Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices 69525

to the settlement. The Agency will

consider all comments received and

may modify or withdraw its consent to

the settlement if comments received

disclose facts or considerations which

indicate that the settlement is

inappropriate, improper, or inadequate.

The Agency’s response to any

comments received will be available for

public inspection at One Congress

Street, Boston, MA 02214–2023.

DATES: Comments must be submitted on

or before December 18, 2000.

ADDRESSES: Comments should be

addressed to the Regional Hearing Clerk,

U.S. Environmental Protection Agency,

Region I, One Congress Street, Suite

1100, Mailcode RAA, Boston,

Massachusetts 02203 and should refer

to: In re: Nashua River Asbestos Site,

U.S. EPA Docket No. I–99–0044.

FOR FURTHER INFORMATION CONTACT: A

copy of the proposed settlement may be

obtained from Steven Schlang, U.S.

Environmental Protection Agency,

Region I, Office of Environmental

Stewardship, One Congress Street, Suite

1100, Mailcode SES, Boston, MA

02114–2023.

Dated: September 29, 2000.

Richard Cavagnero,

Acting Director, Office of Site Remediation

& Restoration.

[FR Doc. 00–29509 Filed 11–16–00; 8:45 am]

BILLING CODE 6560–50–P

ENVIRONMENTAL PROTECTION

AGENCY

[FRL–OW–6903–2]

Notice of Intent To Develop Ambient

Water Quality Criteria for Protection of

Human Health—Methylmercury; Notice

of Reopening to Public Comment

Period

AGENCY: Environmental Protection

Agency (EPA).

ACTION: Notice of reopening to public

comment period.

SUMMARY: This notice informs the public

that the period for the submission of

scientific and technical information for

the development of the revised Ambient

Water Quality Criterion for

Methylmercury is extended.

DATES: The comment period has been

extended fifteen days to November 27,

2000.

ADDRESSES: Send an original and three

copies of any written significant

scientific information to W–00–29

Comment Clerk, Water Docket, Ariel

Rios 1200 Pennsylvania Ave., N.W.

Washington, D.C. 20460. Comments

may be hand-delivered to the Water

Docket, Room EB57, 401 M Street, SW,

Washington, D.C. 20460. Issues may

also be submitted electronically to OWDocket@epa.gov. Information should be

submitted as a WP5.1, 6.1 and/or 8.0 or

an ASCII file with no form of

encryption.

FOR FURTHER INFORMATION CONTACT: Ms.

Mary Manibusan, Health and Ecological

Criteria Division (4304), US EPA, Ariel

Rios Building, 1200 Pennsylvania

Avenue NW, Washington, D.C. 20460;

(202) 260–3688;

manibusan.mary@epa.gov

SUPPLEMENTARY INFORMATION: The

Environmental Protection Agency

published in the Federal Register of

October 12, 2000 (65 FR 60664), that

scientific and technical information that

pertains to the development of a revised

Ambient Water Quality Criterion for

Methylmercury should be received

within 30 days of the Federal Register

publication date of October 12, 2000. In

response to public interest, the

Environmental Protection Agency has

granted a fifteen day extension to the

public comment period.

Geoffrey H. Grubbs,

Director, Office of Science and Technology.

[FR Doc. 00–29504 Filed 11–16–00; 8:45 am]

BILLING CODE 6560–50–P

FEDERAL DEPOSIT INSURANCE

CORPORATION

Sunshine Act Meeting

Pursuant to the provisions of the

‘‘Government in the Sunshine Act’’ (5

U.S.C. 552b), notice is hereby given that

the Federal Deposit Insurance

Corporation’s Board of Directors will

meet in open session at 10 a.m. on

Tuesday, November 21, 2000, to

consider the following matters:

Summary Agenda: No substantive

discussion of the following items is

anticipated. These matters will be

resolved with a single vote unless a

member of the Board of Directors

requests that an item be moved to the

discussion agenda.

Disposition of minutes of previous

Board of Directors’ meetings.

Summary reports, status reports, and

reports of actions taken pursuant to

authority delegated by the Board of

Directors.

Memorandum and resolution re:

Interim Rule (amending Appendix C to

Part 325) to Revise the Risk-Based

Capital Treatment for Securities

Borrowing Transactions.

Discussion Agenda

Memorandum and resolution re: Final

Regulation Prescribing Consumer

Protections for Bank Sales of Insurance.

The meeting will be held in the Board

Room on the sixth floor of the FDIC

Building located at 550 17th Street, NW,

Washington, DC.

The FDIC will provide attendees with

auxiliary aids (e.g., sign language

interpretation) required for this meeting.

Those attendees needing such assistance

should call (202) 416–2089 (Voice);

(202) 416–2007 (TTY), to make

necessary arrangements.

Requests for further information,

concerning the meeting may be directed

to Mr. Robert E. Feldman, Executive

Secretary of the Corporation, at (202)

898–6757.

Dated: November 14, 2000.

Federal Deposit Insurance Corporation.

Robert E. Feldman,

Executive Secretary.

[FR Doc. 00–29548 Filed 11–4–00; 5:03 pm]

BILLING CODE 6714–01–M

FEDERAL RESERVE SYSTEM

Agency Information Collection

Activities: Proposed Collection;

Comment Request

AGENCY: Board of Governors of the

Federal Reserve System.

SUMMARY:

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, as per 5 CFR 1320.16, 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

Appendix A.1. Board-approved

collections of information are

incorporated into the official OMB

inventory of currently approved

collections of information. Copies of the

OMB 83–Is and supporting statements

and approved collection of information

instruments are placed into OMB’s

public docket files. The Federal Reserve

may not conduct or sponsor, and the

respondent is not required to respond

to, an information collection that has

been extended, revised, or implemented

on or after October 1, 1995, unless it

displays a currently valid OMB control

number.

69526 Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices

Request for Comment on Information

Collection Proposals

The following information

collections, 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. Comments are invited on the

following:

a. whether the proposed collections of

information is necessary for the proper

performance of the Federal Reserve’s

functions; including whether the

information has practical utility;

b. the accuracy of the Federal

Reserve’s estimate of the burden of the

proposed information collections,

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

information collections on respondents,

including through the use of automated

collection techniques or other forms of

information technology.

DATES: Comments must be submitted on

or before January 16, 2001.

ADDRESSES: Comments, which should

refer to the OMB control number or

agency form number, should be

addressed to Jennifer J. Johnson,

Secretary, Board of Governors of the

Federal Reserve System, 20th and C

Streets, N.W., Washington, DC 20551,

submitted by electronic mail to

regs.comments@federalreserve.gov, 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 261.14 of the

Board’s Rules Regarding Availability of

Information, 12 CFR 261.14(a).

A copy of the comments may also be

submitted to the OMB desk officer for

the Board: Alexander T. Hunt, Office of

Information and Regulatory Affairs,

Office of Management and Budget, New

Executive Office Building, Room 3208,

Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT:

Draft copies of the proposed reporting

forms may be obtained at the Board’s

web site (www.federalreserve.gov). Draft

copies of the proposed forms, 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. West, Federal Reserve Board

Clearance Officer (202–452–3829),

Division of Research and Statistics,

Board of Governors of the Federal

Reserve System, Washington, DC 20551.

Telecommunications Device for the Deaf

(TDD) users may contact Diane Jenkins

(202–452–3544), Board of Governors of

the Federal Reserve System,

Washington, DC 20551.

Proposal To Approve Under OMB

Delegated Authority the Revision,

Without Extension, of the Following

Reports

1. Report title: Consolidated Financial

Statements for Bank Holding

Companies.

Agency form number: FR Y–9C.

OMB control number: 7100–0128.

Frequency: Quarterly.

Reporters: Bank holding companies.

Annual reporting hours: 231,474.

Estimated average hours per response:

33.45.

Number of respondents: 1,730.

Small businesses are affected.

General description of report: This

information collection is mandatory (12

U.S.C. 1844(c)). Confidential treatment

is not routinely given to the data in

these reports. However, confidential

treatment for the reporting information,

in whole or in part, can be requested in

accordance with the instructions to the

form. Currently data reported on the FR

Y–9C, Schedule HC–H, Column A,

requiring information of ‘‘assets past

due 30 through 89 days and still

accruing’’ and memoranda item 2 are

confidential pursuant to Section (b)(8)

of the Freedom of Information Act 5

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

Abstract: The FR Y–9C consists of

standardized consolidated financial

statements similar to commercial bank

Report of Condition and Income (Call

Report) (FFIEC 031–034; OMB No.

7100–0036). The FR Y–9C is filed

quarterly by top-tier bank holding

companies that have total assets of $150

million or more and by lower-tier bank

holding companies that have total

consolidated assets of $1 billion or

more. In addition, multibank holding

companies with total consolidated

assets of less than $150 million with

debt outstanding to the general public or

engaged in certain nonbank activities

must file the FR Y–9C.

Current actions: The Federal Reserve

proposes to implement numerous

revisions that will streamline the

existing reporting requirements. These

eliminations and reductions in detail

will help the Federal Reserve achieve

the objective set forth in Section 307(c)

of the Riegle Community Development

and Regulatory Improvement Act of

1994, which directs the banking

agencies to review the information that

institutions currently report in the Call

Report and the bank holding company

(BHC) reports and eliminate existing

reporting requirements that are not

warranted for safety and soundness or

other public policy purposes.

As part of the streamlining process,

the Federal Reserve proposes several

reporting changes that will introduce

more uniformity to certain aspects of

regulatory reporting. These changes

would provide more uniformity within

the holding company reports and also

would bring several items into closer

alignment with the Call Report and the

Thrift Financial Report. For example,

standard loan categories would be used

for all of the schedules that collect loan

information. However, not all loanrelated items are needed on all

schedules for supervisory purposes.

Other proposed modifications to the

BHC reports are intended to make its

form and content more closely resemble

the manner in which information is

presented in financial statements that

banks prepare in accordance with

generally accepted accounting

principles (GAAP) for other financial

reporting purposes.

In addition to streamlining the

existing FR Y–9C reporting

requirements by eliminating

information that is no longer of

significant value, the Federal Reserve is

also endeavoring to improve the

relevance of the FR Y–9C by identifying

new types of information that are

considered critical to the Federal

Reserves’ supervisory data needs going

forward. In so doing, the Federal

Reserve has focused primarily on new

activities and other recent developments

that may expose institutions to new or

different types of risk.

Furthermore, by proposing the

following new reporting requirements at

the same time as the FR Y–9C

streamlining changes, BHCs will be able

to make all of the necessary systems

changes at one time. However, the new

reporting requirements would be

implemented on the same schedule as

the Call Report. The Federal Reserve

believes that combining these various

types of revisions into a single package

should result in lower start-up costs and

Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices 69527

1Schedule lettering and titles used throughout

this notice refer to existing schedules. However, the

Federal Reserve also proposes to alter schedule

order and schedule titles to align with the Call

Report.

2The first two of these components of

‘‘Accumulated other comprehensive income’’

would be separately identified in the proposed new

regulatory capital schedule.

reporting burden for BHCs from a

system’s perspective.

The Federal Reserve proposes to make

the following changes to the FR Y–9C,

except for new information on

securitization activities, effective with

the March 31, 2001, reporting date.

Proposed new information on

securtization activities would be

effective with the June 30, 2001,

reporting date.

Changes Related to Proposed Changes

to the Call Report 1

Schedule HC—Consolidated Balance

Sheet

1. Move ‘‘Loans and leases held for

sale’’ onto the balance sheet as a

separate category under item 4, ‘‘Loans

and lease financing receivables.’’ This

change will bring the FR Y–9C balance

sheet presentation of these loans into

conformity with GAAP. Loans and

leases held for sale are currently

included on the balance sheet in item

4.a, ‘‘Loans and leases, net of unearned

income,’’ together with loans that the

holding company has the intent and

ability to hold for the foreseeable future

or until maturity or payoff. However,

loans and leases held for sale are

separately identified in the loan

schedule in Schedule HC–B, part I,

Memorandum item 3. Loans and leases

held for sale would continue to be

reported with the holding company’s

other loans in the loan schedule

(Schedule HC–B, part I).

2. Item 4.c, ‘‘Allocated transfer risk

reserve,’’ would be deleted from the

balance sheet, but would be reported in

the new regulatory capital schedule,

which is discussed below. BHCs would

report their loans and leases net of any

allocated transfer risk reserve in the

loan schedule (Schedule HC–B, part I).

3. Items 27.e, ‘‘Net unrealized holding

gains (losses) on available-for-sale

securities,’’ 27.f, ‘‘Accumulated net

gains (losses) on cash flow hedges,’’ and

27.g, ‘‘Cumulative foreign currency

translation adjustments,’’ would be

combined and reported as

‘‘Accumulated other comprehensive

income.’’ 2 This change would conform

the presentation of the equity capital

section of the FR Y–9C balance sheet to

FASB Statement No. 130, Reporting

Comprehensive Income.

4. A new item for ‘‘Other equity

capital components’’ would be added to

the equity capital section of the balance

sheet. This item would include treasury

stock and unearned Employee Stock

Ownership Plan shares, which, under

GAAP, are to be reported in a contraequity account on the balance sheet.

These items will continue to be reported

separately in the proposed revised

regulatory capital schedule. This change

will make the equity capital section

more consistent with GAAP and with

the equity capital section of the balance

sheet in the proposed bank Call Report

and the Thrift Financial Report.

Schedule HC–A—Securities

1. Add new items on fair value and

amortized cost information for six

categories of asset-backed securities that

are currently included in the items for

‘‘Debt securities.’’ The six categories

that would be reported on Schedule

HC–A, item 5, are securities backed by:

a. credit card receivables, b. home

equity lines, c. auto loans, d. other

consumer loans, e. commercial and

industrial loans, and f. all other loans.

The Federal Reserve proposes to collect

information to facilitate more effective

assessments of BHC credit and other

exposures related to their portfolios of

asset-backed securities. Currently,

virtually all non-mortgage asset-backed

securities are reported in two FR Y–9C

items, i.e., Schedule HC–A, items 4.a

and 5.a, U.S. and foreign ‘‘Debt

securities.’’ The proposed segregation of

specific categories of asset-backed

securities from ‘‘Debt securities’’ would

promote risk-focused supervision by

enhancing the Federal Reserves’ ability

to assess credit exposures and asset

concentrations.

2. Memoranda items 4.a., ‘‘Net

unrealized holding losses on availablefor-sale equity securities with readily

determinable fair values’ and 4.c.,

‘‘Amount of net unrealized holding

gains on available for sale equity

securities’’ would be moved to the new

regulatory capital schedule, which is

discussed below.

3. Memoranda item 9.c, ‘‘All other

equity securities,’’ (equity securities

without readily determinable fair

values), would be moved to a new

Schedule HC–F—Other Assets. These

equity securities are outside the scope of

FASB Statement No. 115, Accounting

for Certain Investments in Debt and

Equity Securities. Therefore, including

them in the FR Y–9C with available-forsale securities in Schedule HC–A, albeit

at historical cost rather than at fair

value, has not been consistent with

GAAP. Moving equity securities without

readily determinable fair values to the

Memoranda schedule is intended to

eliminate this inconsistency.

Schedule HC–B, Part I—Loans and

Leases

1. The definition of ‘‘Construction and

land development’’ loans (item 1.a) and,

hence, the definitions for the other

categories of loans secured by real estate

(items 1.b through 1.e) would be revised

to make them consistent with reporting

requirements in this area for savings

associations as reported on the Thrift

Financial Report. The FR Y–9C

instructions for ‘‘Construction and land

development’’ loans currently direct

BHCs to exclude from this loan category

loans to acquire and hold vacant land

and construction loans with original

maturities greater than 60 months.

These two types of loans are instead

reported as loans secured by farmland,

1–4 family residential properties,

multifamily residential properties, or

nonfarm nonresidential properties, as

appropriate. The definitions for the five

categories of ‘‘Loans secured by real

estate’’ would be revised so that land

loans and long-term construction loans

are reported in a recaptioned item 1.a,

‘‘Construction, land development, and

other land loans.’’

2. The separate loan categories for

‘‘Loans to depository institutions’’ and

‘‘Acceptances of other banks’’ (items 3

and 4, respectively) would be combined.

3. Item 6.a, column A, ‘‘Credit cards

and related plans’’ to individuals for

household, family, and other personal

expenditures, would be split into

separate loan categories for ‘‘Credit

cards’’ and ‘‘Other revolving credit

plans.’’

4. A single Memorandum item for the

total amount of a BHC’s ‘‘Loans and

leases restructured and in compliance

with modified terms’’ would replace the

multiple Memorandum items in which

BHCs must currently report information

about such restructured credits

(Memorandum items 1.a through 1.h.)

Restructured loans secured by 1–4

family residential properties and

restructured consumer loans would be

excluded from the revised

Memorandum item.

5. A new Memoranda item 3, ‘‘Loans

secured by real estate to non-U.S.

addressees (domicile)’’ would be added

in order to enhance the Federal

Reserve’s ability to evaluate the

performance of real estate loans by

addressee.

6. The filing criteria for Part II,

Trading Assets and Liabilities, would be

modified. BHCs that report a quarterly

average for trading assets of $2 million

or more (new proposed item 4.a,

Schedule HC–E) as of the March 31st

69528 Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices

3As described below, the Federal Reserve

proposes to eliminate this reporting threshold.

report date of the current calendar year

would complete Schedule HC–B, Part II.

Analysis of quarter-end trading assets

data indicate that using this reporting

threshold would provide adequate

coverage of BHCs actively involved in

trading and would be comparable to the

coverage of bank trading activity

proposed for the Call Report. In

addition, Part II, Trading Assets and

Liabilities, would be formatted as a

separate Schedule HC–D, to be

consistent with presentation in the Call

Report.

Schedule HC–F—Off-Balance-Sheet

Items

1. The two-way breakout of Part I,

item 2, ‘‘Standby letters of credit and

foreign office guarantees,’’ between item

2.a.(1), ‘‘To U.S. addressees,’’ and

2.a.(2), ‘‘To non-U.S. addressees,’’

would be eliminated and replaced with

a single combined item.

2. Part II, Item 3, ‘‘Securities

borrowed,’’ would no longer be

collected from all BHCs. Instead, the

amount of borrowed securities that

exceed 10 percent of total equity

capital 3 would be reported in

renumbered item 9, ‘‘All other

significant off-balance-sheet items.’’

3. The information collected in Part II,

items 5.a, 5.b, and 5.c on the

outstanding principal balance of and

amount of recourse on three categories

of financial asset transfers would be

moved from Schedule HC–F and

incorporated into the proposed new

schedule on securitization and asset sale

activities, which is discussed below.

4. Part II, Item 6.b, ‘‘Participations in

acceptances acquired by the reporting

BHC,’’ and Memorandum item 1,

‘‘Participations in unused

commitments’’ would be deleted from

Schedule HC–F, and information would

be collected only on the proposed new

regulatory capital schedule discussed

below. Memorandum item 1 would be

redefined to collect information on

commitments with an original maturity

exceeding one year on the new

regulatory capital schedule.

5. Part III, Item 3.b for the gross

notional amount of derivative contracts

held for purposes other than trading that

are not marked to market would be

deleted. All derivative contracts,

including those held for purposes other

than trading, will be marked to market

once a BHC adopts FASB Statement No.

133, Accounting for Derivative

Instruments and Hedging Activities,

which is effective for fiscal years

beginning after June 15, 2000. Thus,

item 3.b will no longer have any

relevance in 2001.

6. Part III, items 4.c.(1) and (2) for the

gross positive and gross negative fair

values of derivatives held for purposes

other than trading that are not marked

to market would be deleted because of

the effect of FASB Statement No. 133.

In addition, items on Schedule HC–F

would be renumbered and formatted to

better align with the order of items

presented on Schedule RC–L, OffBalance-Sheet Items, on the Call Report.

Schedule HC–G—Memoranda

1. The scope of item 14, ‘‘Income

earned, not collected on loans,’’ would

be expanded to cover all ‘‘Accrued

interest receivable,’’ and the item would

be included on a new ‘‘Other Assets’’

schedule discussed below. Broadening

this category to include interest earned,

not collected on earning assets other

than loans would be more consistent

with the typical presentation of accrued

interest receivable in financial

statements prepared for other financial

reporting purposes.

2. Memorandum item 19, ‘‘Deferred

tax assets in excess of regulatory capital

limits,’’ would be retitled as

‘‘Disallowed deferred tax assets’’ and

moved to the revised regulatory capital

schedule (Schedule HC–R), which is

discussed below. This proposed change

is part of an effort by the Federal

Reserve to place all items collected

principally for regulatory capital

calculation purposes in a revised

regulatory capital schedule rather than

having these items scattered across

various FR Y–9C schedules as they are

at present.

3. Items 17.a through 17.d, in which

banks report a six-way breakdown of the

‘‘Outstanding principal balance of 1–4

family residential mortgage loans

serviced for others’ would be moved

from Schedule HC–G and condensed

into a two-way servicing breakdown in

the proposed new schedule on

securitization and asset sale activities,

which is discussed below.

4. Items 20.a through 20.f, which

collect data on quarterly sales of

annuities, mutual funds, and

proprietary products, would be

eliminated. In place of these items, each

BHC would respond to a ‘‘yes’’ or ‘‘no’’

question asking whether it sells private

label or third party mutual funds and

annuities. In addition, BHCs would

report the total assets under the

reporting BHC’s management in

proprietary mutual funds and annuities.

For BHCs with proprietary mutual funds

and annuities, reporting the amount of

assets under management should be

significantly less burdensome than

reporting the quarterly sales volume for

these proprietary products.

5. Item 22, ‘‘Net unamortized realized

deferred gains (losses) on off-balancesheet derivative contracts included in

assets and liabilities reported in

Schedule HC,’’ would be eliminated.

Schedule HC–H—Past Due and

Nonaccrual Loans, Lease Financing

Receivables, Placements, and Other

Assets

1. The presentation of loan category

information would be modified to better

match the loan schedule (HC–B) as

proposed by moving the current

breakdown of loans secured by real

estate from the Memoranda section of

Schedule HC–H, item 4, to item 1 of

Schedule HC–H, and item 5.a would be

redefined to exclude related plans,

which would be reported in item 5.b. In

addition BHCs would separately report

their past due and nonaccrual loans

secured by real estate in foreign offices.

Also the presentation order and certain

item captions would be revised to better

align with Schedule RC–N, Past Due

and Nonaccrual Loans, Leases, and

Other Assets, on the Call Report.

2. Memorandum item 6.b,

‘‘Replacement cost of [past due

derivative] contracts with a positive

replacement cost,’’ would be deleted.

Once BHCs adopt FASB Statement No.

133, Accounting for Derivative

Instruments and Hedging Activities, all

of their derivative contracts will be

carried on the balance sheet at fair

value. Since the replacement cost of a

derivative contract is its fair value and

its book value will also be its fair value,

Memorandum items 6.a., ‘‘Book value of

amounts carried as assets,’’ and 6.b

would duplicate each other. The caption

for Memorandum item 6.a would be

revised to read ‘‘Fair value of amounts

carried as assets.’’

3. Eliminating confidential treatment

for certain past due and nonaccrual

data: The Federal Reserve proposes to

eliminate the confidential treatment for

items past due 30 to 89 days and

restructured items beginning with

amounts reported as of March 31, 2001.

An important public policy issue for the

Federal Reserve has been how to use

market discipline to complement

supervisory resources. Market discipline

relies on market participants having

information about the risks and

financial condition of banking

organizations. The FR Y–9C, in

particular, is widely used by securities

analysts, rating agencies, and large

institutional investors as sources of

BHC-specific data. Disclosure that

increases transparency should lead to

more accurate market assessments of

Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices 69529

risk and value. This, in turn, should

result in more effective market

discipline on BHCs.

Despite this emphasis on market

discipline, the Federal Reserve currently

accords confidential treatment to the

information BHCs report in Schedule

HC–H of the FR Y–9C on the amounts

of their loans, leases, and other assets

that are past due 30 to 89 days and still

accruing and on the amount of

restructured loans and leases that are

past due 90 days or more and still

accruing or in nonaccrual status. This is

the only financial information currently

collected on the FR Y–9C that is treated

as confidential on an individual BHC

basis. In contrast, the information BHCs

report on the amounts of their loans,

leases, and other assets that are 90 days

or more past due and still accruing or

that are in nonaccrual status has been

publicly available. The Federal Reserve

proposes to make all past due and

restructured loan and lease information

publicly available in order to give the

public, including BHCs, more complete

information on the level of and trends

in asset quality at individual

institutions.

Some banking organizations have

held that information on loans, leases

and other assets that are past due 30 to

89 days is not a reliable indicator of

future loan losses or of general asset

quality. They further note that market

discipline would be reduced, rather

than enhanced, by the release of

information that is highly susceptible to

misinterpretation to the extent that it

could cause an unjustifiable loss of

funding to the industry. However,

banking supervisors have consistently

found information on loans and leases

past due 30 to 89 days to be helpful in

identifying banks with emerging asset

quality problems. Therefore the Federal

Reserve believes that such information

is a useful indicator of general asset

quality and would not represent

misleading information to the public.

Moreover, BHCs have the option to

include in their notes to the balance

sheet a brief narrative statement that

provides explanatory comments about

any data disclosure which they feel may

be subject to misinterpretation, the text

of which is available to the public.

Schedule HC–I—Risked-Based Capital

The Federal Reserve proposes to

revise the risk-based capital schedule

(Schedule HC–I) by incorporating many

of the reporting concepts of the FR Y–

9C’s optional regulatory capital

worksheet. All top-tier BHCs with total

consolidated assets of $150 million or

more would continue to be required to

complete the entire revised regulatory

capital schedule. The proposed

schedule will also more directly

correspond to the proposed commercial

bank Regulatory Capital schedule on the

Call Report. Schedule HC–I would also

be retitled ‘‘Regulatory Capital’’ and

relabeled Schedule HC–R.

In general, the proposed revised

format would use a systematic, step-bystep building block approach under

which BHCs would report the various

components and adjustments that

determine Tier 1, Tier 2, and total

capital, as well as risk-weighted assets.

This means that all regulatory capital

ratios—the Tier 1 leverage ratio, the Tier

1 risk-based capital ratio, and the total

risk-based capital ratio—would be

derived directly from the items that

BHCs report on this schedule. These

ratios would also be disclosed in the

schedule. The carrying values of all onbalance-sheet asset values and the face

value or notional amount of most offbalance-sheet items used in the capital

calculations would function as ‘‘control

totals’’ and banks would allocate these

amounts to the appropriate risk weight

categories in accordance with the riskbased capital guidelines.

Existing items in Part III require the

reporting of the major capital

categories—Tier 1, Tier 2, Tier 3, and

total risk-based capital—as well as riskweighted assets and average total assets,

which is used in the Tier 1 leverage

ratio. The amounts reported in these

existing items should be the amounts

determined by BHCs for their own

internal capital analyses consistent with

the applicable capital standards. These

items (Part III items 1.a through 4) are

so-called self-reported capital items.

The first part of the proposed revised

regulatory capital schedule would

essentially replicate the steps that BHCs

are already going through to determine

the major capital categories on a selfreported basis and therefore should not

impose significant additional reporting

burden. Moreover, to facilitate this

proposed step-by-step building block

approach to computing these capital

categories, the Federal Reserve proposes

to move a number of items that are

collected principally for regulatory

capital calculation purposes from their

currently scattered locations in other FR

Y–9C schedules to their more logical

position in the proposed revised capital

schedule. For example, as previously

discussed the item for ‘‘Deferred tax

assets in excess of regulatory capital

limits’’ that is currently collected in

Schedule HC–G—Memoranda, would

now be included in the proposed

revised Schedule HC–I (and retitled as

‘‘Disallowed deferred tax assets’’).

Overall, the Federal Reserve believes

that the proposed revisions to the

regulatory capital schedule provide a

rational, systematic approach to

reporting the elements of capital as well

as the components of risk-weighted

assets. The proposed approach should

offer both enhanced and efficient

reporting for both BHCs and users of the

FR Y–9C report.

Schedule HC–S—Securitization and

Asset Sale Activities

The Federal Reserve proposes to

revise and expand the information

collected in the FR Y–9C to facilitate

more effective analysis of the impact of

securitization and asset sale activities

on BHC credit exposures. In this regard,

the Federal Reserve proposes to

introduce a separate new schedule

(Schedule HC–S) effective with the June

30, 2001, reporting date that would

comprehensively capture information

related to BHC securitization and asset

sale activities. At present, the FR Y–9C

includes several items in various

schedules that are used to assess BHC

involvement in securitization and asset

sale activities. The items generally focus

on the securitization and sale of 1–4

family residential mortgages and

consumer loans. However, over the past

few years, the scope and volume of BHC

asset securitization activities have

expanded significantly beyond the

traditional 1–4 family residential

mortgage and consumer loan areas into

other areas, most notably into the areas

of home equity and commercial lending.

Under this proposal, BHCs involved

in securitization and asset sale activities

would report quarter-end (or year-todate) data for seven loan categories

similar to the manner in which they

report their loan portfolios. These data

would cover 1–4 family residential

loans, home equity lines, credit card

receivables, auto loans, other consumer

loans, commercial and industrial loans,

and all other loans and leases. For each

loan category, BHCs would report: (1)

The outstanding principal balance of

assets sold and securitized with

servicing retained or with recourse or

seller-provided credit enhancements, (2)

the maximum amount of credit

exposure arising from recourse or credit

enhancements to securitization

structures (separately for those

sponsored by the reporting institution

and those sponsored by other

institutions), (3) the past due amounts

and charge-offs and recoveries on the

underlying securitized assets, (4) the

amount of any commitments to provide

liquidity to the securitization structures,

(5) the outstanding principal balance of

assets sold with servicing retained or

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with recourse or seller-provided credit

enhancements that have not been

securitized, (6) the amount of ownership

(or seller’s) interests carried as securities

or loans, and (7) the maximum amount

of credit exposure arising from assets

sold with recourse or seller-provided

credit enhancements that have not been

securitized. A limited amount of

information would also be collected on

BHC credit exposures to asset-backed

commercial paper conduits. For the

home equity line, credit card receivable,

and the commercial and industrial loan

categories, BHCs would also report the

amount of any ownership (or seller’s)

interests in securitizations that are

carried as securities and the past due

amounts and charge-offs and recoveries

on the assets underlying these seller’s

interests.

At present, BHCs report certain

information related to securitizations,

asset sales, and servicing in current

Schedule HC–F—Off-Balance Sheet

Items and Schedule HC–G—

Memoranda. To avoid the loss of this

information until the delayed effective

date of new Schedule RC–S, these

existing items will be moved into and

reported in the Memoranda section of

Schedule HC–S for the March 31, 2001,

report date. These existing items and

what will happen to them after they are

collected in the March 31, 2001, FR Y–

9C are as follows:

1. Schedule HC–F, items 5.a.(1) and

(2) and items 5.b.(1) and (2)—in which

BHCs report the outstanding principal

balance and amount of recourse

exposure on (a) ‘‘First lien 1–4 family

residential mortgage loans’’ and (b)

‘‘Other financial assets’’ that have been

transferred with recourse and are treated

as sold—will be collected in Schedule

HC–S, Memorandum items 4.a.(1) and

(2) and items 4.b(1) and (2), for the final

time as of March 31, 2001.

2. Schedule HC–F, items 5.c.(1) and

(2)—in which BHCs report the

outstanding principal balance and

amount of retained recourse on ‘‘Small

business obligations transferred with

recourse under Section 208 of the Riegle

Community Development and

Regulatory Improvement Act of 1994’’—

will be collected in Schedule HC–S,

Memorandum items 1.a and 1.b, as of

March 31, 2001, and thereafter.

3. Schedule HC–G, item 17—in which

BHCs provide a six-way breakdown of

the ‘‘Outstanding principal balance of

1–4 family residential mortgage loans

serviced for others’’ by type of servicing

contract—will be collected in

condensed form in Schedule HC–S,

Memorandum items 2.a and 2.b, as of

March 31, 2001, and thereafter. In

addition item 2.c, which is not currently

reported in the FR Y–9C, would begin

to be reported as of June 30, 2001,

consistent with the proposed reporting

for Schedule RC–S.

Schedule HI—Consolidated Income

Statement

2. Report the combined amount of taxexempt loan and lease income in a

single income statement item,

Memoranda item 3. This would mean

that, going forward, the body of the

income statement (Schedule HI) would

contain only two items for interest and

fee income from loans (item 1.a.(1), ‘‘In

domestic offices’’ and item 1.a.(2), ‘‘In

foreign offices, Edge and Agreement

subsidiaries, and IBFs’’) and a single

item (item 1.b) for income from lease

financing receivables.

2. The breakout of interest income on

balances due from depository

institutions (by domestic versus foreign

offices) would be eliminated. Currently,

this information is reported in Schedule

HI, items 1.c.(1) and 1.c.(2). Going

forward, there would only be a total

reported for this information.

4. The number of categories of

securities income that BHCs are

required to report would be reduced.

BHCs would report their income for the

three following categories of securities

in the body of the income statement: (a)

U.S. Treasury securities and U.S.

government agency obligations, (b)

Mortgage-backed securities, and (c) All

other securities. BHCs would report

their ‘‘Income on tax-exempt securities

issued by states and political

subdivisions in the U.S.’’ in a new

income statement Memorandum item 4

rather than in the income statement

(Schedule HI) itself.

5. Item 2.c, ‘‘Interest on borrowed

funds,’’ would be retitled ‘‘Interest on

trading liabilities and other borrowed

money.’’ The instructions for this item

also would be clarified to include

trading liabilities.

6. Item 4.a, ‘‘Provision for credit

losses,’’ would be revised so that it

includes only the provision for loan and

lease losses. BHCs would report any

provision for credit losses on offbalance-sheet exposures in item 7.e,

‘‘Other noninterest expense’’ and they

would itemize and describe this

provision in Memoranda item 7, if it is

significant.

7. Item 4.b, ‘‘Provision for allocated

transfer risk,’’ would be eliminated as a

specific income statement item. BHCs

would report any provision for allocated

transfer risk in ‘‘Other noninterest

expense’’ and itemize and describe it in

Memoranda item 7 if it is significant.

8. Noninterest income: Board staff

proposes to add several new noninterest

income categories to those currently

collected in the FR Y–9C income

statement (Schedule HI). Noninterest

income has grown substantially over the

last few years as a source of revenue for

BHCs. A more detailed breakdown of

noninterest income would provide the

Federal Reserve with valuable

supervisory information on the amount

and type of fee-generating activities

within the BHC.

These categories were selected in part

based on a review of noninterest income

information currently reported by BHCs

in Schedule HI, Memoranda items 5 and

6. In these items, BHCs must itemize

and describe, using their own

terminology, their most significant

categories of ‘‘Service charges,

commissions, and fees’’ and ‘‘Other

noninterest income.’’ Two of the

proposed new income statement

categories represent items, or

modifications of items, for which

specific preprinted captions currently

appear in Schedule HI (Memoranda

items 6.a and 6.b). As a result, these

items would no longer be reported in

the Memoranda section of Schedule HI.

The categories of noninterest income

that would be added as specific items

on the FR Y–9C income statement are:

(1) Investment banking, advisory,

brokerage, and underwriting fees and

commissions, (2) venture capital

revenue, (3) net servicing fees, (4) net

securitization income, (5) insurance

commissions and fees, (6) net gains

(losses) on sales of loans, (7) net gains

(losses) on sales of other real estate

owned, and (8) net gains (losses) on

sales of other assets (excluding

securities). The current income

statement item for ‘‘Other service

charges, commissions, and fees’’ (item

5.b.(2)) would be discontinued. The new

noninterest income items would

provide greater comparability among the

categories of noninterest income

currently reported by BHCs. Some of the

proposed noninterest income categories

would represent the only information

provided in the FR Y–9C on certain

activities. By collecting more detailed

noninterest income data, the

significance of each of these activities

can be compared to other incomegenerating activities of the BHC.

9. New item 7.c, ‘‘Amortization

expense of intangible assets,’’ would be

added to the income statement

(Schedule HI).

10. In Schedule HI—Memoranda, the

threshold for itemizing and describing

significant components of ‘‘Other

noninterest income’’ and ‘‘Other

noninterest expense’’ in items 6 and 7

would be changed to 1 percent of the

total of interest income and noninterest

Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices 69531

income from the current threshold of 10

percent of other noninterest income and

10 percent of other noninterest expense,

respectively. This revised threshold is

consistent with the Securities and

Exchange Commission’s threshold for

the disclosure by bank holding

companies of components of other

noninterest income and expense.

11. Similar to the reporting revision

proposed to Schedule HC–B, Part II,

Trading Assets and Liabilities, the filing

criteria for Memoranda item 9, ‘‘Trading

revenue,’’ would be revised to require

BHCs to complete Memoranda item 9

only if they report a quarterly average

for trading assets of $2 million or more

as of the March 31st report date for the

current calendar year.

12. The instructions for Memorandum

items 10.a through 10.c that request

BHCs to disclose the impact of

derivatives held for purposes other than

trading on interest income, interest

expense, and noninterest income

(expense) would be revised. For

reporting beginning in 2001 when FASB

Statement No. 133, Accounting for

Derivative Instruments and Hedging

Activities, is in effect, all derivatives

would be reported on the balance sheet

at fair value and the accounting for fair

value and cash flow hedges under

Statement No. 133 differs from current

hedge accounting practices.

In addition, certain item captions

would be modified to better align with

similar information reported on the

bank Call Report Income Statement.

Schedule HI–A—Changes in Equity

Capital

1. The manner in which the previous

year-end balance of equity capital is

reported in this schedule so that it better

corresponds with how this balance is

presented in financial statements

prepared in accordance with GAAP. At

present, BHCs must report the ‘‘Equity

capital end of previous calendar year’’

in the FR Y–9C in item 1. If the BHC has

filed any amendments to this previous

year-end FR Y–9C report that affected

its originally reported total equity

capital, these equity capital adjustments

are reported in item 2, and the amended

equity capital balance for the previous

year-end is reported in item 3. The

Federal Reserve proposes to eliminate

item 2 and, in effect, have BHCs report

what is now reported in item 3 as their

previous year-end equity capital

balance. Thus, as Schedule HI–A would

be revised, BHCs would report ‘‘Equity

capital most recently reported for the

end of the previous calendar year’’ in

item 1. The Federal Reserve also

proposes to combine item 11,

‘‘Cumulative effect of changes in

accounting principles from prior years,’’

and item 12, ‘‘Corrections of material

accounting errors from prior years,’’ and

designate the combined items as item 2,

‘‘Restatements due to corrections of

material accounting errors and changes

in accounting principles,’’ of revised

Schedule HI–A. The next item in

revised Schedule HI–A (item 3) would

then be captioned ‘‘Balance end of

previous calendar year as restated.’’

2. Items 13.a, ‘‘Change in net

unrealized holding gains (losses) on

available-for-sale securities,’’ 13.b.,

‘‘Change in accumulated net gains

(losses) on cash flow hedges,’’ and 18,

‘‘Foreign currency translation

adjustments’’ would be combined and

replaced by an item for ‘‘Other

comprehensive income.’’ This item

would also include any minimum

pension liability adjustment recognized

during the year-to-date in accordance

with GAAP, which BHCs currently have

to report elsewhere in Schedule HI–A.

Identifying ‘‘Other comprehensive

income’’ in the changes in equity capital

schedule is consistent with FASB

Statement No. 130, Reporting

Comprehensive Income.

In addition, Schedule HI–A would be

renumbered and certain captions would

be modified to better align with the

Changes in Equity Capital schedule on

the Call Report.

Schedule HI–B—Charge-Offs and

Recoveries on Loans and Leases and

Changes in Allowance for Credit Losses

1. The presentation of loan category

information would be modified to better

match the loan schedule (HC–B) as

proposed by moving the current

breakdown of loans secured by real

estate from the Memoranda section of

Schedule HI–B, item 1, to item 1 of

Schedule HI–B, and item 5.a would be

redefined to exclude related plans

which would be reported in item 5.b. In

addition BHCs would also separately

report their charge-offs and recoveries of

loans secured by real estate in foreign

offices. Also the presentation order and

certain item captions would be revised

to align with the Charge-Offs and

Recoveries schedule on the Call Report.

2. The scope of Part II would be

revised to cover changes in the

allowance for loan and lease losses

rather than the entire allowance for

credit losses. In addition, similar to the

proposal discussed above for Schedule

HI–A—Changes in Equity Capital, the

manner in which the previous year-end

balance of the allowance is reported in

Schedule HI–B, Part II, would be

changed so that it better corresponds

with its presentation in financial

statements prepared in accordance with

GAAP. At present, BHCs report the

balance of the allowance as ‘‘originally

reported’’ in their previous year-end FR

Y–9C report in item 1. The effects of any

amendments to the previous year-end

FR Y–9C on the allowance as originally

reported are included in item 3,

‘‘Adjustments.’’ Item 1 would be revised

to eliminate the need to report these

adjustments from amended FR Y9–C

reports in item 3. Thus, BHCs would

report the ‘‘Balance most recently

reported at end of previous year’’ for the

year-end allowance for loan and lease

losses in item 1.

3. Schedule HI–B, Part II,

Memorandum item 1, ‘‘Credit losses on

off-balance-sheet derivative contracts,’’

would be retitled ‘‘Credit losses on

derivatives’’ and moved to Schedule HI,

memoranda item 11.

Other Revisions Not Related to Call

Report Changes

The following proposed revisions are

not directly related to the proposed Call

Report changes for March 2001. Most of

these changes are proposed to provide

greater consistency with current Call

Report items that are not part of the

March 2001 revisions.

Schedule HC—Consolidated Balance

Sheet

1. To better align the presentation of

the FR Y–9C Balance Sheet with that of

the Call Report Balance Sheet,

components of item 7, ‘‘Other real estate

owned,’’ and item 10, ‘‘Intangible

assets,’’ and line items 16, ‘‘Commercial

paper,’’ and 17, ‘‘Other borrowed money

with a remaining maturity of more than

one year’’ would be moved to the

Memoranda schedule.

2. Item 20, ‘‘Mandatory convertible

securities,’’ with a two-way breakout

between item 10.a, ‘‘Equity contract

notes, gross’’ and item 10.b, ‘‘Equity

commitment notes, gross’’ would be

eliminated. Information on mandatory

convertible securities would be

included in item 21, ‘‘Subordinated

notes and debentures.

In addition, items on Schedule HC

would be renumbered and certain line

item captions modified to better align

with information reported on the Call

Report Balance Sheet.

Schedule HC–A—Securities

1. Memoranda item 7, ‘‘U.S.

government agency and corporation

obligations (exclude mortgage-backed

securities)’’ would be moved to

Schedule HC–A, as item 2. Currently a

two-way breakout of this item is

collected for such securities ‘‘Issued by

U.S. government agencies’’ (Memoranda

item 7.a) and for securities ‘‘Issued by

69532 Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices

U.S. government-sponsored agencies’’

(Memoranda item 7.b) from BHCs with

total consolidated assets of $1 billion or

more. These two items would replace

the total reported for U.S. government

agency and corporate obligations

currently reported in item 2 and would

be reported by all BHCs. This change

would provide for consistency in

reporting with the Call Report Schedule

RC–B, Securities.

2. Memoranda item 8, ‘‘Mortgagebacked securities (MBS),’’ with the

breakout between ‘‘Pass-through

securities’’ (item 8.a) and ‘‘Other

mortgage-backed securities (include

CMOs, REMICs, and stripped MBS)’’

(item 8.b) would be moved to Schedule

HC–A, new item 4. These items would

then be reported by all BHCs, rather

than by BHCs with total consolidated

assets of $1 billion or more. FR Y–9C

data show that BHCs of $1 billion or

more in total assets have long been

actively involved in mortgage-backed

securities. For 1999, mortgage-backed

securities represented 45 percent of the

total securities portfolio for BHCs of $1

billion or more in total assets. Call

Report data show that, for commercial

banks between $150 million and $1

billion in total assets, mortgage-backed

securities represented nearly 30 percent

of their total securities portfolio in 1999.

Given the suspected significance of BHC

involvement in this activity at all levels,

the Federal Reserve proposes to collect

mortgage-backed security information

from all FR Y–9C respondents. All

commercial banks currently file this

information on the Call Report.

3. Collect a new item 7, ‘‘Investments

in mutual funds and other equity

securities with readily determinable fair

values’ from all FR Y–9C respondents in

order to assure the completeness and

continuity of the reporting of BHC

security holdings given the proposed

changes to Memoranda items 7 and 8.

Currently this information (Memoranda

item 9.a) is collected only from BHCs

with total consolidated assets of $1

billion or more. All commercial banks

currently file this information on the

Call Report.

4. Item 3.a, ‘‘Taxable securities’’ and

item 3.b, ‘‘Tax exempt securities,’’

would be combined. The caption would

read ‘‘Securities issued by states and

political subdivisions in the U.S.’’

5. Items reported for U.S. securities

(item 4) and Foreign securities (item 5)

would be modified to collect only U.S.

debt securities and Foreign debt

securities for consistency with the Call

Report.

Schedule HC–B—Loans and Lease

Financing Receivables

1. The three-way breakout for item 8,

‘‘All other loans,’’ would be collapsed to

a single item, eliminating items 8.a,

‘‘Taxable obligations (other than

securities) of states and political

subdivisions in the U.S.’’ and 8.b, ‘‘Tax

exempt obligations (other than

securities) of states and political

subdivisions in the U.S.’’ This change

would provide for consistency in

reporting with the Call Report Loan

schedule.

In addition, items from Schedule HC–

B would be renumbered to align with

the presentation order on the Call

Report Loan schedule.

Schedule HC–F—Derivatives and OffBalance-Sheet Items

1. Item 2, ‘‘Financial standby letters of

credit,’’ and item 2.a, ‘‘Amount of

financial standby letters of credit

conveyed to others’’ would be added to

provide for consistency in reporting this

off-balance-sheet information with

similar items collected on the Call

Report, and to tie information reported

in Schedule HC–F with off-balancesheet information proposed in Schedule

HC–R, item 44, ‘‘Financial standby

letters of credit.’’

2. Item 3, ‘‘Performance standby

letters of credit,’’ and item 3.a, ‘‘Amount

of performance standby letters of credit

conveyed to others’’ would be added to

provide for consistency in reporting this

off-balance-sheet information with

similar items collected on the Call

Report, and to tie information reported

in Schedule HC–F with off-balancesheet information proposed in Schedule

HC–R, item 45, ‘‘Performance standby

letters of credit.’’

3. Item 9, ‘‘Other significant offbalance-sheet items (exclude offbalance-sheet derivatives) that exceed

10% of total equity capital’’ would be

retitled as ‘‘All other off-balance-sheet

items (exclude derivatives)’’ to capture

all other off-balance-sheet exposures to

provide for consistency in reporting this

off-balance-sheet information with the

similar item collected on the Call Report

and would provide analysts a complete

measure of the risk associated with

these exposures.

Schedule HC–G—Memoranda

1. The two-way breakdown of

deferred tax assets captured in item

1.a.(1), ‘‘IRS loan loss provision,’’ and

item 1.a.(2), ‘‘Other,’’ would be

eliminated in favor of a single item for

‘‘Net deferred tax assets’’ and the item

would be included on a new ‘‘Other

Assets’’ schedule discussed below.

Similarly, the two-way breakdown of

deferred tax liabilities captured in items

1.b.(1), ‘‘IRS loan loss provision,’’ and

item 1.b.(2), ‘‘Other,’’ would be

eliminated in favor of a single item for

‘‘Net deferred tax liabilities’’ and would

be included on a new ‘‘Other

Liabilities’’ schedule discussed below.

2. Item 3, ‘‘Number of full-time

equivalent employees’’ would be moved

to Schedule HI, Income Statement,

memoranda item 5, to be consistent

with presentation in the Call Report.

3. Item 7.a, ‘‘Amount of cash items in

process of collection netted against

deposit liabilities in reporting Schedule

HC,’’ item 8, ‘‘Reciprocal demand

balances with depository institutions

(other than commercial banks in the

U.S.),’’ and item 16, ‘‘Please describe

and list below separately the dollar

amount outstanding of assets removed

from the reporting company’s balance

sheet (Schedule HC) in connection with

assets netted against liabilities when

there exists a legal right of offset’’ would

be eliminated.

Schedule HC–I—Risked Based Capital

1. Schedule HC–I, Part I, Memoranda

item 6, ‘‘Fair value of mortgage servicing

assets,’’ would be retitled as ‘‘Estimated

fair value of mortgage servicing assets’’

and moved to Schedule HC–M,

Memoranda item 18.a(1).

Schedule HC–IC—Additional Detail on

Capital Components

Items on Schedule HC–IC would be

included in the Memoranda section of

the revised risk-based capital schedule.

In addition, the Federal Reserve

proposes the following changes.

1. Item 1.a.(4), ‘‘Other items included

in ‘Minority interest in consolidated

subsidiaries and similar items,’ on

Schedule HC subject to limits in Tier 1

capital,’’ would be added to provide for

a more complete disclosure of elements

incorporated into the calculation of Tier

1 capital.

2. Item 1.b., ‘‘Auction rate preferred

stock and any other perpetual preferred

stock deemed by the Federal Reserve to

be eligible for Tier 2 capital only,’’ item

2., ‘‘Total perpetual debt, undedicated

portions of mandatory convertible

securities and long-term preferred stock

with an original maturity of 20 years or

more that qualify for supplementary

capital (after discounting),’’ and item 3,

‘‘Intermediate preferred stock with an

original weighted-average maturity of 5

years or more; subordinated debt with

an original weighted average maturity of

5 years or more; or unsecured long-term

debt issued by BHC prior to March 12,

1988, that qualified as secondary capital

Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices 69533

(after discounting)’’ would be

eliminated.

Schedule HC–H—Past Due and

Nonaccrual Loans, Lease Financing

Receivables, Placements, and Other

Assets

1. Item 1, ‘‘Loans secured by real

estate’’ as a total would be deleted. This

item can be derived from the sum of the

components of revised item 1.

New Schedules for ‘‘Other Assets’’ and

‘‘Other Liabilities’’

As mentioned previously, the Federal

Reserve proposes to add two new

schedules for the reporting of ‘‘Other

Assets’’ and ‘‘Other Liabilities.’’ Items

reported on these schedules consist of

items currently reported on the

Memoranda and Securities schedules,

and certain new and revised items. The

addition of these schedules will provide

greater consistency with the

presentation provided in the Call

Report. The ‘‘Other Assets’’ schedule

would consist of the following items: (1)

Accrued interest receivables, (2) Net

deferred tax assets, (3) Interest-only

strips receivable (not in the form of a

security) on Mortgage loans and Other

financial assets, (4) Equity securities

that do not have readily determinable

fair values, and (5) Other. The ‘‘Other

Liabilities’’ schedule would consist of

the following items: (1) Net deferred tax

liabilities, (2) Allowance for credit

losses on off-balance-sheet credit

exposures, and (3) Other.

Item 2 on the ‘‘Other Liabilities’’

schedule, ‘‘Allowance for credit losses

on off-balance-sheet credit exposures,’’

is included on the balance sheet as a

component of other liabilities sheet

separate from the allowance for loan

and lease losses. At present, the limited

number of BHCs that have an allowance

for credit losses on off-balance-sheet

credit exposures combine this

allowance with their allowance for loan

and lease losses when completing

Schedule HI–B, Part II, (Changes in)

Allowance for Credit Losses. Because

the allowance for loan and lease losses

is reported on the balance sheet

(Schedule HC), the amount of the

allowance for credit losses on offbalance-sheet exposures can be derived.

However, as discussed previously, the

Federal Reserve is proposing to revise

the scope of Schedule HI–B, Part II. This

change creates the need for the

proposed new item to identify the

amount, if any, of a BHC’s allowance for

credit losses on off-balance-sheet

exposures.

Schedule HI—Consolidated Income

Statement

2. Item 5.b.(1) ‘‘Service charges on

deposit accounts’’ and item 5.b.(2)

‘‘Other service charges, commissions,

and fees’’ would be combined and

retitled ‘‘Service charges on deposit

accounts in domestic offices.’’ In

addition, Memorandum item 5 would be

deleted since this item was for the

purpose of describing items included in

5.b.(2) that exceeded a particular

threshold.

3. Memorandum item 4 ‘‘Income taxes

applicable to gains (losses) on securities

not held in trading accounts’’ would be

deleted.

Schedule HI–B, Part II—Allowance for

Credit Losses

1. Item 6, ‘‘Foreign currency

translation adjustments,’’ would be

combined with new item 5,

‘‘Adjustments.’’

Revisions Related to the Gramm-LeachBliley Act of 1999

The Federal Reserve proposes to

collect certain information to address

the difference in the supervisory

requirements for BHCs and newly

formed financial holding companies

(FHCs) that conduct insurance-related

activities. While bank holding

companies have engaged in a relatively

limited amount of insurance-related

activities for some time, the volume and

complexity of insurance related

activities engaged in by FHCs will likely

increase as they take advantage of the

provisions of the Gramm-Leach-Bliley

Act of 1999 (GLBA).

Insurance related activities of BHCs

have been limited to the provisions

provided under Regulation Y and the

Garn-St. Germain Depository

Institutions Act of 1982. Now FHCs,

among other things, can engage in and

affiliate with full service insurance

companies providing insurance agency

(sales) and underwriting activities. In

addition, while traditional BHCs have

been able to engage in various nonbank

activities and new businesses, they were

required to apply in advance to acquire

or launch material new business lines.

Today, BHCs that qualify as FHCs are

able to rapidly enter insurance activities

without advance notification to the

Federal Reserve.

The existing FR Y9–C is structured to

accommodate bank, securities and other

activities incidental to banking, but not

for insurance activities. With the latest

Call Report proposal, adjustments are

being proposed to reflect both new

authority and financial innovation for

bank-level activities and many of these

same changes are also being proposed

for the FR Y9–C. However, those Call

Report adjustments do not include

insurance underwriting, since that

activity remains impermissible for

banks. Because insurance underwriting

affiliates are unique to FHCs, the FR

Y9–C will need to reflect this special

affiliation in a way that is useful to

supervisors and the public without

creating undue burden.

As an umbrella supervisor, it is

essential for the Federal Reserve to

evaluate the volume and nature of

insurance activities conducted by an

FHC on a fully consolidated basis. A

few basic indicators of the nature and

volume of the FHC’s insurance business

that cut across legal entities and

business lines will be critical, especially

since the number of entities and related

functional regulators involved with

such activities can be substantial and

impractical for the Federal Reserve to

aggregate on its own. Moreover, with

hundreds of BHCs now qualified as

FHCs, monitoring those that have begun

to engage in insurance activities, and

how rapidly they are growing that

business, will be extremely challenging.

Regulatory disclosures will be

particularly important for smaller FHCs

that do not regularly publish statements

to the marketplace. By adopting some

modest reporting supplements to the FR

Y9–C, the Federal Reserve will be better

prepared to tailor and calibrate its

supervisory and coordination efforts

with functional supervisors on an as

needed and risk-focused basis.

Simply stated, these data would serve

to identify whether the organization has

engaged in agency business (sales),

underwriting and reinsurance activities

and indicate the approximate size of its

reserve positions (which constitute the

largest liability for an insurance

company and the most prominent

source of insurer insolvency). These

‘‘identifiers’’ will serve as a tool for

identifying when the Federal Reserve

will need to contact and coordinate with

functional regulators to get additional

information without duplicative or

onerous burden on the FHC’s

functionally-regulated entities.

The Federal Reserve proposes to add

a new schedule HC–I, ‘‘InsuranceRelated Activities,’’ to obtain the

following ‘‘identifier’’ information: Part

I, Property and Casualty; Part II, Life

and Health; and Part III, All InsuranceRelated Activities. Items proposed for

Part I are: Agent balances; Reinsurance

recoverables; Deferred acquisition costs

and value of insurance acquired; Policy

benefits, reserves, and loss adjusted

expenses; and Unearned premiums.

Items proposed for Part II are: Separate

69534 Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices

account assets; Asset valuation reserve

and interest maximization reserve;

Policy benefits, reserves, and loss

adjusted expenses; Liabilities for

premiums and other deposit funds; and

Separate account liabilities. Items

proposed for Part III are: Total assets

and Net Income.

The Federal Reserve also proposes to

add two ‘‘identifier’’ items to Schedule

HI, Consolidated Income Statement.

Under item 5, ‘‘Noninterest income,’’

item 5.i, ‘‘Premiums earned’’ would be

added. Under item 7, ‘‘Noninterest

expense,’’ item 7.d, ‘‘Benefits, losses

and expenses from insurance related

activities’’ would be added.

Instructions

Instructional revisions and

clarifications will be done in accordance

with changes made to the Call Report

instructions and revisions to the Capital

Guidelines.

2. Report title: Parent Company Only

Financial Statements for Large Bank

Holding Companies

Agency form number: FR Y–9LP.

OMB control number: 7100–0128.

Frequency: Quarterly.

Reporters: Bank holding companies.

Annual reporting hours: 37,985.

Estimated average hours per response:

4.49.

Number of respondents: 2,115.

Small businesses are affected.

General description of report: This

information collection is mandatory (12

U.S.C. 1844(c)). Confidential treatment

is not routinely given to the data in this

report. However, confidential treatment

for the reporting information, in whole

or in part, can be requested in

accordance with the instructions to the

form.

Abstract: The FR Y–9LP includes

standardized financial statements filed

quarterly on a parent company only

basis from each bank holding company

that files the FR Y–9C. In addition, for

tiered bank holding companies, a

separate FR Y–9LP must be filed for

each lower tier bank holding company.

Current actions: The Federal Reserve

proposes the following revisions to the

FR Y–9LP effective with the March 31,

2001, reporting date.

Schedule PC—Parent Company Only

Balance Sheet

1. Item 4.f, ‘‘Allocated transfer risk

reserve,’’ would be deleted from the

balance sheet. BHCs would report item

4.c, ‘‘Loans, net of unearned income’’

and item 4.c, ‘‘Leases, net of unearned

income’’ net of any allocated transfer

risk reserve.

2. Item 15, ‘‘Mandatory convertible

securities,’’ with a two-way breakout

between item 15.a, ‘‘Equity contract

notes, gross’’ and item 15.b, ‘‘Equity

commitment notes, gross’’ would be

eliminated. Information on mandatory

convertible securities would be

included in item 16, ‘‘Subordinated

notes and debentures.’’

3. Items 20.e, ‘‘Net unrealized holding

gains (losses) on available-for-sale

securities,’’ and 20.f, ‘‘Accumulated net

gains (losses) on cash flow hedges’’

would be combined and reported as

‘‘Accumulated other comprehensive

income.’’ This change would conform

the presentation of the equity capital

section of the FR Y–9LP balance sheet

to FASB Statement No. 130, Reporting

Comprehensive Income.

4. A new item for ‘‘Other equity

capital components’’ would be added to

the equity capital section of the balance

sheet. This item would include treasury

stock and unearned Employee Stock

Ownership Plan shares, which, under

GAAP, are to be reported in a contraequity account on the balance sheet.

Treasury stock (item 20.g) would no

longer be reported separately. This

change will make the equity capital

section more consistent with GAAP and

with the equity capital section of the

balance sheet in the proposed bank Call

Report and the Thrift Financial Report.

Schedule PI—Parent Company Only

Income Statement

1. Item 2.c.(1), ‘‘Provision for credit

losses,’’ would be revised so that it

includes only the provision for loan and

lease losses. BHCs would report any

provision for credit losses on offbalance-sheet exposures in item 2.d,

‘‘All other expenses.’’

2. Item 2.c.(2), ‘‘Provision for

allocated transfer risk,’’ would be

eliminated as a specific income

statement item. BHCs would report any

provision for allocated transfer risk in

item 2.d, ‘‘All other expenses.’’

Instructions

Instructional revisions and

clarifications would be made as

necessary, to conform with changes

made to the Call Report instructions.

3. Report title: Parent Company Only

Financial Statements for Large Bank

Holding Companies.

Agency form number: FR Y–9SP.

OMB control number: 7100–0128.

Frequency: Semiannual.

Reporters: Bank holding companies.

Annual reporting hours: 29,001.

Estimated average hours per response:

3.82.

Number of respondents: 3,796.

Small businesses are affected.

General description of report: This

information collection is mandatory (12

U.S.C. 1844(c)). Confidential treatment

is not routinely given to the data in this

report. However, confidential treatment

for the reporting information, in whole

or in part, can be requested in

accordance with the instructions to the

form.

Abstract: The FR Y–9SP is a parent

company only financial statement filed

on a semiannual basis by one-bank

holding companies with total

consolidated assets of less than $150

million, and multibank holding

companies with total consolidated

assets of less than $150 million that

meet certain other criteria. This report,

an abbreviated version of the more

extensive FR Y–9LP, is designed to

obtain basic balance sheet and income

statement information for the parent

company, information on intangible

assets, and information on

intercompany transactions.

Current actions: The Federal Reserve

proposes the following revisions to the

FR Y–9SP effective with the June 30,

2001, reporting date.

Balance Sheet

1. Items 16.d, ‘‘Net unrealized holding

gains (losses) on available-for-sale

securities,’’ and 16.e, ‘‘Accumulated net

gains (losses) on cash flow hedges’’

would be combined and reported as

‘‘Accumulated other comprehensive

income.’’ This change would conform

the presentation of the equity capital

section of the FR Y–9SP balance sheet

to FASB Statement No. 130, Reporting

Comprehensive Income.

2. A new item for ‘‘Other equity

capital components’’ would be added to

the equity capital section of the balance

sheet. This item would include treasury

stock and unearned Employee Stock

Ownership Plan shares, which, under

GAAP, are to be reported in a contraequity account on the balance sheet.

Treasury stock will continue to be

reported separately as Memoranda item

3 (if the amount exceeds 5 percent of

equity capital). This change would make

the equity capital section more

consistent with GAAP and with the

equity capital section of the balance

sheet in the proposed bank Call Report

and the Thrift Financial Report.

3. Memoranda item 4, ‘‘Mandatory

convertible securities, net,’’ would be

eliminated.

In addition the following change

would be made independent of changes

proposed to the FR Y–9C. Instructions

for Memoranda item 1, ‘‘Total

consolidated assets of the bank holding

company,’’ indicate that this item is to

be completed only by multibank

holding companies with total

consolidated assets of less than $150

Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices 69535

million, without any debt outstanding to

the general public and not engaged in a

nonbank activity (either directly or

indirectly) involving financial leverage

and not engaged in credit extending

activities. Board staff proposes to

remove this reporting threshold and

require all BHCs that file the FR Y–9SP

to complete this item so that staff can

monitor the size of these institutions.

Instructions

Instructional revisions and

clarifications would be made as

necessary, to conform with changes

made to the Call Report instructions.

Proposal To Approve Under OMB

Delegated Authority To Extend for

Three Years, With Revision, the

Following Reports

1. Report title: Quarterly Financial

Statements of Nonbank Subsidiaries of

Bank Holding Companies.

Agency form number: FR Y–11Q.

OMB control number: 7100–0244.

Frequency: Quarterly.

Reporters: Bank holding companies.

Annual reporting hours: 14,402.

Estimated average hours per response:

6.35.

Number of respondents: 567.

Small businesses are affected.

General description of report: This

information collection is mandatory (12

U.S.C. 1844(c)). Confidential treatment

is not routinely given to most of the data

in this report. However, confidential

treatment for the reporting information,

in whole or in part, can be requested in

accordance with the instructions to the

form. Currently FR Y–11Q,

memorandum item 7.a, loans and leases

past due 30 through 89 days and FR Y–

11Q, memorandum item 7.d, loans and

leases restructured and included in past

due and nonaccrual loans are

confidential pursuant to Section (b)(8)

of the Freedom of Information Act 5

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

Abstract: The FR Y–11Q is filed

quarterly by the top tier bank holding

companies for each nonbank subsidiary

of a bank holding company with total

consolidated assets of $150 million or

more in which the nonbank subsidiary

has total assets of 5 percent or more of

the top-tier bank holding company’

consolidated Tier 1 capital, or where the

nonbank subsidiary’ total operating

revenue equals 5 percent or more of the

top-tier bank holding company’

consolidated total operating revenue.

The report consists of a balance sheet,

income statement, off-balance-sheet

items, information on changes in equity

capital, and a memoranda section.

Current actions: The Federal Reserve

proposes the following revisions to the

FR Y–11Q effective with the March 31,

2001, reporting date.

Balance Sheet

1. Items 20.e, ‘‘Net unrealized holding

gains (losses) on available-for-sale

securities,’’ and 20.f, ‘‘Accumulated net

gains (losses) on cash flow hedges’’

would be combined and reported as

‘‘Accumulated other comprehensive

income.’’ This change would conform

the presentation of the equity capital

section of the FR Y–9C balance sheet to

FASB Statement No. 130, Reporting

Comprehensive Income.

2. A new item for ‘‘Other equity

capital components’’ would be added to

the equity capital section of the balance

sheet. This item would include treasury

stock and unearned Employee Stock

Ownership Plan shares that, under

GAAP, are to be reported in a contraequity account on the balance sheet.

Treasury stock (item 20.h) would no

longer be reported separately. This

change will make the equity capital

section more consistent with GAAP and

with the equity capital section of the

balance sheet in the proposed FR Y–9C.

Memoranda

1. Consistent with changes proposed

to the FR Y–9C, Memoranda item 7.a,

‘‘Loans and leases past due 30 through

89 days,’’ and Memoranda item 7.d,

Loans and leases restructured and

included in past due and nonaccrual

loans,’’ would no longer be afforded

confidential treatment.

2. The scope of item 12.a, ‘‘Income

earned, not collected on loans,’’ would

be expanded to cover all ‘‘Accrued

interest receivable.’’ Broadening this

category to include interest earned, not

collected on earning assets other than

loans would be more consistent with the

typical presentation of accrued interest

receivable in financial statements

prepared for other financial reporting

purposes.

Income Statement

Noninterest income: Noninterest

income has grown substantially over the

last few years as a source of revenue for

BHCs. A more detailed breakdown of

noninterest income would provide the

Federal Reserve with valuable

supervisory information on the amount

and type of fee-generating activities

within the BHC.

Therefore, the Federal Reserve

proposes to add several new noninterest

income categories to those currently

collected in the FR Y–11Q income

statement. These categories were

selected in part based on a review of

noninterest income information

currently reported by BHCs in Schedule

HI, Memoranda items 5 and 6, of the FR

Y–9C. In these items, BHCs must

itemize and describe, using their own

terminology, their most significant

categories of ‘‘Service charges,

commissions, and fees’’ and ‘‘Other

noninterest income.’’

The categories of noninterest income

that would be added as specific items

on the FR Y–11Q income statement are:

(1) Investment banking, advisory,

brokerage, and underwriting fees and

commissions, (2) venture capital

revenue, (3) net servicing fees, (4) net

securitization income, and (5) insurance

commissions and fees. The current

income statement items for ‘‘Income

from underwriting activities,’’ ‘‘Income

from brokerage activities,’’ ‘‘Income

from loan servicing,’’ and ‘‘Other service

charges, commissions, and fees’’ (items

5.b.(2),(3),(4) and (6)) would be

discontinued.

The new noninterest income items

would provide greater comparability

among the categories of noninterest

income currently reported by BHCs.

Some of the proposed noninterest

income categories would represent the

only information provided in the FR Y–

11Q on certain activities. By collecting

more detailed noninterest income data,

the significance of each of these

activities can be compared to other

income-generating activities of the

nonbank subsidiary and of the BHC.

Changes in Equity Capital

1. The manner in which the previous

year-end balance of equity capital is

reported in this schedule would be

changed so that it better corresponds

with how this balance is presented in

financial statements prepared in

accordance with GAAP. At present,

nonbank subsidiaries must report the

‘‘Equity capital end of previous calendar

year’’ in the FR Y–11Q in item 1. If the

nonbank subsidiary has filed any

amendments to this previous year-end

FR Y–11Q report that affected its

originally reported total equity capital,

these equity capital adjustments are

reported in item 6, and the amended

equity capital balance for the previous

year-end is reported in item 7. Item 1

would be revised to have nonbank

subsidiaries report ‘‘Equity capital most

recently reported for the end of the

previous calendar year.’’

2. Item 18, ‘‘Foreign currency

translation adjustments’’ would be

replaced by an item for ‘‘Other

comprehensive income.’’ This new item

would include any change in net

unrealized holding gains (losses) on

available-for-sale securities and any

change in accumulated net gains (losses)

on cash flow hedges (currently included

69536 Federal Register / Vol. 65, No. 223 / Friday, November 17, 2000 / Notices

in item 6, ‘‘Other adjustments’’).

Identifying ‘‘Other comprehensive

income’’ in the changes in equity capital

schedule is consistent with FASB

Statement No. 130, Reporting

Comprehensive Income.

Instructions

Instructional revisions and

clarifications would be made as

necessary, to conform with changes

made to the Call Report instructions.

2. Report title: Annual Financial

Statements of Nonbank Subsidiaries of

Bank Holding Companies.

Agency form number: FR Y–11I.

OMB control number: 7100–0244.

Frequency: Annual.

Reporters: Bank holding companies.

Annual reporting hours: 8,531.

Estimated average hours per response:

3.24.

Number of respondents: 2,633.

Small businesses are affected.

General description of report: This

information collection is mandatory (12

U.S.C. 1844(c)). Confidential treatment

is not routinely given to the data in this

report. However, confidential treatment

for the reporting information, in whole

or in part, can be requested in

accordance with the instructions to the

form. Currently FR Y–11I, Schedule A,

item 7.a, loans and leases past due 30

through 89 days and FR Y–11I,

Schedule A, item 7.d, loans and leases

restructured and included in past due

and nonaccrual loans are confidential

pursuant to Section (b)(8) of the

Freedom of Information Act 5 U.S.C.

552(b)(8).

Abstract: The FR Y–11I is filed

annually by the top tier bank holding

companies for each of their nonbank

subsidiaries that are not required to file

a quarterly FR Y–11Q. The FR Y–11I

report consists of similar balance sheet,

income statement, off-balance-sheet,

and change in equity capital

information that is included on the FR

Y–11Q. However, some of the items on

the FR Y–11I are collected in a less

detailed manner. In addition, the FR Y–

11I also includes a loan schedule to be

submitted only by respondents engaged

in extending credit.

Current actions: The Federal Reserve

proposes the following revisions to the

FR Y–11I effective with the December

31, 2001, reporting date.

Changes in Equity Capital

1. The manner in which the previous

year-end balance of equity capital is

reported in this schedule would be

changed so that it better corresponds

with how this balance is presented in

financial statements prepared in

accordance with GAAP. At present,

nonbank subsidiaries must report the

‘‘Equity capital end of previous calendar

year’’ in the FR Y–11I in item 1. If the

nonbank subsidiary has filed any

amendments to this previous year-end

FR Y–11I report that affected its

originally reported total equity capital,

these equity capital adjustments are

reported in item 6, and the amended

equity capital balance for the previous

year-end is reported in item 7. Item 1

would be revised to have nonbank

subsidiaries report ‘‘Equity capital most

recently reported for the end of the

previous calendar year.’’

2. Item 5, ‘‘Foreign currency

translation adjustments’’ would be

replaced by an item for ‘‘Other

comprehensive income.’’ This new item

would include any change in net

unrealized holding gains (losses) on

available-for-sale securities and any

change in accumulated net gains (losses)

on cash flow hedges (currently included

in item 6, ‘‘Other adjustments’’).

Identifying ‘‘Other comprehensive

income’’ in the changes in equity capital

schedule is consistent with FASB

Statement No. 130, Reporting

Comprehensive Income.

Schedule A—Loans and Lease

Financing Receivables

1. Consistent with changes proposed

to the FR Y–9C, item 7.a, ‘‘Loans and

leases past due 30 through 89 days,’’

and item 7.d, Loans and leases

restructured and included in past due

and nonaccrual loans,’’ would no longer

be afforded confidential treatment.

Instructions

Instructional revisions and

clarifications would be made as

necessary, to conform with changes

made to the Call Report instructions.

Board of Governors of the Federal Reserve

System, November 13, 2000.

Jennifer J. Johnson,

Secretary of the Board.

[FR Doc. 00–29426 Filed 11–16–00; 8:45 am]

BILLING CODE 6210–01–F

FEDERAL RESERVE SYSTEM

Change in Bank Control Notices;

Acquisitions of Shares of Banks or

Bank Holding Companies

The notificants listed below have

applied under the Change in Bank

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

§ 225.41 of the Board’s Regulation Y (12

CFR 225.41) to acquire a bank or bank

holding company. The factors that are

considered in acting on the notices are

set forth in paragraph 7 of the Act (12

U.S.C. 1817(j)(7)).

The notices are available for

immediate inspection at the Federal

Reserve Bank indicated. The notices

also will be available for inspection at

the offices of the Board of Governors.

Interested persons may express their

views in writing to the Reserve Bank

indicated for that notice or to the offices

of the Board of Governors. Comments

must be received not later than

December 4, 2000.

A. Federal Reserve Bank of Atlanta

(Cynthia C. Goodwin, Vice President)

104 Marietta Street, N.W., Atlanta,

Georgia 30303–2713:1.

1. Nancy Barr Dixon, Eufaula,

Alabama; Michael Charles Dixon, Sr.,

Eufaula, Alabama; Hope Cotton Dixon,

Eufaula, Alabama; Michael Charles

Dixon, Jr., Eufaula, Alabama; Claudia

Dixon Balkcom, Atlanta, Georgia;

Heather Barr Dixon, Eufaula, Alabama;

Marian Christine Dixon, Birmingham,

Alabama; Rebecca Janie Mac Dixon,

Auburn, Alabama; Robert Mack Dixon,

Eufaula, Alabama; Mary Elliott Dixon,

Eufaula, Alabama; Mary Clayton Dixon,

Eufaula, Alabama; Eric Ross Fenichel,

Atlanta, Georgia; Janie Dixon King,

Eufaula, Alabama; William Daniel King,

Eufaula, Alabama; Robert Mack Dixon,

Jr., Eufaula, Alabama; Preston Copeland

Dixon, Birmingham, Alabama; James

Franklin Dixon, III, Birmingham,

Alabama; Rita Hallett Dixon,

Birmingham, Alabama; Thomas Seay

Lawson, Jr., Montgomery, Alabama;

Sarah Clayton Lawson, Montgomery,

Alabama; and Preston Copeland

Clayton, Jr., Eufaula, Alabama; all to

retain voting shares of Eufaula

BancCorp, Inc., Eufaula, Alabama, and

thereby indirectly retain voting shares of

Southern Bank of Commerce, Eufaula,

Alabama.

B. Federal Reserve Bank of Kansas

City (D. Michael Manies, Assistant Vice

President) 925 Grand Avenue, Kansas

City, Missouri 64198–0001:

1. William Edwin Shoemaker,

Cambridge, Nebraska; to acquire voting

shares of FNB Financial Services, Inc.,

Cambridge, Nebraska, and thereby

indirectly acquire voting shares of The

First National Bank of Cambridge,

Cambridge, Nebraska.

C. Federal Reserve Bank of San

Francisco (Maria Villanueva, Consumer

Regulation Group) 101 Market Street,

San Francisco, California 94105–1579:

1. David B. and Mary T. Weyrich,

Paso Robles, California; to acquire

additional voting shares of Heritage

Oaks Bancorp, Paso Robles, California,

and thereby indirectly acquire

additional voting shares of Heritage

Oaks Bank, Paso Robles, California.