This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

33696

Vol. 61, No. 126

Friday, June 28, 1996

FEDERAL DEPOSIT INSURANCE

CORPORATION

12 CFR Part 335

RIN 3064–AB79

Securities of Nonmember Insured

Banks

AGENCY: Federal Deposit Insurance

Corporation (FDIC).

ACTION: Proposed rule.

SUMMARY: The Federal Deposit

Insurance Corporation (FDIC) is

proposing revisions to its regulations,

detailing registration and reporting

requirements for non-member insured

banks with securities required to be

registered under section 12 of the

Securities Exchange Act of 1934

(Exchange Act). The proposal seeks to

incorporate through cross reference the

corresponding regulations of the

Securities and Exchange Commission

(SEC) into the provisions of the FDIC’s

securities regulations. Incorporation

through cross reference will assure that

the FDIC’s regulations remain

substantially similar to the SEC’s

regulations, as required by law. The

FDIC is requesting comments on the

cross reference to the SEC’s regulations

and what additional provisions, if any it

should include in the regulation.

DATES: Comments must be received

September 26, 1996.

ADDRESSES: Comments should be

directed to Jerry L. Langley, Executive

Secretary, Federal Deposit Insurance

Corporation, 550 17th Street N.W.,

Washington, D.C. 20429. Comments

may be hand delivered to room F–402,

1776 F Street N.W., Washington, D.C.,

on business days between 8:30 a.m. and

5:00 p.m. [FAX number (202) 898–3838,

Internet address: comments@FDIC.gov]

Comments may also be inspected in the

FDIC Public Information Center, room

100, 801 17th Street, N.W., Washington,

D.C. between 8:30 a.m. and 5:00 p.m. on

business days.

FOR FURTHER INFORMATION CONTACT: M.

Eric Dohm, Staff Accountant, Division

of Supervision (202–898–8921),

Lawrence H. Pierce, Securities

Activities Officer, Division of

Supervision (202–898–8902), or Gerald

J. Gervino, Senior Attorney, Legal

Division (202–898–3723), Federal

Deposit Insurance Corporation, 550 17th

Street N.W., Washington, D.C. 20429.

SUPPLEMENTARY INFORMATION:

Background

Section 12(i) of the Securities

Exchange Act of 1934, as amended, 15

U.S.C. 78l(i), grants authority to the

FDIC to issue regulations applicable to

the securities of insured banks

(including foreign banks having an

insured branch) which are neither

members of the Federal Reserve System

nor District banks (nonmember banks),

which are substantially similar to the

SEC’s regulations under sections 12

(securities registration), 13 (periodic

reporting), 14(a) (proxies and proxy

solicitation), 14(c) (information

statements), 14(d) (tender offers), 14(f)

(election of directors contests), and 16

(beneficial ownership and reporting) of

the Exchange Act. Section 12(i) does not

however, require the FDIC to issue

substantially similar regulations in the

event that the FDIC finds that

implementation of such regulation is

not necessarily in the public interest or

appropriate for protection of investors

and the FDIC publishes such findings

with detailed reasons therefor in the

Federal Register.

To date, in 12 CFR part 335, the FDIC

has generally maintained its own

version of regulations pursuant to

sections 12, 13, 14(a), 14(c), 14(d), and

14(f) of the Exchange Act. In 1989, the

FDIC incorporated by cross reference

the SEC regulations governing going

private transactions and issuer tender

offers. (54 FR 53592, 12 CFR 335.409

and 335.521). In 1992, SEC regulations

under section 16 of the Exchange Act

were incorporated by cross reference.

(57 FR 4702, 12 CFR 335.401 and

335.402). In 1994, part 335 was

amended to conform with more recent

changes in the comparable SEC

regulations. In connection with its

proposed rule, the FDIC requested

comment on the desirability of

incorporating the SEC rules by cross

reference into its own rules (59 FR

22555 (May 2, 1994)).

The FDIC received six comment

letters in response to its solicitation.

Commentators were asked to comment

upon the following: Should the FDIC

consider proposing a revision to part

335, to incorporate by cross reference

the comparable rules of the SEC, rather

than continue to maintain the separate

but substantially similar body of rules

contained in part 335 as is done

presently? Interested persons were

asked to address: (1) The benefits and

disadvantages of cross referencing as a

method for assuring substantial

similarity between the FDIC’s and the

SEC’s regulations; (2) the potential cost

savings or cost burden of cross

referencing; (3) whether the FDIC

should continue to review preliminary

proxy materials and information

statements; and (4) any other issues

regarding a cross referencing proposal

which commenters believe pertinent.

Written comments were invited to be

submitted during a 60-day comment

period.

All of the commenters supported

cross referencing to some extent. Two

felt that the FDIC should be careful to

adopt or preserve regulations different

from those of the SEC, where FDIC

drafted regulations would be more

appropriate for banks. None provided an

estimate of cost savings from the cross

referencing procedure. One commenter

indicated that if this cross referencing

procedure is adopted, the FDIC should

provide notice to banks filing under part

335 that the SEC has amended rules

applicable to banks by cross reference.

In the interest of quickly bringing its

rules into similarity with those of the

SEC, the FDIC adopted the rule

amendments as they had been

previously proposed. Since the cross

referencing proposal was only described

generally, it is now necessary to publish

an express cross referencing proposal

for comment upon the actual method

and language to be used.

The proposed revision would

incorporate by cross reference the

comparable rules of the SEC rather than

continue to maintain the separate but

substantially similar body of rules

presently contained in part 335.

12 CFR part 335 generally applies

only to nonmember banks having one or

more classes of securities required to be

registered under section 12 of the

Exchange Act. There are presently 191

banks whose securities are registered.
Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Proposed Rules 33697

Proposed Revisions to Part 335

The FDIC proposes to amend 12 CFR

part 335 by incorporating through cross

reference, the regulations of the SEC

issued under sections 12, 13, 14(a),

14(c), 14(d), and 14(f) of the Exchange

Act. As a result, with the exception of

forms filed pursuant to section 16, the

FDIC’s Exchange Act forms would be

eliminated and the SEC’s Exchange Act

forms would be utilized in filings with

the FDIC. All forms filed with the FDIC

however, would be required to contain

the name of the FDIC in lieu of that of

the SEC in order to avoid confusion.

The FDIC believes that incorporation

through cross reference will make its

regulations substantially similar to those

of the SEC, as well as those of other

federal financial institution regulatory

agencies.

The proposed revision would make

appropriate SEC regulations applicable

to persons subject to part 335, except

where part 335 contains a differing or

additional requirement or exception.

Incorporation through cross reference

generally makes all SEC regulations, and

amendments thereto, applicable to

registered nonmember banks, unless the

FDIC acts to vary the SEC’s specific

requirements. The FDIC believes that

this is an effective way to assure that

FDIC regulations issued under the

Exchange Act remain substantially

similar to the SEC’s regulations.

However, the FDIC will still retain the

ability to exempt nonmember banks,

through a separate FDIC rulemaking,

from any particular SEC rule it

determines should not apply to such

banks. The FDIC also retains its

rulemaking authority to subject

nonmember banks to additional or

different regulations where warranted.

The FDIC believes that issuance of the

proposed regulation would simplify the

administration and enforcement of the

disclosure provisions of the Exchange

Act. This is the approach adopted by the

Board of Governors of the Federal

Reserve System (12 CFR 208.16), the

Office of the Comptroller of the

Currency (12 CFR 11.2), and the Office

of Thrift Supervision (12 CFR 563d.1).

Further, as registrants, investors, and

their counsel acquire or expand their

familiarity with SEC regulations,

incorporation by cross reference should

help promote uniformity and

consistency of Exchange Act disclosure,

without affecting the quality of the

administration and enforcement of the

provisions of the Exchange Act for

which the FDIC is the appropriate

regulatory agency.

The FDIC’s principal concern with

respect to the elimination of FDIC forms

and subsequent use of SEC forms is that

filers may incorrectly forward the forms

to the SEC. This can create

embarrassment and legal liability on the

part of the filers for unintentional

failure to file the forms. Errors of this

kind can interfere with the smooth and

efficient administration of public filings

under the Exchange Act. For this reason,

the FDIC proposes that on all forms to

be filed with the FDIC, the cover pages

would be required to prominently

display the name of the FDIC in lieu of

that of the SEC in order to avoid

confusion as to the appropriate filing

agency.

Proposed Differences From Current

Part 335 Regulations

Following is a discussion of the

significant differences between the

FDIC’s existing regulations and the

SEC’s regulations and procedures which

would be incorporated by cross

reference under this proposed rule.

While there are other differences in the

regulations, the FDIC believes them to

be technical or minor in nature. If the

FDIC adopts the proposed rule, each of

these differences will be eliminated.

A. Minimum Asset Test for Registration

The regulations of the SEC and the

FDIC differ in the minimum total asset

size of an issuing company. The

company’s asset size is used as one of

the triggering criteria (in addition to the

number of shareholders) for requiring

registration of securities under section

12 of the Exchange Act. Section 12(g) of

the Exchange Act (17 U.S.C. 781(g))

requires any issuing company with at

least 500 shareholders and a minimum

total assets of $1 million to register the

class of securities, subject to limits,

exemptions, and conditions prescribed

by the SEC or other appropriate

regulatory agency. The SEC’s Rule 12g–

1 (17 CFR 240.12g–1) prescribes the

minimum asset test to be $10 million in

total assets. Currently, the FDIC rules do

not alter the statutory standard.

Incorporation of the SEC’s regulations

by cross reference, would adopt the

SEC’s threshold of $10 million.

B. Shareholder Proposal Rules

The regulations of the SEC and the

FDIC differ primarily with respect to the

proponent’s ownership requirements in

stock of an issuing company, and the

number of proposals which a proponent

may present. The FDIC’s rules presently

require only that the proponent be a

shareholder of the registrant, and that a

proponent may submit a maximum of

two proposals for inclusion in a

registrant’s annual meeting proxy

statement. The SEC’s Rule 14a–8 (17

CFR 240.14a–8) requires a proponent to

beneficially own at least 1% or $1,000

in market value of securities entitled to

be voted on the proposal, requires a

proponent to have held such securities

for at least one year, and permits a

proponent to submit only one proposal

for inclusion in a registrant’s annual

meeting proxy statement. Incorporation

of the SEC’s regulations by cross

reference, would adopt the SEC’s

requirements which include the

differences described above.

C. Certification, Suspension of Trading,

and Removal From Listing by

Exchanges; Unlisted Trading; and

Related Filing Requirements

The SEC’s rules currently require a

national securities exchange to formally

certify that a registrant’s security has

been approved for listing. The SEC’s

rules contain provisions applicable to

suspension of trading on a national

securities exchange, withdrawal, and

striking of a security from listing and

registration. Also, SEC rules prescribe

requirements relative to applications,

changes, termination, suspension, or

exemption of securities admitted to

unlisted trading on a national securities

exchange. The FDIC’s rules currently

also require certification by a national

securities exchange, but do not contain

the additional provisions summarized

above. Incorporation of the SEC’s

regulations by cross reference, would

adopt the SEC’s rules on Certification

By Exchanges (17 CFR 240.12d1–1

through 12d1–6), Suspension Of

Trading, Withdrawal, And Striking

From Listing And Registration (17 CFR

240.12d2–1 through 12d2–6), and

Unlisted Trading (17 CFR 240.12f–1

through 12f–6).

D. Availability of Exchange Act Filings

at Federal Reserve Banks

FDIC regulations currently require

that copies of all registration statements

and periodic reports required by 12 CFR

335.301 through 335.365 (exclusive of

exhibits), the proxy and information

statements required by 12 CFR 335.201,

and annual reports to security holders

required by 12 CFR 335.203 will be

available for inspection at the Federal

Reserve Bank (FRB) of the District in

which the bank making the submission

is located. The FDIC staff believes that

there has been extremely little if any

public interest in inspecting these

Exchange Act filings at the Federal

Reserve Banks. It is also believed that it

is difficult for the public to access these

filings. Adoption of this proposed rule

would eliminate the availability of these

Exchange Act filings at the Federal

Reserve Banks. All Exchange Act filings
33698 Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Proposed Rules

will still be available for inspection at

and copies may be obtained from the

FDIC in Washington, D.C.

Proposed Differences From SEC

Regulations (Superseded SEC

Regulations and FDIC Substituted

Regulations)

Following is a discussion of the

significant differences between the

applicable requirements assuming

adoption of this proposed rule by FDIC,

and the SEC’s regulations and

procedures which would be

incorporated by cross reference. Unless

any particular provisions of the SEC’s

Exchange Act regulations are

specifically superseded by the FDIC,

incorporation by cross reference would

make such provisions applicable to

nonmember banks, related parties and

investors. The FDIC rules under 12 CFR

part 335 currently contain these

provisions or requirements and

retention thereof is considered

warranted. If the FDIC adopts this

proposed rule, each of the following

differences between the rules of the

FDIC and the rules of the SEC will

remain in effect.

A. Review of Proxy and Information

Statements

The SEC and the FDIC regulations

differ significantly in the type of proxy

and information statements subject to

regulatory review prior to distribution to

shareholders. The SEC requires

preliminary filings of proxy and

information statements, but only

concerning those shareholder meetings

which are other than ‘‘routine’’ annual

meetings. In such cases, the SEC

requires preliminary filings to be filed

ten days prior to distribution to

shareholders (17 CFR 240.14a–6 and 17

CFR 240.14c–5). The FDIC however,

currently requires preliminary filings for

all shareholder meetings, and requires

that the preliminary filings be made at

least ten days before routine meetings

and 15 days before other than routine

meetings (12 CFR 335.204).

The SEC regulations exempt proxy

statements for ‘‘routine’’ annual

meetings from the requirement of

preliminary filing and advance review.

While the FDIC receives a moderate

number of ‘‘routine’’ meeting filings, the

staff has found that it is this category of

filings where the most fundamental

errors are made. Proxy statements for

‘‘routine’’ annual meetings often contain

more basic errors and omissions than in

the case of ‘‘non-routine’’ meetings. In

the absence of an advance filing, the

FDIC must choose between requiring a

new meeting after the problem is

belatedly discovered or overlooking

noncompliance until the following year.

A similar problem may occur in

enforcing the regulations with banks

that misread or are negligent in

interpreting the term ‘‘routine’’.

Accordingly, the FDIC is proposing

that its rules under 12 CFR part 335

continue to require the filing of both

routine and non-routine preliminary

proxy materials for staff review and

comment prior to their distribution to

shareholders. The FDIC staff believes

that the overall benefits resulting from

the current requirement under 12 CFR

part 335 to file ‘‘routine’’ preliminary

proxy statements, exceed the costs

attributed to making those filings.

Although the FDIC considers a

continuation of these requirements

appropriate subsequent to adoption of a

cross referencing rule, it intends to

perform a periodic assessment of this

requirement in light of its experience

and will propose revisions as warranted.

B. Disclosure of Extensions of Credit to

Insiders

The SEC and the FDIC regulations

contain requirements for financial

institution disclosure of loans to its

insiders. SEC regulations generally

require the disclosure of certain insider

indebtedness in excess of $60,000

which have preferential terms, were not

made in the ordinary course of business,

or which involve more than the normal

risk of collectibility or involve other

unfavorable features. In contrast, since

1965, the FDIC has required: (a)

disclosure of insiders’ indebtedness on

a basis substantially similar to that of

the SEC, but without the $60,000

threshold; and (b) basic disclosure of

relatively large extensions of credit to

insiders and to insiders as a group,

based strictly upon the amount of

indebtedness.

Even though loans to insiders are

often subject to amount limitations in

banking law and regulation, significant

amounts of insider loans yet occur. The

proposed rule would incorporate the

SEC’s indebtedness of management

disclosure requirements and would also

add a requirement to disclose large

extensions of credit to insiders and to

insiders as a group, based solely upon

the amount of indebtedness. The FDIC

staff believes that the overall benefit

resulting from continuation of the

FDIC’s current disclosure requirements

under 12 CFR part 335 is in the public

interest and is appropriate to the

banking industry.

C. Filing Fees

The regulations of SEC include very

specific requirements for the payment of

filing fees which are applicable to and

must be paid by any person or entity

filing reports with the SEC under the

Exchange Act. The FDIC’s proposed

rules will not require filing fees to be

paid by any person, registrant, or entity

making Exchange Act filings with the

FDIC.

D. Electronic Data Gathering Analysis

and Retrieval (EDGAR)

The SEC’s Regulation S–T (17 CFR

part 232) requires all registrants to

submit filings in electronic format

pursuant to its EDGAR system.

Although the FDIC is studying the

feasibility of the acceptance and

administration of electronic filings

under the Exchange Act, the FDIC does

not accept and is not proposing to

accept electronic filings at this time.

E. Legal Proceedings

The SEC and the FDIC regulations

currently both require disclosure of

legal proceedings in certain filings

under the Exchange Act. The FDIC

generally requires disclosure of all legal

proceedings required to be disclosed by

the SEC, and in addition, the FDIC’s

regulations deem as material and

require disclosure of administrative or

judicial proceedings arising under

section 8 of the Federal Deposit

Insurance Act. The FDIC is proposing

that its rules under 12 CFR part 335

incorporate the SEC’s legal proceedings

disclosure requirements by cross

reference, and in addition, continue to

deem as material and require disclosure

of administrative or judicial proceedings

arising under section 8 of the Federal

Deposit Insurance Act. The FDIC staff

believes that the overall benefit

resulting from the explicit requirement

to disclose proceedings arising under

section 8 of the Federal Deposit

Insurance Act is in the public interest

and is appropriate to the banking

industry.

Request for Public Comments

The Board hereby requests comment

on all aspects of the proposed rule,

particularly those specifically

mentioned above. The FDIC requests

specific written comments from the

public regarding:

(1) The benefits and disadvantages of

cross referencing as a method for

assuring substantial similarity between

FDIC and SEC regulations;

(2) The potential cost savings or cost

burden of cross referencing; Please

include estimates of specific dollar

amounts of any anticipated benefits, as

well as amounts of transitionary and

continuing costs such as purchase of

reference aides, staff training, and any
Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Proposed Rules 33699

necessary additional professional

assistance;

(3) Whether the FDIC should provide

any specific exemptions from, or

separate additions to the SEC’s

regulations;

(4) Whether the FDIC should continue

to require disclosure of insider

extensions of credit as it currently does

under its rules in 12 CFR 335.212 Item

7(b); and

(5) Whether the FDIC should continue

to also make Exchange Act filings

available for inspection at the Federal

Reserve Banks.

(6) The appropriate time frame for

implementation of the final rule,

including the amount of time which

should pass after publication of the final

rule before compliance with the final

rule is required; and

(7) Any other issues regarding the

proposal which commenters believe

would assist in this rulemaking.

Regulatory Flexibility Act

Under section 605(b) of the

Regulatory Flexibility Act (RFA) (5

U.S.C. 605(b)), the initial regulatory

flexibility analysis otherwise required

under section 603 of the RFA (5 U.S.C.

603) is not required if the head of the

agency certifies that the rule will not

have a significant economic impact on

a substantial number of small entities

and the agency publishes such

certification in the Federal Register

along with its general notice of

proposed rulemaking. Pursuant to

section 605(b) of the RFA, the FDIC

certifies that this proposed rule would

apply only to those banks whose

securities are publicly held. Other

covered persons include: insiders of

banks; large shareholders of banks; and

bidders for bank stock.

These regulations will cross-reference

SEC regulations. By statute any

differences must be specifically justified

through the rulemaking process. The

regulations are functionally almost

identical. They are issued under the

same statutory authority. They share a

common legislative purpose. The FDIC

considers the applicable SEC rule,

defining ‘‘small entities’’, a necessary

standard in order to maintain fair and

comparable regulation. The FDIC is

comparing FDIC regulated banks and

SEC regulated nonbank entities,

including bank holding companies. The

applicable SEC definition of ‘‘small

entities’’ sets the upper limit at $5

million. The SEC has delayed raising

this limit until it completes its current

and future initiatives in this area. Any

SEC revisions in this area should pass

through to entities subject to part 335.

Currently, there are no banks below this

limit filing under part 335. Further, this

rulemaking does not substantially

change existing filing requirements for

any individual. Based upon this factual

background, the FDIC certifies that the

proposed amendments will have no

economic impact on any identifiable

small entities as defined for the class by

SEC which is the general regulator in

the area.

Paperwork Reduction Act

The collection of information in this

proposed rule has been reviewed and

approved by the Office of Management

and Budget under control number 3064–

0030 in accordance with the Paperwork

Reduction Act of 1980 (44 U.S.C. 3501

et seq.). Comments on the accuracy of

the burden estimate and suggestions for

reducing the burden should be directed

to the Office of Management and

Budget, Paperwork Reduction Project

(3064–0030), Washington, D.C. 20503,

with copies of such comments to be sent

to Steven F. Hanft, Office of the

Executive Secretary, room F–400, 550

17th Street, N.W., Washington, D.C.

20429.

This information is needed to assure

compliance with the Exchange Act and

to provide information to investors and

the public about the condition of

registered nonmember banks. The likely

respondents are for-profit financial

institutions—registered nonmember

banks, as well as their directors,

executive officers and principal

shareholders. The total reporting burden

for all collections of information in this

regulation is currently estimated as

follows:

Number of Respondents ..........................3,213

Number of Responses Per

Respondent.............................................1.67

Total Annual Responses..........................5,363

Hours Per Response ...................................8.60

Total Annual Burden Hours..................46,036

The estimated annual burden per

respondent varies from 30 minutes to

200 hours, depending on the particular

form and individual circumstances,

with an estimated average of 8.60 hours.

Cost Benefit Analysis

This proposed revision is generally

not expected to result in material

increases in costs and burden to

respondents. Some filers, however, may

realize an increase in costs due to an

increased need for professional

guidance in order to facilitate the

making of filings under the Exchange

Act. Any overall increase in costs

resulting from this proposed rule should

be moderate, however, due to the

existing general familiarity with the

SEC’s regulations on the part of

registrants, investors, and their counsel.

Any such increase in overall costs

should be offset by elimination of the

need for potential filers to become

familiar with two separate sets of

regulations implementing the filing

requirements of the Exchange Act.

Statutory Basis

The revisions to the FDIC’s rules

under sections 12, 13, 14(a), 14(c), 14(d),

14(f) and 16 of the Exchange Act, are

being adopted by the FDIC pursuant to

Exchange Act section 12(i).

List of Subjects in 12 CFR Part 335

Accounting, Banks, banking,

Confidential business information,

Reporting and recordkeeping

requirements, Securities.

For the reasons set forth in the

preamble, the FDIC proposes to revise

part 335 to read as follows:

PART 335—SECURITIES OF

NONMEMBER INSURED BANKS

Sec.

335.101 Scope of part, authority and OMB

control number.

335.111 Forms and schedules.

335.201 Securities exempted from

registration.

335.211 Registration and reporting.

335.221 Forms for registration of securities

and similar matters.

335.231 Certification, suspension of

trading, and removal from listing by

exchanges.

335.241 Unlisted trading.

335.251 Forms for notification of action

taken by national securities exchanges.

335.261 Exemptions; terminations; and

definitions.

335.301 Reports of issuers of securities

registered pursuant to section 12.

335.311 Forms for annual, quarterly,

current, and other reports of issuers.

335.321 Maintenance of records and

issuer’s representations in connection

with required reports

335.331 Acquisition statements and

acquisitions of securities by issuers.

335.401 Solicitations of proxies.

335.501 Tender offers.

335.601 Requirements of section 16 of the

Securities Exchange Act of 1934.

335.611 Initial statement of beneficial

ownership of securities (Form F–7).

335.612 Statement of changes in beneficial

ownership of securities (Form F–8).

335.613 Annual statement of beneficial

ownership of securities (Form F–8A).

335.701 Filing requirements, public

reference, and confidentiality.

335.801 Inapplicable SEC regulations; FDIC

substituted regulations; additional

information.

Authority: 15 U.S.C. 78l(i).

§ 335.101 Scope of part, authority and

OMB control number.

(a) This part is issued by the Federal

Deposit Insurance Corporation (the
33700 Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Proposed Rules

FDIC) under section 12(i) of the

Securities Exchange Act of 1934, as

amended (15 U.S.C. 78)(the Exchange

Act) and applies to all securities of FDIC

insured banks (including foreign banks

having an insured branch) which are

neither a member of the Federal Reserve

System nor a District bank (collectively

referred to as nonmember banks) that

are subject to the registration

requirements of section 12(b) or section

12(g) of the Exchange Act (registered

nonmember banks). The FDIC is vested

with the powers, functions, and duties

vested in the Securities and Exchange

Commission (the Commission or SEC) to

administer and enforce the provisions of

sections 12, 13, 14(a), 14(c), 14(d), 14(f),

and 16 of the Securities Exchange Act

of 1934, as amended (the Exchange

Act)(15 U.S.C. 78l, 78m, 78n(a), 78n(c),

78n(d), 78n(f), and 78p)), regarding

nonmember banks with one or more

classes of securities subject to the

registration provisions of sections 12(b)

and 12(g).

(b) This part generally incorporates

through cross reference, the regulations

of the SEC issued under sections 12, 13,

14(a), 14(c), 14(d), 14(f), and 16 of the

Exchange Act. References to the

Commission are deemed to refer to the

FDIC unless the context otherwise

requires.

(c) The Office of Management and

Budget has reviewed and approved the

recordkeeping and reporting required by

this part (OMB control number 3064–

0030).

§ 335.111 Forms and schedules.

The Exchange Act regulations of the

SEC, which are incorporated by cross

reference under this part, require the

filing of forms and schedules as

applicable. Reference is made to SEC

Exchange Act regulation 17 CFR

249.0–1 regarding the availability of all

applicable SEC Exchange Act forms.

Required schedules are codified and are

found within the context of the SEC’s

regulations. The filings of all applicable

SEC forms and schedules shall be made

with the FDIC at the address in this

section. They shall be titled with the

name of the FDIC in substitution for the

name of the SEC. Forms F–7 (§ 335.611),

F–8 (§ 335.612), F–8A (§ 335.613), are

FDIC forms which are issued under

section 16 of the Exchange Act and can

be obtained from the Registration and

Disclosure Section, Division of

Supervision, Federal Deposit Insurance

Corporation, 550 17th Street N.W.,

Washington, D.C. 20429. Reference is

also made to § 335.701 for general filing

requirements, public reference, and

confidentiality provisions.

§ 335.201 Securities exempted from

registration.

Persons generally subject to

registration requirements under

Exchange Act section 12 and subject to

this part, shall follow the applicable and

currently effective SEC regulations

relative to exemptions from registration

issued under sections 3 and 12 of the

Exchange Act as codified at 17 CFR

240.3a12–1 through 240.3a12–11;

240.12a–4 through 240.12a–7; 240.12g–

1 through 240.12h–4.

§ 335.211 Registration and reporting.

Persons with securities subject to

registration under Exchange Act

sections 12(b) and 12(g), required to

report under Exchange Act section 13,

and subject to this part shall follow the

applicable and currently effective SEC

regulations issued under section 12(b) of

the Exchange Act as codified at 17 CFR

240.12b–1 through 240.12b-36.

§ 335.221 Forms for registration of

securities and similar matters.

(a) The applicable forms for

registration of securities and similar

matters are codified in subpart C of 17

CFR part 249. All forms shall be filed

with the FDIC as appropriate and shall

be titled with the name of the FDIC

instead of the SEC.

(b) The requirements for Financial

Statements can generally be found in

Regulation S-X (17 CFR part 210). Banks

may also refer to the instructions for

FFIEC Reports of Income and Reports of

Condition when preparing unaudited

interim statements. The requirements

for Management’s Discussion and

Analysis of Financial Condition and

Results of Operations can be found at 17

CFR 229.300. Industry Guide 3,

Statistical Disclosure by Bank Holding

Companies, is codified at 17 CFR

229.802.

(c) A ‘‘small business issuer’’, as

defined under 17 CFR 240.12b–2, has

the option of filing Small Business (SB)

Forms (as codified in 17 CFR part 249)

in lieu of the Exchange Act forms

otherwise required to be filed, which

provide for financial and other item

disclosures in conformance with

Regulation S–B of the Securities and

Exchange Commission (17 CFR part

228). The definition of ‘‘small business

issuer’’, generally includes banks with

annual revenues of less than $25

million, whose voting stock does not

have a public float of $25 million or

more.

§ 335.231 Certification, suspension of

trading, and removal from listing by

exchanges.

The provisions of the applicable and

currently effective SEC regulations

under section 12(d) of the Exchange Act

shall be followed as codified at 17 CFR

240.12d1–1 through 240.12d2–2.

§ 335.241 Unlisted trading.

The provisions of the applicable and

currently effective SEC regulations

under section 12(f) of the Exchange Act

shall be followed as codified at 17 CFR

240.12f–1 through 17 CFR 240.12f–6.

§ 335.251 Forms for notification of action

taken by national securities exchanges.

The applicable forms for notification

of action taken by national securities

exchanges are codified in subpart A of

17 CFR part 249. All forms shall be filed

with the FDIC as appropriate and shall

be titled with the name of the FDIC

instead of the SEC.

§ 335.261 Exemptions; terminations; and

definitions.

The provisions of the applicable and

currently effective SEC regulations

under sections 12(g) and 12(h) of the

Exchange Act shall be followed as

codified at 17 CFR 240.12g–1 through

240.12h–4.

§ 335.301 Reports of issuers of securities

registered pursuant to section 12.

The provisions of the applicable and

currently effective SEC regulations

under section 13(a) of the Exchange Act

shall be followed as codified at 17 CFR

240.13a-1 through 240.13a-17.

§ 335.311 Forms for annual, quarterly,

current and other reports of issuers.

(a) The applicable forms for annual,

quarterly, current, and other reports are

codified in subpart D of 17 CFR part

249. All forms shall be filed with the

FDIC as appropriate and shall be titled

with the name of the FDIC instead of the

SEC.

(b) The requirements for Financial

Statements can generally be found in

Regulation S–X (17 CFR part 210).

Banks may also refer to the instructions

for FFIEC Reports of Income and

Reports of Condition when preparing

unaudited interim reports. The

requirements for Management’s

Discussion and Analysis of Financial

Condition and Results of Operations can

be found at 17 CFR 229.300. Industry

Guide 3, Statistical Disclosure by Bank

Holding Companies, is codified at 17

CFR 229.802.

(c) A ‘‘small business issuer’’, as

defined under 17 CFR 240.12b–2, has

the option of filing Small Business (SB)

Forms (as codified in 17 CFR part 249)

in lieu of the Exchange Act forms

otherwise required to be filed, which

provide for financial and other item

disclosures in conformance with

Regulation S–B of the Securities and
Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Proposed Rules 33701

Exchange Commission (17 CFR part

228). The definition of ‘‘small business

issuer’’, generally includes banks with

annual revenues of less than $25

million, whose voting stock does not

have a public float of $25 million or

more.

§ 335.321 Maintenance of records and

issuer’s representations in connection with

required reports.

The provisions of the applicable and

currently effective SEC regulations

under section 13(b) of the Exchange Act

shall be followed as codified at 17 CFR

240.13d2–1 through 240.13b2–2.

§ 335.331 Acquisition statements and

acquisitions of securities by issuers.

The provisions of the applicable and

currently effective SEC regulations

under section 13(d) and 13(e) of the

Exchange Act shall be followed as

codified at 17 CFR 240.13d–1 through

240.13e–102.

§ 335.401 Solicitations of proxies.

The provisions of the applicable and

currently effective SEC regulations

under section 14(a) and 14(c) of the

Exchange Act shall be followed as

codified at 17 CFR 240.14a–1 through

17 CFR 240.14a–103 and 17 CFR

240.14c–1 through 240.14c–101.

§ 335.501 Tender offers.

The provisions of the applicable and

currently effective SEC regulations

under section 14(d), 14(e), and 14(f) of

the Exchange Act shall be followed as

codified at 17 CFR 240.14d–1 through

240.14f–1.

335.601 Requirements of section 16 of the

Securities Exchange Act of 1934.

Persons subject to section 16 of the

Act with respect to securities registered

under this part shall follow the

applicable and currently effective SEC

regulations issued under section 16 of

the Act (17 CFR 240.16a–1 through

240.16e–1), except that the forms

described in § 335.611 (Form F–7),

§ 335.612 (Form F–8), and § 335.613

(Form F–8A) shall be used in lieu of

SEC Form 3 (17 CFR 249.103), Form 4

(17 CFR 249.104), or Form 5 (17 CFR

249.105), respectively. Copies of Forms

F–7, F–8, F–8A and the instructions

thereto can be obtained from the

Registration and Disclosure Section,

Division of Supervision, Federal Deposit

Insurance Corporation, 550 17th Street

N.W., Washington, D.C. 20429.

§ 335.611 Initial statement of beneficial

ownership of securities (Form F–7).

This form shall be filed in lieu of SEC

Form 3 pursuant to SEC rule 16a–3 (17

CFR 240.16a–3) for initial statements of

beneficial ownership of securities. The

FDIC is authorized to solicit the

information required by this form

pursuant to sections 16(a) and 23(a) of

the Securities Exchange Act of 1934 (15

U.S.C. 78p and 78w) and the rules and

regulations thereunder. SEC regulations

referenced in this form are codified at

17 CFR 240.16a–1 through 240.16e–1.

§ 335.612 Statement of changes in

beneficial ownership of securities (Form F–

8).

This form shall be filed pursuant to

SEC rule 16a–3 (17 CFR 240.16a–3) for

statements of changes in beneficial

ownership of securities. The FDIC is

authorized to solicit the information

required by this form pursuant to

sections 16(a) and 23(a) of the Securities

Exchange Act of 1934 (15 U.S.C. 78p

and 78w) and the rules and regulations

thereunder. SEC regulations referenced

in this form are codified at 17 CFR

240.16a–1 through 240.16e–1.

§ 335.613 Annual statement of beneficial

ownership of securities (Form F–8A).

This form shall be filed pursuant to

SEC rule 16a–3 (17 CFR 240.16a–3) for

annual statements of beneficial

ownership of securities. The FDIC is

authorized to solicit the information

required by this form pursuant to

sections 16(a) and 23(a) of the Securities

Exchange Act of 1934 (15 U.S.C. 78p

and 78w), and the rules and regulations

thereunder. SEC regulations referenced

in this form are codified at 17 CFR

240.16a–1 through 240.16e–1.

§ 335.701 Filing requirements, public

reference, and confidentiality.

(a) Filing requirements. Unless

otherwise indicated in this part, one

original and four conformed copies of

all papers required to be filed with the

FDIC under the Exchange Act or

regulations thereunder shall be filed at

its office in Washington, D.C. Official

filings made at the FDIC’s office in

Washington, D.C. should be addressed

as follows: Attention: Registration and

Disclosure Section, Division of

Supervision, Federal Deposit Insurance

Corporation, 550 17th Street N.W.,

Washington, D.C. 20429. Material may

be filed by delivery to the FDIC through

the mails or otherwise. The date on

which papers are actually received by

the FDIC shall be the date of filing

thereof if all of the requirements with

respect to the filing have been complied

with.

(b) Inspection. Except as provided in

paragraph (c) of this section, all

information filed regarding a security

registered with the FDIC will be

available for inspection at the Federal

Deposit Insurance Corporation, 550 17th

Street N.W., Washington, D.C.

(c) Nondisclosure of certain

information filed. Any person filing any

statement, report, or document under

the Act may make written objection to

the public disclosure of any information

contained therein in accordance with

the procedure set forth below.

(1) The person shall omit from the

statement, report, or document, when it

is filed, the portion thereof that it

desires to keep undisclosed (hereinafter

called the confidential portion). In lieu

thereof, it shall indicate at the

appropriate place in the statement,

report, or document that the

confidential portion has been so omitted

and filed separately with the FDIC.

(2) The person shall file with the

copies of the statement, report, or

document filed with the FDIC:

(i) As many copies of the confidential

portion, each clearly marked

‘‘Confidential Treatment’’, as there are

copies of the statement, report, or

document filed with the FDIC and with

each exchange, if any. Each copy shall

contain the complete text of the item

and, notwithstanding that the

confidential portion does not constitute

the whole of the answer, the entire

answer thereto; except that in case the

confidential portion is part of a financial

statement or schedule, only the

particular financial statement or

schedule need be included. All copies

of the confidential portion shall be in

the same form as the remainder of the

statement, report, or document;

(ii) An application making objection

to the disclosure of the confidential

portion. Such application shall be on a

sheet or sheets separate from the

confidential portion, and shall contain:

(A) An identification of the portion of

the statement, report, or document that

has been omitted;

(B) a statement of the grounds of

objection;

(C) consent that the FDIC may

determine the question of public

disclosure upon the basis of the

application, subject to proper judicial

reviews;

(D) the name of each exchange, if any,

with which the statement, report, or

document is filed;

(iii) The copies of the confidential

portion and the application filed in

accordance with this paragraph shall be

enclosed in a separate envelope marked

‘‘Confidential Treatment’’ and

addressed to Executive Secretary,

Federal Deposit Insurance Corporation,

Washington, D.C. 20429.

(3) Pending the determination by the

FDIC as to the objection filed in

accordance with paragraph (c)(2)(ii) of
33702 Federal Register / Vol. 61, No. 126 / Friday, June 28, 1996 / Proposed Rules

this section, the confidential portion

will not be disclosed by FDIC.

(4) If the FDIC determines that the

objection shall be sustained, a notation

to that effect will be made at the

appropriate place in the statement,

report, or document.

(5) If the FDIC shall have determined

that disclosure of the confidential

portion is in the public interest, a

finding and determination to that effect

will be entered and notice of the finding

and determination will be sent by

registered or certified mail to the

person.

(6) The confidential portion shall be

made available to the public:

(i) Upon the lapse of 15 days after the

dispatch of notice by registered or

certified mail of the finding and

determination of the FDIC described in

paragraph (c)(5) of this section, if prior

to the lapse of such 15 days the person

shall not have filed a written statement

that he intends in good faith to seek

judicial review of the finding and

determination;

(ii) Upon the lapse of 60 days after the

dispatch of notice by registered or

certified mail of the finding and

determination of the FDIC, if the

statement described in paragraph

(c)(6)(i) of this section shall have been

filed and if a petition for judicial review

shall not have been filed within such 60

days; or

(iii) If such petition for judicial review

shall have been filed within such 60

days upon final disposition, adverse to

the person, of the judicial proceedings.

(7) If the confidential portion is made

available to the public, a copy thereof

shall be attached to each copy of the

statement, report, or document filed

with the FDIC and with each exchange

concerned.

§ 335.801 Inapplicable SEC regulations;

FDIC substituted regulations; additional

information.

(a) Filing fees. Filing fees will not be

charged relative to any filings or

submissions of materials made with the

FDIC pursuant to the cross reference to

regulations of the SEC issued under

sections 12, 13, 14(a), 14(c), 14(d), 14(f),

and 16 of the Exchange Act, and this

part.

(b) Electronic filings. The FDIC does

not participate in the SEC’s EDGAR

(Electronic Data Gathering Analysis and

Retrieval) electronic filing program (17

CFR part 232), and does not permit

electronically transmitted filings or

submissions of materials in electronic

format to the FDIC.

(c) Legal proceedings. Whenever this

part or cross referenced provisions of

the SEC regulations require disclosure

of legal proceedings, administrative or

judicial proceedings arising under

section 8 of the Federal Deposit

Insurance Act shall be deemed material

and shall be described.

(d) Indebtedness of management.

Whenever this part or cross referenced

provisions of the SEC regulations

require disclosure of indebtedness of

management, extensions of credit to

specified persons in excess of ten (10)

percent of the equity capital accounts of

the bank or $5 million, whichever is

less, shall be deemed material and shall

be disclosed in addition to any other

required disclosure. The disclosure of

this material indebtedness shall include

the largest aggregate amount of

indebtedness (in dollar amounts, and as

a percentage of total equity capital

accounts at the time), including

extensions of credit or overdrafts,

endorsements and guarantees

outstanding at any time since the

beginning of the bank’s last fiscal year

and as of the latest practicable date.

(1) If aggregate extensions of credit to

all specified persons as a group

exceeded 20 percent of the equity

capital accounts of the bank at any time

since the beginning of the last fiscal

year, the aggregate amount of such

extensions of credit shall also be

disclosed.

(2) Other loans are deemed material

and shall be disclosed where:

(i) The extension(s) of credit were not

made on substantially the same terms,

including interest rates, collateral and

repayment terms as those prevailing at

the time for comparable transactions

with other than the specified persons;

(ii) The extension(s) of credit were not

made in the ordinary course of business;

or

(iii) The extension(s) of credit have

involved or presently involve more than

a normal risk of collectibility or other

unfavorable features including the

restructuring of an extension of credit,

or a delinquency as to payment of

interest or principal.

(e) Additional information; filing of

other statements in certain cases. (1) In

addition to the information expressly

required to be included in a statement,

form, schedule or report, there shall be

added such further material

information, if any, as may be necessary

to make the required statements, in light

of the circumstances under which they

are made, not misleading.

(2) The FDIC may, upon the written

request of the bank, and where

consistent with the protection of

investors, permit the omission of one or

more of the statements or disclosures

herein required, or the filing in

substitution therefor of appropriate

statements or disclosures of comparable

character.

(3) The FDIC may also require the

filing of other statements or disclosures

in addition to, or in substitution for

those herein required in any case where

such statements are necessary or

appropriate for an adequate presentation

of the financial condition of any person

whose financial statements are required,

or disclosure about which is otherwise

necessary for the protection of investors.

By Order of the Board of Directors.

Dated at Washington, DC this 17th day of

June, 1996.

Federal Deposit Insurance Corporation.

Robert E. Feldman,

Deputy Executive Secretary.

[FR Doc. 96–16256 Filed 6–27–96; 8:45 am]

BILLING CODE 6714–01–P

ENVIRONMENTAL PROTECTION

AGENCY

40 CFR Part 52

[KY86–2–6933b; FRL–5456–3]

Approval and Promulgation of

Implementation Plans Kentucky:

Approval of Revisions to the Kentucky

State Implementation Plan

AGENCY: Environmental Protection

Agency (EPA).

ACTION: Proposed rule.

SUMMARY: EPA is approving revisions to

the Kentucky State Implementation Plan

(SIP) submitted on December 29, 1994,

by the Commonwealth of Kentucky

through the Natural Resources and

Environmental Protection Cabinet

(Cabinet). The revisions pertain to

Kentucky regulations 401 KAR 59:101

New Bulk Gasoline Plants and 401 KAR

61:056 Existing Bulk Gasoline Plants.

The revisions were the subject of a

public hearing held on July 26, 1994,

and became state effective September

28, 1994. The intended effect of these

revisions is to clarify certain provisions

and ensure consistency with

requirements of the Clean Air Act.

In the final rules section of this

Federal Register, the EPA is approving

the State’s SIP revision as a direct final

rule without prior proposal because the

EPA views this as a noncontroversial

revision amendment and anticipates no

adverse comments. A detailed rationale

for the approval is set forth in the direct

final rule. If no adverse comments are

received in response to this proposed

rule, no further activity is contemplated

in relation to this proposed rule. If EPA

receives adverse comments, the direct

final rule will be withdrawn and all