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[Federal Register Volume 90, Number 23 (Wednesday, February 5, 2025)]
[Notices]
[Pages 9027-9030]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-02257]

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FEDERAL RESERVE SYSTEM

Agency Information Collection Activities: Announcement of Board 
Approval Under Delegated Authority and Submission to OMB

AGENCY: Board of Governors of the Federal Reserve System.

SUMMARY: The Board of Governors of the Federal Reserve System (Board) 
is adopting a proposal to extend for three years, with revision, the 
Financial Statements of Foreign Subsidiaries of U.S. Banking 
Organizations, Financial Statements of U.S. Nonbank Subsidiaries of 
U.S. Holding Companies, (FR 2314/S, FR Y-11/S; OMB No. 7100-0073) and 
the Reports of Foreign Banking Organizations (FR Y-7N/NS/Q; OMB No. 
7100-0125).

DATES: The revisions will take effect as of March 31, 2025.

FOR FURTHER INFORMATION CONTACT: Federal Reserve Board Clearance 
Officer--Nuha Elmaghrabi--Office of the Chief Data Officer, Board of 
Governors of the Federal Reserve System, [email protected], (202) 
452-3884.
    Office of Management and Budget (OMB) Desk Officer for the Federal 
Reserve Board, Office of Information and Regulatory Affairs, Office of 
Management and Budget, New Executive Office Building, Room 10235, 725 
17th Street NW, Washington, DC 20503, or by fax to (202) 395-6974.

SUPPLEMENTARY INFORMATION: On June 15, 1984, OMB delegated to the Board 
authority under the Paperwork Reduction Act (PRA) to approve and assign 
OMB control numbers to collections of information conducted or 
sponsored by the Board. Board-approved collections of information are 
incorporated into the official OMB inventory of currently approved 
collections of information. The OMB inventory, as well as copies of the 
PRA Submission, supporting statements (which contain more detailed 
information about the information

[[Page 9028]]

collections and burden estimates than this notice), and approved 
collection of information instrument(s) are available at https://www.reginfo.gov/public/do/PRAMain. These documents are also available 
on the Federal Reserve Board's public website at https://www.federalreserve.gov/apps/reportingforms/home/review or may be 
requested from the agency clearance officer, whose name appears above. 
On the page displayed at the link above, you can find the supporting 
information by referencing the collection identifier, FR 2314/S, FR Y-
11/S, and FR Y-7N/NS/Q.

Final Approval Under OMB Delegated Authority of the Extension for Three 
Years, With Revision, of the Following Information Collection

    Collection title: Financial Statements of Foreign Subsidiaries of 
U.S. Banking Organizations, and Financial Statements of U.S. Nonbank 
Subsidiaries of U.S. Holding Companies.
    Collection identifier: FR 2314/S and FR Y-11/S.
    OMB control number: 7100-0073.\1\
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    \1\ As part of this clearance, the Board has cleared the FR 
2314/S and FR Y-11/S under the FR 2314 OMB control number (7100-
0073), and will discontinue the FR Y-11's separate OMB control 
number (7100-0244). This non-substantive change is aimed at 
simplifying the tracking and clearance process for the four related 
forms. This change does not modify the reporting or recordkeeping 
requirements of the forms described in this notice in any way. The 
collection is now titled Financial Statements of U.S. Nonbank 
Subsidiaries of U.S. Holding Companies and Financial Statements of 
Foreign Subsidiaries of U.S. Banking Organizations (FR 2314/S and FR 
Y-11/S; OMB No. 7100-0073).
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    General description of collection: The FR 2314 reporting forms 
collect financial information for non-functionally regulated direct or 
indirect foreign subsidiaries of U.S. state member banks, Edge and 
agreement corporations, and holding companies (HCs) (i.e., bank holding 
companies (BHCs), savings and loan holding companies (SLHCs), 
securities holding companies (SHCs), and intermediate holding companies 
(IHCs)). The data from the FR 2314 forms are used to identify current 
and potential problems at the foreign subsidiaries of U.S. parent 
companies, to monitor the activities of U.S. banking organizations in 
specific countries, and to develop a better understanding of activities 
within the industry, in general, and of individual institutions, in 
particular.
    The FR Y-11 reporting forms collect financial information for 
individual non-functionally regulated U.S. nonbank subsidiaries of 
domestic HCs, which is essential for monitoring the subsidiaries' 
potential impact on the condition of the HC or its subsidiary banks. 
HCs file the FR Y-11 on a quarterly or annual basis, or the FR Y-11S on 
an annual basis, predominantly based on whether the organization meets 
certain asset size thresholds. The data from the FR Y-11 forms are used 
with other HC data to assess the condition of HCs that are heavily 
engaged in nonbanking activities and to monitor the volume, nature, and 
condition of their nonbanking operations.
    Frequency: Quarterly and annually.
    Respondents: U.S. banking organizations and U.S. HCs.
    Total estimated number of respondents: Reporting: FR 2314 
(quarterly): 434; FR 2314 (annually): 223; FR 2314S: 295; FR Y-11 
(quarterly): 386; FR Y-11 (annually): 211; FR Y-11S: 286. 
Recordkeeping: FR 2314 (quarterly): 434; FR 2314 (annually): 223; FR 
2314S: 295; FR Y-11 (quarterly): 386; FR Y-11 (annually): 211; FR Y-
11S: 286.
    Estimated average hours per response: Reporting: FR 2314 
(quarterly): 8.0; FR 2314 (annually): 7.9; FR 2314S: 1; FR Y-11 
(quarterly): 8.3; FR Y-11 (annually): 8.3; FR Y-11S: 1. Recordkeeping: 
FR 2314 (quarterly): 0.2; FR 2314 (annually): 0.2; FR 2314S: 0.2; FR Y-
11 (quarterly): 0.2; FR Y-11 (annually): 0.2; FR Y-11S: 0.2.
    Total estimated change in burden: 3,632.
    Total estimated annual burden hours: 31,656.
    Collection title: Reports of Foreign Banking Organizations.
    Collection identifier: FR Y-7N/NS/Q.
    OMB control number: 7100-0125.
    General description of collection: The FR Y-7N/NS collect financial 
information for certain non-functionally regulated U.S. nonbank 
subsidiaries held by foreign banking organizations (FBOs) other than 
through a U.S. BHC, financial holding company (FHC), or U.S. bank. For 
purposes of these reports, an FBO is a foreign bank that operates a 
branch, agency, or commercial lending company subsidiary in the United 
States; controls a bank in the United States; or controls an Edge 
corporation acquired after March 5, 1987. FBOs file the FR Y-7N 
quarterly or annually or the FR Y-7NS annually, predominantly based on 
asset size thresholds. The Federal Reserve uses the data collected on 
the FR Y-7N/NS/Q to assess an FBO's ability to be a continuing source 
of strength to its U.S. operations and to determine compliance with 
applicable U.S. laws and regulations. In addition, the FR Y-7Q collects 
consolidated regulatory capital information from all FBOs, which the 
Federal Reserve uses to assess the FBO's ability to be a continuing 
source of strength to its U.S. banking operations and to determine 
compliance with U.S. laws and regulations.
    Frequency: Quarterly and annually.
    Respondents: FBOs.
    Total estimated number of respondents: Reporting: FR Y-7N 
(quarterly): 29; FR Y-7N (annually): 14; FR Y-7NS: 13; FR Y-7Q 
(quarterly): 122; FR Y-7Q (annually): 19. Recordkeeping: FR Y-7N 
(quarterly): 29; FR Y-7N (annually): 14; FR Y-7NS: 13.
    Estimated average hours per response: Reporting: FR Y-7N 
(quarterly): 8.3; FR Y-7N (annually): 8.3; FR Y-7NS: 1; FR Y-7Q 
(quarterly): 3.25; FR Y-7Q (annually): 2.5. Recordkeeping: FR Y-7N 
(quarterly): 0.2; FR Y-7N (annually): 0.2; FR Y-7NS: 0.2.
    Total estimated change in burden: 120.
    Total estimated annual burden hours: 2,755.
    Current actions: On June 7, 2024, the Board published two separate 
initial notices in the Federal Register (89 FR 48639 and 89 FR 48641) 
requesting public comment for 60 days on the extension, with revision, 
of the FR 2314, FR Y-11 and FR Y-7N. The comment period for both 
notices expired on August 6, 2024, and the Board received one comment 
letter on the FR 2314 and FR Y-11 notice. Additionally, the Board 
received one comment regarding the Federal Financial Institutions 
Examination Council (FFIEC) Foreign Branch Report of Condition (FFIEC 
030/030S), however, the comment is not related to the collections 
discussed in this notice.\2\ After considering the comments received, 
the Board is proceeding with the proposed revisions, but with certain 
modifications. There are no changes to the FR Y-7Q at this time. The 
specific comments, the Board's responses, and pertinent modifications 
follow.
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    \2\ See 89 FR 81137 (October 7, 2024).
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Detailed Discussion of Public Comments

1. Accounting Standards Update (ASU) 2022-02, ``Financial Instruments--
Credit Losses (Topic): Troubled Debt Restructurings and Vintage 
Disclosures''

    The commenter was supportive of the proposed revisions to align the 
regulatory reporting of loan modifications to borrowers experiencing 
financial difficulty (LMBEFD) on the FR 2314, FR Y-11, and FR Y-7N in 
accordance with ASU 2022-02 issued by the Financial Accounting 
Standards Board in March 2022. The commenter

[[Page 9029]]

specifically commended the Board for properly aligning the reporting 
standard to U.S. generally accepted accounting principles (GAAP) and 
current firm practices, which will allow for the collection of relevant 
information without undue regulatory reporting burden to institutions. 
The commenter also encouraged the Board to support implementing ASU 
2022-02 across all regulatory reporting forms, including the FFIEC 
Consolidated Reports of Condition and Income (Call Report) (FFIEC 031/
041/051). In response, the Board is proceeding with these revisions as 
proposed to the FR 2314, FR Y-11, and FR Y-7N.
    Additionally, on June 7, 2024, the Board published in the Federal 
Register separate initial notices that invited comment for 60 days on 
the extension, with revision, of the Financial Statements for Holding 
Companies (FR Y-9 Reports) \3\ and the Consolidated Report of Condition 
and Income for Edge and Agreement Corporations (FR 2886b) \4\ to 
propose aligning the reporting of LMBEFD with ASU 2022-02. Also, on 
June 21, 2024, the Board published in the Federal Register an initial 
notice that invited comment for 60 days on the extension, with 
revision, of the Capital Assessments and Stress Testing Reports (FR 
Y14A/Q/M),\5\ to propose aligning the reporting of LMBEFD with ASU 
2022-02. The comment period for the FR Y-9 and FR 2886b initial notices 
expired on August 6, 2024, and the Board recently finalized these 
revisions as proposed.\6\ The comment period for the FR Y-14A/Q/M 
notice expired on August 20, 2024. With regard to the reporting of 
LMBEFD on the Call Report, the Office of the Comptroller of the 
Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and 
the Board (collectively, the agencies) are continuing to evaluate the 
comments on their September 2023 proposal.\7\ Upon conclusion of their 
review, the agencies will adopt a standard through a subsequent PRA 
notice with a 30-day public comment period.
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    \3\ See 89 FR 48637 (June 7, 2024).
    \4\ See 89 FR 48644 (June 7, 2024).
    \5\ See 89 FR 52042 (June 21, 2024).
    \6\ See 89 FR 90284 (November 15, 2024).
    \7\ See 88 FR 66933 (September 28, 2023).
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2. Incorporate Line Items From the FR 2502q Into the FR 2314

    The commenter was supportive of incorporating line items from the 
Quarterly Report of Assets and Liabilities of Large Foreign Offices of 
U.S. Banks (FR 2502q) into the FR 2314. However, the commenter 
requested the Board modify certain aspects of the proposal. First, the 
commenter urged the Board to limit the scope of respondents subject to 
the proposed FR 2314 Schedule BS-Q, ``Due From, Due To, and Other'' to 
those that meet the current criteria to file the FR 2502q. The 
commenter stated that there are significant scoping differences between 
the FR 2502q and the FR 2314. For subsidiaries, FR 2502q reporting is 
limited to those foreign subsidiaries located in the United Kingdom 
(U.K.) or the Caribbean that file the quarterly FR 2314, have a banking 
charter, engage in banking business, and report $2 billion or more in 
total assets and $10 million or more in total deposits. The FR 2314 
quarterly instructions state that a U.S. Banking Organization (USBO) 
must file the report quarterly for its foreign subsidiary if the parent 
U.S. HC has total consolidated assets of $500 million or more or files 
the FR Y-9C, or the subsidiary is owned or controlled by a state member 
bank or an Edge or agreement corporation that has total consolidated 
assets equal to or greater than $500 million, and the subsidiary meets 
any one of several criteria.\8\ The commenter stated that the FR 2314's 
reporting scope, without the geographic limitation to foreign 
subsidiaries in the U.K. and the Caribbean, results in a much greater 
reporting burden on firms.
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    \8\ A USBO must file the FR 2314 quarterly for its foreign 
subsidiary if the parent U.S. HC has total consolidated assets of 
$500 million or more or files the FR Y-9C, or the subsidiary is 
owned or controlled by a state member bank or an Edge or agreement 
corporation that has total consolidated assets equal to or greater 
than $500 million, and the subsidiary meets any one of the following 
criteria: (1) total assets of the foreign subsidiary are equal to or 
greater than $1 billion; (2) the foreign subsidiary's off-balance-
sheet activities are equal to or greater than $5 billion; (3) the 
foreign subsidiary's equity capital is equal to or greater than 5 
percent of the top-tier organization's consolidated equity capital; 
or (4) the foreign subsidiary's operating revenue is equal to or 
greater than 5 percent of the top-tier organization's consolidated 
operating revenue.
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    Furthermore, this commenter also stated that the proposed changes 
and increased granularity of the items reported would necessitate both 
the development of new systems, as well as modifications to existing 
ones. This reporting burden would be greatest on respondents that have 
newly scoped-in entities that would be reporting this information for 
the first time. In light of this, the commenter requested that, if the 
scope of respondents on the proposed FR 2314 Schedule BS-Q is not 
limited to those that currently meet the criteria to file the FR 2502q, 
foreign subsidiaries would need at least four quarters from publication 
of the final forms and instructions to implement the revisions. 
However, if the scope were limited to foreign subsidiaries that meet 
the current criteria to file the FR 2502q, foreign subsidiaries would 
only need two additional quarters to implement the proposal.
    The Board agrees with the commenter that broadening the criteria 
for reporting the proposed FR 2314 Schedule BS-Q beyond the current 
reporting criteria for the FR 2502q may impose additional burden on FR 
2314 respondents and is finalizing the criteria for completing Schedule 
BS-Q as noted below. Foreign subsidiaries that are located in the U.K. 
or Caribbean (that are not located in a U.S. military facility), that 
have a banking charter and engage in banking business, that report $2 
billion or more in total assets in Schedule BS, item 10, and $10 
million or more in total deposits in Schedule BS-M, item 6, as of the 
end of the calendar quarter, must complete new Schedule BS-Q. Foreign 
Subsidiaries that file the FR 2314 on an annual basis would not report 
the new items. The FR 2314 instructions will be updated to reflect 
these changes. Substantially restricting the scope of institutions 
required to complete Schedule BS-Q should additionally limit the burden 
incurred due to system revisions necessary to implement the revisions. 
Although the proposed line items would be new on the FR 2314, there 
would be fewer items reported and they would be at the same level of 
granularity as currently reported on the FR 2502q. However, the Board 
acknowledges that U.S. HCs and their foreign subsidiaries may need 
additional time initially to develop their reporting systems to 
implement these changes. As such, the Board will delay the requirement 
to complete Schedule BS-Q until March 31, 2025.

3. Other Comments Received

    The commenter noted that the notice proposes to revise the 
instructions of FR 2314 and FR Y-11, Schedule IS, line item 4, 
``Provision for Credit Losses'', to instruct respondents to include 
provisions for credit losses on all financial assets and off-balance-
sheet credit exposures. The commenter stated that, despite this 
proposed revision, contradictory language would remain in the 
instructions for Schedule IS, line item 4, ``Provisions for Credit 
Losses'' stating to ``exclude provision for credit losses on off-
balance-sheet credit exposures and provisions for allocated transfer 
risk, both of which should be reported in Schedule IS, line item 7, 
``Noninterest expense''. The commenter also noted that the current 
instructions of Schedule IS line item 7(a), ``Pertaining to nonrelated

[[Page 9030]]

organizations'', states to ``report any provision for credit losses 
related to off-balance sheet credit exposures''. Therefore, the 
commenter requested the Board (1) exclude the provision for credit 
losses on off-balance sheet credit exposures from Schedule IS, line 
item 4, and (2) instead include them on line item 7. In response to the 
commenter, the Board explicitly notes that provisions for credit losses 
on off-balance sheet and provisions for allocated transfer risk should 
be reflected in FR 2314 and FR Y-11 Schedule IS, item 4, and excluded 
from Schedule IS, item 7. This clarification is also applicable to FR 
Y-7N Schedule IS, items 4, ``Provisions for Credit Losses'' and 7, 
``Noninterest expense''. Therefore, the Board will update the 
instructions of FR 2314, FR Y-11, FR Y-7N Schedule IS items 4 and 7 
accordingly.
    The commenter also asked for clarification on FR 2314 Schedule BS-
Q, line items 3, ``Assets that are claims on U.S. addressees other than 
depository institutions'', and 4, ``Liabilities to U.S. addressees 
other than depository institutions''. The instructions of proposed 
Schedule BS-Q state to exclude balances with related institutions from 
line items 3 and 4, while BS-Q, line items 1, ``Balances due from 
related institutions, gross'', and 2, ``Balances due to related 
institutions, gross'', represent balances due from and due to related 
institutions, gross, as stated in the line item caption name. The 
commenter requested that Board revise the instructions to explicitly 
clarify that these balances reported in Schedule BS-Q line items 1 and 
2 should be excluded when reporting the balances in line items 3 and 4. 
In response, the Board will revise the instructions to explicitly 
clarify that balances with related institutions are excluded from 
Schedule BS-Q, line items 3 and 4.
    The commenter also stated that proposed revisions to the draft FR 
2314 and FR Y-11 report forms, Schedule IS-B, Memoranda items M3 and M4 
contain a reference to a footnote (FN 6) following the the line item 
captions. The commenter requested that FN 6 be added and respondents be 
given the opportunity to comment on this item. Schedule IS-B, Memoranda 
items M3 and M4 should not reference FN 6 on the respective report 
forms. Therefore, the report forms will be updated to no longer 
reference FN 6.
    Lastly, the commenter requested clarity regarding the statement 
that six line items from the FR 2502q would be incorporated into the 
proposed FR 2314 Schedule BS-Q, when it appears that only one line item 
is included. The commenter stated that, ``although there are six line 
items on the proposed FR 2314 Schedule BS-Q, only line items 3 and 4, 
which break out FR 2502q line item 1.c. are from the FR 2502q.'' The 
Board acknowledges that not all line items that were proposed to be 
added to the FR 2314 are explicitly from the FR 2502q. However, the 
intent of these new line items is to allow for the discontinuation of 
the FR 2502q and to support the supervisory data needs of the FR 2502q 
data users.

    Board of Governors of the Federal Reserve System, January 31, 
2025.
Benjamin W. McDonough,
Deputy Secretary and Ombuds of the Board.
[FR Doc. 2025-02257 Filed 2-4-25; 8:45 am]
BILLING CODE 6210-01-P
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