Federal Register / Vol. 80, No. 72 / Wednesday, April 15, 2015 / Rules and Regulations 20153 

approved spent fuel storage casks.’’ The 

revision consists of Amendment No. 5, 

which adds a new damaged fuel 

assembly; revises the maximum or 

minimum enrichments for three fuel 

assembly designs; adds four-zone new 

preferential loading for pressurizedwater reactor fuel assemblies; increases 

the maximum dose rates in LCO 3.3.1; 

and makes other editorial changes to 

Appendices A and B to the TSs. The 

revised TSs are identified in the SER. 

Amendment No. 5 to CoC No. 1031 

for the NAC International, Inc., 

MAGNASTOR® System was not 

submitted in response to new NRC 

requirements, or an NRC request for 

amendment. Amendment No. 5 applies 

only to new casks fabricated and used 

under Amendment No. 5. These changes 

do not affect existing users of the 

MAGNASTOR® System, and the current 

amendments continue to be effective for 

existing users. While any current CoC 

users may comply with the new 

requirements in Amendment No. 5, this 

would be a voluntary decision on the 

part of current users. For these reasons, 

Amendment No. 5 to CoC No. 1031 does 

not constitute backfitting under 10 CFR 

72.62, 10 CFR 50.109(a)(1), or otherwise 

represent an inconsistency with the 

issue finality provisions applicable to 

combined licenses in 10 CFR part 52. 

Accordingly, no backfit analysis or 

additional documentation addressing 

issue finality criteria in 10 CFR part 52 

has been prepared by the staff. 

XIII. Congressional Review Act 

This action is not a major rule as 

defined in the Congressional Review 

Act (5 U.S.C. 801–808). 

XIV. Availability of Documents 

The documents identified in the 

following table are available to 

interested persons through one or more 

of the following methods, as indicated. 

Document 

ADAMS 

accession No./ 

web link/ 

Federal 

Register 

citation 

Proposed CoC No. 1031, 

Amendment No. 5 ............. ML14216A197 

Proposed TS, Appendix A .... ML14216A257 

Proposed TS, Appendix B .... ML14216A270 

Preliminary SER ................... ML14216A310 

Request to Amend Reference 1 Dated December 

19, 2013 ............................ ML13361A144 

Request to Amend Reference 3 Dated March 19, 

2014 .................................. ML14079A525 

Request for Additional Information (RAI) Dated May 

15, 2014 ............................ ML14140A239 

Document 

ADAMS 

accession No./ 

web link/ 

Federal 

Register 

citation 

Supplemental Information for 

Proposed Action Dated 

June 13, 2014 ................... ML14170A032 

The NRC may post materials related 

to this document, including public 

comments, on the Federal rulemaking 

Web site at http://www.regulations.gov 

under Docket ID NRC–2014–0261. The 

Federal rulemaking Web site allows you 

to receive alerts when changes or 

additions occur in a docket folder. To 

subscribe: (1) Navigate to the docket 

folder (NRC–2014–0261); (2) click the 

‘‘Sign up for Email Alerts’’ link; and (3) 

enter your email address and select how 

frequently you would like to receive 

emails (daily, weekly, or monthly). 

List of Subjects in 10 CFR Part 72 

Administrative practice and 

procedure, Criminal penalties, 

Manpower training programs, Nuclear 

materials, Occupational safety and 

health, Penalties, Radiation protection, 

Reporting and recordkeeping 

requirements, Security measures, Spent 

fuel, Whistleblowing. 

For the reasons set out in the 

preamble and under the authority of the 

Atomic Energy Act of 1954, as amended; 

the Energy Reorganization Act of 1974, 

as amended; the Nuclear Waste Policy 

Act of 1982, as amended; and 5 U.S.C. 

552 and 553; the NRC is adopting the 

following amendments to 10 CFR part 

72. 

PART 72—LICENSING 

REQUIREMENTS FOR THE 

INDEPENDENT STORAGE OF SPENT 

NUCLEAR FUEL, HIGH-LEVEL 

RADIOACTIVE WASTE, AND 

REACTOR-RELATED GREATER THAN 

CLASS C WASTE 

■ 1. The authority citation for part 72 

continues to read as follows: 

Authority: Atomic Energy Act secs. 51, 53, 

57, 62, 63, 65, 69, 81, 161, 182, 183, 184, 186, 

187, 189, 223, 234, 274 (42 U.S.C. 2071, 2073, 

2077, 2092, 2093, 2095, 2099, 2111, 2201, 

2232, 2233, 2234, 2236, 2237, 2239, 2273, 

2282, 2021); Energy Reorganization Act secs. 

201, 202, 206, 211 (42 U.S.C. 5841, 5842, 

5846, 5851); National Environmental Policy 

Act sec. 102 (42 U.S.C. 4332); Nuclear Waste 

Policy Act secs. 131, 132, 133, 135, 137, 141, 

148 (42 U.S.C. 10151, 10152, 10153, 10155, 

10157, 10161, 10168); Government 

Paperwork Elimination Act sec. 1704 (44 

U.S.C. 3504 note); Energy Policy Act of 2005, 

Pub. L. 109–58, 119 Stat. 549 (2005). 

Section 72.44(g) also issued under Nuclear 

Waste Policy Act secs. 142(b) and 148(c), (d) 

(42 U.S.C. 10162(b), 10168(c), (d)). Section 

72.46 also issued under Atomic Energy Act 

sec. 189 (42 U.S.C. 2239); Nuclear Waste 

Policy Act sec. 134 (42 U.S.C. 10154). Section 

72.96(d) also issued under Nuclear Waste 

Policy Act sec. 145(g) (42 U.S.C. 10165(g)). 

Subpart J also issued under Nuclear Waste 

Policy Act secs. 117(a), 141(h) (42 U.S.C. 

10137(a), 10161(h)). Subpart K also issued 

under Nuclear Waste Policy Act sec. 218(a) 

(42 U.S.C. 10198). 

■ 2. In § 72.214, Certificate of 

Compliance No. 1031 is revised to read 

as follows: 

§ 72.214 List of approved spent fuel 

storage casks. 

* * * * * 

Certificate Number: 1031. 

Initial Certificate Effective Date: 

February 4, 2009. 

Amendment Number 1 Effective Date: 

August 30, 2010. 

Amendment Number 2 Effective Date: 

January 30, 2012. 

Amendment Number 3 Effective Date: 

July 25, 2013. 

Amendment Number 4 Effective Date: 

April 14, 2015. 

Amendment Number 5 Effective Date: 

June 29, 2015. 

SAR Submitted by: NAC 

International, Inc. 

SAR Title: Final Safety Analysis 

Report for the MAGNASTOR® System. 

Docket Number: 72–1031. 

Certificate Expiration Date: February 

4, 2029. 

Model Number: MAGNASTOR®. 

* * * * * 

Dated at Rockville, Maryland, this 29th day 

of January, 2015. 

For the Nuclear Regulatory Commission. 

Mark A. Satorius, 

Executive Director for Operations. 

[FR Doc. 2015–08679 Filed 4–14–15; 8:45 am] 

BILLING CODE 7590–01–P 

FEDERAL RESERVE SYSTEM 

12 CFR Parts 217, 225, and 238 

[Docket No. R–1509] 

RIN 1700–AE 30 

Regulations Q, Y, and LL: Small Bank 

Holding Company Policy Statement; 

Capital Adequacy of Board-Regulated 

Institutions; Bank Holding Companies; 

Savings and Loan Holding Companies 

AGENCY: Board of Governors of the 

Federal Reserve System (Board). 

ACTION: Final rule. 

SUMMARY: The Board is adopting final 

amendments (Final Rule) to the Small 

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20154 Federal Register / Vol. 80, No. 72 / Wednesday, April 15, 2015 / Rules and Regulations 

1 80 FR 5694 (February 3, 2015) (Proposed Rule). 

2Pub. L. 113–250 (December 18, 2014) (Pub. L. 

113–250). The Act was enacted on December 18, 

2014, and became immediately effective. 

3 12 CFR part 217 (Regulation Q). 

4The comment period for the proposed changes 

to the reporting requirements in the Proposed Rule 

runs through April 6, 2015. Once the comment 

period for the proposed reporting requirements 

closes, the Board will consider any and all reporting 

and Paperwork Reduction Act-related comments 

before finalizing any reporting changes. 

5The examples provided in the Policy 

Statement—securitization and asset management or 

administration—are not exhaustive and serve to 

highlight off-balance sheet activities that may 

involve substantial risk. Other activities may 

present similar concerns. See also 71 FR 9897, 

9899, fn. 2 (February 28, 2006) (2006 Final Rule). 

6See 2006 Final Rule. 

Bank Holding Company Policy 

Statement (Regulation Y, Appendix C) 

(Policy Statement) that: raise from $500 

million to $1 billion the asset threshold 

to qualify for the Policy Statement; and 

expand the scope of companies eligible 

under the Policy Statement to include 

savings and loan holding companies. 

The Board is also adopting final 

conforming revisions to Regulation Y 

and Regulation LL, the Board’s 

regulations governing the operations 

and activities of bank holding 

companies and savings and loan 

holding companies, respectively, and 

Regulation Q, the Board’s regulatory 

capital rules. 

DATES: The final rule is effective May 

15, 2015. 

FOR FURTHER INFORMATION CONTACT: 

Constance M. Horsley, Assistant 

Director, (202) 452–5239, Cynthia 

Ayouch, Manager, (202) 452–2204, 

Thomas Boemio, Manager, (202) 452– 

2982, Douglas Carpenter, Senior 

Supervisory Financial Analyst, (202) 

452–2205, Page Conkling, Supervisory 

Financial Analyst, (202) 912–4647, or 

Noah Cuttler, Senior Financial Analyst, 

(202) 912–4678, Division of Banking 

Supervision and Regulation; Laurie 

Schaffer, Associate General Counsel, 

(202) 452–2272, or Tate Wilson, 

Counsel, (202) 452–3696, Legal 

Division; Board of Governors of the 

Federal Reserve System, 20th and C 

Streets NW., Washington, DC 20551. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Background 

II. Overview of Comments 

III. Summary of the Final Rule 

IV. Administrative Law Matters 

A. Regulatory Flexibility Act 

B. Paperwork Reduction Act 

C. Plain Language 

I. Background 

On February 3, 2015, the Board 

invited comment on a proposed rule 

(Proposed Rule) 1 to implement Public 

Law 113–250 (the Act).2 The Proposed 

Rule proposed increasing the amount of 

assets qualifying holding companies 

may have, expanding the application of 

the Policy Statement to qualifying 

savings and loan holding companies, 

revising the applicability of the Board’s 

regulatory capital rules 3 to exclude 

savings and loan holding companies 

subject to the Policy Statement, and 

revising certain reporting requirements. 

Specifically, the Proposed Rule would 

allow bank holding companies and 

savings and loan holding companies 

with less than $1 billion in total 

consolidated assets to qualify under the 

Policy Statement, provided the holding 

companies also comply with three 

qualitative requirements (Qualitative 

Requirements). Previously, only bank 

holding companies with less than $500 

million in total consolidated assets that 

complied with the Qualitative 

Requirements could qualify under the 

Policy Statement. With the exception of 

the proposed changes to the reporting 

requirements, the Board is adopting as 

final the Proposed Rule without 

changes.4

The Board issued the Policy 

Statement in 1980 to facilitate the 

transfer of ownership of small 

community-based banks in a manner 

consistent with bank safety and 

soundness. The Board has generally 

discouraged the use of debt by bank 

holding companies to finance the 

acquisition of banks or other companies 

because high levels of debt can impair 

the ability of the holding company to 

serve as a source of strength to its 

subsidiary banks. The Board has 

recognized, however, that small bank 

holding companies have less access to 

equity financing than larger bank 

holding companies and that the transfer 

of ownership of small banks often 

requires the use of acquisition debt. 

Accordingly, the Board adopted the 

Policy Statement to permit the 

formation and expansion of small bank 

holding companies with debt levels that 

are higher than typically permitted for 

larger bank holding companies. The 

Policy Statement contains several 

conditions and restrictions designed to 

ensure that small bank holding 

companies that operate with the higher 

levels of debt permitted by the Policy 

Statement do not present an undue risk 

to the safety and soundness of their 

subsidiary banks. 

Previously, the Policy Statement 

applied only to bank holding companies 

with pro forma consolidated assets of 

less than $500 million that met the 

following Qualitative Requirements: (i) 

Were not engaged in significant 

nonbanking activities either directly or 

through a nonbank subsidiary; (ii) did 

not conduct significant off-balance sheet 

activities (including securitization and 

asset management or administration) 

either directly or through a nonbank 

subsidiary; 5 and (iii) did not have a 

material amount of debt or equity 

securities outstanding (other than trust 

preferred securities) that are registered 

with the Securities and Exchange 

Commission. The Board last raised the 

asset threshold in 2006 when it 

increased it from $150 million to $500 

million.6

Under the Policy Statement, holding 

companies that meet the Qualitative 

Requirements may use debt to finance 

up to 75 percent of the purchase price 

of an acquisition (that is, they may have 

a debt-to-equity ratio of up to 3.0:1), but 

are subject to a number of ongoing 

requirements. The principal ongoing 

requirements are that a qualifying 

holding company: (i) Reduce its parent 

company debt in such a manner that all 

debt is retired within 25 years of being 

incurred; (ii) reduce its debt-to equity 

ratio to .30:1 or less within 12 years of 

the debt being incurred; (iii) ensure that 

each of its subsidiary insured depository 

institutions is well capitalized; and (iv) 

refrain from paying dividends until 

such time as it reduces its debt-to-equity 

ratio to 1.0:1 or less. The Policy 

Statement also specifically provides that 

a qualifying bank holding company may 

not use the expedited procedures for 

obtaining approval of acquisition 

proposals or obtaining a waiver of the 

stock redemption filing requirements 

applicable to bank holding companies 

under the Board’s Regulation Y (12 CFR 

225.4(b), 225.14, and 225.23) unless the 

bank holding company has a pro forma 

debt-to-equity ratio of 1.0:1 or less. 

II. Overview of Comments 

The Board received 11 comments on 

the Proposed Rule. Comments were 

submitted by financial trade 

associations, individuals associated 

with financial institutions, and a law 

firm that represents bank holding 

companies and savings and loan 

holding companies. While each 

commenter expressed general support 

for the Proposed Rule, some 

commenters recommended revisions to 

the Proposed Rule. For instance, one 

commenter expressed support for 

raising the asset threshold higher than 

$1 billion. Another commenter 

expressed support for the nonbanking 

and off-balance sheet activity 

requirements but suggested that the 

Board consider rescinding or revising 

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Federal Register / Vol. 80, No. 72 / Wednesday, April 15, 2015 / Rules and Regulations 20155 

7Public Law 113–250. 

8 12 U.S.C. 5371, as amended. 

9See 12 U.S.C. 1841(c)(2)(B), 1841(j), and 

1843(i)(1). 

10See, e.g., Pub. L. 113–250, sec. 2(b). 

11For purposes of applying the Policy Statement 

to savings and loan holding companies, the term 

‘‘nonbank subsidiary’’ as used in the Policy 

Statement refers to a subsidiary of a savings and 

loan holding company other than a savings 

association or a subsidiary of a savings association. 

12See Proposed Rule, 80 FR 5695; 2006 Final 

Rule, 71 FR 9899–9900. 

13 2006 Final Rule, 71 FR 9900. 

14 2006 Final Rule, 71 FR 9899. 

the requirement relating to outstanding 

debt or equity securities registered with 

the SEC. The Board’s responses to these 

comments are discussed below. 

III. Summary of the Final Rule 

Increase in Amount of Qualifying Assets 

Under the Final Rule, a holding 

company with less than $1 billion in 

total consolidated assets may qualify 

under the Policy Statement, provided it 

also complies with the Qualitative 

Requirements. This new asset limit is 

set by statute.7 As noted above, 

commenters generally supported the 

Board’s proposal to increase the scope 

of the Policy Statement by allowing 

firms with less than $1 billion in total 

assets to qualify. One commenter 

suggested that the threshold be 

increased to $5 billion. The Act directs 

the Board to increase the threshold to $1 

billion, and section 171 of the DoddFrank Wall Street Reform and Consumer 

Protection Act (Dodd-Frank Act) 8

effectively prevents the threshold from 

being raised any higher. 

Policy Statement’s Application to 

Savings and Loan Holding Companies 

The Act also directs the Board to 

propose revisions to the Policy 

Statement that would extend its 

application to certain savings and loan 

holding companies. Consistent with the 

Proposed Rule, the Final Rule applies 

the revised Policy Statement to savings 

and loan holding companies by 

amending Appendix C to 12 CFR part 

225 and adding new section 238.9 to 

Subpart A of Regulation LL. 

As explained in the Proposed Rule, 

this change requires other modifications 

to the Policy Statement to take into 

account the status of savings 

associations under the Bank Holding 

Company Act of 1956, as amended (BHC 

Act). The first Qualitative Requirement 

uses the terms ‘‘nonbanking activities’’ 

and ‘‘nonbank subsidiary’’ to refer to the 

activities of a bank holding company. 

Under the BHC Act, however, control of 

a savings association by a bank holding 

company is considered a nonbanking 

activity.9 Because savings and loan 

holding companies control savings 

associations, all activities of savings and 

loan holding companies, including the 

control of savings associations would be 

considered nonbanking activities under 

the Policy Statement. 

This outcome would be inconsistent 

with Congressional intent to apply the 

Policy Statement to savings and loan 

holding companies.10 The Board 

therefore will treat subsidiary savings 

associations of savings and loan holding 

companies as if they were banks for 

purposes of applying the Policy 

Statement. 

As is the case with bank holding 

companies, whether a savings and loan 

holding company engages in 

‘‘significant’’ nonbanking activities will 

depend on the scope of the activities of 

the savings and loan holding company, 

the nature and level of risk of the 

activities, the condition of the savings 

and loan holding company, and other 

criteria as appropriate.11

Consistent with the Policy 

Statement’s provisions for bank holding 

companies, the Board retains the right to 

exclude any savings and loan holding 

company, regardless of size, from the 

Policy Statement if the Board 

determines that such action is 

warranted for supervisory purposes. 

Policy Statement’s Qualitative 

Requirements 

The Final Rule retains the Qualitative 

Requirements without change. One 

commenter noted that the Qualitative 

Requirements concerning nonbanking 

and off-balance sheet activities 

adequately cover bank holding 

companies and savings and loan 

holding companies that meet the size 

threshold but have unusually complex 

activities at the holding company level. 

None of the commenters expressed 

concerns related to the nonbanking or 

off-balance sheet activities 

requirements. Consistent with the 

Board’s previously-issued guidance on 

these two Qualitative Requirements,12

whether a bank holding company or 

savings and loan holding company 

engages in significant nonbanking or offbalance sheet activities will continue to 

depend on a consideration of the scope 

of the activities, the nature and level of 

risk of the activities, the condition of the 

holding company and its subsidiary 

depository institution, and other criteria 

as appropriate. As previously stated, 

determinations of significance are made 

on a case-by-case basis, and relatively 

few bank holding companies or savings 

and loan holding companies are likely 

to be excluded from the Policy 

Statement due to the Qualitative 

Requirements concerning nonbanking 

and off-balance sheet activities.13

One commenter urged the Board to 

rescind the Qualitative Requirement 

that would disqualify a bank holding 

company or savings and loan holding 

company with a material amount of 

outstanding SEC-registered debt or 

equity securities. In the alternative, the 

commenter suggested the Board clarify 

whether bank holding companies and 

savings and loan holding companies 

that meet the asset size threshold and 

would otherwise qualify under the 

Policy Statement but for having SECregistered debt or equity could qualify 

under the Policy Statement. 

The exclusion from the Policy 

Statement of any bank holding company 

that has a material amount of SECregistered debt or equity securities 

reflected the view that SEC registrants 

typically exhibited a degree of 

complexity of operations and access to 

multiple funding sources that warranted 

exclusion from the Policy Statement.14

Determinations of materiality are made 

on a case-by-case basis in order to assess 

the complexity of a firm. In considering 

whether a savings and loan holding 

company or bank holding company has 

a material amount of SEC-registered 

debt or equity securities outstanding 

that contributes to its complexity (other 

than trust preferred securities), the 

Board may consider, among other 

factors: The number and type of classes 

and series of stock issued; the holding 

company’s market capitalization; the 

number of outstanding shares; the 

average trading volume; the holding 

company’s history of issuing equity and 

debt securities, including whether the 

entity has issued any other securities 

that are not registered with the SEC 

(e.g., privately-placed securities); the 

nature and distribution of ownership; 

whether the securities are listed on a 

national exchange; whether the holding 

company qualifies as a ‘‘smaller 

reporting company’’ pursuant to the 

SEC’s regulations and related 

interpretations; and the amount, type, 

and terms of any debt instruments 

issued by the entity. While the Policy 

Statement has included the 

‘‘materiality’’ standard since 2006, as a 

general matter, application of this 

standard has not resulted in many bank 

holding companies being excluded from 

the Policy Statement. After considering 

the concerns raised by the commenter, 

the Board is adopting the Qualitative 

Requirements unchanged. 

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20156 Federal Register / Vol. 80, No. 72 / Wednesday, April 15, 2015 / Rules and Regulations 

15 80 FR 5666 (February 3, 2015). 16See Pub. L. 113–250. 

17See 13 CFR 121.201. Effective July 14, 2014, the 

Small Business Administration revised the size 

standards for banking organizations to $550 million 

in assets from $500 million in assets. 79 FR 33647 

(June 12, 2014). 

Regulation Q Change 

When the Board proposed the 

Proposed Rule, the Board separately 

revised Regulation Q, 12 CFR part 217, 

through issuance of an interim final rule 

(Interim Final Rule), to exclude a 

qualifying savings and loan holding 

company from consolidated regulatory 

capital requirements.15 The Interim 

Final Rule gave effect to the Act, which 

immediately excepted savings and loan 

holding companies that complied with 

the Policy Statement then in effect from 

the provisions of section 171 of the 

Dodd-Frank Act.16 At that time, the 

Policy Statement applied to firms with 

less than $500 million in total 

consolidated assets so the Interim Final 

Rule contained the same limit. In the 

Proposed Rule, the Board proposed 

further revisions to Regulation Q that 

would expand the scope of the 

exclusion for savings and loan holding 

companies to firms with less than $1 

billion in total consolidated assets that 

also meet the Qualitative Requirements. 

The proposed revisions to Regulation Q 

in the Proposed Rule would supersede 

the changes to Regulation Q from the 

Interim Final Rule. The Board did not 

receive any comments concerning the 

proposed change to Regulation Q. The 

Board is adopting as final the proposed 

revisions to Regulation Q that conform 

it to reflect the revised Policy Statement. 

Conforming Amendments 

A number of filing and other 

provisions in Regulations Y and LL are 

triggered by the asset size established in 

the Policy Statement. The Board is 

adopting as final the proposed changes 

that enable qualifying small bank 

holding companies and savings and 

loan holding companies to take 

advantage of the streamlined 

informational, notice, and other 

regulatory requirements. These 

technical and conforming amendments 

provide relief to most bank holding 

companies and savings and loan 

holding companies with less than $1 

billion of total consolidated assets. The 

Final Rule includes the following 

technical and conforming amendments: 

• In section 217.1(c)(1)(iii), 

Regulation Q (12 CFR part 217) excludes 

savings and loan holding companies 

that are subject to the Policy Statement 

through operation of section 238.9 of the 

Board’s Regulation LL (12 CFR part 

238). 

• In section 225.2(r), footnote 2, the 

footnote describing the application of 

the definition of ‘‘well-capitalized’’ in 

the Board’s Regulation Y (12 CFR part 

225) applies to entities with less than $1 

billion of total assets. 

• In section 225.4(b)(2)(iii), different 

pro forma financial information is 

required of smaller bank holding 

companies with less than $1 billion in 

total assets than for larger bank holding 

companies under section 225.4(b)(1) of 

the Board’s Regulation Y. 

• In section 225.14(a)(1)(v), different 

pro forma financial information is 

required of smaller bank holding 

companies with less than $1 billion in 

total assets than for larger bank holding 

companies under section 225.14 of the 

Board’s Regulation Y. 

• In section 225.17(a)(6), footnote 6, a 

bank holding company with less than $1 

billion in assets can satisfy the debt 

requirement if it complies with the 

Policy Statement. 

• In section 225.23(a)(1)(iii), different 

pro forma financial information is 

required of smaller bank holding 

companies with less than $1 billion in 

total assets than for larger bank holding 

companies under section 225.23 of the 

Board’s Regulation Y. 

IV. Administrative Law Matters 

A. Regulatory Flexibility Act Analysis 

The Board is providing a final 

regulatory flexibility analysis with 

respect to the Final Rule. As discussed 

above, the Final Rule reduces regulatory 

burden on small entities by excluding 

many bank holding companies and 

savings and loan holding companies 

with total consolidated assets of less 

than $1 billion that meet the Qualitative 

Requirements from the application of 

Regulation Q. 

The Regulatory Flexibility Act, 5 

U.S.C. 601 et seq., generally requires 

that an agency provide a final regulatory 

flexibility analysis in connection with a 

final rule. Under regulations issued by 

the Small Business Administration, a 

small bank holding company, bank, or 

savings and loan holding company is 

defined as having assets of $550 million 

or less (collectively, small banking 

organizations).17 As of December 31, 

2014, there were approximately 3,862 

small bank holding companies and 275 

small savings and loan holding 

companies. 

The Board received no comments 

from the public or from the Chief 

Counsel for Advocacy of the Small 

Business Administration in response to 

the initial regulatory flexibility analysis 

provided with the notice of proposed 

rulemaking. Thus, no issues were raised 

in public comments related to the 

Board’s initial regulatory flexibility act 

analysis and no changes are being made 

in response to such comments. 

The Final Rule impacts small bank 

holding companies and small savings 

and loan holding companies with total 

consolidated assets of $500 to $550 

million that meet the Qualitative 

Requirements by providing an exclusion 

for these companies from Regulation Q. 

The Board believes that most affected 

small banking organizations already 

hold more capital than is required under 

Regulation Q, so the burden reduction 

from the exclusion from Regulation Q is 

primarily related to compliance and 

systems necessary to comply with 

Regulation Q. In addition, affected small 

bank holding companies will now be 

able to take advantage of the 

applications processing procedures 

provided to qualifying companies under 

the Policy Statement. 

There are no significant alternatives to 

the Final Rule that have less economic 

impact on small banking organizations, 

and the Final Rule significantly reduces 

burden on nearly all small banking 

organizations. 

B. Paperwork Reduction Act 

At this time, the Board is not adopting 

as final the changes to reporting 

requirements in the Proposed Rule. The 

comment period for the proposed 

changes to the reporting requirements in 

the Proposed Rule runs through April 6, 

2015. Once the comment period for the 

proposed reporting requirements closes, 

the Board will consider any and all 

reporting and Paperwork Reduction Actrelated comments before finalizing any 

reporting changes. 

C. Plain Language 

Section 722 of the Gramm-LeachBliley Act (Pub. L. 106–102, 113 Stat. 

1338, 1471, 12 U.S.C. 4809) requires the 

Federal banking agencies to use ‘‘plain 

language’’ in all proposed and final 

rules published after January 1, 2000. In 

light of this requirement, the Board has 

sought to present the Final Rule in a 

simple and straightforward manner. The 

Board sought to present the Proposed 

Rule in a simple and straightforward 

manner and solicited comment on how 

to make the Proposed Rule easier to 

understand. No comments were 

received on the use of plain language. 

List of Subjects 

12 CFR Part 217 

Administrative practice and 

procedure, Banks, banking, Capital, 

Federal Reserve System, Holding 

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Federal Register / Vol. 80, No. 72 / Wednesday, April 15, 2015 / Rules and Regulations 20157 

companies, Reporting and 

recordkeeping requirements, Securities. 

12 CFR Part 225 

Administrative practice and 

procedure, Banks, banking, Federal 

Reserve System, Holding companies, 

Reporting and recordkeeping 

requirements. 

12 CFR Part 238 

Administrative practice and 

procedure, Banks, banking, Federal 

Reserve System, Holding companies, 

Reporting and recordkeeping 

requirements. 

Federal Reserve System 

12 CFR CHAPTER II 

Authority and Issuance 

For the reasons set forth in the 

preamble, chapter II of title 12 of the 

Code of Federal Regulations is amended 

as set forth below: 

PART 217—CAPITAL ADEQUACY OF 

BANK HOLDING COMPANIES, 

SAVINGS AND LOAN HOLDING 

COMPANIES, AND STATE MEMBER 

BANKS (REGULATION Q) 

■ 1. The authority citation for part 217 

continues to read as follows: 

Authority: 12 U.S.C. 248(a), 321–338a, 

481–486, 1462a, 1467a, 1818, 1828, 1831n, 

1831o, 1831p–l, 1831w, 1835, 1844(b), 1851, 

3904, 3906–3909, 4808, 5365, 5368, 5371. 

■ 2. In § 217.1, revise paragraph 

(c)(1)(iii) to read as follows: 

§ 217.1 Purpose, applicability, 

reservations of authority, and timing. 

* * * * * 

(c) * * * 

(1) * * * 

(iii) A covered savings and loan 

holding company domiciled in the 

United States, other than a savings and 

loan holding company that has total 

consolidated assets of less than $1 

billion and meets the requirements of 12 

CFR part 225, appendix C, as if the 

savings and loan holding company were 

a bank holding company and the 

savings association were a bank. For 

purposes of compliance with the capital 

adequacy requirements and calculations 

in this part, savings and loan holding 

companies that do not file the FR Y–9C 

should follow the instructions to the FR 

Y–9C. 

* * * * * 

PART 225—BANK HOLDING 

COMPANIES AND CHANGE IN BANK 

CONTROL (REGULATION Y) 

■ 3. The authority citation for part 225 

continues to read as follows: 

Authority: 12 U.S.C. 1817(j)(13), 1818, 

1828(o), 1831i, 1831p–1, 1843(c)(8), 1844(b), 

1972(1), 3106, 3108, 3310, 3331–3351, 3906, 

3907, and 3909; 15 U.S.C. 1681s, 1681w, 

6801 and 6805. 

■ 4. In § 225.2, paragraph (r), revise 

footnote 2 to read as follows: 

§ 225.2 Definitions. 

* * * * * 

(r) * * * 

Footnote 2: For purposes of this subpart and 

subparts B and C of this part, a bank holding 

company with consolidated assets of less 

than $1 billion that is subject to the Small 

Bank Holding Company Policy Statement in 

appendix C of this part will be deemed to be 

‘‘well-capitalized’’ if the bank holding 

company meets the requirements for 

expedited/waived processing in appendix C. 

■ 5. In § 225.4, revise paragraph 

(b)(2)(iii) to read as follows: 

§ 225.4 Corporate practices. 

* * * * * 

(b) * * * 

(2) * * * 

(iii)(A) If the bank holding company 

has consolidated assets of $1 billion or 

more, consolidated pro forma risk-based 

capital and leverage ratio calculations 

for the bank holding company as of the 

most recent quarter, and, if the 

redemption is to be debt funded, a 

parent-only pro forma balance sheet as 

of the most recent quarter; or 

(B) If the bank holding company has 

consolidated assets of less than $1 

billion, a pro forma parent-only balance 

sheet as of the most recent quarter, and, 

if the redemption is to be debt funded, 

one-year income statement and cash 

flow projections. 

* * * * * 

■ 6. In § 225.14, revise paragraph 

(a)(1)(v) to read as follows: 

§ 225.14 Expedited action for certain bank 

acquisitions by well-run bank holding 

companies. 

* * * * * 

(a) * * * 

(1) * * * 

(v)(A) If the bank holding company 

has consolidated assets of $1 billion or 

more, an abbreviated consolidated pro 

forma balance sheet as of the most 

recent quarter showing credit and debit 

adjustments that reflect the proposed 

transaction, consolidated pro forma 

risk-based capital ratios for the 

acquiring bank holding company as of 

the most recent quarter, and a 

description of the purchase price and 

the terms and sources of funding for the 

transaction; 

(B) If the bank holding company has 

consolidated assets of less than $1 

billion, a pro forma parent-only balance 

sheet as of the most recent quarter 

showing credit and debit adjustments 

that reflect the proposed transaction, 

and a description of the purchase price, 

the terms and sources of funding for the 

transaction, and the sources and 

schedule for retiring any debt incurred 

in the transaction; 

* * * * * 

■ 7. In § 225.17, in paragraph (a)(6), 

revise footnote 6 to read as follows: 

§ 225.17 Notice procedure for one-bank 

holding company formations. 

* * * * * 

(a) * * * 

(6) * * * 

Footnote 6—For a banking organization with 

consolidated assets, on a pro forma basis, of 

less than $1 billion (other than a banking 

organization that will control a de novo 

bank), this requirement is satisfied if the 

proposal complies with the Board’s Small 

Bank Holding Company Policy Statement 

(appendix C of this part). 

■ 8. In § 225.23, revise paragraph 

(a)(1)(iii) to read as follows: 

§ 225.23 Expedited action for certain 

nonbanking proposals by well-run bank 

holding companies. 

* * * * * 

(a) * * * 

(1) * * * 

(iii) If the proposal involves an 

acquisition of a going concern: 

(A) If the bank holding company has 

consolidated assets of $1 billion or 

more, an abbreviated consolidated pro 

forma balance sheet for the acquiring 

bank holding company as of the most 

recent quarter showing credit and debit 

adjustments that reflect the proposed 

transaction, consolidated pro forma 

risk-based capital ratios for the 

acquiring bank holding company as of 

the most recent quarter, a description of 

the purchase price and the terms and 

sources of funding for the transaction, 

and the total revenue and net income of 

the company to be acquired; 

(B) If the bank holding company has 

consolidated assets of less than $1 

billion, a pro forma parent-only balance 

sheet as of the most recent quarter 

showing credit and debit adjustments 

that reflect the proposed transaction, a 

description of the purchase price and 

the terms and sources of funding for the 

transaction and the sources and 

schedule for retiring any debt incurred 

in the transaction, and the total assets, 

off-balance sheet items, revenue and net 

income of the company to be acquired; 

(C) For each insured depository 

institution whose Tier 1 capital, total 

capital, total assets or risk-weighted 

assets change as a result of the 

transaction, the total risk-weighted 

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20158 Federal Register / Vol. 80, No. 72 / Wednesday, April 15, 2015 / Rules and Regulations 

1Footnote 1: [Reserved] 

1Appendix B to PBGC’s regulation on Allocation 

of Assets in Single-Employer Plans (29 CFR part 

4044) prescribes interest assumptions for valuing 

benefits under terminating covered single-employer 

plans for purposes of allocation of assets under 

ERISA section 4044. Those assumptions are 

updated quarterly. 

assets, total assets, Tier 1 capital and 

total capital of the institution on a pro 

forma basis; 

* * * * * 

■ 9. In appendix C to part 225, revise 

the heading and, under section 1, revise 

the first undesignated paragraph to read 

as follows: 

Appendix C to Part 225—Small Bank 

Holding Company and Savings and 

Loan Holding Company Policy 

Statement 

* * * * * 

1. Applicability of Policy Statement 

This policy statement applies only to bank 

holding companies with pro forma 

consolidated assets of less than $1 billion 

that (i) are not engaged in significant 

nonbanking activities either directly or 

through a nonbank subsidiary; (ii) do not 

conduct significant off-balance sheet 

activities (including securitization and asset 

management or administration) either 

directly or through a nonbank subsidiary; 

and (iii) do not have a material amount of 

debt or equity securities outstanding (other 

than trust preferred securities) that are 

registered with the Securities and Exchange 

Commission. The Board may in its discretion 

exclude any bank holding company, 

regardless of asset size, from the policy 

statement if such action is warranted for 

supervisory purposes.1 With the exception of 

section 4 (Additional Application 

Requirements for Expedited/Waived 

Processing), the policy statement applies to 

savings and loan holding companies as if 

they were bank holding companies. 

* * * * * 

PART 238—SAVINGS AND LOAN 

HOLDING COMPANIES (REGULATION 

LL) 

■ 10. The authority citation for part 238 

continues to read as follows: 

Authority: 5 U.S.C. 552, 559; 12 U.S.C. 

1462, 1462a, 1463, 1464, 1467, 1467a, 1468, 

1813, 1817, 1829e, 1831i, 1972; 15 U.S.C. 78l. 

■ 11. Add § 238.9 to subpart A to read 

as follows: 

§ 238.9 Small Bank Holding Company 

Policy Statement. 

(a) The Board’s Small Bank Holding 

Company Policy Statement (12 CFR part 

225, appendix C) (Policy Statement) 

applies to savings and loan holding 

companies as if they were bank holding 

companies. To qualify or rely on the 

Policy Statement, savings and loan 

holding companies must meet all 

qualifying requirements in the Policy 

Statement as if they were a bank holding 

company. For purposes of applying the 

Policy Statement, the term ‘‘nonbank 

subsidiary’’ as used in the Policy 

Statement refers to a subsidiary of a 

savings and loan holding company other 

than a savings association or a 

subsidiary of a savings association. 

(b) The Board may exclude any 

savings and loan holding company, 

regardless of asset size, from the Policy 

Statement under paragraph (a) of this 

section if the Board determines that 

such action is warranted for supervisory 

purposes. 

By order of the Board of Governors of the 

Federal Reserve System, April 9, 2015. 

Margaret McCloskey Shanks, 

Deputy Secretary of the Board. 

[FR Doc. 2015–08513 Filed 4–14–15; 8:45 am] 

BILLING CODE 6210–01–P 

PENSION BENEFIT GUARANTY 

CORPORATION 

29 CFR Part 4022 

Benefits Payable in Terminated SingleEmployer Plans; Interest Assumptions 

for Paying Benefits 

AGENCY: Pension Benefit Guaranty 

Corporation. 

ACTION: Final rule. 

SUMMARY: This final rule amends the 

Pension Benefit Guaranty Corporation’s 

regulation on Benefits Payable in 

Terminated Single-Employer Plans to 

prescribe interest assumptions under 

the regulation for valuation dates in 

May 2015. The interest assumptions are 

used for paying benefits under 

terminating single-employer plans 

covered by the pension insurance 

system administered by PBGC. 

DATES: Effective May 1, 2015. 

FOR FURTHER INFORMATION CONTACT: 

Catherine B. Klion (Klion.Catherine@

pbgc.gov), Assistant General Counsel for 

Regulatory Affairs, Pension Benefit 

Guaranty Corporation, 1200 K Street 

NW., Washington, DC 20005, 202–326– 

4024. (TTY/TDD users may call the 

Federal relay service toll-free at 1–800– 

877–8339 and ask to be connected to 

202–326–4024.) 

SUPPLEMENTARY INFORMATION: PBGC’s 

regulation on Benefits Payable in 

Terminated Single-Employer Plans (29 

CFR part 4022) prescribes actuarial 

assumptions—including interest 

assumptions—for paying plan benefits 

under terminating single-employer 

plans covered by title IV of the 

Employee Retirement Income Security 

Act of 1974. The interest assumptions in 

the regulation are also published on 

PBGC’s Web site (http://www.pbgc.gov). 

PBGC uses the interest assumptions in 

Appendix B to Part 4022 to determine 

whether a benefit is payable as a lump 

sum and to determine the amount to 

pay. Appendix C to Part 4022 contains 

interest assumptions for private-sector 

pension practitioners to refer to if they 

wish to use lump-sum interest rates 

determined using PBGC’s historical 

methodology. Currently, the rates in 

Appendices B and C of the benefit 

payment regulation are the same. 

The interest assumptions are intended 

to reflect current conditions in the 

financial and annuity markets. 

Assumptions under the benefit 

payments regulation are updated 

monthly. This final rule updates the 

benefit payments interest assumptions 

for May 2015.1

The May 2015 interest assumptions 

under the benefit payments regulation 

will be 0.75 percent for the period 

during which a benefit is in pay status 

and 4.00 percent during any years 

preceding the benefit’s placement in pay 

status. In comparison with the interest 

assumptions in effect for April 2015, 

these interest assumptions are 

unchanged. 

PBGC has determined that notice and 

public comment on this amendment are 

impracticable and contrary to the public 

interest. This finding is based on the 

need to determine and issue new 

interest assumptions promptly so that 

the assumptions can reflect current 

market conditions as accurately as 

possible. 

Because of the need to provide 

immediate guidance for the payment of 

benefits under plans with valuation 

dates during May 2015, PBGC finds that 

good cause exists for making the 

assumptions set forth in this 

amendment effective less than 30 days 

after publication. 

PBGC has determined that this action 

is not a ‘‘significant regulatory action’’ 

under the criteria set forth in Executive 

Order 12866. 

Because no general notice of proposed 

rulemaking is required for this 

amendment, the Regulatory Flexibility 

Act of 1980 does not apply. See 5 U.S.C. 

601(2). 

List of Subjects in 29 CFR Part 4022 

Employee benefit plans, Pension 

insurance, Pensions, Reporting and 

recordkeeping requirements. 

In consideration of the foregoing, 29 

CFR part 4022 is amended as follows: 

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