75870 Federal Register / Vol. 65, No. 234 / Tuesday, December 5, 2000 / Proposed Rules

1See Conference of State Bank Supervisors v.

Conover, 715 F.2d 604, 615 (D.C. Cir. 1983)

(confirming the OCC’s interpretation of how the

national treatment principle applies).

2 12 CFR 4.7 generally provides that the OCC may

conduct a full-scope, on-site examination of certain

well capitalized and well managed Federal

branches and agencies at least once during each 18-

month period, rather than each 12-month period.

The FRB applies the same capital and management

requirements when determining whether a State

branch or agency will be subject to the 18-month

examination schedule. 12 CFR 211.26(c)(2).

Initial Certificate Effective Date: April

19, 2000

Amendment Number 1 Effective Date:

February 20, 2001

SAR Submitted by: Transnuclear, Inc.

SAR Title: Final Safety Analysis Report

for the TN–32 Dry Storage Cask

Docket Number: 72–1021

Certificate Expiration Date: April 19,

2020

Model Number: TN–32, TN–32A, TN–

32B

* * * * *

Dated at Rockville, Maryland, this 16th day

of November, 2000.

For the Nuclear Regulatory Commission.

William D. Travers,

Executive Director for Operations.

[FR Doc. 00–30907 Filed 12–4–00; 8:45 am]

BILLING CODE 7590–01–P

DEPARTMENT OF THE TREASURY

Office of the Comptroller of the

Currency

12 CFR Part 5

[Docket No. 00–32]

RIN 1557–AB92

Operating Subsidiaries of Federal

Branches and Agencies

AGENCY: Office of the Comptroller of the

Currency, Treasury.

ACTION: Proposed rule.

SUMMARY: Consistent with the principle

of national treatment for foreign banks

operating in the United States

established by the International Banking

Act of 1978, the Office of the

Comptroller of the Currency (OCC)

proposes to enable a Federal branch or

agency to establish or maintain an

operating subsidiary in generally the

same manner that a national bank may

establish or control an operating

subsidiary.

DATES: Comments must be received by

February 5, 2001.

ADDRESSES: Please direct comments to:

Office of the Comptroller of the

Currency, Public Information Room, 250

E Street, SW, Mail Stop 1–5,

Washington, DC, 20219, Attention:

Docket No. 00–32. In addition,

comments may be sent by facsimile

transmission to fax number 202–874–

5274, or by electronic mail to regs.

comments@occ.treas.gov. Comments

may be inspected and photocopied at

the OCC’s Public Reference Room, 250

E. Street, SW, Washington, DC, between

9 a.m. and 4:30 p.m. on business days.

You can make an appointment to

inspect the comments by calling 202–

874–5043.

FOR FURTHER INFORMATION CONTACT:

Martha Clarke, Senior Attorney,

International Activities Division, 202–

874–0680; Stuart Feldstein, Assistant

Director, Legislative and Regulatory

Activities Division, 202–874–5090;

Heidi M. Thomas, Senior Attorney,

Legislative and Regulatory Activities

Division, 202–874–5090, or Carlos

Hernandez, Senior International

Advisor, International Banking and

Finance Division, 202–874–4730.

SUPPLEMENTARY INFORMATION:

Background

The International Banking Act of 1978

(12 U.S.C. 3101 et seq.) (the IBA) applies

the national treatment principle to the

regulation of foreign bank activities in

the United States. Specifically, under

the national treatment principle

established by the IBA, the operations of

a foreign bank conducted through a

Federal branch or agency shall be

conducted with the same rights,

privileges, conditions, and limitations

that apply to a national bank operating

at the same location, subject to the

OCC’s regulations.1 12 U.S.C. 3102(b).

For example, the powers of national

banks that are set forth in the National

Bank Act, such as lending money and

engaging in certain securities and

insurance sales activities, are not

expressly repeated in the IBA but are

provided to Federal branches and

agencies by operation of section 3102(b).

Congress has subsequently enacted

other legislation that confirms that the

IBA need not be amended each time

there is a change to the banking laws

that affects national banks, unless the

IBA prohibits or limits that specific

activity. For example, when Congress

authorized broader leasing authority for

national banks in 1987, Federal

branches and agencies could avail

themselves of this authority by

operation of section 3102(b) of the IBA.

Thus, it is not necessary to amend the

IBA to authorize Federal branches and

agencies to take advantage of powers

authorized for national banks.

Consistent with these principles, this

proposal provides that a Federal branch

or agency may establish an operating

subsidiary to the same extent as a

similarly situated national bank.

Description of the Proposal

12 CFR 5.34 sets forth application or

notice procedures for national banks

engaging in activities through an

operating subsidiary and lists the

activities that qualify for the notice

procedures. The proposal provides that

§ 5.34 applies to a Federal branch or

agency that seeks to establish or

maintain any subsidiary that a national

bank would be authorized to establish

or control under § 5.34. The procedures

of § 5.34 apply to the Federal branch or

agency with certain modifications that

reflect the differences in the nature of

Federal branches and agencies

compared to national banks.

Section 5.34(e)(5)(iv) provides that a

national bank that is well capitalized

and well managed may acquire or

establish an operating subsidiary, or

perform a new activity in an existing

operating subsidiary, by filing a notice

with the OCC within 10 days after

acquiring or establishing the subsidiary,

or commencing the activity, if the

activities are listed in § 5.34(e)(5)(v).

National banks that do not meet the well

capitalized and well managed criteria

also may acquire or establish an

operating subsidiary by filing an

application with, and receiving

approval from, the OCC. 12 CFR

5.34(e)(5)(i). Finally, § 5.34(e)(5)(vi)

provides that a national bank may

acquire or establish an operating

subsidiary without filing an application

or providing notice to the OCC, if the

bank is adequately capitalized or well

capitalized and the activities of the new

subsidiary meet certain conditions.

Under the proposal, a Federal branch

or agency is considered well capitalized

for purposes of § 5.34 if it meets the

definition of ‘‘well capitalized’’ that the

OCC uses when authorizing an extended

examination cycle for certain Federal

branches and agencies. See 12 CFR

4.7(b)(1)(iii).2 Section 4.7(b)(1)(iii)

requires that: a foreign bank’s most

recently reported capital adequacy

position consists of, or is equivalent to,

Tier 1 and total risk-based capital ratios

of at least 6 percent and 10 percent,

respectively, on a consolidated basis; or

the Federal branch or agency has

maintained on a daily basis, over the

past three quarters, eligible assets in an

amount not less than 108 percent of the

preceding quarter’s average third party

liabilities (determined consistent with

applicable Federal and state law), and

Federal Register / Vol. 65, No. 234 / Tuesday, December 5, 2000 / Proposed Rules 75871

sufficient liquidity is currently available

to meet obligations to third parties.

Under the proposal, a Federal branch

or agency is well managed if: the

Federal branch or agency has a

composite Risk Management,

Operational Controls, Compliance, and

Asset Quality (ROCA) supervisory rating

of 1 or 2 at its most recent examination;

or in the case of a Federal branch or

agency that has not been examined, the

Federal branch or agency has and uses

managerial resources that the OCC

determines are satisfactory.

The OCC will apply other relevant

regulatory standards to Federal branches

and agencies that establish and maintain

operating subsidiaries as appropriate in

light of the differences in corporate

structure between national banks and

Federal branches and agencies. For

example, current § 5.34(e)(4) requires

that pertinent book figures of the parent

bank and its operating subsidiary to be

combined for the purpose of applying

statutory limitations when combination

is needed to effect the intent of the

statute, e.g., for purposes of the statutory

dividend restrictions, lending limits, or

investments in bank premises. See 12

U.S.C. 56, 60, 84, and 371d. Any

limitation or restriction based on the

capital of a national bank (e.g., the

lending limit at 12 U.S.C. 84) refers, as

applied to a Federal branch or agency,

to the dollar equivalent of the capital of

the foreign bank. See 12 U.S.C. 3102(b).

For purposes of determining compliance

with the limitation or restriction,

pertinent book figures of the Federal

branch or agency and its operating

subsidiary shall be combined. If the

foreign bank has more than one Federal

branch or agency, pertinent book figures

of all its Federal branches and agencies

and their operating subsidiaries shall be

combined.

Comment Solicitation

The OCC requests comment on all

aspects of this proposal.

The OCC requests comment on

whether the proposal is written clearly

and is easy to understand. On June 1,

1998, the President issued a

Memorandum directing each agency in

the Executive branch to write its rules

in plain language. This directive applies

to all new proposed and final

rulemaking documents issued on or

after January 1, 1999. In addition, Public

Law 106–102 requires each Federal

agency to use plain language in all

proposed and final rules published after

January 1, 2000. The OCC invites

comment on how to make this rule

clearer. For example, you may wish to

discuss:

(1) Whether we have organized the

material to suit your needs;

(2) Whether the requirements of the

rule are clear; or

(3) Whether there is something else

we could do to make the rule easier to

understand.

Regulatory Flexibility Act Analysis

Pursuant to section 605(b) of the

Regulatory Flexibility Act, the

Comptroller of the Currency certifies

that this proposal will not have a

significant economic impact on a

substantial number of small entities.

Unfunded Mandates Reform Act of

1995

Section 202 of the Unfunded

Mandates Reform Act of 1995, Pub. L.

104–4 (Unfunded Mandates Act)

requires that an agency prepare a

budgetary impact statement before

promulgating a rule that includes a

Federal mandate that may result in

expenditure by State, local, and tribal

governments, in the aggregate, or by the

private sector, of $100 million or more

in any one year. If a budgetary impact

statement is required, section 205 of the

Unfunded Mandates Act also requires

an agency to identify and consider a

reasonable number of regulatory

alternatives before promulgating a rule.

The OCC has determined that the

proposal will not result in expenditures

by State, local, or tribal governments or

by the private sector of $100 million or

more. Accordingly, the OCC has not

prepared a budgetary impact statement

or specifically addressed the regulatory

alternatives considered.

Executive Order 12866 Determination

The Comptroller of the Currency has

determined that this rule does not

constitute a ‘‘significant regulatory

action’’ for the purposes of Executive

Order 12866.

Paperwork Reduction Act

Respondents are not required to

respond to these collections of

information unless they display a

currently valid Office of Management

and Budget (OMB) control number.

The collection of information

requirements contained in this notice of

proposed rulemaking have been

submitted to the Office of Management

and Budget for review in accordance

with the Paperwork Reduction Act of

1995 (44 U.S.C. 3507(d)). Comments on

the collections of information should be

sent to the Alexander Hunt, Desk

Officer, Office of Management and

Budget, Paperwork Reduction Project

(1557–0215), Washington, DC 20503,

with copies to the Jessie Dunaway,

Legislative and Regulatory Activities

Division (1557–0215, Office of the

Comptroller of the Currency, 250 E

Street, SW, Washington, DC 20219.

The collection of information

requirements in this proposal are found

in 12 CFR 5.34. The likely respondents

are Federal branches and agencies of

foreign banks.

Estimated average annual burden

hours per Federal branch and agency

respondent: 1 hour

Estimated number of Federal branch

and agency respondents: 20

Estimated total annual reporting

burden: 20 hours

The OCC invites comment on:

(1) Whether the collections of

information contained in this notice of

proposed rulemaking are necessary for

the proper performance of the agency’s

functions, including whether the

information has practical utility;

(2) The accuracy of the estimate of the

burden of the proposed information

collections;

(3) Ways to enhance the quality,

utility, and clarity of the information to

be collected;

(4) Ways to minimize the burden of

the information collections on

respondents, including the use of

automated collection techniques or

other forms of information technology;

and

(5) Estimates of capital or start-up

costs and costs of operation,

maintenance, and purchases of services

to provide information.

List of Subjects in 12 CFR Part 5

Administrative practice and

procedure, National banks, Reporting

and recordkeeping requirements,

Securities.

Authority and Issuance

For the reasons set forth in the

preamble, the OCC proposes to amend

part 5 of chapter I of Title 12 of the Code

of Federal Regulations as follows:

PART 5—RULES, POLICIES, AND

PROCEDURES FOR CORPORATE

ACTIVITIES

1. The authority citation for part 5

continues to read as follows:

Authority: 12 U.S.C. 1 et seq., 93a; and

section 5136A of the Revised Statutes (12

U.S.C. 24a).

2. In § 5.34:

A. Revise paragraph (c); and

B. Revise paragraphs (d)(2) and (d)(3)

to read as follows:

§ 5.34 Operating subsidiaries.

* * * * *

(c) Scope. This section sets forth

authorized activities and application or

75872 Federal Register / Vol. 65, No. 234 / Tuesday, December 5, 2000 / Proposed Rules

1OCC Interpretive Letter No. 872 (Oct. 28, 1999)

(IL 872); OCC Interpretive Letter No. 866 (Oct. 8,

1999) (IL 866); and OCC Interpretive Letter No. 695

(Dec. 8, 1995), reprinted in [1995–1996 Transfer

Binder] Fed. Banking L. Rep. (CCH) ¶ 81.010 (IL

695).

notice procedures for national banks

engaging in activities through an

operating subsidiary. The procedures in

this section do not apply to financial

subsidiaries authorized under § 5.39.

This section applies to a Federal branch

or agency that establishes or maintains

any subsidiary that a national bank is

authorized to establish or control under

this section.

(d) * * *

(2) Well capitalized means the capital

level described in 12 CFR 6.4(b)(1) or,

in the case of a Federal branch or

agency, the capital level required by 12

CFR 4.7(b)(1)(iii).

(3) Well managed means, unless

otherwise determined in writing by the

OCC:

(i) In the case of a national bank:

(A) The national bank has received a

composite rating of 1 or 2 under the

Uniform Financial Institutions Rating

System in connection with its most

recent examination; or

(B) In the case of any national bank

that has not been examined, the

existence and use of managerial

resources that the OCC determines are

satisfactory.

(ii) In the case of a Federal branch or

agency:

(A) The Federal branch or agency has

received a composite ROCA supervisory

rating (which rates risk management,

operational controls, compliance, and

asset quality) of 1 or 2 at its most recent

examination; or

(B) In the case of a Federal branch or

agency that has not been examined, the

existence and use of managerial

resources that the OCC determines are

satisfactory.

* * * * *

Dated: November 28, 2000.

John D. Hawke, Jr.,

Comptroller of the Currency.

[FR Doc. 00–30885 Filed 12–4–00; 8:45 am]

BILLING CODE 4810–33–P

DEPARTMENT OF THE TREASURY

Office of the Comptroller of the

Currency

12 CFR Parts 5 and 9

[Docket No. 00–30]

RIN 1557–AB79

Fiduciary Activities of National Banks

AGENCY: Office of the Comptroller of the

Currency.

ACTION: Notice of proposed rulemaking;

advance notice of proposed rulemaking.

SUMMARY: The Office of the Comptroller

of the Currency (OCC), through a Notice

of Proposed Rulemaking (NPRM), is

proposing to amend its regulations to

codify OCC interpretations on national

bank multi-state trust operations. The

purpose of these changes is to provide

enhanced guidance to national banks

engaging in fiduciary activities. The

OCC also is inviting comment, through

an advance notice of proposed

rulemaking (ANPR), on whether

uniform standards of care generally

applicable to national bank trustees’

administration of private trusts and

investment of private trust property

should be established. The purpose of

the ANPR is to determine the extent to

which national banks that engage in

fiduciary activities in more than one

state experience problems in their

administration as a result of complying

with more than one state’s laws and, if

problems exist, to invite comment on

ways in which the OCC could address

these problems.

DATES: Comments must be received by

February 5, 2001.

ADDRESSES: Send your comments to:

Office of the Comptroller of the

Currency, Public Information Room, 250

E Street, SW, Mail Stop 1–5,

Washington, DC 20219, Attention:

Docket No. 00–30. Comments will be

available for public inspection and

photocopying at the same location. In

addition, you may send comments by

fax to (202) 874–5274, or by electronic

mail to regs.comments@occ.treas.gov.

FOR FURTHER INFORMATION CONTACT: For

questions concerning the NPRM, contact

Lisa Lintecum, Director, or Joel Miller,

Senior Advisor, Asset Management,

(202) 874–4447; Richard Cleva, Senior

Counsel, Bank Activities and Structure,

(202) 874–5300; Michele Meyer, Senior

Attorney, Legislative and Regulatory

Activities Division, (202) 874–5090; or

William Dehnke, Assistant Director,

Securities and Corporate Practices

Division, (202) 874–5210.

SUPPLEMENTARY INFORMATION: This

rulemaking consists of two parts. First,

the OCC, through an NPRM, proposes to

codify recent OCC interpretations in

which we analyzed the extent to which

a national bank may, in states other than

its home state, (a) have trust offices or

trust representative offices, (b) engage in

fiduciary activities, and (c) market its

fiduciary services to customers. Second,

we invite comments, through an ANPR,

on whether the OCC should propose to

add a new section to part 9 that would

establish national standards for the

conduct of fiduciary activities by

national banks. These ideas are

explained more fully below.

NPRM: Codification of OCC

Interpretations

The OCC has issued three interpretive

letters 1 addressing multi-state fiduciary

activities. In IL 695, we concluded that

a national bank with its main office in

one state may act in a fiduciary capacity

in any other state that permits its own

in-state fiduciaries to act in that

capacity, including at trust offices in

other states. In IL 866 and IL 872, we

further clarified that a national bank

that acts in a fiduciary capacity in one

state may market its fiduciary services

to customers in other states, solicit

business from them, and act as fiduciary

for customers located in other states.

The proposal codifies these

interpretations, which affect several

sections in part 9, as explained in the

following discussion.

Definitions (Revised § 9.2)

The second sentence in current

§ 9.2(g) provides that the extent of

fiduciary powers is the same for out-ofstate national banks as in-state national

banks. This sentence is unnecessary in

light of proposed new § 9.7, which sets

forth the rules concerning multi-state

fiduciary operations, and the proposal

removes it.

Proposed §§ 9.2(j) and (k) define

‘‘trust office’’ and ‘‘trust representative

office,’’ respectively. These terms are

used in proposed new § 9.7. A ‘‘trust

office’’ is defined as an office of a

national bank, other than a main office

or a branch, at which the bank acts in

a fiduciary capacity. A trust

representative office is an office of a

national bank, other than a main office,

branch, or trust office, at which the bank

performs activities ancillary to its

fiduciary business, but does not act in

a fiduciary capacity. These ancillary

activities might include, for instance,

advertising, marketing, and soliciting for

fiduciary business; contacting existing

or potential customers, answering

questions, and providing information

about matters related to their accounts;

acting as a liaison between the trust

office and the customer (e.g., forwarding

requests for distribution or changes in

investment objectives, or forwarding

forms and funds received from the

customer); or simply inspecting or

maintaining custody of fiduciary assets.

Neither a trust office nor trust

representative office is a branch for

purposes of the McFadden Act, 12