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FEDERAL RESERVE BANK
OF NEW YORK
fa -£A A < Vo
N ovem ber 12, 1 9 9 2
Regulatory Reports Monitoring Program
To the Chief Executive Officers o f All State Member Banks, Bank Holding Companies, Foreign Banking
Organizations and Their Branches and Agencies, Edge and Agreement Corporations, and National and State
Nonmember Banks that File Form FFIEC 030 or FR 2314, in the Second Federal Reserve District:
As you may be aware, recent banking legislation reemphasized the importance of the timeliness
and accuracy of the periodic regulatory reports on financial condition, such as Reports of Condition
and Income, submitted to the Federal financial institutions supervisory agencies. This includes the
“prompt corrective action” provisions of the Federal Deposit Insurance Corporation Improvement
Act of 1991 (“FDICIA”) that are triggered, in significant part, by financial information concerning
capital levels submitted to Federal regulators by banking organizations in their Call Reports and
other regulatory filings, and also includes the civil money penalty assessment enhancements
associated with regulatory reporting deficiencies contained in FDICIA and in the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 and other legislation.
To ensure adequate implementation of these recent legislative enhancements concerning
regulatory reporting requirements, the Federal Reserve recently developed a new Regulatory
Reports Monitoring Program (the “Program”), effective as of the September 30, 1992 reporting
period. As described in the overview, which is printed on the following pages, the Program is
designed to identify those banking institutions supervised by the Federal Reserve that file late
reports and to encourage all domestic and foreign banking organizations to file accurate and timely
periodic regulatory reports. The Program will be expanded in the near future to include the
Systemwide monitoring of inaccurately prepared or false regulatory reports submitted to the Federal
Reserve System.
We want to take this opportunity to remind you of your banking organization’s responsibility
to submit timely and accurate regulatory reports, and of the fines that may be assessed against
financial institutions and individuals that fail to do so. Banking organizations should make every
effort to ensure that the regulatory reports filed with the Federal Reserve are accurate and that they
are received prior to or no later than each report’s due date. Reserve Banks will no longer be able
to grant grace periods or extensions beyond the due date of a report in the absence of exigent
circumstances.
Questions regarding your reporting responsibilities should be directed, at this Bank, to
Elaine D. Mauriello, Assistant Vice President, Statistics Function (Tel. No. 212-720-5722).
C h ester B . F e l d b e r g ,
Executive Vice President.
OVERVIEW OF THE REGULATORY REPORTS MONITORING PROGRAM
In c a r r y i n g out its s u p e r v i s o r y r e s p o n s i b i l i t i e s , t he
F e d e r a l R e s e r v e S y s t e m reli e s on t he t i m e l y a nd a c c u r a t e f i l i n g
of r e g u l a t o r y r e p orts b y d o m e s t i c an d f o r e i g n fin a n c i a l
i n stitutions.
Data c o l l e c t e d from r e g u l a t o r y r e p o r t s are
r e q u i r e d to f a c i l i t a t e e a r l y i d e n t i f i c a t i o n of p r o b l e m s i t u a t i o n s
t h a t c a n t h r e a t e n the s a f e t y and s o u n d n e s s of s u c h b a n k i n g
o r g a n i z a t i o n s , to e n s u r e c o m p l i a n c e b y b a n k i n g o r g a n i z a t i o n s w i t h
t he p r o m p t c o r r e c t i v e a c t i o n p r o v i s i o n s of r e c e n t b a n k i n g
legislation, a n d for o t h e r l e g i t i m a t e s u p e r v i s o r y p u r p oses.
Late
or false s u b m i s s i o n s of re p o r t s m a y c o n c e a l d e t e r i o r a t i o n in an
i n s t i t u t i o n ' s f i n ancial c o n d i t i o n a nd perf o r m a n c e , a nd m a y
m i s l e a d r e g u l a t o r s an d th e p u b l i c a b o u t an i n s t i t u t i o n ' s
f i n a ncial condition.
T he F i n a n c i a l I n s t i t u t i o n s Reform, Recovery, a n d
E n f o r c e m e n t A c t of 1989 (''FIRREA'') a n d t he F e d e r a l D e p o s i t
I n s u r a n c e C o r p o r a t i o n I m p r o v e m e n t A c t of 1991 (''FDICIA") a m e n d e d
v a r i o u s b a n k i n g s t a t u t e s to e n h a n c e t h e Fe d e r a l R e s e r v e ' s
a u t h o r i t y to a s s e s s c i vil m o n e y p e n a l t i e s a g a i n s t s t a t e m e m b e r
banks, b a n k h o l d i n g c o m p a n i e s a nd f o r e i g n i n s t i t u t i o n s t h a t file
late, false or m i s l e a d i n g r e g u l a t o r y r e p o r t s . 1 F I R R E A a nd
F D I C I A a l s o e n h a n c e d t h e F e d eral R e s e r v e ' s a u t h o r i t y t o a s s e s s
m o n e t a r y p e n a l t i e s a g a i n s t i n d i v i d u a l s tha t c a u s e or p a r t i c i p a t e
in s u c h filings.
To e n c o u r a g e b a n k i n g i n s t i t u t i o n s to file t i m e l y a n d
a c c u r a t e r e g u l a t o r y reports, t he F e d e r a l R e s e r v e S y s t e m r e c e n t l y
i m p l e m e n t e d a n e w R e g u l a t o r y R e p o r t s M o n i t o r i n g P r o g r a m (the
" P r o g r a m " ) . U n d e r the Program, t h e F e d e r a l R e s e r v e w i l l m a i n t a i n
a s y s t e m to i d e n t i f y t h o s e b a n k i n g i n s t i t u t i o n s it s u p e r v i s e s —
i n c l u d i n g s t a t e m e m b e r banks, b a n k h o l d i n g c o m p anies, E d g e a n d
A g r e e m e n t corpo r a t i o n s , a n d th e b r a n c h e s a n d a g e n c i e s of f o r e i g n
b a n k s — t h a t file late r e p o r t s from t h e S e p t e m b e r 30, 1992
r e p o r t i n g p e r i o d forward.
T h e R e s e r v e B a nks w i l l b e i d e n t i f y i n g
a nd m a i n t a i n i n g r e c o r d s of late r e p o r t e r s a n d s u b m i t t i n g s u m m a r y
r e p o r t s of t h e s e r e c o r d s to B o a r d s t a f f a f t e r e v e r y r e p o r t i n g
period.
A l t h o u g h the P r o g r a m is p r e s e n t l y d e s i g n e d t o m o n i t o r
1 "Late" r e p o r t s a r e self - e x p l a n a t o r y .
"False" r e p o r t s
g e n e r a l l y i n v o l v e t h e s u b m i s s i o n of m a t h e m a t i c a l l y i n c o r r e c t
data, s u c h as a d d i t i o n e r r o r s or t r a n s p o s i t i o n s , t h e s u b m i s s i o n
of Call R e p o r t s w i t h o u t a p p r o p r i a t e schedules, a n d t h e
i n a d v e r t e n t f i l i n g of i n a c c u r a t e information.
Gen e r a l l y , f a lse
r e p o r t s c a n b e s c r e e n e d t h r o u g h t h e u s e of c o m p u t e r v a l i d i t y
edits.
O n t h e o t h e r hand, a " m i s l eading" f i l i n g i n v o l v e s s o m e
d e g r e e of k n o w i n g or r e c k l e s s b e h a v i o r o n t h e p a r t of t h e f i l e r
a n d t h e i n t e n t i o n a l o r n e g l i g e n t s u b m i s s i o n of i n a c c u r a t e
i n f o r m a t i o n to t h e F e d e r a l Reserve.
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I f r jt&
iz -
only late filings, it will soon be expanded to cover false
filings for the December 31, 1992 reporting period.
Generally, all regulatory reports of financial
condition and income that are required by statute and regulation
to be filed with the Federal Reserve by domestic and foreign
banking organizations will be subject to the Program.
However,
reports that must be filed in connection with supervisory
actions, applications for mergers and acquisitions, and the
Confidential Report of Operations filed by foreign banking
organizations (F.R. 2068), as well as Federal Reserve monetary
aggregate reports, will not be subject to the Program.
To promote consistent treatment of banking
organizations under the Program, the Reserve Banks may not,
starting with the September 30, 1992 reporting period, grant
grace periods or extensions of the submission dates of regulatory
reports, unless there are exigent circumstances.
Under the Program, a late report is defined as an
official copy of a report that is not received by the Reserve
Bank or its designated electronic collection agent in a "timely"
manner.
The filing of an institution's completed original report
will be considered "timely" in the following cases:
1.
The report is received by the end of the reporting day
on the submission deadline (i.e., 5 p.m. at each of
the Reserve Banks).
2.
The report is mailed first class and postmarked no
later than the third calendar day preceding the
submission deadline no matter when the report is
received by the Federal Reserve District.
In the
absence of a postmark, an institution may be called
upon to provide proof of timely mailing if the report
has been received after the submission deadline.
3.
The completed original report is put into an overnight
delivery system on the day before the submission
deadline.
An institution may be called upon to
provide proof of timely entry if the report has been
received after the submission deadline.
4.
For electronic filers, the report is received by the
Reserve Bank by the end of the reporting day on
the submission deadline (i.e., 5 p.m. at each of the
Reserve Banks) or, for the Call Report, the report is
received by the electronic collection agent by the
submission deadline.
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The Program also requires that the Board staff
responsible for enforcement actions consult with the staffs of
the Reserve Banks in order to ensure that appropriate follow-up
supervisory actions are taken and that the Federal Reserve
addresses all instances of chronic late and false regulatory
reporting through the use of civil money penalty or other
enforcement proceedings.
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@FedFRASER