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[Federal Register Volume 79, Number 236 (Tuesday, December 9, 2014)]
[Notices]
[Pages 73071-73073]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-28708]

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FEDERAL DEPOSIT INSURANCE CORPORATION

Agency Information Collection Activities: Information Collection 
Revision; Comment Request (3064-0189)

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Notice of information collection to be submitted to OMB for 
review and approval under the Paperwork Reduction Act, and request for 
comment.

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SUMMARY: The Federal Deposit Insurance Corporation (FDIC) invites the 
general public and other Federal agencies to take this opportunity to 
comment on a revision of a continuing information collection, as 
required by the Paperwork Reduction Act of 1995.
    An agency may not conduct or sponsor, and a respondent is not 
required to respond to, an information collection unless it displays a 
currently valid Office of Management and Budget (OMB) control number. 
The FDIC is soliciting comment concerning its information collection 
titled, ``Annual Stress Test Reporting Template and Documentation for 
Covered Banks with Total Consolidated Assets of $10 Billion to $50 
Billion under Dodd-Frank'' (OMB Control No. 3064-0189).

DATES: Comments must be received by January 8, 2015.

ADDRESSES: You may submit written comments by any of the following 
methods:

[[Page 73072]]

     Agency Web site: http://www.fdic.gov/regulations/laws/federal/. Follow the instructions for submitting comments on the FDIC 
Web site.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Email: [email protected]. Include ``Annual Stress Test 
Reporting'' on the subject line of the message.
     Mail: Gary A. Kuiper, Counsel, or John Popeo, Counsel, 
Legal Division, MB-3098, Attention: Comments, FDIC, 550 17th Street 
NW., Washington, DC 20429.
     Hand Delivery/Courier: Guard station at the rear of the 
550 17th Street Building (located on F Street) on business days between 
7:00 a.m. and 5:00 p.m.
    Public Inspection: All comments received will be posted without 
change to http://www.fdic.gov/regulations/laws/federal/ including any 
personal information provided.
    Additionally, you may send a copy of your comments: By mail to the 
U.S. OMB, 725 17th Street NW., #10235, Washington, DC 20503 or by 
facsimile to 202.395.6974, Attention: Federal Banking Agency Desk 
Officer.

FOR FURTHER INFORMATION CONTACT: You can request additional information 
from Gary Kuiper, 202.898.3877, or John Popeo, 202.898.6923, Legal 
Division, FDIC, 550 17th Street NW., MB-3098, Washington, DC 20429. In 
addition, copies of the templates referenced in this notice can be 
found on the FDIC's Web site (http://www.fdic.gov/regulations/laws/federal/).

SUPPLEMENTARY INFORMATION: The FDIC is requesting comment on the 
following revision of an information collection:

Annual Stress Test Reporting Template and Documentation for Covered 
Banks With Total Consolidated Assets of $10 Billion to $50 Billion 
Under Dodd-Frank

    Section 165(i)(2) of the Dodd-Frank Wall Street Reform and Consumer 
Protection Act \1\ (Dodd-Frank Act) requires certain financial 
companies, including state nonmember banks and state savings 
associations, to conduct annual stress tests \2\ and requires the 
primary financial regulatory agency \3\ of those financial companies to 
issue regulations implementing the stress test requirements.\4\ A state 
nonmember bank or state savings association is a ``covered bank'' and 
therefore subject to the stress test requirements if its total 
consolidated assets exceed $10 billion. Under section 165(i)(2), a 
covered bank is required to submit to the Board of Governors of the 
Federal Reserve System (Board) and to its primary financial regulatory 
agency a report at such time, in such form, and containing such 
information as the primary financial regulatory agency may require.\5\ 
On October 15, 2012, the FDIC published in the Federal Register a final 
rule implementing the section 165(i)(2) annual stress test 
requirement.\6\ The final rule requires covered banks to meet specific 
reporting requirements under section 165(i)(2). In 2013, the FDIC first 
implemented the reporting templates for covered banks with total 
consolidated assets of $10 billion to $50 billion and provided 
instructions for completing the reports.\7\ This information collection 
notice describes revisions by the FDIC to those reporting templates and 
related instructions as well as required information. The information 
contained in these information collections may be given confidential 
treatment to the extent allowed by law. (5 U.S.C. 552(b)(4)).
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    \1\ Public Law 111-203, 124 Stat. 1376 (July 21, 2010).
    \2\ 12 U.S.C. 5365(i)(2)(A).
    \3\ 12 U.S.C. 5301(12).
    \4\ 12 U.S.C. 5365(i)(2)(C).
    \5\ 12 U.S.C. 5365(i)(2)(B).
    \6\ 77 FR 62417 (October 15, 2012).
    \7\ See 78 FR 16263 (March 14, 2013) and 78 FR 63470 (October 
24, 2013).
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    Consistent with past practice, the FDIC intends to use the data 
collected through these revised templates to assess the reasonableness 
of the stress test results of covered banks and to provide forward-
looking information to the FDIC regarding a covered bank's capital 
adequacy. The FDIC also may use the results of the stress tests to 
determine whether additional analytical techniques and exercises could 
be appropriate to identify, measure, and monitor risks at the covered 
bank. The stress test results are expected to support ongoing 
improvement in a covered bank's stress testing practices with respect 
to its internal assessments of capital adequacy and overall capital 
planning.
    The FDIC recognizes that many covered banks with total consolidated 
assets of $10 billion to $50 billion are part of a holding company that 
is also required to submit relevant Dodd Frank Annual Stress Test 
(DFAST) reports to the Board (FR Y-16, OMB No. 7100-0356). The FDIC, 
Office of Comptroller of the Currency, and Board (collectively the 
``Agencies'') have coordinated the preparation of stress testing 
templates in order to make the templates as similar as possible and 
thereby minimize the burden on affected institutions. These Agencies 
have coordinated in a similar manner regarding these proposed 
modifications to the stress testing templates. Therefore, the revisions 
by the FDIC to its reporting requirements will remain consistent with 
the modifications that the Board proposes to make to the FR Y-16.

Description of Information Collection

    The FDIC DFAST 10-50 reporting form collects data through two 
primary schedules: (1) The Results Schedule (which includes the 
quantitative results of the stress tests under the baseline, adverse, 
and severely adverse scenarios for each quarter of the planning 
horizon) and (2) the Scenario Variables Schedule. In addition, 
respondents are required to submit a summary of the qualitative 
information supporting their quantitative projections.

Results Schedule

    For each of the three supervisory scenarios (baseline, adverse, and 
severely adverse) each covered bank is required to report data on two 
supporting schedules: (1) The Income Statement Schedule and (2) the 
Balance Sheet Schedule. Therefore, two supporting schedules for each 
scenario (baseline, adverse, and severely adverse) are completed. In 
addition, the Results Schedule includes a Summary Schedule, which 
summarizes key results from the Income Statement and Balance Sheet 
Schedules.
    Income statement data is collected on a projected quarterly basis 
showing projections of revenues and losses. For example, respondents 
project net charge-offs by loan type (stratified by twelve specific 
loan types), gains and losses on securities, pre-provision net revenue, 
and other key components of net income (i.e., provision for loan and 
lease losses, taxes, etc.).
    Balance sheet data is collected on a quarterly basis for 
projections of certain assets, liabilities, and capital. Capital data 
is also collected on a projected quarterly basis and include components 
of regulatory capital, including the projections of risk weighted 
assets and capital actions such as common dividends and share 
repurchases.

Scenario Variables Schedule

    To conduct the stress tests, an institution may choose to project 
additional economic and financial variables beyond the mandatory 
supervisory scenarios provided to estimate losses or revenues for some 
or all of its portfolios. In such cases, the institution would be 
required to complete the Scenario Variables Schedule for each scenario 
where the institution chooses to use additional

[[Page 73073]]

variables. The Scenario Variables Schedule collects information on the 
additional scenario variables used over the planning horizon for each 
supervisory scenario.

Revisions to Reporting Templates for Banks With $10 Billion to $50 
Billion in Assets

    On July 9, 2013, the FDIC approved an interim final rule that will 
revise and replace the FDIC's risk-based and leverage capital 
requirements to be consistent with agreements reached by the Basel 
Committee on Banking Supervision in ``Basel III: A Global Regulatory 
Framework for More Resilient Banks and Banking Systems'' (``Basel 
III'').\8\ The final rule was published in the Federal Register on 
April 14, 2014 (``revised capital framework'').\9\ The revisions 
include implementation of a new definition of regulatory capital, a new 
common equity tier 1 minimum capital requirement, a higher minimum tier 
1 capital requirement, and, for banking organizations subject to the 
Advanced Approaches capital rules, a supplementary leverage ratio that 
incorporates a broader set of exposures in the denominator measure. In 
addition, the rule will amend the methodologies for determining risk 
weighted assets. All banking organizations that are not subject to the 
Advanced Approaches Rule must begin to comply with the revised capital 
framework on January 1, 2015.
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    \8\ 78 FR 55340 (September 10, 2013).
    \9\ 79 FR 20754 (April 14, 2014).
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    Due to the timing of the Dodd-Frank Act stress test and the revised 
capital rulemaking, the FDIC considered several options for the timing 
and scope of this proposal to collect information related to the 
capital rulemaking. On August 13, 2014, the FDIC published in the 
Federal Register, a 60-day information collection notice requesting 
public comment on proposed revisions to the stress testing reporting 
templates.\10\ The FDIC received one comment. The commenter expressed 
concerns that covered banks will lack the relevant data for the stress 
testing requirements ahead of when these items are required to be 
reported in the Consolidated Report of Condition and Income (``Call 
Reports''). After carefully considering this comment, the FDIC has made 
minor technical changes and clarifications to the reporting 
instructions as described below.
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    \10\ 79 FR 47457 (August 13, 2014).
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    The FDIC proposes to revise the FDIC DFAST 10-50 Summary Schedule 
by adding a common equity tier 1 capital data item and the FDIC DFAST 
10-50 Balance Sheet Schedules (baseline, adverse, and severely adverse 
scenarios) by adding a common equity tier 1 risk based capital ratio 
data item in order to reflect the requirements of the revised capital 
framework. These revisions to the FDIC 10-50 DFAST reporting forms 
would apply beginning in the 2015 stress test cycle in which covered 
banks must report by March 31, 2015.
    In addition, the FDIC proposes to clarify the FDIC DFAST 10-50 
reporting form instructions to emphasize that a covered bank should 
transition to the revised capital framework requirements in its bank-
run stress test projections in the quarter in which the revised capital 
framework requirements become effective. Specifically, a covered bank 
would be required to comply with the revised capital framework and 
begin including the common equity tier 1 capital data item and common 
equity tier 1 risk based capital ratio data item in projected quarter 2 
(1st quarter, 2015) through projected quarter 9 (4th quarter, 2016) for 
each supervisory scenario for the 2015 stress test cycle.
    The FDIC also proposes several clarifications to the FDIC DFAST 10-
50 reporting form instructions, including: Indicating that the Scenario 
Variables Schedule would be collected as a reporting form in Reporting 
Central (instead of as a file submitted in Adobe Acrobat PDF format); 
clarifying what covered banks should include in line items 32 and 33 
(retail and wholesale funding) on the Balance Sheet Schedule with 
reference to relevant Call Report line items; clarifying the disallowed 
deferred tax asset and unrealized gains and losses on available-for-
sale (``AFS'') securities line items; clarifying the descriptions of 
the total capital and total risk-based capital line items; and finally, 
clarifying how the supporting qualitative information should be 
organized.

Burden Estimates

    The FDIC estimates the burden of this collection of information as 
follows:

Current

    Number of Respondents: 22.
    Annual Burden per Respondent: 464 hours.
    Total Annual Burden: 10,208 hours.

Proposed

    Estimated Number of Respondents: 22.
    Estimated Annual Burden per Respondent: 469 hours.
    Estimated Total Annual Burden: 10,318 hours.
    The burden for each $10 billion to $50 billion covered bank that 
completes the FDIC DFAST 10-50 Results Template and FDIC DFAST 10-50 
Scenario Variables Template is estimated to be 469 hours. The burden to 
complete the FDIC DFAST 10-50 Results Template is estimated to be 440 
hours, including 20 hours to input these data and 420 hours for work 
related to modeling efforts. The burden to complete the FDIC DFAST 10-
50 Scenario Variables Template is estimated to be 29 hours. The total 
burden for all 22 respondents to complete both templates is estimated 
to be 10,318 hours, or an increase to the total burden of 110 hours.
    Comments are invited on all aspects of the proposed changes to the 
information collection, particularly:
    (a) Whether the collection of information is necessary for the 
proper performance of the functions of the FDIC, including whether the 
information has practical utility;
    (b) The accuracy of the FDIC's estimate of the burden of the 
collection of information;
    (c) Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    (d) Ways to minimize the burden of the collection on respondents, 
including through the use of automated collection techniques or other 
forms of information technology;
    (e) Estimates of capital or start-up costs and costs of operation, 
maintenance, and purchase of services to provide information; and
    (f) The ability of FDIC-supervised banks and savings associations 
with assets between $10 billion and $50 billion to provide the 
requested information to the FDIC by March 31, 2015.

    Dated at Washington, DC, this 3rd day of December 2014.

Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2014-28708 Filed 12-8-14; 8:45 am]
BILLING CODE 6714-01-P
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