The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
PR-IDfiS
FEDERAL RESERVE SYSTEM
Sem iannual Regulatory Flexibility Agenda
October 1 ,1 9 9 6 - April 1 ,1 9 9 7
BOARD O F G O V E R N O R S ’ SE M IA N N U A L
R E G U LA T O R Y FLE XIB ILITY A G E N D A
The Semiannual Regulatory Flexibility Agenda provides information on those
regulatory matters that the Board now has under consideration or anticipates
considering over the next six months. It is divided into three parts: (1) regulatory
matters that the Board m ay consider for public comment during the next six months;
(2) matters that have been proposed and are under consideration; and (3) regulatory
matters that the Board has completed or is not expected to consider further.
T he Agenda is published twice a year in the F e d e ra l R egister. Com m ents
regarding any of the Agenda items should be submitted directly to the Board of
Governors.
Public Information Departm ent
FEDER AL R E S E R V E BANK O F N E W Y O R K
FEDERAL RESERVE SYSTEM
12 CFR Chap. II
N otice o f Semiannual R egulatory F l e x i b i l i t y Agenda
AGENCY:
Board o f Governors o f the Federal Reserve System.
ACTION:
Semiannual re g u la to r y agenda.
SUM ARY:
M
The Board i s is s u in g t h is Agenda under th e R egulatory
F l e x i b i l i t y Act and the Board's Statem ent o f P o lic y Regarding
Expanded Rulemaking Procedures.
The Board a n t ic ip a t e s having
under c o n sid e r a tio n re g u la to r y m atters as in d ic a te d below during
th e p eriod October 1, 1996, through A p ril 1, 1997.
The next
Semiannual Agenda w i l l be p u b lish ed in A p ril 1997.
DATES:
Comments about th e form or con ten t o f th e Agenda may be
subm itted any tim e during th e next s ix months.
ADDRESSES:
Comments should be addressed to W illiam W W iles,
.
S ecreta ry o f th e Board, Board o f Governors o f th e Federal Reserve
System, Washington, D 20551.
C
FOR FURTHER INFORMATION CONTACT:
A s t a f f co n ta ct fo r each item
i s in d ic a te d w ith th e r e g u la to r y d e s c r ip tio n below .
SUPPLEMENTARY INFORMATION:
The Board i s p u b lish in g i t s October
1996 Agenda as part o f th e October 1996 U n ified Agenda o f Federal
R eg u la tio n s, which i s coord in ated by th e O ffic e o f Management and
Budget under E xecu tive Order 12866.
P a r tic ip a tio n by th e Board
in th e U n ified Agenda i s on a volu n tary b a s is .
The Board's Agenda i s d iv id ed in to th ree s e c t io n s .
The
f i r s t , Proposed Rule S tage, rep o rts on m atters th e Board may
co n sid er fo r p u b lic comment during th e next s ix months.
The
second s e c t io n , F inal Rule S tage, rep o rts on m atters th a t have
been proposed and are under Board c o n sid e r a tio n .
A th ir d
s e c t io n , Completed A ctio n s, rep o rts on reg u la to r y m atters the
Board has com pleted or i s not exp ected to co n sid er fu r th e r .
M atters begun and com pleted between is s u e s o f th e Agenda have not
been in clu d ed .
A dot (•) p reced in g an en try in d ic a t e s a new m atter th a t
was not a p art o f the B oard's p reviou s Agenda and which th e Board
has not com pleted.
(signed) Barbara R. Lowrey
Barbara R. Lowrey,
A sso c ia te S ecreta ry o f th e Board.
-2 -
-*
S ectio n 1
Proposed Rule Stage
►
-3 -
*
TITLE:
R egu lation: H — Membership o f S ta te Banking I n s t it u t io n s in the
Federal Reserve System
LEGAL
12
12
12
12
12
12
12
12
12
12
12
12
12
12
12
AUTHORITY:
u se 36
u se 2 4 8 (a)
u se 2 4 8 (c)
u se 321-338a
u se 371d
u se 461
u se 481-486
u se 601
u se 611
u se 1814
u se 1818
u se 1 8 2 3 (
j)
u se 1828(o)
u se 1831o
A
Ar
A
V
A
A
A
A
)
r■
u se 1 8 3 1 p -l
CFR CITATION:
12 CFR 208
ABSTRACT:
In co n ju n ctio n w ith th e Federal D eposit Insurance C orporation and
th e O ffic e o f th e C om ptroller o f th e Currency, th e Board w i l l
co n sid er is s u in g fo r p u b lic comment a proposed r e g u la tio n
e s t a b lis h in g a p r o fe s s io n a l q u a lif ic a t io n program fo r banks th a t
engage in r e t a i l recommendations and s a le s o f c e r ta in s e c u r it ie s
u sin g t h e ir own em ployees. The proposed r e g u la tio n w i l l e s t a b lis h
q u a lif ic a t io n t e s t in g , r e g is t r a t io n and co n tin u in g ed u cation
requirem ents fo r bank em ployees th a t a c t in th e c a p a c ity o f bank
s e c u r i t i e s r e p r e s e n ta tiv e s . The proposed requirem ents w i l l be
based on th e p r o fe s s io n a l q u a lif ic a t io n r u le s o f th e s e c u r it ie s
s e lf - r e g u la t o r y o r g a n iz a tio n s.
I t i s not a n tic ip a te d th a t th e p rop osal w i l l have a s ig n if ic a n t
economic impact on a s u b s ta n tia l number o f sm all banks.
TIMETABLE:
ACTION
Board may req u est comment by
DATE
1 0 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Angela Desmond
S en ior Counsel
D iv isio n o f Banking S u p erv isio n and R egu lation
202 452-2781
,
-4 -
FR CITE
TITLE:
Regulation: H -- Membership of State Banking Institutions in the
Federal Reserve System; and Regulation: Y -- Bank Holding
Companies and Change in Bank Control
LEGAL AUTHORITY:
12 USC 1831m
CFR CITATION:
12 CFR 208
12 CFR 225
ABSTRACT:
During 1992, the Board's s t a f f co n su lted w ith the oth er fe d e r a l
banking a g en cies regarding the im plem entation o f s e c tio n 112, the
bank a u d itin g requirem ents, o f the Federal D eposit Insurance
Corporation Improvement Act o f 1991. The s e c tio n in clu d es
requirem ents fo r in su red commercial banks to r e c e iv e a u d its of
t h e ir annual rep o rts by independent p u b lic accou n tan ts,
requirem ents fo r banks and t h e ir a u d ito rs to report c e r ta in
inform ation to th e Board, and requirem ents fo r independent au dit
com m ittees fo r banks. In some c a s e s , th e se requirem ents can be
s a t i s f i e d by comparable arrangements at the bank h old in g company
l e v e l . The Act g e n e r a lly exempts in su red d ep o sito ry - in s t it u t io n s
from th e se requirem ents when t h e ir t o t a l a s s e t s are l e s s than
$150 m illio n , u n le ss a higher th r esh o ld i s chosen by the Federal
D eposit Insurance Corporation (FDIC).
The FDIC, the agency with primary r e s p o n s ib ilit y fo r implementing
t h is mandate through r e g u la tio n s , f in a liz e d i t s r e g u la tio n in May
1993, which a p p lied to a l l FDIC-insured banks and t h r i f t s . The
FDIC's r e g u la tio n a p p lied th e se requirem ents to d ep o sito ry
i n s t it u t io n s w ith t o t a l a s s e t s o f $500 m illio n or more.
Subsequently in February 1996, the FDIC approved amendments to
i t s r u le s implementing s e c tio n 112 th a t were la r g e ly required by
th e R ieg le Community Development and R egulatory Improvement Act
o f 1994. These amendments expand o p p o r tu n itie s fo r h olding
companies to f i l e a s in g le report coverin g m u ltip le su b sid ia ry
banking o r g a n iz a tio n s, conform the r u le 's r e fe r e n c e s to the
Federal R eserv e's R egulation O, and make oth er te c h n ic a l
r e v is io n s .
The Board has j o in t rulemaking a u th o r ity w ith the oth er banking
a g en cies regarding th e enforcement p r o v isio n s o f s e c tio n 112. I t
i s exp ected th a t the Board and the oth er a g e n c ie s w i l l develop a
n o tic e o f proposed rulemaking fo r p u b lic 'comment by year-end.
TIMETABLE:
ACTION
Board may co n sid er amendments to
R egu lation s H and Y by
DATE
1 2 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
-5-
FR CITE
TITLE:
Regulation: H -- Membership of State Banking ,Institutions in the
Federal Reserve System; and Regulation: Y — Bank Holding
Companies and Change in Bank Control
AGENCY CONTACT:
Gerald A. Edwards, Jr.
A s s is ta n t D irecto r
D iv isio n o f Banking S u p erv isio n and R egu lation
202 452-2741
RIN: 7100-AB39
-6-
TITLE:
Regulation: H — Membership of State Banking Institutions in the
Federal Reserve System; and Regulation: Y — Bank Holding
Companies and Change in Bank Control
LEGAL AUTHORITY:
12 USC 1831n
12 USC 1833d
CFR CITATION:
12 CFR 208
12 CFR 225
ABSTRACT:
During 1992 and 1993, the Board's s t a f f co n su lted w ith th e other
fe d e r a l banking a g en cies regarding th e im plem entation o f s e c tio n
121, th e bank accounting requirem ents, o f th e Federal D eposit
Insurance Corporation Improvement Act o f 1991 (FDICIA). These
requirem ents in clu d e the im plem entation o f d is c lo s u r e s o f th e
f a ir market valu e of a s s e t s , l i a b i l i t i e s , and c e r ta in p r o j e c t s ,
which may r e s u lt in th e r e v is io n o f rep o rtin g requirem ents fo r
banks and bank holding com panies. The accounting p r o v isio n s o f
th e Act do not in clu d e exem ptions fo r sm all i n s t i t u t i o n s . Thus,
any changes to r e g u la tio n s and rep o rtin g requirem ents would
l i k e l y a f f e c t sm aller s t a t e member banks.
The Federal F in a n cia l I n s t it u t io n s Examination C ouncil (FFIEC)
req u ested p u b lic comment on proposed rep o rtin g requirem ents, and
th e comment p eriod exp ired on June 14, 1993. Furthermore, th e
FFIEC proposed on March 9, 1994, new C all Report item s fo r
d e r iv a tiv e in stru m en ts, in clu d in g new inform ation on t h e ir market
v a lu e s . The comment p eriod fo r t h is proposal exp ired on May 9,
1994, and th e FFIEC in clu d ed new in form ation about market v a lu es
o f d e r iv a tiv e instrum ents in i t s C a ll Report requirem ents fo r
March 1995. Market valu e in form ation about on- and
o ff-b a la n c e -s h e e t f in a n c ia l in strum ents i s a ls o reported in
banks' annual f in a n c ia l statem en ts f i l e d w ith th e Board and th e
oth er fe d e r a l banking a g en cies pursuant to FDICIA s e c t io n 112.
F ollow ing f i n a l a c tio n by th e FFIEC, the Board may co n sid er
re q u estin g p u b lic comment by year-end on changes to i t s
r e g u la tio n s in order to implement c e r ta in a sp e c ts o f s e c t io n 121.
TIMETABLE:
ACTION
Board may co n sid er amendments to
R egu lation s H and Y by
DATE
1 2 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: Yes
AGENCY CONTACT:
Gerald A. Edwards, Jr.
A s s is ta n t D irecto r
D iv isio n o f Banking S u p erv isio n and R egulation
202 452-2741
RIN: 7100-AB41
-7 -
FR CITE
4.
TITLE:
Regulation: H -- Membership of State Banking Institutions in the
Federal Reserve System; and Regulation: Y — Bank Holding
Companies and Change in Bank Control (Docket Number: R-0835)
LEGAL
12
12
12
12
12
12
12
12
12
12
12
12
12
12
12
AUTHORITY:
u se 36
u se 2 4 8 (a)
u se 2 4 8 (c)
u se 321-338
u se 371d
u se 461
u se 481-486
u se 601
u se 611
u se 1814
u se 1817(j ) (13)
u se 1818
u se 1823 (j )
u se 1828(o)
u se 1831o
CFR CITATION:
12 CFR 208, app A
12 CFR 225, app A
ABSTRACT:
In May 1994, th e Board issu e d fo r p u b lic comment two p rop osals on
th e c a p it a l treatm ent o f recou rse arrangements and d ir e c t c r e d it
s u b s t it u t e s . The f i r s t p roposal (1) fo rm a lly d e fin e s recou rse and
d ir e c t c r e d it s u b s t it u t e s , (2) reduces th e r isk -b a se d c a p it a l
charge fo r lo w - le v e l recou rse arrangements to th e maximum amount
o f p o s s ib le lo s s under the recou rse o b lig a t io n up to the
e f f e c t i v e c a p it a l charge, and (3) re q u ir e s th e same r isk -b a sed
c a p it a l charge fo r f i r s t lo s s d ir e c t c r e d it s u b s t it u t e s as i s
c u r r e n tly a p p lied to recou rse tr a n s a c tio n s (59 FR 27115, May 25,
1994) .
Subsequent to th e issu a n ce o f t h is p ro p o sa l, th e Congress
mandated, under s e c tio n 350 o f th e R ie g le Community Development
and R egulatory Improvement Act o f 1994, th a t th e Board is s u e
r e g u la tio n s lim it in g , as o f March 22, 1995, th e amount o f r is k based c a p it a l an in su red d ep o sito ry i n s t i t u t i o n i s required to
hold fo r a s s e t s tr a n sfe r r e d w ith recourse- to th e maximum amount
o f recou rse fo r which the i n s t i t u t i o n i s c o n tr a c tu a lly l i a b l e .
The p o rtio n o f th e Board's proposal d e a lin g w ith lo w -le v e l
recou rse tr a n s a c tio n s s a t i s f i e s the minimum requirem ents of
s e c tio n 350, and, a cc o rd in g ly , in February 1995, the Board
adopted th a t p o rtio n o f the proposal (60 FR 8177, February 13,
1995) .
The second p ro p o sa l, an advance n o tic e o f proposed rulem aking,
sought p u b lic comment on an approach to a s s e s s in g r isk -b a sed
c a p it a l on banking o r g a n iz a tio n s' r is k exp osu res a s s o c ia te d w ith
c e r ta in a s s e t s e c u r it iz a t io n s . Under t h i s approach, the c a p it a l
charge would be based upon the r e la t iv e r is k o f l o s s . The Board
w ill co n tin u e to co n sid er the advanced n o tic e o f proposed
rulem aking, as w e ll as the o u tsta n d in g is s u e s addressed in the
-8 -
TITLE:
Regulation: H — Membership of State Banking Institutions in the
Federal Reserve System; and Regulation: Y — Bank Holding
Companies and Change in Bank Control (Docket Number: R-0835)
ABSTRACT CONT:
f i r s t p roposal and i s exp ected to take fu rth er a c tio n w ith in the
next two months. Small e n t i t i e s would be a ffe c te d by th e f in a l
ru le and th e two p rop osals on ly to the e x ten t th a t th ey engage in
exten d in g recou rse arrangements or d ir e c t c r e d it s u b s t it u t e s ; i t
i s not exp ected th a t th e p ro p o sa ls w i l l have a s ig n if ic a n t
economic im pact.
TIMETABLE:
ACTION
Board requ ested comment
Board adopted one asp ect o f th e proposal
Further Board a c tio n w ith in th e next
two months
DATE
05/25/94
0 2 /1 3 /9 5
1 0 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Thomas R. Boemio
S up ervisory F in a n cia l A nalyst
D iv isio n o f Banking S u p erv isio n and R egulation
202 452-2982
RIN: 7100-AB77
-9-
FR CITE
59 FR 27115
60 FR 8177
TITLE:
Regulation: H -- Membership of State Banking Institutions in the
Federal Reserve System; and Regulation: Y — Bank Holding
Companies and Change in Bank Control
LEGAL
12
12
12
12
12
AUTHORITY:
USC 36
USC 321
USC 1828
USC 1831u
USC 1842
CFR CITATION:
12 CFR 208
12 CFR 225
ABSTRACT:
S e c tio n s 101, 102, and 103 o f the R ieg le-N e a l I n t e r s t a t e Banking
and Branching E ffic ie n c y Act o f 1994 e s t a b lis h c o n d itio n s under
which bank h o ld in g companies and n a tio n a l banks w i l l be perm itted
to engage in in t e r s t a t e banking and branching through
a c q u is it io n s , m ergers, and esta b lish m en t o f de novo branches.
Under s e c t io n 9 o f the Federal Reserve A ct, th e lim it a t io n s and
c o n d itio n s on branching by n a tio n a l banks a ls o are a p p lic a b le to
s t a t e member banks. S e c tio n 101 o f th e R ieg le-N e a l Act a ls o
perm its a bank to r e c e iv e d e p o sits and provide c e r ta in oth er
s e r v ic e s as agent fo r any a f f i l i a t e d d e p o sito r y i n s t i t u t i o n
w ithout th e bank being co n sid ered to be a branch o f the
a f f i l i a t e d d e p o sito r y i n s t i t u t i o n .
Amendments to R egu lation Y r e f l e c t in g the s ta tu to r y changes have
been proposed as part o f the Board's o v e r a ll review o f R egulation
Y under s e c t io n 303 o f th e R ieg le Community Development and
R egulatory Improvement Act o f 1994 (Docket Number: R -0 9 3 5).
S im ila r amendments to R egu lation H w i l l be co n sid ered by the
Board in i t s o v e r a ll review o f th a t r e g u la tio n by year-en d .
The s ta tu to r y changes reduce r e s t r ic t io n s c u r r e n tly a p p lic a b le to
bank h o ld in g companies and s t a t e member banks o f a l l s i z e s ,
in clu d in g sm all i n s t i t u t i o n s , and w i l l not s i g n i f i c a n t l y in c r e a se
re g u la to r y burden on sm all banks.
TIMETABLE:
ACTION
Board req u ested comment on R egu lation Y
Board i s exp ected to a ct on R egu lation
H by
DATE
0 9 /0 6 /9 6
1 2 /0 0 /9 6
FR CITE
61 FR 47241
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: Undetermined
AGENCY CONTACT:
Lawranne Stewart
S en ior A ttorney
Legal D iv isio n
202 452-3513
RIN: 7100-AB87
6 .
TITLE:
S ectio n 303 R egulatory Review
LEGAL AUTHORITY:
12 USC 48 0 3 ( a ) (1)
CFR CITATION:
12 CFR Chapter II
ABSTRACT:
In response to the requirem ents o f s e c tio n 303 o f the R ieg le
Community Development and R egulatory Improvement Act o f 1994, the
Board i s review in g i t s r e g u la tio n s fo r purposes o f stre a m lin in g ,
improving e f f ic ie n c y , reducing unnecessary c o s t s , and removing
in c o n s is t e n c ie s and ou tm od ed /d u p licative requirem ents. The Board
i s a ls o working j o in t ly w ith the oth er banking a g en cies to make
uniform r e g u la tio n s and g u id e lin e s implementing common s ta tu to r y
and su p erv iso ry p o l i c i e s . A re g u la to r y review tim e ta b le was
p u b lish ed in th e Federal R eg iste r in October 1995 (60 FR 53546,
October 16, 1995).
Within the next s ix months, i t i s exp ected th a t the Board w ill
seek p u b lic comment during the course o f the review s o f the
fo llo w in g r e g u la tio n s /p o lic y sta te m e n ts/o th e r reg u la to ry
guidance. Reviews alread y proposed fo r p u b lic comment appear
elsew h ere in the Agenda.
Regulation G, S e c u r itie s C redit by Persons Other Than Banks,
Brokers, or D ea lers.
Regulation H, Membership o f S ta te Banking I n s t it u t io n s in the
Federal Reserve System.
Regulations H and Y, A ppendices, C ap ital Adequacy G u id elin e s.
Regulation K, In te r n a tio n a l Banking O perations (O verall
Comprehensive R eview ).
Regulation O, Loans to E xecu tive O ffic e r s , D ir e c to r s, and
P r in c ip a l Shareholders o f Member Banks.
Regulation X, Borrowers o f S e c u r itie s C red it.
TIMETABLE:
ACTION
Board a c tio n expected during th e next
s ix months
DATE
0 4 /00/97
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: Undetermined
AGENCY CONTACT:
Thomas A. Durkin
R egulatory Planning and Review D irecto r
O ffic e o f th e S ecretary
202 452-3236
RIN: 7100-AC09
-1 1 -
FR CITE
S ectio n 2
F in al Rule Stage
, ►
•N
7.
TITLE:
R egulation: B — Equal C redit Opportunity (Docket Number: R-0876)
LEGAL AUTHORITY:
15 USC 1691
CFR CITATION:
12 CFR 202
4
4
4
ABSTRACT:
In A p ril 1995, the Board iss u e d fo r p u b lic comment a proposed
amendment to R egulation B to e lim in a te the gen eral p r o h ib itio n on
c o lle c t in g data r e la t in g to an a p p lic a n t's race, c o lo r , sex ,
r e lig io n , and n a tio n a l o r ig in , g iv in g c r e d ito r s the o p tio n to ask
a p p lic a n ts to provide the in form ation on a volu n tary b a s is (60 FR
20436, A p ril 26, 1995). This amendment would allow data
c o lle c t io n only; c r e d ito r s s t i l l would be p ro h ib ite d from
co n sid er in g an a p p lic a n t's ra ce, c o lo r , se x , r e lig io n , and
n a tio n a l o r ig in in t h e ir c r e d it d e c is io n s .
Compliance w ith th e proposed amendment i s v olu n tary and would not
be exp ected to have a s ig n if ic a n t economic impact on sm all
i n s t i t u t i o n s . Follow ing review o f th e p u b lic comments, th e Board
i s exp ected to take fu rth er a c tio n w ith in th e next s ix months.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 4 /2 6 /9 5
04/00/97
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
S h eila h Goodman
S t a f f A ttorney
D iv isio n o f Consumer and Community A ffa ir s
202 452-3667
RIN: 7100-AB99
-13-
FR CITE
60 FR 20436
a
r
TITLE:
R eg u latio n : D — R eserve
(D o c k e t Number: R -0 9 2 9 )
LEGAL
12
12
12
12
12
12
12
R equ irem en ts
of
D epo sito ry
In stitu tio n s
AUTHORITY:
USC 2 4 8 (a)
USC 2 4 8 (c)
USC 371a
USC 461
USC 601
USC 611
USC 3105
CFR CITATION:
12 CFR Part 208
ABSTRACT:
In June 1996, as part o f i t s re g u la to r y review p ro cess mandated
by s e c tio n 303 o f th e R ieg le Community Development and R egulatory
Improvement Act o f 1994, th e Board approved is s u in g fo r p u b lic
comment a p rop osal to amend R egu lation D in order to reduce
reg u la to r y burden and s im p lify and update requirem ents (61 FR
30545, June 17, 1996). In g e n e r a l, th e p rop osal would d e le t e
t r a n s it io n a l r u le s r e la t in g to th e expansion o f re ser v e
requirem ents to nonmember d e p o sito r y i n s t i t u t i o n s , the
a u th o r iz a tio n o f N W accounts n ation w id e, and o th er m atters th a t
O
no lon ger have a s ig n if ic a n t e f f e c t .
I t i s not exp ected th a t th e amendments w i l l have a s ig n if ic a n t
adverse economic impact on a s u b s ta n tia l number o f sm all
e n t i t i e s . F ollow ing review o f th e p u b lic comments, th e Board i s
exp ected to take fu rth er a c tio n by year-en d .
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 6 /1 7 /9 6
1 2 /0 0 /9 6
►
k
4
FR CITE
61 FR 30545
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Rick Heyke
S t a f f A ttorney
Legal D iv isio n
202 452-3688
-
-1 4 -
TITLE:
R egulation: E — E le c tr o n ic Fund T ransfers (Docket Number:
R-0919)
LEGAL AUTHORITY:
15 USC 1693 e t seq
CFR CITATION:
12 CFR 205
ABSTRACT:
In 1994, the Board issu e d a proposed comprehensive r e v is io n to
R egulation E under th e Board's R egulatory Planning and Review
Program (Docket Number: R-0830; RIN: 7100-AA77). In th e p rop osal,
the Board a ls o requested comment on whether R egulation E should
apply to sto r e d -v a lu e card s. S to red -v a lu e cards (a lso known as
prepaid cards) m aintain, t y p ic a lly in a computer chip or m agnetic
s t r ip , a "stored value" o f funds a v a ila b le to the card h old er. The
balance recorded on the card i s d eb ited at a m erchant' s term in al
when the cardholder makes a purchase. In response to comment, the
Board in May 1996 p u b lish ed fu r th er proposed amendments to
R egulation E, imposing m odified R egulation E requirem ents on
sto r e d -v a lu e products in system s th a t track in d iv id u a l
tr a n s a c tio n s , cards, or consumers; p rovid in g an exemption for
cards on which a maximum valu e o f $100 can be sto red ; and
p rovid in g th a t other sto r e d -v a lu e cards are not covered by
R egu lation E (61 FR 19696, May 2, 1996).
In th e 1994 proposed r e v is io n , the Board a ls o requ ested comment
on an amendment th a t would perm it e le c t r o n ic d e b its to an account
to be au th orized in e le c t r o n ic form, such as by p erson al computer
and modem. In response to comment, the Board in i t s May 1996
p rop osal p u b lish ed fu rth er proposed amendments th a t would perm it
e le c t r o n ic communications to s u b s tit u te g e n e r a lly fo r o r a l or
w r itte n d is c lo s u r e s , docum entation, and n o tic e s required under
R egu lation E.
F in a lly , commenters requ ested th a t the Board con sid er proposing
e x te n sio n o f th e error r e s o lu tio n tim e lim it s under R egu lation E
fo r new accounts to avoid th e p o s s i b i l i t y o f fraud. In response
to th e se comments, th e Board in i t s May 1996 proposal p u b lish ed
fu r th er proposed amendments th a t would extend the error
r e s o lu tio n tim e lim it s .
The p ro p o sa ls are part o f th e Board's o v e r a ll review o f i t s
r e g u la tio n s as required by s e c tio n 303 of- the R ieg le Community
Development and R egulatory Improvement Act o f 1994. I t i s not
exp ected th a t the p rop osals would have a s ig n if ic a n t economic
impact on sm all i n s t i t u t i o n s . Follow ing review o f the p u b lic
comments, th e Board i s exp ected to take fu rth er a c tio n w ith in the
next s ix months.
TIMETABLE:
ACTION
Board requ ested comment
Further Board a ctio n by
DATE
0 5 /0 2 /9 6
04/00/97
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
-1 5 -
FR CITE
61 FR 19696
TITLE:
R egulation: E — E le c tr o n ic Fund T ransfers (Docket Number:
R-0919)
AGENCY CONTACT:
John C. Wood
Senior A ttorney
D iv isio n o f Consumer and Community A ffa ir s
202 452-2412
RIN: 7100-AC06
- 1 6
TITLE:
R egulation: G — S e c u r itie s C redit by Persons Other than Banks,
Brokers, or D ealers; R egulation: T — C redit by Brokers and
D ealers; R egulation: U — C redit by Banks (Docket Number: R-0923)
LEGAL
15
15
15
AUTHORITY:
u se 78g S e c u r itie s Exchange Act of 1934, as amended
u se 78h S e c u r itie s Exchange Act of 1934, as amended
u se 78w S e c u r itie s Exchange Act of 1934, as amended
CFR CITATION:
12 CFR 207
12 CFR 220
12 CFR 221
ABSTRACT:
The Board i s conducting a p e r io d ic review o f i t s margin
r e g u la tio n s . The f i r s t r e g u la tio n to be review ed was R egulation
T, which r e g u la te s e x te n sio n s o f c r e d it by and to brokers and
d e a le r s (see Docket Numbers R-0772, RIN 7100-AB28 and R-0840, RIN
7100-AB78). In May 1996, at th e same tim e th e Board adopted a
r e v ise d R egulation T, i t requ ested p u b lic comment on a d d itio n a l
amendments to R egu lations G, T, and U (61 FR 20399, May 6, 1996).
The proposed amendments would allow b ro k er-d ea lers to extend good
f a it h c r e d it on any n o n -eq u ity s e c u r ity ; allow tr a n s a c tio n s
in v o lv in g n on -eq u ity s e c u r it ie s to be e f f e c t e d in an account not
su b je c t to the r e s t r ic t io n s o f R egulation T 's margin account;
remove r e s t r ic t io n s on the a b i l i t y o f b ro k er-d ea le rs to c a lc u la te
requ ired margin for n o n -eq u ity s e c u r it ie s on a " p o r t f o lio ” b a sis;
r e la x th e Board's c o l la t e r a l requirem ents fo r th e borrowing and
len d in g o f s e c u r it ie s ; and exempt from R egu lation T any c r e d it
extended abroad by a U.S. b ro k er-d ea ler on fo r e ig n s e c u r i t i e s to
fo r e ig n p erso n s. The proposal a ls o seek s comment on whether the
Board should expand th e number o f eq u ity s e c u r it ie s e l i g i b l e for
loan v a lu e under R egulation T and whether th e Board should amend
R eg u la tio n s G and U to modify t h e ir method fo r determ ining which
e q u ity s e c u r it ie s q u a lify as margin sto c k .
I t i s not a n tic ip a te d th a t the r e v is io n s would have a s ig n if ic a n t
economic impact on th e o v e r a ll len d in g a c t i v i t i e s o f a
s u b s ta n tia l number o f sm all le n d e r s. Follow ing review o f the
p u b lic comments, the Board i s expected to take fu r th er a c tio n
w ith in th e next two months. The p rop osals are a p art o f the
Board's o v e r a ll review o f i t s re g u la tio n s, as requ ired by s e c tio n
303 o f th e R ieg le Community Development and R egulatory
Improvement Act o f 1994.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 5 /0 6 /9 6
1 0 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
-1 7 -
FR CITE
61 FR 20399
TITLE:
R egu lation: G - - S e c u r itie s C redit by Persons Other than Banks,
Brokers, or D ealers; R egu lation: T — C redit by Brokers and
D ealers; R egu lation: U - - C redit by Banks (Docket Number: R-0923)
AGENCY CONTACT:
S c o tt Holz
S en ior A ttorney
D iv isio n o f Banking S u p erv isio n and R egu lation
202 452-2781
-1 8 -
11.
TITLE:
R e g u l a t i o n : H - - M em bership o f
F e d e r a l R e s e r v e S y stem (D ocket
LEGAL
12
12
12
12
12
12
12
12
12
12
12
12
12
12
12
S t a t e Banking I n s t i t u t i o n s
Number: R -0 9 0 9 )
in
the
AUTHORITY:
u se 36
u se 2 4 8 (a)
u se 2 4 8 (c)
u se 321-338a
u se 371d
u se 461
u se 481-486
u se 601
u se 611
u se 1814
u se 1823 (j )
u se 1828(o)
u se 1831o
u se 1831p -l
u se 3105
CFR CITATION:
12 CFR Part 208
ABSTRACT:
In December 1995, the Board issu e d fo r p u b lic comment proposed
amendments to R egulation H p e r ta in in g to th e recordkeeping and
con firm ation d is c lo s u r e s fo r c e r ta in s e c u r it ie s tr a n sa c tio n s
e f f e c t e d by s t a t e member banks (60 FR 66759, December 26, 1995) .
These d is c lo s u r e s cover tr a n sa c tio n s e f f e c t e d fo r customers
in v o lv in g debt and a sset-b a ck ed s e c u r it ie s and g e n e r a lly req u ire
th ree-d a y se ttle m e n t fo r th e se tr a n s a c tio n s .
I t i s not exp ected th a t th e r e v is io n s w i l l have a s ig n if ic a n t
economic impact on a s u b s ta n tia l number o f sm all i n s t i t u t i o n s .
F ollow ing review o f the p u b lic comments, th e Board i s exp ected to
take fu rth er a c tio n w ith in th e next two months. The p roposal i s
part o f the Board's o v e r a ll review o f i t s r e g u la tio n s as required
by s e c tio n 303 o f the R ieg le Community Development and R egulatory
Improvement Act o f 1994.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n expected by
DATE
1 2 /2 6 /9 5
1 0 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Susan S. Meyers
Senior S e c u r it ie s R egulation A nalyst
D iv isio n o f Banking S u p ervision and R egu lation
202 452-2781
RIN: 7100-AC07
-19-
FR CITE
60 FR 66759
*
#1 2 .
TITLE:
Regulation: H -- Membership of State Banking Institutions in the
Federal Reserve System; and Regulation: K -- International
Banking Operations (Docket Number: R-0921)
LEGAL AUTHORITY:
15 USC 78o-5
CFR CITATION:
12 CFR Part 208
12 CFR Part 211
ABSTRACT:
In A p ril 1996, th e Board, the O ffic e o f the C om ptroller o f the
Currency, and the Federal D eposit Insurance C orporation j o i n t l y
p u b lish ed fo r comment a proposed ru le regarding th e
r e s p o n s i b i l i t i e s o f banks th a t are government s e c u r i t i e s brokers
or d e a le r s w ith r e sp e c t to s a le s p r a c tic e s concerning government
s e c u r i t i e s (61 FR 18470, A p ril 25, 1996). The proposed ru le would
e s t a b lis h standards concerning th e recommendations to custom ers
and th e conduct o f b u sin e ss by a bank th a t i s a government
s e c u r i t i e s broker or d e a le r . The a g en cies a ls o proposed adopting
an in te r p r e ta tio n concerning recommendations to i n s t i t u t i o n a l
custom ers w ith re sp e c t to government s e c u r it ie s tr a n s a c tio n s . The
a g e n c ie s req u ested comment g e n e r a lly on the need fo r and
d e s i r a b i l i t y o f th e proposed r u le and in te r p r e ta t io n . The
proposed ru le i s not exp ected to have a s ig n if ic a n t economic
impact on a s u b s ta n tia l number o f sm all banks.
F ollow ing review o f th e p u b lic comments, the Board i s exp ected to
take fu r th er a c tio n by year-en d .
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 4 /2 5 /9 6
1 2 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
O liv er Irelan d
A sso c ia te General Counsel
Legal D iv isio n
202 452-3625
-20-
FR CITE
61 FR 18470
13.
TITLE:
Regulation: H -- Membership of State Banking Institutions in the
Federal Reserve System; Regulation: Y — Bank Holding Companies
and Change in Bank Control (Docket Number: R-0930)
LEGAL
12
12
12
12
12
12
12
12
12
12
12
12
12
12
12
AUTHORITY:
u se 36
u se 248 (a)
u se 2 4 8 (c)
u se 321-338a
u se 371d
u se 461
u se 481-486
u se 601
u se 611
u se 1814
u se 1823 (j )
u se 18 2 8 (o)
u se 18 3 1 (o)
u se 1831p -l
u se 3105
CFR CITATION:
12 CFR 208 appendix A
ABSTRACT:
In May 1996, th e Board approved is s u in g fo r p u b lic comment a
proposal to r e v is e th e r isk -b a sed c a p it a l treatm ent fo r c e r ta in
c o l la t e r a li z e d tr a n sa c tio n s (61 FR 42565, August 16, 1996). Under
th e Board's e x is t in g r isk -b a sed c a p it a l treatm en t, th e p o rtio n o f
a tr a n sa c tio n th a t i s supported by q u a lify in g c o l la t e r a l (th at
i s , cash or OECD government s e c u r it ie s ) i s r isk -w eig h ted at 20
p erc en t. T ransactions th a t are f u l l y supported by c o l la t e r a l w ith
a p o s it iv e margin may be e l i g i b l e fo r a zero p erc en t. G enerally,
th e p rop osal would perm it a p o rtio n o f a tr a n sa c tio n th a t i s
f u l l y supported with a p o s it iv e margin o f c o l la t e r a l to be
e l i g i b l e fo r a zero percent r is k w eigh t. The p o rtio n th a t i s to
be co n tin u o u sly c o lla t e r a liz e d must be s p e c if ie d by the p a r t ie s .
This p rop osal was developed on an in tera g en cy b a s is and, i f
adopted, would e lim in a te one o f th e su b sta n tiv e d iffe r e n c e s among
the a g e n c ie s w ith regard to the risk -b a se d c a p it a l treatm ent for
c o l la t e r a li z e d tr a n s a c tio n s . I t would implement part o f the
R ieg le Community Development and R egulatory Improvement Act of
1994, which req u ires th e a g en cies to make uniform r e g u la tio n s and
g u id e lin e s implementing common su p erv iso ry p o l i c i e s . The e f f e c t
o f th e proposal would be to allow i n s t i t u t i o n s to hold l e s s
c a p it a l fo r c e r ta in c o l la t e r a liz e d tr a n s a c tio n s . I t i s not
exp ected to have a s ig n if ic a n t economic impact on a s u b s ta n tia l
number o f sm all e n t i t i e s .
Follow ing review of the p u b lic comments, the Board i s expected to
take fu r th er a ctio n by year-end.
TIMETABLE:
ACTION
Board requ ested comment
Further Board a ctio n by
DATE
0 8 /1 6 /9 6
1 2 /0 0 /9 6
-21-
FR CITE
61 FR 42565
4
TITLE:
Regulation: H -- Membership of State Banking Institutions in the
Federal Reserve System; Regulation: Y — Bank Holding companies
and Change in Bank Control (Docket Number: R-0930)
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Barbara Bouchard
Supervisory F in a n cia l A nalyst
D iv isio n o f Banking S u p erv isio n and R egu lation
202 452-3072
K
-22-
14.
TITLE:
R egulation: 0 — Loans to E xecutive O ffic e r s , D ir e c to r s, and
P rin cip a l Shareholders o f Member Banks (Docket Number: R-0924)
LEGAL AUTHORITY:
12 USC 375b
PL 102-242
CFR CITATION:
12 CFR 215
ABSTRACT:
In A p ril 1996, the Board approved is s u in g fo r p u b lic comment a
proposed amendment to R egulation 0, which lim it s how much and on
what terms a bank may lend to i t s own in s id e r s and in s id e r s of
i t s a f f i l i a t e s (61 FR 19863, May 3, 1996). Under th e proposed
r u le , four o f the f iv e r e s t r ic t io n s o f R egu lation 0 would not
apply to e x te n sio n s o f c r e d it by a bank to e x e c u tiv e o f f ic e r s and
d ir e c to r s o f the bank's a f f i l i a t e s , provided th a t th o se ex e cu tiv e
o f f ic e r s and d ir e c to r s were not engaged in major policym aking at
the len d in g bank. The f i f t h r e s t r ic t io n , which p r o h ib its lend in g
on p r e f e r e n tia l term s, would con tinu e to apply to e x te n sio n s of
c r e d it to such p erso n s.
R egulation 0 has long con tained an ex cep tio n from a l l the
r e s t r ic t io n s o f R egu lation 0 fo r q u a lify in g e x e c u tiv e o f f ic e r s o f
a f f i l i a t e s . The R ieg le Community Development and R egulatory
Improvement Act o f 1994 au th orized the Board to extend the
ex cep tio n to q u a lify in g d ir e c to r s but a ls o sc a le d back the
ex cep tio n w ith re sp e c t to p r e f e r e n tia l term s. As a r e s u lt ,
R egulation 0 must be sc a le d back fo r e x e c u tiv e o f f i c e r s of
a f f i l i a t e s at the same time i t i s expanded fo r d ir e c to r s of
a ffilia te s .
The proposed amendment a ls o would sim p lify use o f th e ex cep tion
by e lim in a tin g the requirem ent th a t an e x e c u tiv e o f f i c e r or
d ir e c to r be excluded from major policym aking at the len d in g bank
by a r e s o lu tio n o f th e board o f d ir e c to r s o f th e a f f i l i a t e
employing th e e x e c u tiv e o f f ic e r or d ir e c to r . Under the amendment,
such a r e s o lu tio n would only be required o f the board o f
d ir e c to r s o f the len d in g bank.
I t i s not a n tic ip a te d th a t the amendment would have a
s i g n i f i c a n t l y adverse economic impact on a s u b s ta n tia l number o f
sm all i n s t i t u t i o n s . F ollow ing review o f the p u b lic comments, the
Board i s exp ected to take fu rth er a c tio n w ith in th e next two
months.
TIMETABLE:
ACTION
Board requ ested comment
Further Board a c tio n by
DATE
0 5 /0 3 /9 6
1 0 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
FR CITE
61 FR 19863
TITLE:
R egu lation: 0 — Loans to E xecu tive O ffic e r s , D ir e c to r s, and
P r in c ip a l Shareholders o f Member Banks (Docket Number: R-0924)
AGENCY CONTACT:
Gordon M ille r
A ttorney
Legal D iv isio n
202 452-2534
%
i
►
»
-2 4 -
TITLE:
R egulation: R — R ela tio n s with D ealers in S e c u r itie s Under
S ectio n 32, Banking Act o f 1933 (Docker Number: R-0931)
LEGAL AUTHORITY:
12 USC 32
CFR CITATION:
12 CFR Part 218
ABSTRACT:
In June 1996, the Board approved is s u in g fo r p u b lic comment a
p roposal to remove R egulation R from the Code o f Federal
R egu lation s and a Board in te r p r e ta tio n th a t a p p lie s the
in te r lo c k s p r o h ib itio n s o f s e c tio n 32 o f the G la s s -S te a g a ll Act
to bank h old in g companies (61 FR 34749, July 3, 1996). S ectio n 32
p r o h ib its o f f i c e r , d ir e c to r , and employee in te r lo c k s between
member banks and firm s "prim arily engaged" in underw riting and
d ea lin g in s e c u r i t i e s . The Board proposed to remove R egulation R,
sin c e th e s o le purpose o f the r e g u la tio n c u r r e n tly i s to r e s t a te
the s ta tu to r y p r o v isio n s o f s e c tio n 32. In a d d itio n , because
s e c tio n 32 does n ot, by i t s term s, apply to bank h old in g
com panies, th e Board proposed r e scin d in g i t s in te r p r e ta tio n
ap plying s e c tio n 32 to th e se com panies. The Board exp ressed the
view th a t re scin d in g the in te r p r e ta tio n could g iv e some measure
o f r e g u la to r y r e l i e f to bank h old in g companies and o f f e r them
a c c e ss to a la r g e r p ool o f persons from which to choose t h e ir
o f f i c e r s , d ir e c t o r s , and em ployees.
I t i s not a n tic ip a te d th a t the p roposal w ill have a s ig n if ic a n t
economic impact on a s u b s ta n tia l number o f sm all e n t i t i e s su b jec t
to th e Board's r e g u la tio n . Follow ing review o f th e p u b lic
comments, th e Board i s exp ected to take fu rth er a c tio n w ith in the
next th ree months. The proposal i s part o f th e Board's o v e r a ll
review o f i t s r e g u la tio n s as required by s e c tio n 303 o f the
R ieg le Community Development and R egulatory Improvement Act o f
1994.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 7 /0 3 /9 6
1 1 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Thomas C orsi
Senior A ttorney
Legal D iv isio n
202 452-3275
-25-
FR CITE
61 FR 34749
TITLE:
R egu lation: U - - C redit by Banks for the Purpose of Purchasing or
Carrying Margin Stocks (Docket Number: R-0905)
LEGAL AUTHORITY:
15 u se 78g S e c u r itie s Exchange Act of 1934, as amended
15 u se 7 8h S e c u r itie s Exchange Act of 1934, as amended
15 u se 7 8w S e c u r itie s Exchange Act of 1934, as amended
CFR CITATION:
12 CFR 221
ABSTRACT:
The .Board i s conducting a p e r io d ic review o f R egu lation U, which
g e n e r a lly r e g u la te s bank e x te n sio n s o f c r e d it th a t are secured by
p u b lic ly traded sto c k . In December 1995, th e Board proposed
amendments fo r p u b lic comment th a t would (1) reduce the
r e g u la to r y burden a s s o c ia te d w ith loan s secured by margin sto ck
and oth er c o l l a t e r a l and (2) c l a r i f y th e circu m stan ces under
which a bank may fin a n ce th e purchase o f customer s e c u r it ie s
bought on a cash b a s is at a b ro k er-d ea ler (60 FR 63660, December
12, 1995) . Comment was a ls o in v ite d on a l l oth er areas o f the
r e g u la tio n . The p ro p o sa ls s a t i s f y requirem ents under s e c tio n 303
o f th e R ieg le Community Development and R egulatory Improvement
Act o f 1994.
In May 1996, th e Board req u ested comment on R egu lation s G, T, and
U (Docket Number R-0923, 61 FR 20399, May 6, 1996). The proposal
in c lu d e s a req u est fo r comment on th e ap p rop riate scope o f
R egu lation U by s o l i c i t i n g view s on th e d e f in it io n o f "margin
sto c k ." Responses to th e req u est w i l l be co n sid ered as part of
th e p e r io d ic review o f R egu lation U.
I t i s not a n tic ip a te d th a t th e r e v is io n s w i l l have a s ig n if ic a n t
economic impact on the o v e r a ll len d in g a c t i v i t i e s o f a
s u b s ta n tia l number o f sm all banks. F ollow ing review o f the p u b lic
comments, th e Board i s exp ected to take fu r th er a c tio n w ith in the
next th ree months.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
1 2 /1 2 /9 5
1 1 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
S c o tt J. Holz
S en ior A ttorney
D iv isio n o f Banking S u p erv isio n and R egu lation
202 452-2781
RIN: 7100-AB65
-26-
FR CITE
60 FR 63660
17.
TITLE:
R egulation: V - - Loan Guarantees for D efense Production (Docket
Number: R-0928)
LEGAL
50
E
O
EO
AUTHORITY:
App. USC 2061 e t seq
12919
10789
CFR CITATION:
12 CFR 245
ABSTRACT:
In May 1996, as part o f i t s reg u la to ry review p ro cess mandated by
s e c tio n 303 o f th e R ieg le Community Development and R egulatory
Improvement Act o f 1994, the Board approved is s u in g fo r p u b lic
comment a p rop osal to a b o lish i t s R egu lation V as o b so le te (61 FR
26471, May 28, 1996). R egulation V implements th e loan guarantee
p r o v isio n s o f T i t le I I I o f the Defense Production Act o f 1950, as
amended (the A c t), by s e t t in g fo rth a p p lic a b le procedures, forms,
f e e s , ch arges, and r a te s o f in t e r e s t fo r such loan g u aran tees. In
1975, amendments to th e Act made the guarantee p r o v isio n s
o b s o le te fo r most p r a c t ic a l purposes, but th e loan guarantee
p r o v isio n s were not d e le te d . No loan gu aran tees are c u rr en tly
ou tstan d in g and no a p p lic a tio n s fo r loan guarantees have been
f i l e d fo r se v e r a l y ea r s. The p roposal seek s to e lim in a te an
o b s o le te r e g u la to r y p r o v isio n and does not impose any su b s ta n tia l
economic burden on sm all e n t i t i e s .
F ollow ing review o f th e p u b lic comments, th e Board i s expected to
take fu rth er a c tio n w ith in the next month.
DATE
0 5 /2 8 /9 6
1 0 /0 0 /9 6
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Heatherun A llis o n
A ttorney
Legal D iv isio n
202 452-3565
-2 7 -
FR CITE
61 FR 26471
TITLE:
R egu lation : Y — Bank Holding Companies and Change in Bank
C ontrol (Docket Number: R-0935)
LEGAL
12
12
12
12
12
AUTHORITY:
USC 1841 e t seq
USC 3106
USC 3108
USC 1817 (j) (13)
USC 18 1 8 (b)
CFR CITATION:
12 CFR 225
ABSTRACT:
In August 1996, th e Board approved is s u in g fo r p u b lic comment a
com prehensive r e v is io n o f R egu lation Y th a t i s in ten d ed to
improve th e co m p etitiv en ess o f bank h olding companies by
e lim in a tin g unnecessary r e g u la to r y burden and o p era tin g
r e s t r ic t io n s and by str e a m lin in g th e a p p lic a t io n /n o t ic e p ro cess
(61 FR 47241, September 6, 1 9 9 6 ). The proposal i s a ls o p art o f
th e Board’s o v e r a ll review o f i t s r e g u la tio n s as req u ired by
s e c t io n 303 o f th e R ieg le Community Development and R egulatory
Improvement Act o f 1994. Among o th er r e v is io n s , th e Board
proposed to e s t a b lis h a strea m lin ed and ex p ed ited review p ro cess
fo r bank and nonbanking p ro p o sa ls by w ell-ru n bank h old in g
com panies. The Board a ls o proposed to reorgan ize and expand th e
reg u la to r y l i s t o f nonbanking a c t i v i t i e s and to remove a number
o f r e s t r i c t i o n s on th o se a c t i v i t i e s th a t are outmoded, have been
superseded by Board ord er, or do not apply to in su red banks th a t
conduct th e same a c t i v i t y . In a d d itio n , the Board proposed
se v e r a l amendments to th e ty in g r e s t r i c t i o n s , in c lu d in g removal
o f th e re g u la to r y e x te n sio n o f th o se r e s t r ic t io n s to bank h old in g
companies and t h e ir nonbank s u b s id ia r ie s . A number o f oth er
changes have a ls o been proposed to e lim in a te unnecessary
re g u la to r y burden and to stre a m lin e and modernize R egu lation Y,
in c lu d in g changes to th e p r o v is io n s implementing th e Change in
Bank C ontrol Act and s e c t io n 914 o f th e F in a n cia l I n s t it u t io n s
Reform, Recovery, and Enforcement Act o f 1989.
I t i s exp ected th a t the numerous changes proposed w i l l r e s u lt in
a s i g n if ic a n t red u ction in r e g u la to r y f i l i n g s , in th e paperwork
burden and p ro ce ssin g tim e a s s o c ia te d w ith re g u la to r y f i l i n g s ,
and in th e c o s ts a s s o c ia te d w ith complying w ith r e g u la tio n ,
th ereb y improving th e a b i l i t y o f a l l bank h old in g com panies,
in c lu d in g sm all o r g a n iz a tio n s, to conduct b u sin e ss on a more
c o s t - e f f i c i e n t b a s is . The Board s p e c i f i c a l l y in v it e d p u b lic
comment on t h is a sp ect o f th e proposed r e v is io n s . F ollow ing
review o f th e p u b lic comments, th e Board i s exp ected to take
fu r th e r a c tio n in e a r ly 1997.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 9 /0 6 /9 6
0 3 /0 0 /9 7
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
-28-
FR CITE
61 FR 47241
TITLE:
R egulation: Y - - Bank Holding Companies and Change in Bank
Control (Docket Number: R-0935)
AGENCY CONTACT:
Diane A. Koonjy
Senior A ttorney
Legal D iv isio n
202 452-3274
-29-
19.
TITLE:
R egu lation: C — A v a ila b ilit y o f Funds and C o lle c tio n o f Checks
C
(Docket Number: R-0926)
LEGAL AUTHORITY:
12 USC 4001 e t seq
CFR CITATION:
12 CFR 229
ABSTRACT:
As p art o f i t s re g u la to ry review p ro cess mandated by s e c tio n 303
o f th e R ieg le Community Development and R egulatory Improvement
Act o f 1994, th e Board proposed c la r if y in g and te c h n ic a l
amendments to i t s R egu lation CC in June 1996 (61 FR 27802,
June 3, 1996). The proposed amendments, which do not rep resen t
any major p o lic y changes, address a v a r ie t y o f check c o l le c t io n
is s u e s , in c lu d in g the treatm ent o f d e p o s its r e c e iv e d at
"contractu al" branches (such as a f f i l i a t e b a n k s). A growing
number o f banks are asking fo r c l a r i f i c a t i o n o f co n tr a c tu a l
branching is s u e s w ith th e advent o f in t e r s t a t e banking. Many o f
th e proposed amendments are d esign ed to reduce th e burden on
banks o f complying w ith th e r e g u la tio n . The amendments would
apply to a l l d ep o sito ry i n s t i t u t i o n s and are not l i k e l y to have a
s ig n if ic a n t economic impact on sm all i n s t i t u t i o n s .
F ollow ing review o f th e p u b lic comments, th e Board i s exp ected to
take fu r th er a c tio n by year-end .
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 6 /0 3 /9 6
1 2 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Stephanie Martin
S en ior A ttorney
Legal D iv isio n
202 452-3198
-3 0 -
FR CITE
61 FR 27802
20.
TITLE:
R egulation: D - - Truth in Savings (Docket Number: R-0836 and
D
Docket Number: R-0869)
LEGAL AUTHORITY:
12 USC 4301 e t seq
CFR CITATION:
12 CFR 230
ABSTRACT:
S ectio n s 261 to 275 o f the Federal D eposit Insurance Corporation
Improvement Act o f 1991 req u ire d ep o sito ry in s t it u t io n s to
provide a schedu le o f term s, r a te s , and fe e s for d e p o sit accounts
o ffe r e d by th e i n s t i t u t i o n . The law a ls o s e t s fo rth r u le s for
ad vertisem en ts fo r d e p o sit accou n ts.
In January 1995, the Board issu e d for p u b lic comment proposed
amendments to R egulation D th a t would produce an annual
D
percentage y ie ld (APY) th a t r e f l e c t s th e tim ing o f in t e r e s t
payments as w e ll as the tim ing o f compounding. The proposal a ls o
s o l i c i t s comment on an a lt e r n a t iv e method o f c a lc u la tin g the APY
(an in te r n a l r a te of return formula) (60 FR 5142, January 26,
1995). The January 1995 proposal i s an outgrowth o f a May 1994
p roposal th a t would have a ffe c te d in s t i t u t i o n s ' compounding and
c r e d itin g p r a c tic e s in a d d itio n to changing the APY (59 FR 24378,
May 11, 1 994). The Board a ls o adopted in January 1995 an in terim
ru le th a t perm its in s t it u t io n s and d e p o sit brokers a d v e r tisin g
noncompounding m u lti-y ea r time accounts th a t req u ire in t e r e s t
payouts a t le a s t annually to d is c lo s e an APY equal to the
in t e r e s t ra te (60 FR 5128, January 26, 1995; Docket No. R -0836).
P ub lic comment on the approach was s o l i c i t e d in a Ju ly 1994
n o tic e exten d in g the comment p eriod fo r th e May 1994 p roposal (59
FR 35271, Ju ly 11, 1994). The economic impact on sm all
i n s t i t u t i o n s w i l l depend upon the v a r ie ty o f d e p o sit products
o ffe r e d , th e ex te n t o f the d is c lo s u r e s , and the o p tio n s for
com pliance o ffe r e d by the f in a l r u le .
The Congress i s co n sid erin g l e g i s l a t i o n th a t would req u ire
s u b s ta n tia l r e v is io n s to R egulation DD, in clu d in g e lim in a tin g the
APY. Further a c tio n by the Board i s d eferred , pending a c tio n by
the Congress on Truth in Savings l e g i s l a t i o n .
TIMETABLE:
ACTION
Board req u ested comment
Board extended comment p eriod
Board adopted an in terim ru le
Board requ ested fu rth er comment
Further Board a c tio n fo llo w in g
C ongressional a c tio n
DATE
05/11/94
07/11/94
0 1 /2 6 /9 5
0 1 /2 6 /9 5
1 2 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: Yes
-3 1 -
59
59
60
60
FR CITE
FR 24378
FR 35271
FR 5128
FR 5142
TITLE:
Regulation: DD — Truth in Savings
Docket Number: R-0869)
(Docket Number:
AGENCY CONTACT:
Jane Ahrens
S en ior A ttorney
D iv isio n o f Consumer and Community A ffa ir s
202 452-3667
RIN:
7100-AB80
-32-
R-0836 and
21.
TITLE:
Federal Reserve Bank Book-Entry S e c u r itie s T ransfer S erv ices
(Docket Number: R-0866)
LEGAL AUTHORITY:
12 USC 221 e t seq
CFR CITATION:
None
ABSTRACT:
In January 1995, the Board req u ested p u b lic comment on the
e f f e c t s o f opening the Fedwire o n -lin e b ook-entry s e c u r it ie s
tr a n s fe r s e r v ic e e a r lie r in th e day, on new s e r v ic e c a p a b ilit ie s
r e la te d to e a r lie r opening, and on esta b lish m en t o f a firm
c lo s in g tim e for the s e r v ic e (60 FR 123, January 3, 1995) . An
e a r lie r opening time could b e n e f it th e f in a n c ia l markets by
f a c i l i t a t i n g in te r n a tio n a l tr a n s a c tio n s , p rovid in g in crea sed
liq u i d i t y , and reducing r is k . P a r tic ip a tio n in th e proposed
ea rly -h o u r s e r v ic e would be v o lu n ta ry ; th e r e fo r e , the se r v ic e
should not have a s ig n if ic a n t economic e f f e c t on a s u b s ta n tia l
number o f sm all e n t i t i e s .
In August 1995, fo llo w in g review o f th e p u b lic comments, the
Board adopted a firm c lo s in g tim e o f 3:15 pm (ET) fo r tr a n sfe r
o r ig in a tio n s and 3:30 pm (ET) fo r r e v e r s a ls , e f f e c t i v e January 2,
1996 (60 FR 42410, August 15, 1995).
F ollow ing fu rth er review o f th e p u b lic comments, th e Board i s
exp ected to take fu rth er a c tio n regarding e a r lie r opening and new
s e r v ic e c a p a b ilit ie s by year-end .
TIMETABLE:
ACTION
Board requ ested comment
Board adopted firm c lo s in g tim e
Further Board a c tio n by
DATE
0 1 /0 3 /9 5
0 8 /1 5 /9 5
1 2 /0 0 /9 6
FR CITE
60 FR 123
60 FR 42410
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
L isa Hoskins
P ro ject Leader
D iv isio n o f Reserve Bank O perations and Payment Systems
202 452-3437
RIN: 7100-AB97
-3 3 -
22.
TITLE:
Federal Reserve Payments System Risk P o lic y (Docket Number:
R-0889)
LEGAL AUTHORITY:
12 USC 221 e t seq
CFR CITATION:
None
«
ABSTRACT:
In August 1995, th e Board req u ested p u b lic comment on a p o lic y to
c o n tr o l a c c e ss to Federal Reserve Bank automated c le a r in g house
(ACH) s e r v ic e s by e n t i t i e s oth er than th e d e p o sito r y i n s t i t u t i o n s
whose Federal Reserve accounts w i l l be d eb ite d (60 FR 42413,
August 15, 1995). The proposed p o lic y i s in ten d ed to help ensure
th e s a f e t y and soundness o f th e ACH system .
The proposed p o lic y could have a s ig n if ic a n t economic impact on a
s u b s ta n tia l number o f sm all d e p o sito r y i n s t i t u t i o n s th a t use
Federal R eserve ACH s e r v ic e s or th ir d -p a r ty ACH s e r v ic e
p r o v id e r s. The p rop osal would req u ire th o se i n s t i t u t i o n s to
perform c r e d it assessm en ts o f t h e ir corp orate custom ers who
o r ig in a t e ACH c r e d it t r a n s fe r s , s e t c r e d it lim it s fo r th o se
custom ers, and tran sm it th o se lim it s to a m onitoring f a c i l i t y
operated by e it h e r th e Federal Reserve or th e th ir d -p a r ty s e r v ic e
p ro v id er.
F ollow ing review o f th e p u b lic comments, th e Board i s exp ected to
take fu r th er a c tio n by year-end .
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 8 /1 5 /9 5
1 2 /0 0 /9 6
FR CITE
60 FR 42413
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: Yes
AGENCY CONTACT:
S c o tt E. Knudson
S en ior F in a n c ia l S e r v ic e s A nalyst
D iv isio n o f Reserve Bank O perations and Payment Systems
202 452-3959
RIN: 7100-AC04
-
-3 4 ________________________________________________ _____ _
23.
TITLE:
Revenue Limit on B a n k -In e lig ib le A c t i v i t i e s o f S u b sid ia r ie s of
Bank Holding Companies Engaged in Underwriting and D ealing in
S e c u r itie s (Docket Number: R-0841)
LEGAL AUTHORITY:
12 USC 377
CFR CITATION:
None
ABSTRACT:
S ectio n 20 o f the G la s s -S te a g a ll Act p r o h ib its a member bank from
being a f f i l i a t e d with a company th a t i s "engaged p r in c ip a lly " in
underw riting and d ea lin g in s e c u r it ie s th a t a bank may not
underw rite and deal in d ir e c t ly ( " in e lig ib le s e c u r it ie s " ) . In
July 1994, the Board iss u e d fo r p u b lic comment a proposal to
provide an a lt e r n a t iv e to th e current indexed revenue t e s t used
to measure com pliance w ith th e "engaged p r in c ip a lly " standard for
s u b s id ia r ie s o f bank h old in g companies engaged, to a lim ite d
e x te n t, in underw riting and d e a lin g in i n e l i g i b l e s e c u r it ie s
(" se c tio n 20 su b s id ia r ie s" ) (59 FR 35516, July 12, 1994). The
current t e s t lim it s to 10 p ercen t o f the t o t a l revenue o f a
s e c tio n 20 su b sid ia ry the revenue earned by the su b sid ia r y from
i n e l i g i b l e s e c u r it ie s a c t i v i t i e s . Comments were s o l i c i t e d on
whether a s s e t v a lu es or s a le s volume d ata, or a com bination of
both m easures, should be used as a new a lt e r n a t iv e t e s t .
In July 1996, the Board again sought p u b lic comment on t h is
docket item proposing to r e ta in a t e s t based on revenue but r a is e
from 10 p ercen t to 25 p ercen t th e lim it on revenue earned by a
s e c tio n 20 su b sid ia ry from i n e l i g i b l e s e c u r it ie s a c t i v i t i e s (61
' FR 40643, August 5, 1996) . The proposal would allow s e c tio n 20
■
s u b s id ia r ie s a d d itio n a l f l e x i b i l i t y in the conduct o f t h e ir
s e c u r it ie s o p era tio n s and a r is e s due to (1) the Board's in crea sed
exp erien ce in review ing and m onitoring the a c t i v i t i e s and
o p era tio n s o f s e c tio n 20 s u b s id ia r ie s and (2) the Board's b e l i e f
th a t changes in the product mix th a t s e c tio n 20 s u b s id ia r ie s are
perm itted to o f f e r and developm ents in the s e c u r it ie s markets
have a ffe c te d the r e la tio n s h ip between revenue and a c t i v i t y . The
proposal i s not expected to have a s ig n if ic a n t economic impact on
sm all e n t i t i e s nor on a s u b s ta n tia l number o f bank holding
com panies.
F ollow ing review o f th e p u b lic comments, the Board i s expected to
take fu rth er a c tio n by year-en d .
TIMETABLE:
ACTION
Board requested comment
Board requ ested fu rth er comment
Further Board a c tio n by
DATE
07/12/94
0 8 /0 5 /9 6
1 2 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
-35
FR CITE
59 FR 35516
61 FR 40643
TITLE:
Revenue Limit on B a n k -In e lig ib le A c t i v i t i e s o f S u b sid ia r ie s o f
Bank Holding Companies Engaged in Underw riting and D ealing in
S e c u r it ie s (Docket Number: R-0841)
AGENCY CONTACT:
Thomas C orsi
S en ior A ttorney
Legal D iv isio n
202 452-3275
RIN:
7100-AB82
■
*
-
*
-36-
24.
TITLE:
Review of R e s tr ic tio n s on D irector and Employee I n te r lo c k s ,
Cross-M arketing A c t iv it ie s and the Purchase and S ale of F in a n cia l
A ssets (Docket Number: R-0701)
LEGAL AUTHORITY:
12 USC 1843 (c) (8)
CFR CITATION:
None
ABSTRACT:
The Board i s p rovid in g a second op portu nity fo r p u b lic comment on
proposed r e v is io n s to th ree o f the p ru d en tia l lim it a t io n s
e s ta b lis h e d in i t s orders under s e c tio n 4 ( c ) (8) o f th e Bank
Holding Company Act and s e c tio n 20 o f the G la s s -S te a g a ll Act th a t
perm it a nonbank su b sid ia ry o f a bank h olding company to
underw rite and d eal in s e c u r i t i e s .
In August 1996, the Board proposed to ease or e lim in a te the
fo llo w in g r e s t r ic t io n s on th e se s o - c a lle d s e c tio n 20
s u b s id ia r ie s : the p r o h ib itio n on d ir e c to r , o f f i c e r , and employee
in te r lo c k s between a s e c tio n 20 su b sid ia ry and i t s a f f i l i a t e d
banks or t h r i f t s (the in te r lo c k s r e s t r i c t i o n ) ; th e r e s t r ic t io n on
a bank or t h r i f t a c tin g as agent fo r , or engaging in marketing
a c t i v i t i e s on b eh a lf o f, an a f f i l i a t e d s e c tio n 20 su b sid ia r y (the
cross-m ark etin g r e s t r i c t i o n ) ; and the r e s t r ic t io n on th e purchase
and s a le o f f in a n c ia l a s s e t s between a s e c tio n 20 su b sid ia r y and
i t s a f f i l i a t e d bank or t h r i f t (the f in a n c ia l a s s e t s
r e s t r i c t i o n ) (61 FR System 40640, August 5, 1996).
The amendments are not l i k e l y to have a s ig n if ic a n t economic
impact on a s u b s ta n tia l number o f sm all e n t i t i e s . S ectio n 20
s u b s id ia r ie s are g e n e r a lly e s ta b lis h e d by the la r g e s t bank
h old in g com panies. However, i t i s hoped th a t the proposed
r e v is io n s , i f adopted, would reduce c o st b a r r ie r s fo r sm aller
bank h o ld in g companies co n sid erin g esta b lish m en t o f a s e c tio n 20
s u b s id ia r y . F ollow ing review o f the p u b lic comments, th e Board i s
exp ected to take fu rth er a c tio n w ith in the next two months.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 8 /0 5 /9 6
1 0 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Gregory Baer
Managing Senior Counsel
Legal D iv isio n
202 452-3236
-37-
FR CITE
61 FR 40640
25.
TITLE :
R
Rules 1 egarding A v a ila b ilit y o f Inform ation (Docket Number:
R-0917 )
LEGAL
5
12
12
12
12
12
12
12
12
12
12
12
12
12
12
AUTHORITY:
u se 552
u se 2 4 8 (i)
u se 2 4 8 (k)
u se 321 e t seq
u se 611 e t seq
u se 1442
u se 1 8 1 7 (a )( 2 ) (A)
u se 1817(a) (8)
u se 18 1 8 (u)
u se 1 8 1 8 (v)
u se 1 8 2 1 (o)
u se 1821 (t)
u se 1830
u se 1844
u se 1951 e t seq
w
<1
4
r -4 j
]
r]
4
>
»
]
1
CFR CITATION:
12 CFR 261
ABSTRACT:
In February 1996, th e Board is s u e d fo r p u b lic comment proposed
amendments to i t s Rules Regarding A v a ila b ilit y o f Inform ation (61
FR 7436, February 28, 1 9 9 6 ). The proposed amendments, although
p rim a rily te c h n ic a l in n a tu re, are intended to improve th e
Board's e f f ic ie n c y in p r o c e ssin g req u ests fo r th e d is c lo s u r e o f
p u b lic ly - a v a ila b le in fo rm a tio n as w e ll as c o n f id e n t ia l
su p erv iso ry in fo rm a tio n . I t i s not a n tic ip a te d th a t th e proposed
amendments w i l l have a s i g n if ic a n t economic impact on a
s u b s ta n tia l number o f sm all e n t i t i e s su b jec t to th e r e g u la tio n .
F ollow ing review o f th e p u b lic comments, th e Board i s exp ected to
take fu r th er a c tio n by y ea r-en d . The amendments are p art o f th e
Board's o v e r a ll review o f i t s r e g u la tio n s as requ ired by s e c t io n
303 o f th e R ieg le Community Development and R egulatory
Improvement Act o f 1994.
TIMETABLE:
ACTION
Board req u ested comment
Further Board a c tio n by
DATE
0 2 /2 8 /9 6
1 2 /0 0 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Karen Appelbaum
A ttorney
Legal D iv isio n
202 452-3389
<I
.
-3 8 -
FR CITE
61 FR 7436
*
•*-
S ectio n 3
Completed A ction s
k,
-39-
TITLE:
R egulation: E — E le c tr o n ic Fund T ransfers (Docket Number:
R-0830)
LEGAL AUTHORITY:
15 USC 1693b
CFR CITATION:
12 CFR 205
ABSTRACT:
In March 1996, fo llo w in g review o f the p u b lic comments, th e Board
com pleted a review o f R egu lation E, which implements the
E le c tr o n ic Fund T ransfer Act (61 FR 19661, May 2, 1996). The a ct
and r e g u la tio n e s t a b lis h th e b a sic r ig h t s , l i a b i l i t i e s , and
r e s p o n s i b i l i t i e s o f consumers who use e le c t r o n ic fund tr a n s fe r
s e r v ic e s and o f f in a n c ia l in s t i t u t i o n s th a t o f f e r th e se s e r v ic e s
(whether or not the in s t i t u t i o n s hold th e consum er's a cc o u n t).
The review was part o f th e Board's R egulatory Planning and Review
Program, which p rovid es fo r th e p e r io d ic review o f Board
r e g u la tio n s to determ ine whether a r e g u la tio n should be
e lim in a te d , updated, s im p lif ie d , or oth erw ise r e v is e d .
The amendments to R egu lation E s im p lify , c l a r i f y , and update th e
r e g u la tio n . Because th e r e g u la tio n c l o s e ly p a r a lle ls the
s ta tu to r y requirem ents, th ere were few su b sta n tiv e changes to th e
March 1994 p ro p o sa l. C ertain r e v is io n s expand th e scope o f
exem ptions from coverage to h elp reduce com pliance burden. For
example, th e a s s e t - s i z e c u t o ff fo r a "small in s t it u t io n "
exemption — e s ta b lis h e d by th e r e g u la tio n — in cr ea se d from $25
m illio n to $100 m illio n . S im ila r ly , th e re g u la to r y exemption fo r
s e c u r it ie s tr a n sa c tio n s i s broader in th a t i t a p p lie s to
tr a n s fe r s made through reg u la ted brokers or d e a le r s (or fu tu r e s
commission merchants) even i f th e s e c u r ity or commodity i t s e l f i s
not r e g u la te d (as in th e ca se o f m unicipal s e c u r i t i e s ) .
The f in a l r e g u la tio n has been shortened by about f i f t e e n p erc en t,
a red u ction la r g e ly a ttr ib u ta b le to th e d e le tio n o f o b s o le te
p r o v isio n s and to th e tr a n s fe r o f exp lan atory m a te ria l to the
commentary. In a d d itio n , th e s t a f f commentary in te r p r e tin g th e
r e g u la tio n has been reform atted and s i g n i f i c a n t l y improved to
f a c i l i t a t e com pliance.
The f i n a l r u le i s not exp ected to have a s ig n if ic a n t economic
impact on sm all i n s t i t u t i o n s . The amendments a ls o are co n sid ered
a p art o f th e Board's o v e r a ll review o f i t s r e g u la tio n s as
req u ired by s e c tio n 303 o f the R eig le Community Development and
R egulatory Improvement Act o f 1994.
TIMETABLE:
ACTION
Board approved req u estin g comment
Board adopted f in a l ru le
DATE
0 3 /0 7 /9 4
0 5 /0 2 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
FR CITE
59 FR 10684
61 FR 19661
TITLE:
R egulation: E - - E le c tr o n ic Fund T ransfers (Docket Number
R-0830)
AGENCY CONTACT:
Jane Jensen G ell
A ttorney
D iv isio n o f Consumer and Community A ffa ir s
202 452-2084
RIN: 7100-AA77
27.
TITLE:
Regulation H -- Membership of State Banking Institutions in the
Federal Reserve System (Docket Number: R-0897)
LEGAL AUTHORITY:
42 USC 4001 e t seq
CFR CITATION:
12 CFR 208
ABSTRACT:
The N a tio n a l Flood Insurance Reform Act o f 1994 ( T it le V o f the
R ieg le Community Development and R egulatory Improvement Act o f
1994) in c lu d e s a number o f amendments to the Flood D isa ste r
P r o te c tio n Act o f 1973. The amendments are in tend ed to improve
com pliance w ith e x is t in g flo o d in su ran ce purchase requirem ents,
in clu d in g p r o v isio n s concerning fo rced placem ent o f p o l i c i e s ,
escrow ing o f in su ran ce premiums, standard d eterm in ation forms,
n o t if ic a t io n requirem ents, p e n a lt ie s fo r noncom pliance, and
com pliance exam ination requ irem en ts. A ll s t a t e member banks,
in c lu d in g sm all i n s t i t u t i o n s , w i l l be su b je c t to th e amended
p r o v is io n s .
Under th e s t a t u t e , th e fe d e r a l banking a g en cies are to c o n su lt
and co o rd in a te on the development o f im plem enting r e g u la tio n s
through th e Federal F in a n c ia l I n s t it u t io n s Examination C oun cil.
In October 1995, th e Board iss u e d fo r p u b lic comment a proposed
r u le developed j o i n t l y by th e banking a g en cies to implement th e
p r o v isio n s o f th e s t a t u t e concerning flo o d insurance purchase,
escrow o f flo o d in su ran ce premiums, and n o t if ic a t io n requirem ents
(60 FR 53962, October 18, 1995). The proposal i s part o f the
Board's o v e r a ll review o f i t s r e g u la tio n s as required by s e c tio n
303 o f th e R ieg le Community Development R egulatory Improvement
Act o f 1994. In August 1996, fo llo w in g review o f the p u b lic
comments, th e Board adopted a f in a l ru le developed j o i n t l y w ith
th e banking a g en cies in s u b s t a n t ia lly th e form proposed (61
FR 45683 August 29, 1996). The r u le i s not expected to have a
s ig n if ic a n t economic impact on sm all i n s t i t u t i o n s .
TIMETABLE:
ACTION
Board req u ested comment
Board adoption p rop osal
DATE
1 0 /1 8 /9 5
0 8 /2 9 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Lawranne Stew art
Senior A ttorney
Legal D iv isio n
202 452-3513
RIN: 7100-AB86
-4 2 -
FR CITE
60 FR 53962
61 FR 45683
28.
TITLE:
Regulation: H -- Membership of State Banking Institutions in the
Federal Reserve System; Regulation: Y — Bank Holding Companies
and Change in Bank Control (Docket Numbers: R-0884 and R-0886)
u
Ul
*
*
♦
L
i
I
LEGAL
12
12
12
12
12
12
12
12
12
12
12
12
12
12
12
AUTHORITY:
u se 36
u se 2 4 8 (a)
u se 2 4 8 (c)
u se 321-338a
u se 371d
u se 461
u se 481-486
u se 601
u se 611
u se 1814
u se 1823 ( j )
u se 1828(o)
u se 1831o
u se 1831p-l
u se 3105
CFR CITATION:
12 CFR Part 208
12 CFR Part 225
ABSTRACT:
In July 1995, the Board requested p u b lic comment on proposed
amendments to i t s risk -b a sed c a p it a l g u id e lin e s fo r S ta te member
banks and bank h old in g companies to in co rp o ra te a measure fo r
market r is k in fo r e ig n exchange and commodity a c t i v i t i e s and in
the tra d in g o f debt and e q u ity in stru m en ts. In March 1996, the
Board req u ested comment on a r e v is io n to i t s p rop osal th a t would
c l a r i f y how th e c a lc u la tio n o f c a p it a l requirem ents would be
ad ju sted based on b a c k -te s tin g o f an i n s t i t u t i o n ' s in te r n a l r is k
measurement model. These p rop osals were c o n s is te n t w ith proposed
in te r n a tio n a l market r is k standards and were developed j o in t ly
w ith the other Federal bank reg u la to ry a g e n c ie s. Follow ing review
o f th e p u b lic comments, th e Board and the oth er a g en cies adopted
a f in a l ru le on market r is k in August 1996 (61 FR 47358,
September 6, 1996). The f in a l ru le in co rp o ra tes a r e v ise d v er sio n
o f th e Ju ly 1995 p ro p o sa l, c o n s is te n t w ith r e v is io n s to
in te r n a tio n a l c a p it a l stand ard s. The f in a l r u le req u ires an
i n s t i t u t i o n to c a lc u la te market r isk c a p it a l requirem ents u sin g
i t s own in te r n a l r is k measurement model and e lim in a te s the
proposed o p tio n o f u sin g a r isk -w e ig h tin g model developed by
su p e r v is o r s. The f in a l ru le in co rp o ra tes th e March 1996 proposal
s u b s t a n t ia lly as proposed.
In Ju ly 1995, the Board a ls o requested comment on an a lt e r n a t iv e
"pre-commitment" approach for s e t t in g market r is k c a p it a l
requirem ents. Under t h is approach, an i n s t i t u t i o n would s p e c ify
the amount o f c a p it a l i t chose to a llo c a t e to support market r isk
over a s p e c if ie d p eriod o f tim e. The Board could provide
-43-
TITLE:
Regulation: H — Membership of State Banking Institutions in the
Federal Reserve System; Regulation: Y -- Bank Holding Companies
and Change in Bank Control (Docket Numbers: R-0884 and R-0886)
ABSTRACT CONT:
in c e n tiv e s fo r i n s t i t u t i o n s to a llo c a t e s u f f i c i e n t market r is k
c a p it a l by methods such as p u b lic d is c lo s u r e o f market r is k
c a p it a l l e v e l s or p e n a lt ie s when lo s s e s exceed a llo c a te d c a p it a l.
F ollow ing review o f th e p u b lic comments, th e Board d id not take
a c tio n on t h i s p ro p o sa l, but in d ic a te d th a t i t may co n sid er t h i s
approach as th e market r is k c a p it a l r u le s co n tin u e to ev o lv e
d o m e stic a lly and in t e r n a t io n a lly .
The market r is k c a p it a l r u le s w i l l a f f e c t on ly i n s t i t u t i o n s w ith
r e l a t i v e l y la r g e tra d in g a c t i v i t i e s and th e r e fo r e w i l l have
l i t t l e or no e f f e c t on sm all e n t i t i e s .
TIMETABLE:
ACTION
Board req u ested comment on R-0884
Board req u ested comment on R-0886
Board adopted R-0884 proposal
DATE
0 7 /2 5 /9 5
0 7 /2 5 /9 5
0 9 /0 6 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
James Houpt
A s s is ta n t D irecto r
D iv isio n o f Banking S u p erv isio n and R egu lation
202 452-3358
RIN: 7100-AC01
FR CITE
60 FR 38081
60 FR 38142
61 FR 47358
29.
TITLE:
Regulation:
R-0916)
K -- International Banking Operations
(Docket Number:
LEGAL AUTHORITY:
12 USC 3105(k)
CFR CITATION:
12 CFR 211
ABSTRACT:
In February 1996, the Board approved is s u in g fo r p u b lic comment a
proposed amendment to R egulation K to implement th e p ro v isio n o f
the R ieg le-N ea l I n te r s t a t e Banking and Branching E ffic ie n c y Act
o f 1994 th a t amended th e In te r n a tio n a l Banking Act o f 1978 by
adding a new su b sectio n regarding th e management o f s h e ll
branches (61 FR 6956, February 23, 1996). The r e le v a n t su b sectio n
p r o h ib its fo r e ig n banks from u sin g t h e ir U.S. branches or
a g en cies to manage ty p es o f a c t i v i t i e s through o ffsh o r e s h e ll
branches th a t could not be managed by a U.S. bank at i t s fo reig n
branches or s u b s id ia r ie s .
I t i s not a n tic ip a te d th a t the p roposal w i l l have a s ig n if ic a n t
economic impact on a s u b s ta n tia l number o f sm all e n t i t i e s su b jec t
to th e Board's r e g u la tio n . In Ju ly 1996, fo llo w in g review o f the
p u b lic comments, the Board adopted th e amendments in the form
proposed (61 FR 39052, Ju ly 26, 1996). The proposal i s part o f
the Board's o v e r a ll review o f i t s r e g u la tio n s as required by
s e c tio n 303 o f th e R ieg le Community Development and Regulatory
Improvement Act o f 1994.
TIMETABLE:
ACTION
Board requ ested comment
Board adopted proposal
DATE
0 2 /2 3 /9 6
0 7 /2 6 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Janet Crossen
Senior A ttorney
Legal D iv isio n
202 452-3281
RIN: 7100-AB88
-45-
FR CITE
61 FR 6956
61 FR 39052
30.
TITLE:
Regulation:
R-0911)
K -- International Banking Operations
(Docket Number:
LEGAL AUTHORITY:
12 USC 1841 et seq
12 USC 3101 et seq
CFR CITATION:
12 CFR 211
ABSTRACT:
The R ieg le-N e a l I n t e r s t a t e Banking and Branching Act o f 1994 (the
I n t e r s t a t e Act) co n ta in s p r o v isio n s a f f e c t in g fo r e ig n banks w ith
U.S. o p e r a tio n s, in c lu d in g , among oth er m a tters, in t e r s t a t e
banking and branching and th e s e le c t io n o f home s t a t e s by fo r e ig n
banks. In December 1995, th e Board issu e d fo r p u b lic comment
proposed r u le s concerning home s t a t e s e le c t io n , removing c e r ta in
outdated r e s t r ic t io n s and making oth er changes needed to
implement th e se s ta tu to r y changes (60 FR 67100, December 28,
1995). Further, the Board req u ested comment on o th er is s u e s
r a ise d fo r fo r e ig n banks under th e I n t e r s t a t e A ct. The p rop osals
are p art o f th e Board's o v e r a ll review o f i t s r e g u la tio n s as
req u ired by s e c tio n 303 o f th e R ieg le Community Development and
R egulatory Improvement Act o f 1994.
In May 1996, fo llo w in g review o f th e p u b lic comments, th e Board
adopted th e r u le s in s u b s t a n t ia lly th e form proposed (61 FR
24439, May 15, 1996). Other is s u e s r a ise d fo r fo r e ig n banks w i l l
be co n sid ered by the Board in i t s fu tu re review o f th e p r o v isio n s
o f R egu lation K concerning th e in t e r s t a t e o p era tio n o f fo r e ig n
banks. I t i s not exp ected th a t th e p ro p o sa ls w i l l have a
s ig n if ic a n t economic impact on a s u b s ta n tia l number o f sm all
banks.
TIMETABLE:
ACTION
Board req u ested comment
Board adopted p roposal
DATE
1 2 /2 8 /9 5
0 5 /1 5 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Douglas M Ely
.
S en ior A ttorney
Legal D iv isio n
202 452-5289
RIN: 7100-AB89
-46-
FR CITE
60 FR 67100
61 FR 24439
TITLE:
Regulation: L —
R-0907)
Management Official Interlocks
(Docket Number:
LEGAL AUTHORITY:
PL 103-325
CFR CITATION:
12 CFR 212
ABSTRACT:
R egulation L implements p r o v isio n s o f the D epository I n s t it u t io n s
Management In te r lo c k s Act (DIMIA), which r e g u la te s management
in te r lo c k s among d ep o sito ry i n s t i t u t i o n s . S ectio n 338 o f the
R ieg le Community Development and R egulatory Improvement Act of
1994 (CDRI Act) amended c e r ta in s e c t io n s o f DIMIA. In December
1995, the Board, along w ith the O ffic e o f th e Com ptroller o f the
Currency, Federal D eposit Insurance C orporation, and O ffic e of
T h rift S u p erv isio n , issu e d fo r p u b lic comment a j o in t proposed
ru le (60 FR 67424, December 29, 1995); th e N ation al C redit Union
A sso c ia tio n iss u e d an id e n t ic a l p ro p o sa l. The proposed ru le
r e v is e s each a g en cy 's r e g u la tio n implementing DIMIA to conform
w ith th e s ta tu to r y changes s e t fo rth in s e c tio n 338 and, in order
to comply w ith s e c tio n 303 o f the CDRI A ct, stre a m lin e s and
m o d ifies th e r e g u la tio n s to improve e f f ic ie n c y , reduce
unnecessary c o s t s , and e lim in a te unwarranted c o n s tr a in ts on
c r e d it a v a i l a b i l i t y .
In August 1996, fo llo w in g review o f the p u b lic comments, the
banking a g en cies adopted th e r u le s s u b s t a n t ia lly as proposed
(61 FR 40293, August 2, 1996).
I t i s not a n tic ip a te d th a t th e f in a l ru le w i l l have a s ig n if ic a n t
impact on a s u b s ta n tia l number o f sm all i n s t i t u t i o n s .
TIMETABLE:
ACTION
Board req u ested comment
Board adopted proposal
DATE
1 2 /2 9 /9 5
0 8 /0 2 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Tina Woo
S ta f f A ttorney
Legal D iv isio n
202 452-3890
RIN: 7100-AB90
-47-
FR CITE
60 FR 67424
61 FR 40293
32.
TITLE:
Regulation: M -- Consumer Leasing
(Docket Number:
R-0892)
LEGAL AUTHORITY:
15 USC 1604
CFR CITATION:
12 CFR 213
ABSTRACT:
The Board i s undertaking a com plete review o f R egu lation M under
th e Board's R egulatory Planning and Review Program. In November
1993, th e Board approved is s u in g fo r p u b lic comment an advance
n o tic e o f th e proposed rulem aking, s o l i c i t i n g comment, g e n e r a lly ,
on r e v is io n s to the r e g u la tio n , w h ile a ls o s o l i c i t i n g comment on
s p e c i f i c is s u e s d e a lin g w ith e a r ly term in a tio n p e n a lt ie s ,
a d v e r tis in g , and se g r e g a tio n o f d is c lo s u r e terms from oth er
in fo rm a tio n . In August 1995, fo llo w in g review o f th e comments,
th e Board approved th e issu a n ce o f a proposed ru le r e v is in g
R egu lation M The proposed rulemaking i s in clu d ed in th e Board’ s
.
o v e r a ll review o f i t s r e g u la tio n s as requ ired by s e c t io n 303 o f
th e R ieg le Community Development and R egulatory Improvement Act
o f 1994.
On September 18, 1996, fo llo w in g review o f th e p u b lic comments,
th e Board adopted f i n a l amendments to R egu lation M (Federal
R e g iste r c i t e u n a v a ila b le ) . The f i n a l r u le co n ta in s many o f the
r e v is io n s th a t were proposed and makes fu rth er changes, some o f
them s u b s ta n tiv e .
Some o f th e changes— lim ite d to motor v e h ic le le a s in g — in clu d e a
statem ent a le r t in g consumers about charges fo r term in a tin g a
le a s e e a r ly and d is c lo s u r e o f how scheduled p e r io d ic payments are
d eriv ed (shown as a m athem atical p r o g r e s s io n ). A le s s o r would not
be req u ired to d is c lo s e a le a s e charge or th e c o s t o f a le a s e
exp ressed as a r a te , but i f i t chose to d is c lo s e or a d v e r tis e a
r a te , th e le s s o r would have to in clu d e a statem ent c a u tio n in g th e
consumer not to r e ly on th e r a te alon e and th a t th e r a te should
be used in co n ju n ctio n w ith oth er c o s t d is c lo s u r e s . The f i n a l
r u le makes changes in th e format fo r p rovid in g d is c lo s u r e s ;
c e r ta in item s would be seg reg a ted from other in form ation to draw
consumers' a t t e n t io n . In a d d itio n , th e f in a l ru le co n ta in s
r e v is io n s th a t implement a s ta tu to r y amendment and th a t make
oth er changes to th e a d v e r tis in g p r o v is io n s . The s ta tu to r y
amendment a llo w s a t o l l - f r e e telep h o n e number or a p r in t
ad vertisem en t to s u b s t it u t e fo r c e r ta in le a s e d is c lo s u r e s in
rad io com m ercials; th e f in a l r u le expands the a p p lic a tio n o f t h is
p r o v isio n to t e l e v i s i o n a d v e r t is in g .
I t i s not a n tic ip a te d th a t th e r e v is io n s w i l l have a s i g n if ic a n t
economic impact on a s u b s ta n tia l number o f sm all e n t i t i e s .
TIMETABLE:
ACTION
Board approved req u estin g comment
Board approved issu a n ce o f a
proposed r u le
Comment p erio d extended to 2 /1 5 /9 6
Board adopted r e v is io n s
-48-
DATE
1 1 /1 9 /9 3
0 9 /2 0 /9 5
FR CITE
58 FR 61035
60 FR 48752
1 2 /0 6 /9 5
0 9 /1 8 /9 6
60 FR 62349
TITLE:
R egulation: M - - Consumer Leasing (Docket Number: R-0892)
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Adrienne D. Hurt
Managing Counsel - F in a n cia l S erv ices S ectio n
D iv isio n o f Consumer and Community A ffa ir s
202 452-2412
RIN: 7100-AB74
-49-
33.
TITLE:
Regulation: S — Reimbursement for Providing Financial Records;
Recordkeeping Requirements for Certain Financial Records (Docket
Number: R-0888)
LEGAL
12
12
31
AUTHORITY:
USC 1829b
USC 1951-1959
USC 5311-5330
CFR CITATION:
12 CFR 219
31 CFR 103.33
ABSTRACT:
In January 1995, the Department o f th e Treasury and the Board
j o i n t l y adopted a f in a l ru le th a t re q u ir es enhanced recordkeeping
r e la te d to c e r ta in funds tr a n s fe r s and tr a n s m itta ls o f funds by
f in a n c ia l i n s t i t u t i o n s (the j o in t r u l e ) . A lso in January 1995,
th e Treasury adopted a companion r u le , known as th e t r a v e l r u le ,
th a t r e q u ir es f in a n c ia l i n s t i t u t i o n s to in clu d e in tr a n sm itta l
orders c e r ta in in form ation th a t must be m aintained under the
j o in t r u le . The j o in t ru le s e t s fo r th d e f in i t io n s o f terms used
in both r u le s . The o r ig in a l e f f e c t i v e date o f th e se r u le s was
January 1, 1996. Subsequent to adoption o f th e se r u le s , se v e r a l
banks have exp ressed concerns th a t com pliance w ith th e j o in t ru le
and th e t r a v e l ru le would be com plicated i f th e p a r t ie s to an
in te r n a tio n a l tr a n s fe r were d efin ed d if f e r e n t l y in th e Bank
Secrecy Act r e g u la tio n s than they are d efin e d in th e Uniform
Commercial Code A r t ic le 4A. In response to th e se con cern s, in
August 1995, the Board approved is s u in g fo r p u b lic comment
proposed amendments to th e j o in t r u le 's d e f in it io n s and te c h n ic a l
conform ing changes to th e su b sta n tiv e p r o v isio n s to conform the
meanings o f th e d e f in it io n s o f th e p a r t ie s to an in te r n a tio n a l
tr a n s fe r to t h e ir meanings under A r t ic le 4A o f th e Uniform
Commercial Code (60 FR 44144, August 24, 1995).
The proposed amendments are intended to reduce co n fu sio n o f banks
and nonbank f in a n c ia l i n s t i t u t i o n s (in c lu d in g sm all in s t it u t io n s )
as to th e a p p li c a b ilit y o f the j o in t r u le and th e t r a v e l ru le and
to reduce th e c o s t o f complying w ith th e r u le s ' requirem ents.
F ollow ing review o f th e p u b lic comments, th e Treasury and the
Board adopted th e r u le as proposed (61 FR 14383, A p ril 1, 1996).
These amendments w i l l not have a s ig n if ic a n t adverse economic
impact on sm all i n s t i t u t i o n s .
DATE
0 8 /2 4 /9 5
0 4 /0 1 /9 6
TIMETABLE:
ACTION
Board req u ested comment
Board adopted p roposal
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
-50-
FR CITE
60 FR 44144
61 FR 14383
TITLE:
Regulation: S -- Reimbursement for Providing Financial Records;
Recordkeeping Requirements for Certain Financial Records (Docket
Number: R-0888)
AGENCY CONTACT:
E lain e B o u t ilie r
Senior Counsel
Legal D iv isio n
202 452-2418
RIN: 7100-AC03
-51-
34.
TITLE:
Regulation: S -- Reimbursement for Providing Financial Records;
Recordkeeping Requirements for Certain Financial Records (Docket
Number: R-0906)
LEGAL AUTHORITY:
12 USC 3415
CFR CITATION:
12 CFR 219
ABSTRACT:
In December 1995, th e Board req u ested p u b lic comment on a
r e v is io n to subpart A o f R egu lation S, which implements the
requirem ent under th e Right to F in a n cia l P rivacy Act (RFPA) th a t
th e Board e s t a b lis h th e r a te s and c o n d itio n s under which payment
s h a ll be made by a government a u th o r ity to a f in a n c ia l
i n s t i t u t i o n fo r p rovid in g f in a n c ia l records pursuant to RFPA (60
FR 65599, December 20, 1995). The proposed amendments update the
f e e s to be charged and r e f l e c t s ta tu to r y changes in th e
exem ptions. A lso , as p art o f the o v e r a ll review o f i t s
r e g u la tio n s as required by s e c t io n 303 o f th e R ie g le Community
Development and R egulatory Improvement Act o f 1994, th e Board has
strea m lin ed th e r e g u la tio n by e lim in a tin g unnecessary p r o v is io n s .
In June 1996, fo llo w in g review o f th e p u b lic comments, th e Board
adopted a r e v ise d ru le w ith fu r th er r e v is io n s in th e fe e schedule
(61 FR 29638, June 12, 1996). I t i s not a n tic ip a te d th a t the
p rop osal w i l l have a s ig n if ic a n t adverse economic impact on sm all
in s titu tio n s .
TIMETABLE:
ACTION
Board req u ested comment
Board adopted p roposal
DATE
1 2 /2 0 /9 5
0 6 /1 2 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
E la in e M B o u t ilie r
.
Sen ior Counsel
Legal D iv isio n
202 452-2418
RIN: 7100-AC10
-52-
FR CITE
60 FR 65599
61 FR 29638
TITLE:
R egulation: T — C redit by Brokers and D ealers (Docket Number:
R-0772)
LEGAL
15
15
15
AUTHORITY:
u se 7 8g S e c u r itie s Exchange Act of 1934, as amended
u se 7 8h S e c u r itie s Exchange Act o f 1934, as amended
u se 7 8w S e c u r itie s Exchange Act o f 1934, as amended
CFR CITATION:
12 CFR 220
ABSTRACT:
The Board i s conducting a p e r io d ic review o f R egulation T, which
r e g u la te s e x te n sio n s o f c r e d it by and to brokers and d e a le r s . In
August 1992, the Board approved a gen eral req u est fo r comments to
a id in i t s review (57 FR 37109, August 18, 1992). In July 1994,
th e Board proposed amendments in two s p e c i f i c areas o f R egulation
T (Docket Number R-0840; RIN 7100-AB78). Those amendments were
adopted in October 1994.
In June 1995, the Board proposed a d d itio n a l amendments th a t
fu r th er r e f l e c t the comments subm itted in response to th e Board's
Advance N o tice o f Proposed Rulemaking (60 FR 33673, June 29,
1995) . In May 1996, fo llo w in g review o f the p u b lic comments, the
Board took f in a l a c tio n on many o f th e proposed amendments (61 FR
20386, May 6, 1996) . At the same tim e, the Board s o l i c i t e d
comment on a d d itio n a l p rop osals concerning R egu lation T, as w e ll
as R eg u la tio n s G and U, the margin r e g u la tio n s a p p lic a b le to
banks and len d ers other than brokers and d e a le r s (Docket Number
R-0923) . The f in a l ru le e lim in a te s r e s t r ic t io n s on th e a b i l i t y of
b ro k er-d ea le rs to arrange fo r c r e d it ; in c r e a se s th e type and
number o f dom estic and fo reig n s e c u r it ie s th a t may be bought on
margin and in c r e a se s the loan valu e o f some s e c u r it ie s th a t are
a lread y m arginable; d e le te s Board r u le s , e f f e c t i v e June 1, 1997,
regard in g o p tio n s tr a n sa c tio n s in favor o f th e r u le s o f the
o p tio n s exchanges; and reduces r e s t r ic t io n s on tr a n sa c tio n s
in v o lv in g fo r e ig n p ersons, fo r e ig n s e c u r i t i e s , and fo r e ig n
currency.
I t i s not a n tic ip a te d th a t the r e v is io n s w i l l have a s ig n if ic a n t
economic impact on the o v e r a ll len d in g a c t i v i t i e s o f a
s u b s ta n tia l number of sm all brokerage firm s.
The p rop osal has been in clu d ed in the Board's o v e r a ll review o f
i t s r e g u la tio n s as required by s e c tio n 303 o f the R ieg le
Community Development and R egulatory Improvement Act o f 1994.
TIMETABLE:
ACTION
Board iss u e d advance n o tic e and requ est
fo r comment
Board req u ested comment on amendments
Board adopted amendments
DATE
0 8 /1 8 /9 2
FR CITE
57 FR 37109
0 6 /2 9 /9 5
0 5 /0 6 /9 6
60 FR 33763
61 FR 20386
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
-53-
TITLE:
R egu lation : T — C redit by Brokers and D ealers (Docket Number:
R-0772)
AGENCY CONTACT:
S c o tt Holz
S en ior A ttorney
D iv isio n o f Banking S u p ervision and R egu lation
202 452-2781
«
' *
RIN: 7100-AB28
-54-
36.
TITLE:
R egulation: Y — Bank Holding Companies and Change in Bank
Control (Docket Number: R-0868)
LEGAL
12
12
12
12
12
12
12
12
12
12
12
AUTHORITY:
u se 1817 (j ) (13
u se 1818
u se 1831(i)
u se 1843(c) (8)
u se 1844(b)
u se 3106
u se 3108
u se 3907
u se 3909
u se 3310
u se 3331-3351
CFR CITATION:
12 CFR 225.125(g)
ABSTRACT:
S ectio n 2 2 5 .2 5 (b )(4 ) o f th e Board's R egulation Y a u th o riz es bank
h old in g companies to a ct as investm ent a d v iser to r e g is te r e d
investm ent companies. Bank h old in g companies th a t provide such
s e r v ic e s are su b je c t to c e r ta in r e s t r ic t io n s s e t fo r th in the
Board's in te r p r e ta tio n regarding investm ent a d v iser a c t i v i t i e s .
In December 1994, th e Board approved is s u in g fo r p u b lic comment a
p roposal to amend th e lim it a t io n s in the investm ent a d v iser
in te r p r e ta tio n to perm it bank h olding companies th a t a d v ise an
investm ent company to purchase, in a fid u c ia r y c a p a c ity ,
s e c u r it ie s o f the investm ent company i f the purchase i s
s p e c i f i c a l l y au th orized by the terms o f the instrum ent c r e a tin g
th e fid u c ia r y r e la t io n s h ip , by court order, or by th e law o f the
j u r is d ic t io n under which the t r u s t i s adm inistered (59 FR 67654,
December 30, 1994).
In August 1996, fo llo w in g review o f the p u b lic comments, the
Board adopted th e amendment s u b s ta n tia lly as proposed, excep t
th a t the Board determ ined to r e fr a in from imposing a g en eral
requirem ent th a t a bank h old in g company d is c lo s e to i t s fid u c ia r y
custom ers th a t i t may acq u ire for them shares o f an investm ent
company fo r which th e bank h old in g company se rv es as investm ent
a d visor (61 FR 45873, August 30, 1996). The Board concluded th a t
e x is t in g d is c lo s u r e requirem ents are g e n e r a lly s u f f i c i e n t to
ensure th a t fid u c ia r y custom ers are aware' o f p o te n t ia l c o n f lic t s
o f in t e r e s t th a t may a r is e from t h is a c t i v i t y .
I t i s not expected th a t th e f in a l r u le s w i l l have a s ig n if ic a n t
economic impact on a s u b s ta n tia l number o f sm all e n t i t i e s th a t
would be su b jec t to th e r e g u la tio n .
TIMETABLE:
ACTION
Board requested comment
Board adopted p roposal
DATE
1 2 /3 0 /9 4
0 8 /3 0 /9 6
-55-
FR CITE
59 FR 67654
61 FR 45873
TITLE:
R egu lation: Y - - Bank Holding Companies and Change in Bank
C ontrol (Docket Number: R-0868)
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Thomas M C orsi
.
Senior A ttorney
Legal D iv isio n
202 452-3275
RIN: 7100-AB95
-56-
37.
TITLE:
R isk-Based C ap ital Standards: I n te r e st Rate Risk (Docket Number:
R-0802)
LEGAL
12
12
12
12
12
12
12
12
12
12
12
12
12
12
15
AUTHORITY:
u se 36
u se 2 4 8 (a)
u se 2 4 8 (c)
u se 321-338
u se 461
u se 481-486
u se 601
u se 611
u se 1814
u se 1823 (j )
u se 3105
u se 3310
u se 3331-3351
u se 3906-3909
u se 78(b)
CFR CITATION:
12 CFR 208
12 CFR 225
ABSTRACT:
S ectio n 305 o f th e Federal D eposit Insurance Corporation
Improvement Act o f 1991 (FDICIA) req u ires each fe d e r a l banking
agency to r e v is e i t s risk -b a se d c a p ita l standards fo r the
d ep o sito ry in s t i t u t i o n s i t r e g u la te s in order to ensure th a t
th o se standards take adequate account of in t e r e s t r a te r is k
(IRR), co n cen tra tio n o f c r e d it r is k , and th e r is k s o f
n o n tr a d itio n a l a c t i v i t i e s .
In March 1993, th e Board approved fo r p u b lic comment a n o tic e o f
proposed rulemaking fo r IRR. Follow ing review o f th e p u b lic
comments, th e Board approved a f in a l ru le in June 1995 amending
i t s r isk -b a se d c a p it a l standards to con sid er e x p l i c i t l y "a bank's
exposure to d e c lin e s in th e economic value o f i t s c a p it a l due to
changes in in t e r e s t r a t e s ” when ev a lu a tin g c a p it a l adequacy (60
FR 39490, August 2, 1995).
A lso in June 1995, the Board approved req u estin g p u b lic comment
on a proposed J o in t Agency P o lic y Statement regarding the
measurement and assessm ent o f in t e r e s t ra te r is k (60 FR 39495,
August 2, 1995). The proposed P o lic y Statem ent d escrib ed a
measurement framework comprised of exemption sc r e e n s, a
su p erv iso ry model, and use o f a bank's own in te r n a l model. Based
on continued concerns exp ressed by the in d u stry in t h e ir comment
l e t t e r s and the numerous d i f f i c u l t i e s the a g en cies encountered in
tr y in g to develop and implement a stand ard ized measure w ith an
ap propriate balance between accuracy and burden, th e a g en cies
decided not to adopt a standard measure.
In stea d , th e a g en cies decided th a t sound p r a c t ic e s guidance could
more a p p ro p ria tely address s a f e t y and soundness concerns and
provide the in d u stry w ith g re a te r f l e x i b i l i t y in measuring and
-57-
TITLE:
R isk-Based C ap ital Standards (Docket Number: R-0802)
ABSTRACT CONT:
managing in t e r e s t ra te r is k . In May 1996, fo llo w in g review o f the
p u b lic comments, the Board approved a j o in t agency p o lic y
statem ent p rovid in g guidance to banks on sound p r a c t ic e s to be
fo llo w ed fo r managing in t e r e s t r a te r is k (61 FR 33166, June 26,
1996).
Small banks would be exempted from th e proposed P o lic y Statem ent
and a s s o c ia te d rep o rtin g requirem ents in order to le s s e n
re g u la to r y burden on sm a ll, well-m anaged banks.
TIMETABLE:
ACTION
Board req u ested comment on an ANPRM
Board approved req u estin g comment on
proposed rulemaking
Board approved f in a l ru le im plem enting
s e c t io n 305
Board approved req u estin g comment on
proposed J o in t Agency P o lic y Statem ent
Board approved J o in t Agency P o lic y
Statem ent
DATE
0 8 /1 0 /9 2
0 9 /1 4 /9 3
FR CITE
57 FR 35507
58 FR 48206
0 8 /0 2 /9 5
60 FR 39490
0 8 /0 2 /9 5
60 FR 39495
0 6 /2 6 /9 6
61 FR 33166
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
James Embersit
Manager
D iv isio n o f Banking S u p erv isio n and R egulation
202 452-5249
RIN: 7100-AB50
-58-
38.
TITLE:
Rules of Practice for Hearings (Docket Number: R-0878)
LEGAL AUTHORITY:
12 USC 504
12 USC 554-557
12 USC 248
12 USC 324
12 USC 505
12 USC 1817 (j)
12 USC 1818
12 USC 1847
CFR CITATION:
12 CFR Part 263, subpart A
ABSTRACT:
S ectio n 916 o f the F in a n cia l I n s t it u t io n s Reform, Recovery and
Enforcement Act of 1989 required th e fe d e r a l f in a n c ia l
i n s t it u t io n s reg u la to ry a g en cies to develop uniform r u le s and
procedures fo r a d m in istra tiv e h ea rin g s. The a g en cies each adopted
f in a l Uniform Rules in August 1991. Based on t h e ir exp erien ce
s in c e th en , th e a g en cies have id e n t i f ie d s e c t io n s o f th e Uniform
Rules th a t should be m od ified . In June 1995, amendments to th ose
p r o v isio n s were p ublished fo r comment (60 FR 32882, June 23,
1995). In a d d itio n to te c h n ic a l m o d ific a tio n s or c l a r i f i c a t i o n s ,
th e p ro p o sa ls a ls o make some su b sta n tiv e changes r e la t in g to the
scope o f document d isco v ery and th e exam ination o f w itn e sse s by
m u ltip le cou n sel fo r a p arty. The proposed amendments w i l l not
have a s ig n if ic a n t economic impact on a s u b s ta n tia l number of
sm all e n t i t i e s . They a f f e c t on ly th o se persons and e n t i t i e s who
are the su b je c t o f l i t i g a t e d enforcem ent a c tio n s by the Board.
In May 1996, fo llo w in g review o f the p u b lic comments, th e Board
and the oth er banking a g en cies adopted th e amendments
s u b s t a n t ia lly in the form proposed (61 FR 20338, May 6, 1996).
This p rop osal has been in clu d ed in the Board's o v e r a ll review o f
i t s r e g u la tio n s as required by s e c tio n 303 o f th e R ieg le
Community Development and R egulatory Improvement Act o f 1994.
DATE
0 6 /2 3 /9 5
0 5 /0 6 /9 6
TIMETABLE:
ACTION
Board req u ested comment
Board adopted proposal
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Katherine Wheatley
A s s is ta n t General Counsel
Legal D iv isio n
202 452-3779
RIN: 7100-AC05
-59-
FR CITE
60 FR 32882
61 FR 20338
39.
TITLE:
S ectio n 23A of the Federal Reserve Act (Docket Number
R -0902)
LEGAL AUTHORITY:
12 USC 2 4 8 (i)
12 USC 371c(e)
CFR CITATION:
12 CFR Part 250.242
ABSTRACT:
S ectio n 23A o f the Federal R eserve Act r e g u la te s c e r ta in
tr a n s a c tio n s between in su red d e p o sito r y i n s t i t u t i o n s and t h e ir
a f f i l i a t e s . In g en er a l, i t p r o h ib its in su red d e p o sito r y
i n s t i t u t i o n s from engaging in covered tr a n s a c tio n s w ith a s in g le
a f f i l i a t e in ex c ess o f 10 p ercen t o f th e i n s t i t u t i o n ' s c a p it a l
sto ck and su rp lu s (a g g r e g a te ly , th e lim it i s 20 p e r c e n t) . S e c tio n
23A does n o t, however, in clu d e a d e f in i t io n o f c a p it a l sto ck and
su r p lu s .
In November 1995, th e Board iss u e d fo r p u b lic comment a p rop osal
th a t would d e fin e c a p it a l sto ck and su rp lu s fo r s e c tio n 23A as
T ier 1 and T ier 2 c a p it a l p lu s th e b alan ce o f th e allow ance fo r
loan and le a s e lo s s e s (60 FR 62050, December 4, 1995). In A p ril
1996, fo llo w in g review o f th e p u b lic comments, th e Board adopted
a d e f in i t io n o f c a p it a l sto ck and su rp lu s fo r s e c tio n 23A
e s s e n t i a l l y as proposed (61 FR 19805, May 3, 1996). The
d e f in i t io n became e f f e c t i v e as o f J u ly 1, 1996. I t i s c o n s is t e n t
w ith th e d e f in it io n o f c a p it a l and su rp lu s in R egu lation 0 and
w ith th e d e f in it io n used by th e O ffic e o f th e C om ptroller o f th e
Currency fo r n a tio n a l bank len d in g l i m i t s .
I t i s not exp ected th a t th e d e f in i t io n w i l l have a s ig n if ic a n t
adverse economic impact on a s u b s ta n tia l number o f sm all
in s titu tio n s .
TIMETABLE:
ACTION
Board req u ested comment
Board adopted p roposal
DATE
1 2 /0 4 /9 5
0 5 /0 3 /9 6
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Pam N a r d o lilli
Sen ior A ttorney
Legal D iv isio n
202 452-3289
RIN: 7100-AC08
-60-
FR CITE
60 FR 62050
61 FR 19805
40.
TITLE:
Standards for Safety and Soundness (Docket Number: R-0766)
LEGAL AUTHORITY:
PL 102-242
CFR CITATION:
12 CFR Chapter II
ABSTRACT:
S ectio n 132 o f th e Federal D eposit Insurance Corporation
Improvement Act o f 1991 (FDICIA) d ir e c t s each fe d e r a l banking
agency to p r e sc r ib e standards regarding o p e r a tio n s, management,
a s s e t q u a lity , ea rn in g s, sto ck v a lu a tio n (to the e x ten t
f e a s i b l e ) , and employee com pensation. In July 1992, the Board
requested p u b lic comment on an in tera g en cy advance n o tic e o f
proposed rulem aking. A fter co n sid erin g the p u b lic 's comments, a
n o tic e o f proposed rulemaking was issu e d fo r comment th a t
con tained broad p r in c ip le -b a se d standards th a t le a v e th e method
for m eeting such standards la r g e ly in the p rovince o f management.
In September 1994, the R ieg le Community Development and
R egulatory Improvement Act o f 1994 m odified s e c tio n 132 by: (1)
p rovid in g th e a g en cies w ith the op tion to promulgate standards as
g u id e lin e s rath er than r e g u la tio n s; (2) removing bank h old in g
companies from th e scope o f s e c tio n 132; and (3) g iv in g each
agency d is c r e t io n to p re sc r ib e standards r e la t in g to ea rn in g s,
a s s e t q u a lity , and sto ck v a lu a tio n th a t i t deems a p p rop riate.
Although th e l e g i s l a t i v e changes allow the standards to be issu e d
as g u id e lin e s , th e enforcement p r o v isio n s r e la t in g to com pliance
p lans must be issu e d as r e g u la tio n s . A ccordingly, in February
1995, the Board adopted a f in a l ru le and g u id e lin e s fo r s e c tio n
132 tak in g in to account th e se changes.
The Board a ls o approved fo r comment proposed g u id e lin e s fo r a s s e t
q u a lity and earn in gs th a t rep resen t broader, more com prehensive
standards than th e r ig id r a t io s or minimums o r ig in a lly mandated
by s e c tio n 132. The f in a l ru le and g u id e lin e s and proposed
g u id e lin e s were p u b lish ed in a j o in t agency n o tic e in Ju ly 1995
(60 FR 35673 and 35688, July 10, 1995).
Follow ing review o f the p u b lic comments, th e Board adopted the
a s s e t q u a lity and earnings g u id e lin e s s u b s t a n t ia lly as proposed
(61 FR 43948, August 27, 1996). The s a fe ty and soundness
g u id e lin e s were com pleted as part o f the Board's o v e r a ll review
o f R egulation H as required by s e c tio n 303 o f the R ieg le
Community Development and R egulatory Improvement Act o f 1994.
TIMETABLE:
ACTION
Board requ ested comment
Board issu e d n o tic e o f proposed rulemaking
Board adopted ru le and g u id e lin e s
Board requested comment on a d d itio n a l
g u id e lin e s
Board adopted a s s e t q u a lity and earnings
g u id e lin e s
-
61-
FR CITE
FR 31336
FR 60802
FR 35673
FR 35688
DATE
0 7 /1 5 /9 2
1 1 /1 8 /9 3
0 7 /1 0 /9 5
07/10/95-
57
58
60
60
0 8 /2 7 /9 6
61 FR 43948
TITLE:
Standards for S a fety and Soundness (Docket Number: R-0766)
EFFECTS ON SMALL BUSINESS AND OTHER ENTITIES: None
AGENCY CONTACT:
Roger T. Cole
Deputy A sso c ia te D irecto r
D iv isio n o f Banking S u p erv isio n and R egulation
202 452-2618
RIN: 7100-AB52
@FedFRASER