Full text of Federal Reserve Bank of New York Circulars : 9523. Commercial Bank Reports of Condition and Income

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FEDERAL RESERVE BANK
OF NEW YORK

Circular No. 9 5 2 3
July 8. 1983

C om m ercial B an k R eports o f C ondition and Incom e
To All State Member Banks, Multi-Bank Holding Companies,
and Others Concerned, in the Second Federal Reserve District:

The following statem ent has been issued by the Federal Financial Institutions Examination
Council:

The Examination Council has announced its approval of the new Commercial Bank Reports of
Condition and Income that are to become effective with the filing of the March 31, 1984 reports. The
Council also implemented Sections 428(b) and 429 of the Garn-St Germain Depository Institutions Act of
1982, which deal with the reporting and public disclosure of “insider” loans at commercial and mutual
savings banks. These reporting and disclosure requirements are to become effective December 31, 1983.
The revised Reports of Condition and Income will provide supervisory authorities with new and
better regulatory data that reflect changes arising from deregulation and evolving industry practices. The
three banking agencies soon will submit the new reports to the Office of Management and Budget for
approval.
These Call Report changes mark the final stage of revision, which began in June 1982 when the
Council issued for public comment a completely revised report th&t was to become effective in March
1983. After reviewing public comments, the Council deferred many of the revisions until 1984, but decided
to introduce some of them earlier because of the urgent supervisory need for certain information.
The first of these changes introduced the Report of Past Due, Nonaccrual, and Renegotiated Loans
and Lease Financing Receivables in December 1982. This was followed in March 1983 with requirements
that all commercial banks file the Report of Income quarterly, and that all banks with assets of $10
million or more prepare the report on an accrual basis. The third stage created, as part of the June 1983
report, schedules dealing with interest rate sensitivity and with off balance sheet transactions.
The most significant of the final revisions will involve: changes in the reporting of deposit liabilities;
changes in the form and structure of the income statement: the adoption, for banks with assets of less than
$300 million, of new flexible loan categories for most schedules requiring loan details; the reporting of
certain quarterly averages of selected balance sheet accounts, and the establishment of a new filing class,
i.e., banks with assets of between $100 and $300 million dollars. In addition, International Banking
Facilities (IBFs) have been redefined as foreign offices. Therefore, any bank that has an IBF will be
required to file the more detailed reports for banks with foreign offices. Furthermore, banks with assets of
less than $100 million will no longer have the option of filing report forms for larger banks. The Council
also made changes to minimize reporting burdens.
The Council’s actions regarding insider loans will reduce reporting burdens on banks, but continue
disclosure to the supervisory agencies and the public of the information on insider loans that the Congress
has earmarked for disclosure.




(Over)

The changes automatically amend the former rules regarding the reporting of insider loans, based
on Section 430 of the Garn-St Germain Act, and will:
— eliminate the requirement that banks annually file Form FFIEC 003, “Report on
Ownership of the Reporting Bank and on Indebtedness of Its Executive Officers and
Principal Shareholders to the Reporting Bank and to Its Correspondent Banks”;
— require banks to report quarterly, beginning with the December 31, 1983 Report of
Condition, the total amount of extensions of credit by the reporting bank to all of its
executive officers and principal shareholders and to their related interests, and the
number of these persons having significant amounts of such loans outstanding;
— continue to recommend to reporting banks that they use a specific FFIEC form to get
information about the debts of their executive officers, principal shareholders and
their related interests to correspondent banks; and
— recommend to the three federal bank regulatory agencies that they adopt, by
December 31, 1983, regulations requiring each bank to publicly disclose upon request
names of its executive officers and principal shareholders, or their related interests,
who had certain extensions of credit outstanding that were five percent or more of
the reporting bank’s equity capital, or $500,000, whichever is less.
Questions regarding this matter may be directed to Betsy Buttrill White, Manager, Banking
Studies Department (Tel. No. 212-791-5852).




A nthony M. S olomon ,
President.