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FEDERAL RESERVE BANK OF NEW YORK [ Circular No. 1 0 6 10 "I January 7, 1993 RISK-BASED CAPITAL G U ID E L IN E S — Lower Risk Weight for Certain Collateralized Transactions — Lower Risk Weight for Certain Residential Construction Loans — Institutions Eligible for 20 % Risk Weight To All State Member Banks and Bank Holding Companies in the Second Federal Reserve District: The Board of Governors of the Federal Reserve System has adopted modifications to its riskbased capital guidelines, for State member banks and bank holding companies, that (a) lower the risk weight assigned to certain collateralized transactions, (b ) lower the risk weight assigned to certain loans to finance the construction of presold residential properties, and (c) amend the list of multilateral lending institutions eligible for a 20% risk weight. The modification affecting presold residential property loans is an interim rule on which the Board has invited public comment by January 29, 1993. Collateralized transactions Following is the text of the Board’s announcement of the rule affecting certain collateralized transactions: The Federal Reserve Board has announced adoption of modifications to its risk-based capital guidelines affecting the treatment of certain collateralized transactions. The revised guidelines for State member banks and bank holding companies lower the risk weight assigned to such transactions to a level more commensurate with the minimal risks involved. The revision lowers the risk weight from 20 percent to zero percent for certain transactions that are collateralized by cash and OECD central government securities, including U.S. Government agency securities, provided the transactions meet specified criteria. The change is consistent with international bank capital standards. This rule is effective December 30, 1992. Presold residential property loans Following is the text of the Board’s announcement of the interim rule on presold residential property loans: The Federal Reserve Board has issued an interim rule amending the risk-based capital guidelines for State member banks and bank holding companies to lower from 100 to 50 percent the risk weight on loans to finance the construction of 1- to 4-family residences that have been presold. The interim rule amends the Board’s Regulation H and Regulation Y and is effective December 30, 1992. The interim rule will be reviewed by the Board after the receipt of public comment. Public comment is requested by January 29, 1993. The interim rule implements section 618(a) of the Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991 (RTCRRIA). (OVER) f Institutions eligible for 20% risk weight In September 1992, the Board invited comment on an interim rule adding the European Bank for Reconstruction and Development, the International Finance Corporation, and the Nordic Investment Bank to its list of named multilateral lending institutions that are eligible for a 20 percent risk weight. Following review of the comments, the Board adopted the modification as a final rule, effective December 22, 1992. Enclosed, for State member banks and bank holding companies in this District, are copies of amendments to the Board’s Regulations H and Y, as published in the which reflect these modifications. Additional, single copies can be obtained at this Bank (33 Liberty Street) from the Issues Division on the first floor, or by calling our Circulars Division (Tel. No. 212-720-5215 or 5216). Comments on the interim rule affecting multifamily housing loans must be submitted by January 27, 1993, and may be sent to the Board, as specified in the notice, or to our Bank Analysis Department. Federal Register, Questions on these matters may be directed to Manuel J. Schnaidman, Manager, Bank Analysis Department (Tel. No. 212-720-6710), or to Anne Wakelin of that Department (Tel. No. 212-720-6969). E. G erald C o r r ig a n , President. === = p | Wednesday December 30, 1992 Vol. 57, No. 251 Pp. 6 2177-62183 Regulations H and Y Capital Adequacy Guidelines 1. Interim Rule on Certain Presold Residential Property Loans (Docket No. R-0787) 2. Final Rule on Certain Collateralized Transactions (Docket No. R-0756) [Enc. Cir. No. 10610] Federal Register / Vol. 57, No. 251 / Wednesday, December 30, 1992 / Rules and Regulations 6 2 177 suggestion as an alternative to the original proposal. The Board has adopted this change to the risk-based capital guidelines on an interim basis in order to provide interested parties an opportunity to comment on this approach. DATES: This interim rule is effective as of December 30,1992. Comments must be received by January 29,1993. ADDRESSES: Comments should be addressed to Mr. William Wiles, Secretary of the Board, Board of Governors of the Federal Reserve System, 20th and Constitution Avenue NW., Washington, DC 20551, or delivered to room B-2223, Eccles Building, between 8:45 am and 5 pm. Comments may be inspected in room B1122 between 9 am and 5 pin, except as provided in § 261.8 of the Board’s Rules Regarding Availability of Information, 12 CFR 261.8. FOR FURTHER INFORMATION CONTACT: FEDERAL RESERVE SYSTEM 12 CFR Parts 208 and 225 [Regulations H and Y; Docket No. R-0787] Capital; Capital Adequacy Guidetines Board of Governors of the Federal Reserve System. ACTION: Interim rule with request for comments. AGENCY: Rhoger H. Pugh, Assistant Director (202/ 728-5883), Norah M. Barger, Manager (202/452-2402), and Robert E. Motyka, Senior Financial Analyst (202/4523621), Division of Banking Supervision and Regulation, Board of Governors of the Federal Reserve System. For the hearing impaired only. Telecommunication Device for the Deal (TDD), Dorothea Thompson (202/4523544), Board of Governors of the Federal Reserve System, 20th and C Streets, NW., Washington, DC 20551. SUPPLEMENTARY INFORMATION: Background The international bank capital SUMMARY: The Federal Reserve is standards (Basle Accord)1 place all amending its risk-based capital assets into the 100 percent risk category guidelines to lower from 100 percent to unless the asset specifically qualifies for 50 percent the risk weight assigned to a preferential risk category. In this certain loans to builders to finance the regard, the Accord allows member construction of presold residential (1- to countries at their discretion to assign a 4-family) properties. This interim rule 50 percent risk weight to loans secured implements section 618(a) of the by residential property provided that Resolution Trust Corporation such loans are fully secured by Refinancing, Restructuring, and mortgages on residential property that is Improvement Act of 1991 (RTCRRIA). In rented or is occupied (or is intended to February 1992, the Federal Reserve, be occupied) by the borrower and the under the auspices of the Federal risk weight is applied in accordance Financial Institutions Examination with strict prudential criteria. The U.S. Council (FFIEC), sought public risk-based capital guidelines, which comment on 8 proposal to implement implement the Basle Accord, assign 1section 618(a) of RTCRRIA through a to 4-family residential mortgages that change to the commercial bank Consolidated Reports of Condition and 1 The Basle Accord is a risk-based capital framework that was proposed by the Basle Income (Call Report). It was suggested Committee on Banking Regulations and Supervisory in the comments that section 618(a) of Practices endorsed by toe bank the RTCRRIA be implemented through governorsandthe Group of Ten central countries in of (G-10) an amendment to the Federal banking )ulv 1968. The Committee is comprised of representatives of the central banks and supervisory agencies' risk-based capital rules and guidelines instead of to the Call Report. authorities from the G-10 countries (Belgium, Italy, The Board has determined to adopt this Canada. France, Germany, UnitedJapan, Netherlands, Sweden. Switzerland, tha Kingdom, and the United States) and Luxembourg. Board of Governors of the Federal Reserve System CAPITAL ADEQUACY GUIDELINES A m endm ents to R egulations H and Y (Effective December 22, 1992) regional development banks in which G10 countries are shareholding members 12 CFR Parts 208 and 225 may be accorded, at national discretion, a 20 percent risk weight. Like the Basle [Regulations H and Y; Docket No. R-0776] Accord, the Board’s risk-based capital guidelines specify five multilateral Capital; Capital Adequacy Guidelines lending institutions and regional AGENCY: Board of Governors of the development banks1 that are eligible for Federal Reserve System. the 20 percent risk weight. The ACTION: Final rule. guidelines further state that other multilateral lending institutions and SUMMARY: The Board is modifying its regional development banks may be risk-based capital guidelines for state accorded a 20 percent risk weight if the member banks and bank holding U S. government is a shareholder or companies to include the European contributing member. Bank for Reconstruction and On September 16,1992, the Board Development (EBRD), the International proposed clarifying that bank holding Finance Corporation (IFC), and the companies and state member banks may Nordic Investment Bank (NIB) in the list assign a 20 percent risk weight to claims of named multilateral lending on, or guaranteed by, the EBRD, the IFC, institutions that are eligible for a 20 or the NIB. The U.S. is a contributing percent risk weight This modification shareholder of the EBRD, but this would conform the Board’s risk-based organization was established after the capital guidelines more closely to original publication of the capital interpretive guidance adopted by the adequacy guidelines. Since the IFC is a other G-10 countries that are signatories subsidiary of the World Bank, an to the Basle Accord. organization that the guidelines EFFECTIVE DATE: The final rule is specifically names as an institution effective as of December 22,1992. eligible for the 20 percent risk weight, it implicitly is included in the 20 FOR FURTHER INFORMATION CONTACT: percent risk category. Although the U.S. Norah Barger, Manager, Policy is neither a shareholder nor a Development (202/452-2402), Ali contributing membor of the NIB, the Emran, Financial Analyst (202/4522208), Division of Banking Supervision Basle Committee on Banking Supervision has interpreted the criteria and Regulation; and Brian E. J. Lam, Attorney (202/452-2067), Legal in the Basle Accord for assigning a Division, Board of Governors of the multilateral lending institution to the 20 Federal Reserve System. For the hearing percent risk category to mean that any impaired only, Telecommunication country may include the NIB in this Device for the Deaf (TDD), Dorothea preferential risk category since Sweden, Thompson (202/452-3544) Board of a G-10 country, is a shareholder in the Governors of the Federal Reserve NIB. Thus, adding the NIB to the list of named multilateral lending institutions System, 20th and C Streets, i-JW., Washington, DC 20551. SUPPLEMENTARY INFORMATION: Under the 1 In ten tio n al Bank for Reconstruction and risk-based capital framework Development (World Bank), Interaznerican established by the Basle Accord, claims Development Bank. Asian Development Bank, on, rnd claims guaranteed by, African Development Bank, and the European Investment Bank. multilateral lending institutions and FEDERAL RESERVE SYSTEM eligible for a 20 percent risk weight would serve to conform the Board’s riskbased capital guidelines more closely to the interpretative guidance adopted by the other G-10 countries that are signatories to the Basle Accord. The proposed modifications to the risk-based capital guidelines would have the effect of also including in the 20 percent risk category portions of claims collateralized by securities issued by the EBRD, IFC, and NIB. The Board’s proposal on multilateral lending institutions took the form of an interim rule that was effective immediately. The comment period ended October 23,1992. The Board received no public comments and, thus, is now issuing in final form an amendment to the risk-based capital guidelines to include in the 20 percent category claims on and claims guaranteed by the EBRD, IFC, and NIB as well as portions of claims collateralized by securities issued by those multilateral lending institutions. Regulatory Flexibility Act Analysis The Federal Reserve Board does not believe adoption of this proposal would have a significant economic impact on a substantial number of small business entities (in this case, small banking organizations), in accord with the spirit and purposes of the Regulatory Flexibility Act (5 U.S.C. 601 et seq ). In this regard, the proposed revision would reduce certain regulatory burdens on bank holding companies as it would reduce the capital charge on certain transactions. In addition, because the risk-based capital guidelines generally do not apply to bank holding companies with consolidated assets of less than $150 million, this proposal will not affect such companies. List of Subjects 12 CFR Part 208 PRINTED IN NEW YORK. FROM FE D E R A L R E G IS T E R , VOL. 57, NO. 2 46, pp. 60718-20 [Enc. Cir. No. 10610] (OVER) Accounting, Agriculture, Banks, banking, Confidential business information. Currency, Federal Reserve System, Reporting and recordkeeping requirements, Securities. 12 CFR Part 225 Administrative practice and procedure, Banks, banking, Federal Reserve System, Holding companies, Reporting and recordkeeping requirements, Securities. For the reasons set forth in the preamble, and pursuant to the Board’s authority under section 5(b) of the Bank Holding Company Act of 1956 (12 U.S.C. 1844 (b)), and section 910 of the International Lending Supervision Act of 1983 (12 U.S.C. 3909), the Board is amending 12 CFR parts 208 and 225 as follows: by the McFadden Act of 1927; and sections PART 225— BANK HOLDING 1101-1122 of the Financial Institutions COMPANIES AND CHANGE IN BANK Reform, Recovery, and Enforcement Act of CONTROL 1989 (12 U.S.C 3310 and 3331-3351). 2. Appendix A to part 208 is amended 1. The authority citation for part 225 is revised to read as follows: by revising the second sentence of the Authority: 12 U.S.C 1817(j) (13), 1818(b), second paragraph in m.C.2 to read as 1828(o), 18311, 1843(c) (8), 1844(b), 19 7 20 ). follows: Appendix A to Part 208— Capital Adequacy Guidelines For State Member Banks: RiskBased Measure * A 1 1 1. * * * # A * C*** 2. * * * In addition, this category also includes claims on, and the portions of claims that are guaranteed by, U.S. government-sponsored3 *agencies and claims 32 on, and the portions of claims guaranteed by, the International Bank for Reconstruction and Development (World Bank), the International Finance Corporation, the Interaroerican Development Bank, the Asian Development Bank, the African Development Bank, the European Investment Bank, the PART 208— MEMBERSHIP OF STATE European Bank for Reconstruction and BANKING INSTITUTIONS IN THE Development, the Nordic Investment Bank, FEDERAL RESERVE SYSTEM and other multilateral lending institutions or 1. The authority citation for part 208 regional development banks in which the U.S. government is a shareholder or is revised to read as follows: contributing member.* * * Authority: Sections 9 ,11(a), 11(c), 19, 21, * * * * * 25, and 25(a) of the Federal Reserve Act, as amended (12 U.S.C 321-338, 248(a), 248(c), 461,481-486,601 and 611, respectively); 3i For this purpose, U.S. government-sponsored sections 4 ,13(j), and 18(o) of the Federal agencies are defined as agencies originally established or chartered by the Federal government Deposit Insurance Act, as amended (12 to serve public purposes specified by the U.S. U.S.C 1814,1823(i), and 1828(o), respectively); section 7(a) of the International Congress but whose obligations are not explicitly guaranteed by the full faith and credit of the U.S. Banking Act of 1978 (12 U.S.C 3105); These agencies include the Federal sections 907-910 of the International Lending government.Mortgage Corporation (FHLMC), the Home Loan Supervision Act of 1983 (12 U.S.C. 3906Federal National Mortgage Association (FNMA), the 3909); sections 2 ,12(b), 12(g), 12(i), 15B(c) Farm Credit System, the Federal Home Loan Bank (5), 17,17A, and 23 of the Securities System, and the Student Loan Marketing Exchange Act of 1934 (15 U.S.C. 78b, 781(b), Association (SLMA). Claims on U.S. governmentsponsored agencies include capital stock in a 781(g), 78l(i), 78o-4(c) (5), 78q, 78q-l, and Federal Home Loan Bank that is held as a condition 78w, respectively); section 5155 of the of membership in that Bank. Revised Statutes (12 U.S.C 36) as amended 3106, 3108, 3 9 0 7 ,3 9 0 9 , 3310, 3331-3351, and sec. 306 of the Federal Deposit Insurance Corporation Improvement Act of 1991 (Pub. L. 1 0 2 - 2 4 2 . 1 0 5 Stat. 2 2 3 6 (1 9 9 1 )). 2. Appendix A to part 225 is amended by revising the second sentence of the second paragraph in m .C.2 to read as follows: Appendix A to Part 223— Capital Adequacy Guidelines for Bank Holding Companies: Risk-Based Measure * * * * * U *** L C*** . 2. * * * In a d d ition , th is category a lso in clu d es c la im s on, an d th e p ortion s o f cla im s that are gu aran teed b y, U.S. govern m en t-sp on sored 39 a g en cies an d cla im s on. and the p ortion s o f c la im s gu aran teed by, the International B ank for R econ stru ction and D evelop m en t (W orld Bank), the International F in a n ce C orporation, th e Interam ericna D ev elo p m en t Bank, th e A sia n D evelop m en t Bank, th e A frican D ev elo p m en t Bank, the E uropean In vestm en t Bank, th e European Bank for R econ stru ction and D evelop m en t, th e N ord ic In vestm en t Bank, and other m ultilateral le n d in g in stitu tio n s or regional d ev elo p m en t ban k s in w h ic h the U.S. govern m en t is a sh areh old er or con trib utin g m em b er.* * * • * A * * Board o f G overnors o f th e F ederal R eserve S ystem , D ecem b er 1 6 , 1 9 9 2 . W illiam W. W iles, Secretary of the Board. (FR D o c 9 2 - 3 0 9 6 2 F ile d 12-21-92; 8 :4 5 am] atujHo c o o e t m s v f 6 2 1 7 8 Federal Register / Vol. 57, No. 251 / Wednesday, December 30, 1992 / Rules and Regulations meet certain criteria to the 50 percent risk category. In order to qualify for a 50 percent risk weight, a loan secured by a 1- to 4-family residential property must be a first lien; must be made in accordance with prudent underwriting standards, including a conservative loan-to-value ratio; must be performing in accordance with its original terms; and must not be more than 90 days past due or carried in nonaccrual status. The U.S. risk-based capital guidelines assign loans to builders to finance the construction of residential properties that have been presold to purchasers who intend to occupy the property to the 100 percent risk category on the basis of the perceived inherent riskiness of these loans. Under the Basle Accord such loans could, at national discretion, be assigned a 50 percent risk weight. After the risk-based capital guidelines were adopted, the Federal Reserve along with the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and the Office of Thrift Supervision (OTS) reexamined the issue of the capital treatment of residential mortgages. Specifically, the banking agencies considered the appropriateness of applying a 50 percent risk weight to certain loans to builders to finance the construction of residential properties that have been presold to qualifying individuals. Before the agencies proceeded with a proposal. Congress enacted the RTCRRIA on December 12,1991. Section 618(a) of the Act requires the Federal banking agencies to provide for a risk weight of 50 percent in their regulations and guidelines for any single family residential construction loan that meets the following criteria: (1) The loan is for the construction of 1• to 4-family residential property; (2) The bank has sufficient documentation, as may be required by the appropriate Federal banking agency, to demonstrate the intent and ability of the buyer to purchase the property; (3) The purchaser provides to the builder a nonrefundable deposit in an amount determined by the appropriate Federal banking agency, but not less than 1 percent of the principal amount of the mortgage; and (4) The loan satisfies prudent underwriting standards as established by the appropriate Federal banking agency. In order to effect a lower risk weight for these loans in conformance with the legislation, the agencies decided to propose expanding the definition of loans “secured by 1- to 4-family residential properties” contained in the commercial bank Call Report to include presold residential construction loans that meet certain criteria. In this regard, the FF1KC published for comment on February 3,1992, a proposal to add to the list of loans that are secured by 1to 4-family residential properties, and exclude from the list of loans made for the purpose of construction and land development, loans that are “made in accordance with sound lending principles to builders with substantial project equity for the construction of 1to 4-family residences that have been presold under firm contracts to purchasers who have obtained firm commitments for permanent qualifying mortgage loans and have made substantial earnest money deposits.” For the Federal Reserve ana the FDIC, the proposed definitional change would have resulted in lowering the risk weight for presold 1- to 4-family residential construction loans because these agencies’ risk-based capital guidelines assign loans that meet the Call Report definition of 1- to 4-family residential mortgages to the 50 percent risk category. The definitional change would have had no effect on the risk weight for presold residential construction loans held by national banks or thrifts since neither the OCC’s nor the OTS's risk-based capital rules reference the Call Report definition for loans secured by 1- to 4-family residential properties. As a result, both the OCC and OTS were required to amend their risk-based capital rules to effect the lower risk weight. The OTS amendment became effective May 13, 1992, while the OCC amendment became effective October 5.1992. Once a final version of the Call Report change was agreed to, the Federal Reserve intended to make conforming changes to the Consolidated Financial Statements for Bank Holding Companies (Y-9C Report). Comments Received Comments were received from 41 public respondents. These included one multinational, one regional, and twentynine community banking organizations; one thrift association; one governmentsponsored entity; seven trade associations; and one member of the public. Overall, 32 commenters, or approximately 78 percent of the total respondents, agreed with the proposal. They expressed the view that the definitional change and reassignment of these loans to a lower risk category was fair and consistent with the riskiness inherent in these types of residential real estate loans. The nine commenters that opposed the FFIEC’s proposal did so on the grounds that, in their view, the perceived reporting burden to implement the proposal did not justify the merits of the outcome. One of these commenters stated it would agree with the proposal if the Call Report change would be optional. It was suggested in the comments that the Federal Reserve implement the provisions of section 618(a) of the RTCRRIA by amending the risk-based capital guidelines rather than by changing the definition of loans secured by 1- to 4-family residential properties contained in the Call Report. One commenter, the multinational banking organization, noted that this approach would be more appropriate and much simpler for banking organizations to implement than a regulatory reporting change. The FFIEC proposal requested specific comment on builder equity and purchaser earnest money standards, “including the most appropriate way to define and compute a builder’s project equity and the percentages or amounts of builder equity and purchaser earnest money that should be at risk.” Eleven comment letters suggested definitions, and amounts for “builder equity” and “purchaser earnest money deposit.” The amounts suggested for builder’s equity ranged from 10 percent to 75 percent of the contract price. In addition, a number of commenters offered specific suggestions on what that percentage should be based on, such as cost of land acquisition or hard costs of construction. Suggested amounts for substantial earnest money deposits ranged from 1 percent to 20 percent. A m e n d m e n t T o T h e R isk -B a se d C a p ita l Guidelines Based upon discussions with the other Federal banking agencies and the public comments received, the Board is amending the risk-based capital guidelines for state member banks and bank holding companies to state that loans secured by 1- to 4-family residential properties eligible for the 50 percent risk category for risk-based capital purposes include “loans to builders with substantial project equity for the construction of 1- to 4-family residences that have been presold under firm contracts to purchasers who have obtained firm commitments for permanent qualifying mortgage loans and have made substantial earnest money deposits." In order to be assigned a 50 percent risk weight, such loans, like other loans for 1- to 4-family residences, would have to be made in accordance with prudent underwriting standards, including a conservative loan-to-value ratio; to be performing in accordance with their original terms; Federal Register / Vol. 57, No. 251 / Wednesday, December 30, 1992 / Rules and Regulations 6 2 1 7 9 and to not be 90 days or more past due or carried in nonaccrual status. This change to the risk-based capital guidelines would have the effect of including in the 50 percent risk category presold residential construction loans that RTCRRIA requires to be included in this categ* ry. The Board notes that the statute specifies that the agencies may establish prudent underwriting standards for presold 1- to 4-family residential construction loans accorded a 50 percent risk weight In this regard, the agencies expect that institutions will apply a 50 percent risk weight to loans to builders for 1- to 4-family residential property construction only if the bank has obtained sufficient documentation that the buyer of the home intends to purchase the home (i.e., has a legally binding written sales contract) and has the ability to obtain a mortgage loan sufficient to purchase the home [i.e., has a firm written commitment for pennanent financing of the home upon completion), so long as the following additional criteria are met: (A) The purchaser is an individual(s) who intends to occupy .he residence and is not a partnership, joint venture, trust corporation, or any other entity (including an entity acting as a sole proprietorship) that is purchasing one or more of the homes for speculative purposes. (B) The builder must incur at least the first 10 percent of the direct costs [i.e., actual costs of the land, labor, and material) before any drawdown is made under the construction loan and the construction loan may not exceed 80 percent of the sales price of the presold home 2 (C) The purchaser has made a substantial “earnest money deposit" of no less than 3 percent of the residence’s sales price and that deposit must he subject to forfeiture if the purchaser terminates the sales contract. (D) The earnest money deposit must be held in escrow by the bank financing the builder or by an independent party in a fiduciary capacity and the escrow agreement must provide that, in the event of default arising from the 2 Under the agencies’ 1992 rm l estate underwriting standards regulation and guidelines, as a general matter, institutions may extend loans for the construction of 1- to 4-family residences with loan-to-value ratios (LTV) of up to 85 percent These guidelines, which implement section 304 of the Federal Deposit Insurance Corporation Improvement Act of 1991, become effective on March 19.1993. While these guidelines permit institutions to make presold residential construction loans with LTV ratios that exceed 8 0 percent such loans would not qualify for the 50 percent risk category Rather, they should assigned to the 100 jrercent risk category. cancellation of the sales contract by the buyer, the escrow funds must first be used to defray any costs incurred by the lending bank. Section 618(a) requires the agencies to take action within 120 days of enactment of the RTCRRIA to permit the different capital treatment of the type of housing loans discussed above. As suggested in the comments received, the Board has decided to implement section 618(a) by adopting revisions to the riskbased capital guidelines directly rather than changing the Call Report and Y-9C Report provisions. The effect on the calculation of capital for state member banks and bank holding companies of amending the guidelines is substantially the saaie as the effect of revising the Call Report and the Y-9C Report, and will satisfy the requirements of section 618(a) The Board adopted the change to the risk-based capital guidelines as an interim rule, rather than a final rule, however, in order to provide interested parties an opportunity to comment on this alternative approach. The adoption of an interim rule will permit state member banks and bank bolding companies to take advantage of a lower risk weight for presold residential construction loans effective immediately. The Board will revise the rule as required to address comments received during the thirty-day comment period. R e g u la t o r y F le x ib ilit y A c t A n a l y s i s The Federal Reserve Board does not believe that adoption of this amendment would have a significant economic impact on a substantial number of small business entities in accord with the spirit and purposes of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) In that regard, the amendment would reduce certain regulatory burdens on bank holding companies. In addition, because the risk-based and leverage capital guidelines generally do not apply to bank holding companies with consolidated assets of less than $150 million, this amendment will not affect such companies. List of Subjects 12 CFR Part 208 Accounting, Agriculture, Banks, banking, Confidential business information, Currency, Federal Reserve System, Reporting and recordkeeping requirements, Securities. 12 CFR Part 225 Administrative practice and procedure, Banks, banking, Federal Reserve System, Holding companies, Reporting and recordkeeping requirements. Securities. For the reasons set forth in the preamble, and pursuant to the Board’s authority under section 5(b) of the Bank Holding Company Act of 1956 (12 U.S.C 1844(b)), and section 910 of the International Lending Supervision Act of 1983 (12 U.S.C 3909), the Board is amending 12 CFR parts 208 and 225 as follows: PART 208— MEMBERSHIP OF STATE BANKING INSTITUTIONS IN THE FEDERAL RESERVE SYSTEM 1. The authority citation for part 208 is revised to read as follows: A uthority: Sections 9 , 11(a), 11(c), 19, 21, 25, and 25(a) of the Federal Reserve Act, as amended (12 U S.G 321-338, 248(a). 248(c). 461, 481-486, 601, and 611, resp ectively); sections 4 and 13(j) of the Federal D ep osit Insurance Act, as amended (12 U.S.C. 1814 and I823(j), respectively); section 7(a) of the International Banking Act o f 1978 (12 U.S.C. 3105); sections 907-910 of the International Lending Supervision A ct of 1983 (1 2 U.S.C. 3906-3909); sections 2, 12(b), 12(g), 12(»), 15B(c) (5), 17, 17 A, and 23 o f the Securities Exchange A ct o f 1934 (15 U.S.C. 78b , 78J(b), 787(g), 78/(i), 78o-4(c) (5), 78q, 78q -l, and 78w, respectively); s e c tio n 5155 of the Revised Statutes (12 U.S jC. 36) as amended by the McFadden Act of 1927; and sections 1101-1122 of the Financial Institutions Reform, Recovery and Enforcement A ct of 1989 (12 U.S.C. 3310 and 3331-3351); 12 U.S.C. 93a, 161, 1818, 3907, 3909, Sec. 618, Pub. L. 1 0 2 -2 3 3 ,1 0 5 Stat. 1761 (Resolution Trust Corporation Refinancing, Restructuring, and Improvement Act of 1991). 2. Appendix A to part 208 is amended by revising footnote 35 to read as follows: APPENDIX A T O PART 2 0 8 — (A m en d ed ) * * * * # III. Procedures for Computing WeightedRisk Assets and Off-Balance-Sheet Items • A * * * C. Risk Weights * A A * * 3 . . .3 S 33 Loans that qualify as loans secured by one- to four-family residential properties are listed in the instructions to the commercial hank call report. In addition, for risk-based capital purposes, loans secured by one- to four-family residential properties include loans to builders with substantial project equity for the construction of one- to fonr-fwaily residences that have been presold under firm contracts to purchasers who have obtained firm commitments tor permanent qualifying mortgage loans and have made substantial earnest money deposits. 6 2 1 8 0 Federal Register / Vol. 57, No. 251 / Wednesday, December 30, 1992 / Rules and Regulations PART 225— BANK HOLDING COMPANIES AND CHANGE IN BANK CONTROL 1. The authority.citation for part 225 is revised to read as follows: Authority: 12 U.S.C. 1817(j)(13), 1818, 1831 i. 1843(c)(8). 1844(b), 3106, 3108, 3907, 3 9 0 9 .3 3 1 0 ,and 33313351. 2. Appendix A to Part 225 is amended by revising footnote 38 to read as follows: the Federal Reserve System. For the hearing impaired only. Telecommunication Device for the Deaf (TDD), Dorothea Thompson (202/4523544), Board of Governors of the Federal Reserve System, 20th and C Street, NW., Washington, DC 20551. Discussion SUPPLEMENTARY INFORMATION: Under the international bank capital standards (the Basle Accord),1 claims collateralized by cash and OECD central government securities may be assigned 111 PROCEDURES FOR COMPUTING to the zero percent risk category. WEIGHTED-RISK ASSETS AND OFFHowever, the U S. Federal banking BALANCE-SHEET ITEMS agencies exercised national discretion, * * * * * as permitted under the Basle Accord, to C. Risk Weights assign such claims to the 20 percent risk * * * * * category. This decision has had the 3 * * * m effect of essentially limiting the zero Board of Governors of the Federal Reserve- percent risk category to cash assets and System. December 2 2 ,1 9 9 2 . claims (including securities) on OECD William W. Wiles, central governments and claims directly and unconditionally guaranteed by such Secretary of the Board governments. Claims secured by cash or 1FR Doc. 92-31551 Filed 12-29-92; 8:45 ami securities issued or guaranteed by OECD 81UJNG COOt M10-01-F central governments are assigned to the next highest risk category, i.e., 20 percent, in order to take into account 12 CFR Parts 208 and 225 the operational risks that are present in (Regulations H and V; Docket No. R-0756] most conventional secured lending arrangements.1 2 Capital; Capital Adequacy Guidelines In some instances, however, the AGENCY: Board of Governors of the application of a 20 percent risk weight Federal Reserve System. to very low-risk collateralized ACTION: Final rule. transactions—such as certain indemnified securities lending SUMMARY: The Board is revising its risk- arrangements—could place U.S. banking based capital guidelines for state organizations at a competitive member banks and bank holding disadvantage to foreign banks subject to companies to lower the risk weight the Basle Accord that are applying a assigned to certain collateralized zero percent risk weight to such :ransactions to a level more transactions. In an effort to address this commensurate with the minimal risks disparity in treatment and to arrive at a nvolved. The revision is consistent capital treatment for such transactions ,vith the international bank capital that is more commensurate with the Jtandards. minimal risks entailed, the Board EFFECTIVE DATE: Decem ber 3 0 ,1 9 9 2 . reviewed the possibility of assigning a :OR FURTHER INFORMATION CONTACT: zero percent risk weight to claims Ihoger H. Pugh, Assistant Director (202/ collateralized by cash or OECD central ^28-5883), Norah M. Barger, Manager government securities or U.S. 202/452-2402). Robert E. Motyka, Senior Financial Analyst (202/4521 The Basle Accord is a risk-based framework that 1621), or Alfred D. Teuscher, was proposed by the Basle Committee on Banking Supervisory Financial Analyst (202/452- Supervision and endorsed by the central bank 1007), Division of Banking Supervision governors of the Group of Ten (G-10) countries in )uly 1968. The committee is comprised of ind Regulation. Board of Governors of representatives of the central banks and supervisory APPENDIX A TO PART 225 - [Amended] * * * * * ,ALoans that qualify as loans secured by one- to our-family residential properties are listed in the nstructions to the FR Y-9C Report. In addition, for tsk-based capital purposes, loans secured by one3 four-family residential properties include loans a builders with substantial project equity for the onstniction of one- to four-family residences that ave been presold under firm contracts to urchasers who have obtained firm commitments >r permanent qualifying mortgage loans and have lade substantial earnest money deposits. authorities from the G-10 countries (Belgium, Canada. France, Germany, Italy, Japan, Netherlands. Sweden. Switzerland, the United Kingdom, and the United States) and Luxembourg. 2 A claim secured by cash or OECD government securities may be assigned to the 20 percent risk category only to the extent that the face amount of the claim is covered by the market value of the collateral. The portion of the claim that is not covered by recognized collateral is assigned to the risk category appropriate to the obligor or. if relevant, the guarantor. Government agency securities3 that met certain criteria. The criterion particularly considered in this regard was the maintenance on a daily basis of a positive collateral margin, which was intended to mitigate significantly the risks normally associated with collateralized transactions. As a consequence of this review, on April 10,1992, the Board issued for public comment a proposal to modify the risk-based capital guidelines that would lower the risk weight for collateralized transactions meeting certain criteria from the 20 percent risk category to the zero percent risk category. In this regard, the Board proposed that a claim collateralized by cash on deposit in the banking organization or by OECD central government or U.S. Government agency securities could be assigned to the zero percent risk category, provided that a positive collateral margin is maintained on a daily basis, fully taking into account any change in the banking organization's exposure (to the obligor or counterparty) under the claim in relation to the market value of the collateral held in support of that claim. If the market value of the collateral received from the obligor or counterparty falls below 100 percent of the amount of the banking organization's exposure under such a collateralized claim, the borrower must immediately post enough additional collateral to cover any shortfall and maintain a positive margin. The Board sought specific comment on whether additional criteria should be required in order to better ensure that only truly low-risk collateralized transactions are assigned to the zero percent risk category. The Board also requested comment on whether a higher risk weight, for example 10 percent, might be more appropriate than the zero percent risk weight for these transactions, which can be associated with some, albeit small, risk. The proposal also stated the Board's intention to continue to require, consistent with the Basle Accord, that for a claim collateralized by cash to be eligible for a preferential risk weight for risk-based capital purposes, the cash must be on deposit in the banking organization. In this connection, however, the Board proposed to clarify that in a securities lending transaction where the banking organization is acting 3 The definition of U.S. Government agency securities in the risk-based capital guidelines does not include U S. Government-sponsored agency securities. Under the guidelines, claims collateralized by U S. Government-sponsored agency securities are assigned to the 20 percent risk category. Federal Register / Vol. 57, No. 251 / Wednesday, December 30, 1992 / Rules and Regulations 6 2 1 8 1 The second question asked whether as agent for a customer that is the these transactions should be assigned to beneficial owner of the lent securities a risk weight higher than zero percent, and where the borrower has delivered for example 10 percent. Of the thirteen cash collateral to the banking organization that is not maintained on commenters addressing this question, deposit, the transaction will be deemed twelve opposed the assignment of a to be collateralized by cash on deposit higher risk weight. One trade and, thus, eligible for a preferential risk organization was not opposed to a higher risk weight but felt that a 10 weight only if: (lj Any reinvestment risk associated percent risk weight would still overstate with the cash collateral is borne by the the risk inherent in these transactions. customer and (2) Any indemnification provided byFinal Rule Based upon the comments received the banking organization is limited to the difference between the market value and further consideration of the very of the lent securities and the amount of limited risk associated with assigning collateralized transactions meeting the cash received as collateral. If these two conditions are not met, indicated criteria to the zero percent the transaction would not be deemed to risk weight, the Board is adopting its be collateralized by cash on deposit and, proposed revision to the risk-based capital guidelines for state member thus, would not be eligible for a preferential risk weight. banks and bank holding companies with regard to these transactions. Comments Received This revision will permit banking Public comments were received from organizations to assign to the zero twenty-two respondents: fifteen banking percent risk category claims organizations (three multinational, one collateralized by cash on deposit in the superregional, nine regional, and two banking organization or by OECD community banks); two savings central government or U.S. Government institutions; and five trade associations. agency securities for which a positive All of the respondents agreed that the collateral margin is maintained on a proposal to lower the risk weight from daily basis, fully taking into account any 20 percent to zero percent for certain change in the banking organization's transactions collateralized by cash or exposure to the obligor or counterparty OECD central government securities under a claim in relation to the market would result in a more accurate value of the collateral held in support of reflection of the very limited risk that claim. The Board will not require associated with such transactions. Two that a specific minimum margin of commenters suggested that a zero collateral be maintained on percent risk weight should be extended collateralized transactions assigned to to any portion of a claim collateralized the zero percent risk category. However, by cash or OECD central government the Board expects that banking securities. One of these commenters also organizations will establish, as a part of recommended that claims collateralized prudent operating procedures, a minimum level of margin for these by securities issued by U.S. transactions based upon such factors as Government-sponsored agency the volatility of the securities involved securities should be accorded a zero so as to avoid unduly frequent margin percent risk weight. Two commenters suggested technical wording changes to calls. the proposed clarification with regard to The Board is also adopting, with a few technical wording changes, its proposed securities lending transactions clarification with regard to certain collateralized by cash where a bank is requirements pertaining to transactions acting in an agent capacity. The first question on wnich the Board collateralized by cash where the sought specific comment asked whether banking organization is acting as agent. additional criteria should be set forth in This clarification indicates that where a banking organization is acting as agent order to better ensure that only truly low-risk collateralized transactions are for a customer in a transaction involving the lending or sale of securities that is assigned to the zero percent risk collateralized by cash delivered to the category. Of the thirteen commenters banking organization, the transaction is addressing this question, eleven deemed to be collateralized by cash on indicated that additional criteria were deposit for purposes of determining the not needed. Of the two respondents appropriate risk weight, provided that supporting the establishment of a any indemnification is limited to no minimum positive margin, one more than the difference between the indicated that a minimum collateral market value of the securities and the coverage of 101 percent of the claim should be specified, while the other did amount of cash collateral received and not indicate a specific level of coverage. any reinvestment risk associated with the cash collateral is borne by the customer. This rule is effective immediately in order to implement in the most expeditious manner a capital charge that is more commensurate with the risks entailed in collateralized transactions meeting the specified criteria and that will help place U.S. banking organizations engaging in such transactions on a more equal footing with foreign banks subject to the Basle Accord. In addition, the Board believes an immediate effective date is appropriate because the revision would reduce, rather than expand regulatory burden. Regulatory Flexibility Act Analysis The Federal Reserve Board does not believe the adoption of this final rule will have a significant economic impact on a substantial number of small business entities (in this case, small banking organizations), in accord with the spirit and purposes of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). In this regard, the revised final rule will reduce certain regulatory burdens on bank holding companies, as it reduces the capital charge on certain transactions. In addition, because the risk-based capital guidelines generally do not apply to bank holding companies with consolidated assets of less than $150 million, the final rule will not affect such companies. List of Subjects 12 CFR Part 208 Accounting, Agricultural loan losses, Applications, Appraisals, Banks, banking, Branches, Capital adequacy, Confidential business information, Currency, Dividend payments, Federal Reserve System, Flood insurance, Publication of reports of condition, Reporting and recordkeeping requirements, Securities, State member banks. 12 CFR Part 225 Administrative practice and procedure, Appraisals, Banks, banking, Capital adequacy, Federal Reserve System, Holding companies, Reporting and recordkeeping requirements, Securities, State member banks. For the reasons set forth in this notice, and pursuant to the Board’s authority under section 5(b) of the Bank Holding Company Act of 1956 (12 U.S.C. 1844(b)), and section 910 of the International Lending Supervision Act of 1983 (12 U.S.C. 3909), the Board is amending 12 CFR parts 208 and 225 to read as follows: 6 2 1 8 2 Federal Register / Vol. 57, No. 251 / Wednesday, December 30, 1992 / Rules and Regulations A uthority: 12 U.S.C. 1 8 1 7 (j)(1 3 ), 1 8 1 8 , the bank's exposure to the obligor or counterparty under a claim in relation to the 1 8 3 1 i. 1 8 4 3 (c )(8 ), 1 8 4 4 (b ), 3 1 0 6 , 3 1 0 8 , 3 9 0 7 market value of the collateral held in support 3 9 0 9 , 3 3 1 0 , and 3 3 3 1 - 3 3 5 1 . of that claim. * * * A p p en d ix A — [A m en d ed ] 1. The authority citation for part 208 2. * * * This category also includes the 2. A p p en d ix A is a m en d ed by replacing continues to read as follows: portions of claims (including repurchase se co n d se n ten ce in the first paragraph, transactions) collateralized by cash on Authority: Sections 9 ,11(a), 11(c), 19, 21, ad d in g a se n ten ce at the en d o f the first deposit in the bank or by securities issued or paragraph, an d rep lacin g the first and secon d 25, and 25(a) of the Federal Reserve Act, as guaranteed by OECD central governments or se n ten ces o f the se co n d paragraph o f sectio n amended (12 U.S.C 321-338, 248(a), 248(c), U S. government agencies that do not qualify III.B.l.. ad d in g a paragraph to the en d o f 461, 481-486, 601,'and 611, respectively): for the zero percent risk-weight category; sections 4 and 13(j] of the Federal Deposit se ctio n U L G l.;r e p la c in g th e third paragraph Insurance Act, as amended (12 U.S.C. 1814 collateralized by securities issued or o f se ctio n III.C.2.; by ad d in g a n ew sen ten ce and 1823(]), respectively); section 7(a) of the guaranteed by U S. government-sponsored to th e en d o f the n in th paragraph o f section III.D.l.; and by a d d in g a n e w item 5. under International Banking Act of 1978 (12 U S.G agencies; or collateralized by securities 3105); sections 907-910 of the International issued by multilateral lending institutions or "C ategory 1: Zero P ercen t” and revisin g item 8. u n d er “ C ategory 2: 2 0 P ercen t” o f Lending Supervision Act of 1983 (12 U S.C. regional development banks in which the A ttach m en t III, to read as follow s: 3906-3909); sections 2 ,12(b), 12(g), 12(i), U.S. government is a shareholder or 15B(c) (5), 17,17A, and 23 of the Securities contributing member. • * * • • Exchange Act of 1934 (15 U.S.C. 78b, 787(b). * * * * * III. * * * 787(g). 787(i), 78o-4(c) (5), 78q, 78q-l, and D * * * A. * * * 78w, respectively); section 5155 of the 1. * * * Where a bank is acting as agent B. * * * C laim s fo lly secu red by su ch Revised Statutes (12 U.S.C. 36) as amended by the McFadden Act of 1927; and sections for a customer in a transaction involving the collateral gen erally are a ssig n ed to the 2 0 percent risk-w eight category. C ollateralized lending or sale of securities that is 1101-1122 of the Financial Institutions collateralized by cash delivered to the bank, tran saction s m eetin g a ll the co n d itio n s Reform, Recovery, and Enforcement Act of the transaction is deemed to be collateralized d escrib ed in se ctio n III.Gl. m ay be assign ed 1989 (12 U S,C 3310 and 3331-3351). by cash on deposit in the bank for purposes a zero p ercen t risk w eigh t. Appendix A — [Amended] W ith regard to co lla tera lized claim s that of determining the appropriate risk-weight 2 Appendix A is amended by replacing the category, provided that any indemnification m ay b e a ssig n ed to the 2 0 p ercen t risk-w eight category, the exten t to w h ic h q u alifyin g second sentence in the first paragraph, is limited to no more than the difference se cu rities are recogn ized as collateral is adding a sentence at the end of the first between the market value of the securities d eterm in ed b y their current m arket valu e. If paragraph, and replacing the first and second and the cash collateral received and any sentences of the second paragraph of section reinvestment risk associated with that cash su ch a c la im is o n ly partially secu red , that is, th e market v alu e o f the p led g ed secu rities III.B.l;adding a paragraph to the end of collateral is borne by the customer. * * * is less than the face am oun t o f a balancesection IILC.1.; replacing the third paragraph * * * * * sh ee t asset or an off-balance-sheet Item, the )f section III.C.2.; by adding a new sentence p ortion that is covered b y the m arket valu e 0 the end of the ninth paragraph of section Attachment III * * * o f th e q u a lify in g collateral is a ssig n ed to the H. D.I.; and by adding a new item 5. under 2 0 p ercen t risk category, an d th e p ortion o f Category 1 Zero Percent” and revising item Category 1*. Zero Percent * * * *. is n ot by collateral I. under “Category 2: 20 Percent" of 5. Claims collateralized by cash on deposit the cla im othat sh or a coveredin g secu rity is in th e form f ca q u a lify \ttachment III, to read as follows: in the bank or by securities issued or the guaranteed by OECD central governments or a ssig n ed to or, ifrisk category appropriate to » * * * • th e ob ligor relevan t, the guarantor. U S. government agencies for which a III. * * * positive margin of collateral is maintained on G * * • A. * * * a daily basis, folly taking into account any 1. * * * T h is category a lso in c lu d e s cla im s B. * * * Claims fully secured by such change in the bank's exposure to the obligor co lla tera lized b y cash on d ep o sit in the oilateral generally are assigned to the 20 or counterparty under a claim in relation to su b sid iary len d in g in stitu tio n or by secu rities >ercent risk-weight category. Collateralized the market value of the collateral held in issu ed or guaranteed by OECD central ransactions meeting all the conditions govern m en ts or U.S. govern m en t a gen cies for [escribed in section III.Gl. may be assigned support of that claim.* * * w h ic h a p o sitiv e m argin o f collateral is zero percent risk weight. Category 2: 20 Percent * * * m ain tain ed o n a d a ily b asis, fo lly taking into With regard to collateralized claims that a cco u n t an y ch an ge in the b anking nay be assigned to the 20 percent risk-weight 8. The portions of claims that are collateralized3 by cash on deposit in the o rgan ization ’s ex p o su re to the obligor or ategory, the extent to which qualifying cou n terp arty u n d er a c la im in relation to the ecurities are recognized as collateral is bank or by securities issued or m arket v a lu e o f the collateral h eld in support etermined by their current market value. If guaranteed by the U.S. Treasury, the o f that claim . * * * uch a claim is only partially secured, that central governments of other OECD 2. * * * T h is category a lso in c lu d e s the 3, the market value of the pledged securities countries, and U.S government agencies p ortion s o f c la im s (in c lu d in g rep urchase 1less than the face amount of a balanceheet asset or an off-balance-sheet item, the that do not qualify for the zero percent tran saction s) co lla tera lized b y ca sh on d e p o sit in the su b sid iary len d in g in stitu tio n ortion that is covered by the market value risk-weight category, or that are or by se cu rities issu ed or guaranteed by f the qualifying collateral is assigned to the collateralized by securities issued or OECD cen tral g overn m en ts or U.S. 0 percent risk category, and the portion of guaranteed by U.S. governmentg overn m en t a g en cies that d o n ot q u alify for ie claim that is not covered by collateral in sponsored agencies. * * * the zero p ercen t risk-w eight category; * * * * * le form of cash or a qualifying security is co lla tera lized by se cu rities issu ed or ssigned to the risk category appropriate to guaranteed b y U .S. govern m en t-sp on sored ie obligor or, if relevant, the guarantor. PART 225— BANK HOLDING • * agen cies; or co lla tera lized b y se cu rities PART 208—-MEMBERSHIP OF STATE BANKING INSTITUTIONS IN THE FEDERAL RESERVE SYSTEM * G *** COMPANIES AND CHANGE IN BANK * * issu ed b y m u ltilateral len d in g in stitu tio n s or region al d e v elo p m en t banks in w h ic h the 1. * * * This category also includes claims CONTROL U.S. govern m en t is a sh arehold er or allateralized by cash on deposit in the bank 1. The authority citation for part 225 con trib u tin g m em ber. * * * r by securities issued or guaranteed by * * * * * continues to read as follows: iECD central governments or U.S. Dvamment agencies for which a positive D. * * * targin of collateral is maintained on a daily 1. * * * W here a ban k in g organ ization is 3 The extent of collateralization is determined by asis, fully taking into account any change in current market value. actin g as agent for a cu stom er in a transaction the Federal Register / Vol. 57, No. 251 / Wednesday, December 30, 1992 / Rules and* Regulations 6 2 1 8 3 involving the lending or sale of securities that is collateralized by cash delivered to the banking organization, the transaction is deemed to be collateralized by cash on deposit in a subsidiary lending institution for purposes of determining the appropriate riskweight category, provided that any indemnification is limited to no more than the difference between the market value of the securities and the cash collateral received and any reinvestment risk associated with that cash collateral is borne by the customer. * # * * * * Attachment III * * * * * Category 1: Zero Percent * • * 5. Claims collateralized by cash on deposit in the subsidiary lending institution or by securities issued or guaranteed by OECD central governments or U.S. government agencies for which a positive margin of collateral is m aintained on a daily basis, fully taking into account any change in the bank's exposure to the obligor or counterparty under a claim in relation to the market value of the collateral held in support of that claim.* * * Category 2: 20 Percent * * * 8 The portions of claims that are collateralized* by cash on deposit in the subsidiary lending institution or by securities issued or guaranteed by the U.S. Treasury, the central governments of other OECD countries, and U.S. government agencies that do not qualify for the zero percent riskweight category, or that are collateralized by securities issued or guaranteed by U.S. government-sponsored agencies.* * * * * * * * Board of Governors of the Federal Reserve System, December 23, 1992. W illiam W. W iles, Secretary of the Board. !FR Doc 9 2 -3 1 7 0 2 Filed 1 2 -29-92; 8:45 am] BILLING CODE 6210-01-F
@FedFRASER