, 2021 / Notices 97 

20 85 FR 32991 (June 1, 2020). 

21https://www.federalreserve.gov/reportforms/ 

supplemental/Final%20FR%20Y-9C%20September

%202020%20Supplemental%20Instructions.pdf. 

Losses issued in May 2020.20

Accordingly, as provided in the FR Y– 

9C Supplemental Instructions for the 

September 30, 2020, report date,21 a 

holding company that has adopted ASC 

Topic 326 may make the charge-off 

election for accrued interest receivable 

balances in ASU 2019–04 separately 

from the other elections for these 

balances in the ASU for FR Y–9C 

reporting purposes. A holding company 

may also charge off uncollectible 

accrued interest receivable against an 

ACL for FR Y–9C reporting purposes. 

The Board plans to update the FR Y– 

9C Glossary entry for ‘‘Accrued Interest 

Receivable’’ to align the instructions in 

this entry with the elections permitted 

under U.S. GAAP for institutions that 

have adopted ASC 326, which also 

would achieve consistency with the 

discussion of accrued interest receivable 

in the Interagency Policy Statement on 

Allowances for Credit Losses. 

2. Shared Fees and Commissions From 

Securities-Related and Insurance 

Activities 

Holding companies with $5 billion or 

more in total assets report income from 

certain securities-related and insurance 

activities in FR Y–9C report Schedule 

HI, Income Statement, items 5.d.(1) 

through (7), while holding companies 

with less than $5 billion in total assets 

report only items 5.d.(6) and 5.d.(7). 

When an institution partners with, or 

otherwise joins with, a third party to 

conduct these securities-related or 

insurance activities, and any fees and 

commissions generated by these 

activities are shared with the third 

party, the Schedule HI instructions do 

not currently address the reporting 

treatment for these sharing 

arrangements. Consequently, holding 

companies may have reported the gross 

fees and commissions from these 

activities in the appropriate subitem of 

Schedule HI, item 5, ‘‘Other noninterest 

income,’’ and the third party’s share of 

the fees and commissions separately as 

expenses in Schedule HI, item 7.d, 

‘‘Other noninterest expense.’’ 

Alternatively, holding companies may 

have reported only their net share of the 

fees or commissions in the appropriate 

subitem of Schedule HI, item 5. 

The Board believes that reporting 

shared fees and commissions on a net 

basis is preferable to gross reporting and 

is analogous to how income from certain 

other income-generating activities is 

reported on the FR Y–9C income 

statement, including securitization 

income and servicing fee income, which 

are currently reported net of specified 

expenses and costs. 

This net approach better represents an 

institution’s income from a securitiesrelated or insurance activity engaged in 

jointly with a third party than when the 

third party’s share of the fees and 

commissions is separately reported as a 

noninterest expense in another income 

statement data item. As a result, the 

Board has clarified the existing 

Schedule HI instructions to ensure 

consistent reporting on a net basis of 

fees and commissions from securitiesrelated and insurance activities that are 

shared with third parties. Furthermore, 

to avoid including repetitive language in 

the instructions for the multiple 

noninterest income items for income 

from securities-related and insurance 

activities in Schedule HI, a new nonreportable item 5.d captioned ‘‘Income 

from securities-related and insurance 

activities’’ has been added before the 

existing 5.d subitems on the FR Y–9C 

report. The reporting treatment for 

arrangements involving the sharing of 

fees and commissions with third parties 

arising from an institution’s securities 

brokerage, investment banking, 

investment advisory, securities 

underwriting, insurance and annuity 

sales, insurance underwriting, or any 

other securities-related and insurance 

activities is explained once in the new 

item 5.d instructions. 

3. Pledged Equity Securities 

In January 2016, the FASB issued 

ASU 2016–01, ‘‘Recognition and 

Measurement of Financial Assets and 

Financial Liabilities.’’ As one of its main 

provisions, the ASU requires 

investments in equity securities, except 

those accounted for under the equity 

method and those that result in 

consolidation, to be measured at fair 

value, with changes in fair value 

recognized in net income. Thus, the 

ASU eliminates the existing concept of 

available-for-sale (AFS) equity 

securities, which are measured at fair 

value with changes in fair value 

generally recognized in other 

comprehensive income. As of December 

31, 2020, all holding companies will 

have been required to adopt ASU 2016– 

01 and, as a consequence, must report 

equity securities with readily 

determinable fair values not held for 

trading in Schedule HC, Balance Sheet, 

item 2.c, ‘‘Equity securities with readily 

determinable fair values not held for 

trading,’’ instead of Schedule HC–B, 

Securities, item 7, ‘‘Investments in 

mutual funds and other equity securities 

with readily determinable fair values.’’ 

Accordingly, Schedule HC–B, item 7, 

will be removed effective December 31, 

2020. 

Holding companies report held-tomaturity and AFS securities in Schedule 

HC–B, items 1 through 7, and have long 

reported in Schedule HC–B, 

Memorandum item 1, ‘‘Pledged 

securities’’ the amount of such 

securities that are pledged to secure 

deposits and for other purposes. 

Considering that all institutions that 

previously reported their AFS equity 

securities in Schedule HC–B, item 7, 

now report these securities in Schedule 

HC, item 2.c, the Board is updating the 

instructions for Schedule HC–B, 

Memorandum item 1, and Schedule HC, 

item 2.c, to indicate that holding 

companies should include in 

Memorandum item 1 the fair value of 

pledged equity securities with readily 

determinable fair values not held for 

trading that are now reported in 

Schedule HC, item 2.c. The wording of 

existing footnote 1 to Memorandum 

item 1 of Schedule HC–B on the FR Y– 

9C forms will be similarly updated. 

These instructional clarifications would 

ensure that pledged equity securities 

formerly reportable as AFS equity 

securities would continue to be reported 

in Memorandum item 1 

notwithstanding the change in 

accounting for equity securities under 

U.S. GAAP. Information on pledged 

securities is an important element of the 

agencies’ analysis of an institution’s 

liquidity risk. The existing footnote 1 to 

Memorandum item 1, Schedule HC–B 

on the FR Y–9C forms and the 

instructions for PC–B Memoranda line 

item 10, ‘‘Pledged securities’’, of the FR 

Y–9LP and related footnote 1 reference 

of this line item on the FR Y–9LP forms 

will be similarly updated. 

The FR Y–9C instructional 

clarifications to the Glossary entry for 

‘‘Accrued Interest Receivable’’ and 

Schedule HC–B for pledged equity 

securities will take effect December 31, 

2020, while the instructional 

clarifications to Schedule HI for shared 

fees and commissions from securitiesrelated and insurance activities will take 

effect March 31, 2021. 

Board of Governors of the Federal Reserve 

System, December 28, 2020. 

Ann Misback, 

Secretary of the Board. 

[FR Doc. 2020–29028 Filed 12–31–20; 8:45 am] 

BILLING CODE 6210–01–P