Federal Register / Vol. 75, No. 189 / Thursday, September 30, 2010 / Proposed Rules 60347 

such as a negotiable order of withdrawal 

(‘‘NOW’’) account, money-market deposit 

account, or Interest on Lawyers Trust 

Account (‘‘IOLTA’’), even if checks may be 

drawn on the account. 

The temporary full insurance coverage of 

‘‘noninterest-bearing transaction accounts’’ 

expires on December 31, 2012. After 

December 31, 2012, funds in noninterestbearing transaction accounts will be insured 

under the FDIC’s general deposit insurance 

rules, subject to the Standard Maximum 

Deposit Insurance Amount of $250,000. 

For more information about FDIC 

insurance coverage of transaction accounts, 

visit http://www.fdic.gov. 

(2) Institutions participating in the 

FDIC’s Transaction Account Guarantee 

Program on December 31, 2010, must 

provide a notice by mail to depositors 

with negotiable order of withdrawal 

accounts that are protected in full as of 

that date under the Transaction Account 

Guarantee Program and to depositors 

with Interest on Lawyer Trust Accounts 

that, as of January 1, 2011, such 

accounts no longer will be eligible for 

unlimited protection, but instead will be 

insured under the general insurance 

rules up to the SMDIA of $250,000. This 

notice must be provided to such 

depositors no later than December 31, 

2010. 

(3) If an institution uses sweep 

arrangements, modifies the terms of an 

account, or takes other actions that 

result in funds no longer being eligible 

for full coverage under this section, the 

institution must notify affected 

customers and clearly advise them, in 

writing, that such actions will affect 

their deposit insurance coverage. 

By order of the Board of Directors. 

Dated at Washington DC, this 27th day of 

September 2010. Federal Deposit Insurance 

Corporation. 

Robert E. Feldman, 

Executive Secretary. 

[FR Doc. 2010–24594 Filed 9–29–10; 8:45 am] 

BILLING CODE 6714–01–P 

FEDERAL HOUSING FINANCE BOARD 

12 CFR Part 914 

FEDERAL HOUSING FINANCE 

AGENCY 

12 CFR Part 1260 

RIN 2590–AA35 

Information Sharing Among Federal 

Home Loan Banks 

AGENCY: Federal Housing Finance 

Agency. 

ACTION: Notice of proposed rulemaking; 

request for comments. 

SUMMARY: Section 1207 of the Housing 

and Economic Recovery Act of 2008 

(HERA) amended the Federal Home 

Loan Bank Act (Bank Act) to require the 

Federal Housing Finance Agency 

(FHFA) to make available to each 

Federal Home Loan Bank (Bank) 

information relating to the financial 

condition of all other Banks. Section 

1207 also requires FHFA to promulgate 

regulations to facilitate the sharing of 

such information among the Banks. This 

proposed rule would implement those 

HERA provisions, and also would 

transfer to new part 1260, without 

substantive change, existing regulations 

of the former Federal Housing Finance 

Board (Finance Board) relating to the 

filing of regulatory reports by the Banks. 

DATES: Written comments must be 

received on or before November 29, 

2010. 

ADDRESSES: You may submit your 

comments, identified by regulatory 

information number (RIN) 2590–AA35, 

by any of the following methods: 

• E-mail: Comments to Alfred M. 

Pollard, General Counsel may be sent by 

e-mail to RegComments@fhfa.gov. 

Please include ‘‘RIN 2590–AA35’’ in the 

subject line of the message. 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. If 

you submit your comment to the 

Federal eRulemaking Portal, please also 

send it by e-mail to FHFA at 

RegComments@fhfa.gov to ensure 

timely receipt by FHFA. Please include 

‘‘RIN 2590–AA35’’ in the subject line of 

the message. 

• U.S. Mail, United Parcel Service, 

Federal Express, or Other Mail Service: 

The mailing address for comments is: 

Alfred M. Pollard, General Counsel, 

Attention: Comments/RIN 2590–AA35, 

Federal Housing Finance Agency, 

Fourth Floor, 1700 G Street, NW., 

Washington, DC 20552. 

• Hand Delivered/Courier: The hand 

delivery address is: Alfred M. Pollard, 

General Counsel, Attention: Comments/ 

RIN 2590–AA35, Federal Housing 

Finance Agency, Fourth Floor, 1700 G 

Street, NW., Washington, DC 20552. The 

package should be logged at the Guard 

Desk, First Floor, on business days 

between 9 a.m. and 5 p.m. 

FOR FURTHER INFORMATION CONTACT: Eric 

M. Raudenbush, Assistant General 

Counsel, Office of General Counsel, 

eric.raudenbush@fhfa.gov, (202) 414– 

6421 (this is not a toll-free number); 

Federal Housing Finance Agency, 

Fourth Floor, 1700 G Street, NW., 

Washington, DC 20552; Daniel E. 

Coates, Associate Director, Division of 

FHLBank Regulation, 

daniel.coates@fhfa.gov, (202) 408–2959 

(this is not a toll-free number), Federal 

Housing Finance Agency, 1625 Eye 

Street, NW., Washington, DC 20006. The 

telephone number for the 

Telecommunications Device for the 

Hearing Impaired is (800) 877–8339. 

SUPPLEMENTARY INFORMATION: 

I. Comments 

FHFA invites comments on all aspects 

of the proposed rule and will take all 

comments into consideration before 

issuing the final rule. Copies of all 

comments will be posted without 

change, including any personal 

information you provide, such as your 

name and address, on FHFA’s Internet 

Web site at http://www.fhfa.gov. In 

addition, copies of all comments 

received will be available for 

examination by the public on business 

days between the hours of 10 a.m. and 

3 p.m. at the Federal Housing Finance 

Agency, Fourth Floor, 1700 G Street, 

NW., Washington, DC 20552. To make 

an appointment to inspect comments, 

please call the Office of General Counsel 

at (202) 414–6924. 

II. Background 

A. The Federal Home Loan Bank System 

(Bank System) 

The Bank System consists of 12 Banks 

and the Office of Finance (OF). The 

Banks are instrumentalities of the 

United States organized under the 

Federal Home Loan Bank Act (Bank 

Act). See 12 U.S.C. 1423, 1432(a). The 

Banks are cooperatives; only members 

of a Bank may purchase its capital stock, 

and only members or certain eligible 

housing associates (such as state 

housing finance agencies) may obtain 

access to secured loans, known as 

advances, or other products provided by 

a Bank. See 12 U.S.C. 1426(a)(4), 

1430(a), 1430b. Each Bank is managed 

by its own board of directors and serves 

the public interest by enhancing the 

availability of residential mortgage and 

community lending credit through its 

member institutions. See 12 U.S.C. 

1427. Any eligible institution (generally 

a federally insured depository 

institution or state-regulated insurance 

company) may become a member of a 

Bank if it satisfies certain criteria and 

purchases a specified amount of the 

Bank’s capital stock. See 12 U.S.C. 1424; 

12 CFR part 1263. 

B. New Statutory Provision Requiring 

the Sharing of Bank Information 

Section 1207 of HERA added a new 

section 20A to the Bank Act, 12 U.S.C. 

1440a, that requires FHFA to make 

available to each Bank such reports, 


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60348 Federal Register / Vol. 75, No. 189 / Thursday, September 30, 2010 / Proposed Rules 

1HERA amended certain aspects of section 11 of 

the Bank Act, relating to the issuance of 

consolidated obligations and the role of the OF in 

that process. FHFA intends to make conforming 

revisions to the regulations now located at part 966, 

and to relocate those provisions to an appropriate 

place in FHFA’s regulations. 

records, or other information as may be 

available, relating to the condition of 

any other Bank in order to enable each 

Bank to evaluate the financial condition 

of the other Banks and the Bank System 

as a whole. The underlying objective for 

that requirement is that such 

information will better enable each 

Bank to assess the likelihood that it may 

be required to make payments on behalf 

of another Bank under the joint and 

several liability on the Banks’ 

Consolidated Obligations (COs), as well 

as to comply with its disclosure 

obligations under the Securities 

Exchange Act of 1934 (1934 Act) (both 

of which are discussed in detail below). 

See 12 U.S.C. 1440a(a). Section 20A 

further requires FHFA to promulgate 

regulations to facilitate the sharing of 

such financial information among the 

Banks. See 12 U.S.C. 1440a(b)(1). 

Section 20A permits a Bank to request 

that FHFA determine that particular 

information that may otherwise be made 

available is proprietary and that the 

public interest requires that such 

information not be shared. See 12 U.S.C. 

1440a(b)(2). Finally, section 20A 

provides that it does not affect the 

obligations of the Banks under the 1934 

Act and related regulations of the 

Securities and Exchange Commission 

(SEC), and that the sharing of Bank 

information thereunder shall not cause 

FHFA to waive any privilege applicable 

to the shared information. See 12 U.S.C. 

1440a(c), (d). 

C. Banks’ Joint and Several Liability and 

Disclosure Requirements on COs 

The Banks fund their operations 

principally through the issuance of the 

COs, which are debt instruments issued 

on behalf of the Banks by the OF, a joint 

office of the Banks, pursuant to section 

11 of the Bank Act, 12 U.S.C. 1431, and 

part 966 of the regulations of the 

Finance Board, 12 CFR part 966.1 Under 

these regulations, the COs may be 

issued only through OF as agent for the 

Banks and the Banks are jointly and 

severally liable for the timely payment 

of principal and interest on all COs 

when due. See 12 CFR 966.2(b), 

966.9(a). Accordingly, even when COs 

are issued with one Bank being the 

primary obligor, the ultimate liability 

for the timely payment of principal and 

interest thereon remains with all of the 

Banks collectively. By virtue of their 

status as government-sponsored 

enterprises (GSEs) and the soundness of 

the Banks’ secured lending (advances) 

business over many years, the Banks 

typically can borrow funds in the 

capital markets at favorable rates. The 

Banks pass along a portion of their GSE 

funding advantage to their member 

institutions—and ultimately to 

consumers—by providing advances and 

other financial services at rates that may 

not otherwise be available to their 

members. 

Although the COs themselves are not 

registered securities under the federal 

securities laws, the Finance Board 

adopted regulations in 2004 requiring 

each Bank to register a class of its 

common stock (which is issued only to 

its member institutions) with the SEC 

under section 12(g) of the 1934 Act, 15 

U.S.C. 78l(g). See 69 FR 38811 (June 29, 

2004), codified at 12 CFR part 998. Each 

Bank subsequently registered a class of 

its common stock with the SEC in 

compliance with that regulation. 

Separately, HERA included a provision 

requiring the Banks to register their 

common stock under section 12(g) of the 

1934 Act, and to maintain that 

registration. See 15 U.S.C. 78oo(b). 

Accordingly, each Bank remains subject 

to the periodic disclosure requirements 

established under the 1934 Act, as 

interpreted and administered by the 

SEC. 

D. Considerations of Differences 

Between the Banks and the Enterprises 

Section 1201 of HERA amended the 

Federal Housing Enterprises Financial 

Safety and Soundness Act of 1992 to 

add a new section 1313(f), which 

requires the Director of FHFA, when 

promulgating regulations relating to the 

Banks, to consider the differences 

between the Banks and the Enterprises 

(Fannie Mae and Freddie Mac) as they 

relate to: the Banks’ cooperative 

ownership structure; the mission of 

providing liquidity to members; the 

affordable housing and community 

development mission; their capital 

structure; and their joint and several 

liability on consolidated obligations. 

See HERA, section 1201, Public Law 

110–289, 122 Stat. 2782–83 (amending 

12 U.S.C. 4513). The Director also may 

consider any other differences that are 

deemed appropriate. In preparing this 

proposed rule, FHFA considered the 

differences between the Banks and the 

Enterprises as they relate to the above 

factors. FHFA requests comments from 

the public about whether differences 

related to these factors should result in 

any revisions to the proposal. 

III. The Proposed Rule 

The proposed rule would add a new 

part 1260 to the regulations of FHFA to 

govern the handling of Bank records, 

reports, and other information. It would 

transfer material relating to Bank 

regulatory reports from part 914 of the 

regulations of the Finance Board to new 

part 1260 and would remove part 914. 

It would also create new provisions 

within part 1260 to govern the sharing 

of information among Banks, as required 

by section 20A of the Bank Act. The 

substance of each provision of the 

proposed rule is described in the 

following paragraphs. 

Section 1260.1—Definitions 

Proposed § 1260.1 would include a 

series of definitions, most of which 

would relate to the provisions to be 

relocated from part 914 of the 

regulations of the Finance Board. The 

definitions of the acronyms ‘‘AHP,’’ 

‘‘AMA,’’ ‘‘CICA,’’ and ‘‘CIP’’ (which are 

used in § 1260.2, discussed below) 

would be substantively identical to the 

definitions of those terms set forth in 12 

CFR part 900, which applies to 12 CFR 

chapter IX, including current part 914. 

In addition, the proposed rule would 

transfer to § 1260.1, without substantive 

change, the definition of the term 

‘‘Regulatory Report’’ that is currently set 

forth in 12 CFR 914.1. Finally, § 1260.1 

would also contain definitions for the 

short forms ‘‘Bank,’’ ‘‘Bank Act,’’ and 

‘‘FHFA.’’ 

Section 1260.2—Filing Regulatory 

Reports 

The proposed rule would transfer to 

§ 1260.2 from § 914.2 of the Finance 

Board’s regulations a provision 

requiring each Bank to file regulatory 

reports with FHFA, as requested by the 

agency. As defined in § 1260.1, these 

regulatory reports would include any 

report of data needed to evaluate the 

safety and soundness of the Bank’s 

operations or its compliance with 

statutory requirements, or with 

regulations, orders or other 

requirements imposed by FHFA. 

Proposed § 1260.2 is identical to current 

§ 914.2, except that § 1260.2 would 

expressly refer to FHFA as regulator of 

the Banks instead of the former Finance 

Board. 

Section 1260.3—Sharing of Information 

Among the Banks 

Paragraph (a) of proposed § 1260.3 

sets forth the operative provisions of the 

regulation that implement section 20A 

of the Bank Act, which identify the 

information to be shared and describe 

the manner in which FHFA will share 

that information. The information to be 


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Federal Register / Vol. 75, No. 189 / Thursday, September 30, 2010 / Proposed Rules 60349 

2FHFA also reviews the annual combined Bank 

System financial statements prepared by OF on 

behalf of the Banks. The agency then issues a letter 

to the OF board of directors that provides 

recommendations for enhanced disclosures. This 

also would not be distributed to the Banks under 

the proposed rule, for the same reason. 

shared will include the final report of 

examination for each Bank, along with 

any other supervisory reports that FHFA 

presents to the board of directors of any 

Bank. Documents that are related to the 

reports of examination but are not part 

of the report, such as work programs, 

conclusions memoranda, and findings 

memoranda, would not be included 

among the materials to be distributed to 

the Banks. FHFA is proposing to 

distribute the reports of examination to 

each of the other Banks and OF as a 

matter of routine, rather than in 

response to individual requests, and to 

do so soon after the report has been 

finalized and presented to the board of 

directors of the subject Bank. Because 

OF is a joint office of the Banks and 

because it is charged with preparing the 

combined financial reports for the Bank 

System, FHFA is proposing to distribute 

to OF copies of the reports for all of the 

Banks. Although OF is examined by 

FHFA in the same manner as the Banks, 

FHFA is not proposing to distribute to 

the Banks the report of examination for 

OF because all twelve Bank presidents 

sit on OF’s board of directors and, 

therefore, would already have access to 

the report.2 Paragraph (a) also notes that 

the distribution of information under 

this provision is subject to the 

requirements set forth in paragraphs (b) 

through (d) of the proposal, which 

reflect the statutory provisions relating 

to the withholding of certain proprietary 

information. 

Section 20A of the Bank Act reflects 

a determination by Congress that 

providing greater access to financial 

information relating to all of the other 

Banks will help each Bank assess its 

potential exposure to joint and several 

liability on the COs, as well as the 

accuracy of its disclosure documents 

under the 1934 Act. At present, each 

Bank already has access to a significant 

amount of information about the 

financial condition of the other Banks. 

That information includes the quarterly 

and annual reports that each Bank files 

with the SEC under the 1934 Act, which 

reports must disclose all material 

business and financial information 

about the particular Bank. It also 

includes the call reports that each Bank 

files with FHFA, as well as the quarterly 

certifications that each Bank must file 

with FHFA attesting to its ability to 

make full and timely payments on its 

current obligations during the next 

quarter. See 12 CFR 966.9(b)(1), (2). The 

Banks also have access to FHFA’s 

Annual Report to Congress (required 

under 12 U.S.C. 4521(a)), which 

summarizes the conclusions set forth in 

each Bank’s report of examination. 

FHFA believes that by providing each 

Bank with access to the actual reports of 

examination and other supervisory 

reports presented to the boards of 

directors of the other Banks, the 

proposed rule would enable each Bank 

to better evaluate the other financial 

information already available and thus 

make a more informed assessment about 

the financial condition of each of the 

other Banks. The reports of examination 

and other supervisory reports would 

include more detailed information than 

is currently available to the Banks. 

Among other things, the report of 

examination typically sets forth the 

examiners’ assessment of the strength of 

the Bank’s corporate governance, its 

management of market risk, credit risk 

and operational risk, and its overall 

financial condition and performance. 

Based on these assessments, the report 

also may enumerate matters that require 

corrective action by, or under the 

supervision of, the Bank’s board of 

directors and the dates by which such 

corrective action is to be completed. The 

Banks are well-suited to evaluate the 

information contained in a report of 

examination as a result of their own 

experience with the examination 

process. 

Although FHFA believes that its 

distribution of the reports of 

examination and other supervisory 

reports will provide the Banks with the 

type of information contemplated by the 

statute, FHFA requests comments on 

whether other types of documents also 

should be made available under this 

regulation. FHFA also requests 

comments on whether the rule should 

allow FHFA to expand the categories of 

information to be distributed to the 

Banks without undertaking a 

subsequent rulemaking, i.e., whether the 

Director or his designee may expand the 

categories of information to be 

disseminated through a less formal 

means, such as by order or staff action. 

FHFA believes that the approach 

embodied in the proposed rule, i.e., 

where FHFA provides supervisory 

information directly to each of the 

Banks rather than requiring the Banks to 

share supervisory information among 

themselves, is consistent with the 

requirements of section 20A and will 

achieve its objectives. Section 20A(a) 

generally directs FHFA to make 

available to all of the Banks information 

relating to the financial condition of all 

of the other Banks. Section 20A(b) 

separately directs FHFA to adopt 

regulations to facilitate the sharing of 

the information made available under 

section 20A(a) directly among the 

Banks. That latter provision appears to 

reflect a presumption that FHFA would 

implement the HERA amendments by 

requiring each Bank to provide copies of 

its report of examination and other 

supervisory reports directly to all of the 

other Banks. Because FHFA is 

proposing to distribute the reports of 

examination and other supervisory 

reports directly to all of the Banks, 

FHFA believes that the rule need not 

include a provision dealing with Bankto-Bank sharing of the reports of 

examination and other supervisory 

reports that FHFA presents to the board 

of directors. Moreover, as noted 

previously, the Banks currently share 

various types of other information 

among themselves on a voluntary basis, 

which suggests that there is no 

compelling need to mandate Bank-toBank sharing of particular categories of 

other information. FHFA requests 

comments on whether the rule should 

retain this approach. 

By statute, FHFA is required to 

conduct an on-site examination of each 

Bank at least annually to determine the 

condition of the entity for the purpose 

of ensuring its safety and soundness. 

See 12 U.S.C. 1440, 4517(a)–(b). Upon 

completion of each annual or special 

examination, FHFA examiners prepare a 

written report of examination for the 

Director of FHFA (as required by section 

20 of the Bank Act, 12 U.S.C. 1440), 

which is subsequently presented to the 

board of directors of the particular Bank. 

The report of examination is prepared 

for the Director of FHFA and, by 

regulation, remains the property of 

FHFA even when in the possession of 

a Bank, OF, a Bank member, or another 

government agency. See 12 U.S.C. 1440; 

12 CFR 911.3(c)(3). Accordingly, these 

reports, as well as any other supervisory 

correspondence, are subject to the 

restrictions on the disclosure of 

unpublished information set out in part 

911 of the regulations of the former 

Finance Board (which remain in effect 

until superseded by action of FHFA). 

Currently, the Banks are prohibited by 

regulation from sharing their reports of 

examination among themselves, or with 

any other outside party, except pursuant 

to the written consent of FHFA. See 12 

CFR 911.3(c)(1). In 2006, the Finance 

Board issued an Advisory Bulletin that 

permitted the Banks to disclose the 

factual content of a report of 

examination in the preparation of its 

SEC disclosure documents, but 

continued to prohibit the Banks from 

releasing the report of examination 


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60350 Federal Register / Vol. 75, No. 189 / Thursday, September 30, 2010 / Proposed Rules 

itself, or any portion of the report. See 

Federal Housing Finance Board 

Advisory Bulletin 2006–AB–03 (July 18, 

2006) (available online at http:// 

www.fhfa.gov/webfiles/13094/2006-AB03.pdf). The Advisory Bulletin 

specifically prohibited the sharing of 

reports of examination among the Banks 

even for the purpose of assessing the 

likelihood of having to make a payment 

on COs for which another Bank is the 

primary obligor. If FHFA adopts a final 

rule that requires it to provide 

examination reports to all of the Banks, 

FHFA also will consider whether any 

revisions to the Advisory Bulletin are 

necessary, such as to ensure that the 

Bulletin remains consistent with 

purposes of HERA while also ensuring 

that the Banks do not share the reports 

of examination that they receive from 

FHFA with any other parties. 

In the rule, FHFA is proposing to 

distribute only the final reports of 

examination, along with any other 

supervisory reports that FHFA has 

presented to a Bank’s board of directors, 

and to do so as a matter of course after 

each report has been finalized and 

presented to the Bank’s board, rather 

than making the reports available only 

upon the request of individual Banks. 

FHFA views the proposed distribution 

of the reports to all of the Banks as a 

matter of course as preferable to 

providing the reports only in response 

to a specific request from one or more 

of the Banks. First, the proposed 

approach would ensure that all Banks 

receive and use the same information in 

assessing their potential joint and 

several liability and in preparing their 

disclosure documents. Further, this 

approach would result in a more 

efficient and regular process for FHFA 

to administer and would establish a 

clear and standard timeframe for each 

Bank to review its own report of 

examination for any proprietary 

information that it believes should be 

withheld under the statutory standards 

of section 20A of the Bank Act. FHFA 

requests comments on whether the 

proposed distribution as a matter of 

course is the most appropriate means of 

providing information to the Banks. 

Paragraph (b) of proposed § 1260.3 

would implement the statutory 

requirement that each Bank be afforded 

the opportunity to request that the 

Director of FHFA not disclose particular 

information because the information is 

proprietary and the public interest 

requires that the information not be 

shared. Paragraph (b)(1) generally 

restates the statutory standard, which is 

a two-part test and requires that both 

parts must be satisfied in order for the 

Director or his designee to determine 

that the information should not be 

disclosed. Paragraph (b)(1) also would 

give each Bank a brief period of time 

within which to ask that FHFA not 

disclose certain information within the 

report of examination to the other 

Banks. In order to make such a request, 

a Bank must file a written request with 

FHFA that particular information 

contained in its report of examination or 

other supervisory report be redacted 

from the copy of the report to be 

distributed to the other Banks. Each 

entity would be required to file its 

request no later than the close of 

business on the tenth business day 

following the date on which FHFA 

presented the final report of 

examination or the supervisory report to 

the entity’s board of directors. 

FHFA believes that ten (10) business 

days is sufficient time for a Bank to 

review its report of examination or any 

other supervisory reports for proprietary 

information that it believes meets the 

standards for being withheld. First, 

through the receipt of draft reports and 

other supervisory correspondence, the 

Bank most likely will already be 

familiar with most of the contents of the 

reports well before they are presented to 

the Bank’s board of directors. Second, a 

final report of examination typically is 

not a lengthy document, and therefore 

should not require a lengthy period of 

time to review for proprietary 

information. The same should be true 

for other types of supervisory reports. 

Finally, in order for this process to 

achieve the statutory objectives, these 

reports of examination must be 

reasonably current, so that the 

recipients can evaluate them together 

with other current information relating 

to the financial condition of the Bank. 

FHFA requests comments on whether 

the final rule should allow each entity 

a different length of time within which 

to review its report of examination for 

proprietary information that it believes 

should not be disclosed. 

Paragraph (b)(2) of proposed § 1260.3 

would require the Director of FHFA, or 

such other FHFA officer as the Director 

may designate, to determine promptly 

whether to grant all or part of a request 

to withhold proprietary information that 

a Bank has made in accordance with the 

requirements of paragraph (b)(1). Any 

determination made by the Director or 

his designee under this paragraph 

would be final. 

Proposed § 1260.3(c) describes the 

process by which FHFA would 

distribute reports to the other Banks. 

The rule would require FHFA to 

distribute a report of examination or 

other supervisory report after the ten 

(10) business-day period noted above 

has expired without a request to 

withhold proprietary information, or 

after the Director or his designee has 

made a determination in response to 

such a request. If the Director or his 

designee determines that the report 

includes proprietary information that 

should not be disclosed, FHFA will 

distribute an appropriately redacted 

version of the report. The proposed rule 

would allow reports of examination and 

other supervisory reports to be 

distributed in either tangible or 

electronic form, as deemed appropriate 

on either an ongoing, or case-by-case, 

basis by FHFA. 

Section 20A(d) of the Bank Act states 

that the Director of FHFA shall not be 

deemed to have waived any privilege 

applicable to any information 

concerning a Bank by sharing 

information as required under section 

20A(a) of the statute. As mentioned 

above, reports of examination and other 

supervisory correspondence are 

considered to be privileged unpublished 

information that are subject to the 

restrictions on disclosure set forth in 

part 911 of the regulations of the 

Finance Board, which remains in effect. 

See 12 CFR 911.1, 911.3(c)(3). Proposed 

§ 1260.3(d) would make clear that 

reports of examination or any other 

privileged information that may be 

made available under § 1260.3 would 

remain subject to the restrictions set 

forth in part 911 of this title, or any 

future regulatory provisions dealing 

with the same subject matter that may 

be promulgated by FHFA. Proposed 

§ 1260.3(d) would operate in parallel 

with 12 CFR 911.3(a), which provides 

that possession or control of 

unpublished information by any entity, 

including the Banks and OF, does not 

constitute a waiver by FHFA of any 

privilege, or of its right to control, 

supervise, or impose limitations on the 

subsequent use and disclosure of the 

information. 

Because FHFA conducts examinations 

at various times over the course of a 

year, examination reports for different 

Banks are generated at different times 

during the year. Thus, if the rule were 

to apply only to reports of examination 

and supervisory reports that were 

prepared after the rule takes effect, it 

could take nearly one year for FHFA to 

distribute the reports for all twelve of 

the Banks. FHFA believes that a better 

approach would be to include in the 

rule a transition provision that allows 

FHFA to distribute the then-current 

reports of examination to all of the 

Banks and OF soon after the rule takes 

effect. Accordingly, proposed 

§ 1260.3(e) includes a transition 

provision that would require FHFA to 


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Federal Register / Vol. 75, No. 189 / Thursday, September 30, 2010 / Proposed Rules 60351 

distribute to each Bank and OF a copy 

of the most recent report of examination 

for each Bank as of the effective date of 

the final rule. Each Bank would be given 

ten (10) business days from the effective 

date of the final rule to submit to FHFA 

a written request to withhold 

proprietary information contained in the 

report of examination, in the manner 

described in paragraph (b)(1). Following 

the expiration of this review period, the 

reports of examination would be 

distributed as provided in paragraphs 

(b)(2) and (c) of proposed § 1260.3. 

FHFA requests comments regarding 

whether the transition provision should 

require the distribution of any reports of 

examination other than the most current 

report as of the effective date of the final 

rule, and, if so, to what extent, and 

whether any other types of documents 

should be provided as part of the initial 

distribution. 

IV. Paperwork Reduction Act 

The proposed rule does not contain 

any collections of information pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.). Therefore, 

FHFA has not submitted any 

information to the Office of 

Management and Budget for review. 

V. Regulatory Flexibility Act 

The proposed rule applies only to the 

Banks, which do not come within the 

meaning of small entities as defined in 

the Regulatory Flexibility Act (RFA). 

See 5 U.S.C. 601(6). Therefore, in 

accordance with section 605(b) of the 

RFA, FHFA certifies that this proposed 

rule, if promulgated as a final rule, will 

not have significant economic impact on 

a substantial number of small entities. 

List of Subjects 

12 CFR Part 914 

Federal home loan banks, Reporting 

and recordkeeping requirements. 

12 CFR Part 1260 

Confidential business information, 

Federal home loan banks, Reporting and 

recordkeeping requirements. 

Accordingly, for the reasons stated in 

the preamble and under the authority of 

12 U.S.C. 4526, the Federal Housing 

Finance Agency proposes to amend 

subchapter C of chapter IX and 

subchapter D of chapter XII of title 12 

of the Code of Federal Regulations as 

follows: 

CHAPTER IX—FEDERAL HOUSING 

FINANCE BOARD 

SUBCHAPTER C—GOVERNANCE AND 

MANAGEMENT OF THE FEDERAL HOME 

LOAN BANKS 

PART 914—[REMOVED] 

1. Remove part 914. 

CHAPTER XII—FEDERAL HOUSING 

FINANCE AGENCY 

SUBCHAPTER D—FEDERAL HOME LOAN 

BANKS 

2. Add part 1260 to subchapter D to 

read as follows: 

PART 1260—FILING OF REGULATORY 

REPORTS AND SHARING OF 

INFORMATION 

Sec. 

1260.1 Definitions. 

1260.2 Filing Regulatory Reports. 

1260.3 Sharing of information among 

Banks. 

Authority: 12 U.S.C. 1440, 1440a, 4511, 

4514, and 4517. 

§ 1260.1 Definitions. 

As used in this part: 

AHP means the Affordable Housing 

Program, the CICA program that each 

Bank is required to establish pursuant to 

section 10(j) of the Bank Act (12 U.S.C. 

1430(j)) and part 1291 of this chapter. 

AMA means those assets that may be 

acquired by a Bank under part 955 of 

this title. 

Bank, written in title case, means a 

Federal Home Loan Bank established 

under section 12 of the Bank Act (12 

U.S.C. 1432). 

Bank Act means the Federal Home 

Loan Bank Act, as amended (12 U.S.C. 

1421 through 1449). 

CICA means any advance made 

through a program offered by a Bank 

under section 10 of the Bank Act (12 

U.S.C. 1430), part 952 of this title, and 

part 1291 of this chapter to provide 

funding for targeted community lending 

and affordable housing. 

CIP means the Community Investment 

Program, an advance program under 

CICA required to be offered pursuant to 

section 10(i) of the Bank Act (12 U.S.C. 

1430(i)). 

FHFA means the Federal Housing 

Finance Agency. 

Regulatory Report means—(1) Any 

report to FHFA of raw or summary data 

needed to evaluate the safe and sound 

condition and operations of a Bank or to 

determine compliance with any: 

(i) Provision in the Bank Act or other 

law, order, rule, or regulation; 

(ii) Condition imposed in writing by 

FHFA in connection with the granting 

of any application or other request by a 

Bank; or 

(iii) Written agreement entered into 

between FHFA and a Bank; and 

(2) Includes, without limitation: 

(i) Call reports and reports of 

instrument-level risk modeling data; 

(ii) Reports related to a Bank’s 

housing mission achievement, such as 

reports related to AMA, AHP, CIP, and 

other CICA programs; and 

(iii) Reports submitted in response to 

requests to one or more Banks for 

information on a nonrecurring basis. 

§ 1260.2 Filing Regulatory Reports. 

Each Bank shall file Regulatory 

Reports with FHFA in accordance with 

the forms, instructions, and schedules 

issued by FHFA from time to time. If no 

regularly scheduled reporting dates are 

established, Regulatory Reports shall be 

filed as requested by FHFA. 

§ 1260.3 Sharing of information among 

Banks. 

(a) In general. In order to enable each 

Bank to evaluate the financial condition 

of any one or more of the other Banks 

and the Bank System, FHFA 

periodically shall distribute to each 

Bank and to the Office of Finance the 

final reports of examination (or such 

portions thereof that FHFA deems 

appropriate) of all other Banks, as well 

as any other supervisory reports that 

FHFA presents to the board of directors 

of a Bank, subject to the requirements 

set forth in paragraphs (b) through (d) of 

this section. 

(b) Requests to withhold proprietary 

information.—(1) After FHFA has 

presented a Bank’s report of 

examination or other supervisory report 

to its board of directors, the Bank shall 

have ten (10) business days within 

which to request in writing that 

particular information contained therein 

be withheld from disclosure because it 

is proprietary and the public interest 

requires that it not be shared. 

(2) After receiving a timely written 

request made under paragraph (b)(1) of 

this section, the Director or his designee 

shall promptly determine whether to 

redact any information from the report 

of examination or other supervisory 

report prior to distributing it to the other 

Banks and the Office of Finance. Such 

a determination shall be final. 

(c) Distribution of Information. After 

the expiration of the review period 

established under paragraph (b)(1) of 

this section without a request from the 

affected Bank, or after the Director or his 

designee has made a determination 

under paragraph (b)(2) of this section, 

FHFA shall distribute a copy of the 

report of examination or other 

supervisory report to each Bank and the 

Office of Finance in either tangible or 


jdjones on DSK8KYBLC1PROD with PROPOSALS-1
60352 Federal Register / Vol. 75, No. 189 / Thursday, September 30, 2010 / Proposed Rules 

electronic form, as FHFA shall deem 

appropriate. 

(d) No waiver of privilege. The release 

of information under this section does 

not constitute a waiver by FHFA of any 

privilege, or its right to control, 

supervise, or impose limitations on, the 

subsequent use and disclosure of any 

information concerning a Bank. To the 

extent that any reports of examination 

or other materials provided to a Bank or 

the Office of Finance pursuant to this 

section otherwise qualify as 

Unpublished Information under § 911.1 

of this title or any successor provision, 

those materials shall continue to qualify 

as such and shall continue to be subject 

to the restrictions on disclosure set forth 

in part 911 of this title, or any successor 

provisions. 

(e) Transition provision. Following 

the effective date of this section, FHFA 

will distribute promptly to each Bank 

and the Office of Finance a copy of the 

most recent report of examination of all 

other Banks. Each Bank shall have ten 

(10) business days following the 

effective date of this section within 

which to submit a written request to 

withhold information as described in 

paragraph (b)(1) of this section. Upon 

the expiration of the time period 

described in the preceding sentence, the 

distribution of the initial reports of 

examination shall proceed in 

accordance with paragraphs (b)(2) and 

(c) of this section. 

Dated: September 24, 2010. 

Edward J. DeMarco, 

Acting Director, Federal Housing Finance 

Agency. 

[FR Doc. 2010–24578 Filed 9–29–10; 8:45 am] 

BILLING CODE 8070–01–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 71 

Proposed Modification of the Seattle, 

WA, Class B Airspace Area; Public 

Meetings 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Notice of meetings. 

SUMMARY: This notice announces three 

fact-finding informal airspace meetings 

to solicit information from airspace 

users and others concerning a proposal 

to revise the Class B airspace area at 

Seattle, WA. The purpose of these 

meetings is to provide interested parties 

an opportunity to present views, 

recommendations, and comments on the 

proposal. All comments received during 

these meetings will be considered prior 

to any revision or issuance of a notice 

of proposed rulemaking. 

DATES: The informal airspace meetings 

will be held on Thursday, December 9, 

2010, from 6:30 p.m.–9 p.m.; Tuesday, 

December 14, 2010, from 6:30 p.m.– 

9 p.m.; and Thursday, December 16, 

2010, from 6:30 p.m.–9 p.m. Comments 

must be received on or before January 

31, 2011. 

ADDRESSES: (1) The meeting on 

Thursday, December 9, 2010, will be 

held at Snohomish County Auditorium, 

2320 California Street, Everett, WA 

98201. (2) The meeting on Tuesday, 

December 14, 2010, will be held at the 

Highline Performing Arts Center, 401 

South 152nd Street, Burien, WA 98148. 

(3) The meeting on Thursday, December 

16, 2010, will be held at The Theater at 

Auburn Mountainview, 28900 124 

Avenue South East, Auburn, WA, 

98092. 

Comments: Send comments on the 

proposal, in triplicate, to: Clark Desing, 

Manager, Operations Support Group, 

AJV–W2, Western Service Center, Air 

Traffic Organization, Federal Aviation 

Administration, 1601 Lind Avenue, 

SW., Renton WA 98057. 

FOR FURTHER INFORMATION CONTACT: To 

obtain details including a graphic 

depiction regarding this proposal, 

please contact Everett Paul Delay, FAA 

Support Manager Seattle TRACON, SeaTac International Airport, 825 South 

160th Street, Burien, WA 98148, (206) 

214–4620. 

SUPPLEMENTARY INFORMATION: 

Meeting Procedures 

(a) Doors open 30 minutes prior to the 

beginning of each meeting. The 

meetings will be informal in nature and 

will be conducted by one or more 

representatives of the FAA. A 

representative from the FAA will 

present a briefing on the planned 

modification to the Class B airspace at 

Seattle, WA. Each participant will be 

given an opportunity to deliver 

comments or make a presentation, 

although a time limit may be imposed. 

Only comments concerning the plan to 

modify the Class B airspace area at 

Seattle WA, will be accepted. 

(b) The meetings will be open to all 

persons on a space-available basis. 

There will be no admission fee or other 

charge to attend and participate. 

(c) Any person wishing to make a 

presentation to the FAA panel will be 

asked to sign in and estimate the 

amount of time needed for such 

presentation. This will permit the panel 

to allocate an appropriate amount of 

time for each presenter. These meetings 

will not be adjourned until everyone on 

the list has had an opportunity to 

address the panel. 

(d) Position papers or other handout 

material relating to the substance of 

these meetings will be accepted. 

Participants wishing to submit handout 

material should present an original and 

two copies (3 copies total) to the 

presiding officer. There should be 

additional copies of each handout 

available for other attendees. 

(e) These meetings will not be 

formally recorded. However, a summary 

of comments made at the meeting will 

be filed in the docket. 

Agenda for the Meetings 

—Sign-in. 

—Presentation of meeting procedures. 

—FAA explanation of the planned Class 

B airspace area modifications. 

—Solicitation of public comments. 

—Closing comments. 

Issued in Washington, DC, on September 

21, 2010. 

Paul Gallant, 

Acting Manager, Airspace and Rules Group. 

[FR Doc. 2010–24543 Filed 9–29–10; 8:45 am] 

BILLING CODE P 

FEDERAL TRADE COMMISSION 

16 CFR Part 321 

[RIN 3084-AB18] 

Notice of Proposed Rulemaking: 

Mortgage Acts and Practices – 

Advertising Rule 

AGENCY: Federal Trade Commission 

(FTC or Commission). 

ACTION: Notice of proposed rulemaking; 

request for comment. 

SUMMARY: Pursuant to the 2009 

Omnibus Appropriations Act (Omnibus 

Appropriations Act), as clarified by the 

Credit Card Accountability, 

Responsibility and Disclosure Act of 

2009 (Credit CARD Act), the 

Commission issues a Notice of Proposed 

Rulemaking (NPRM) relating to unfair or 

deceptive acts and practices that may 

occur with regard to mortgage 

advertising, the Mortgage Acts and 

Practices (MAP) – Advertising Rule 

(proposed rule). The proposed rule 

published for comment, among other 

things, would prohibit any 

misrepresentation in any commercial 

communication regarding any term of 

any mortgage credit product; and 

impose recordkeeping requirements. 

DATES: Comments must be received by 

November 15, 2010. 

ADDRESSES: Interested parties are 

invited to submit written comments 


jdjones on DSK8KYBLC1PROD with PROPOSALS-1