Industry Insights

FFIEC Progress in Call Report Burden-Reduction Initiative

August 2016
Author:  Chris Meriwether

Chris Meriwether

Director

Audit

Financial Services

600 N. Hurstbourne Parkway, Suite 350
P.O. Box 22127
Louisville, KY 40252-0127 (40222)

Louisville
502.581.0435

The Federal Financial Institutions Examination Council (FFIEC) has made strides in two areas of the formal initiative launched in December 2014 to identify potential opportunities to reduce the burden on community banks associated with Consolidated Reports of Condition and Income (Call Report) requirements. The initiative identified five areas for responding to industry concerns about the cost and burden arising from the Call Report preparation process.

Revisions to the Call Report

The FFIEC has approved Call Report revisions originally proposed in September 2015 (see FIL-39-2015, Proposed Revisions to the Consolidated Reports of Condition and Income). The revisions to the Call Report include certain burden-reducing changes, several new and revised Call Report data items and various instructional clarifications. Subject to the U.S. Office of Management and Budget’s approval, the Call Report revisions will take effect September 30, 2016, or March 31, 2017, depending on the change.

The FFIEC announced the approved Call Report revisions in FIL-45-2016, Consolidated Reports of Condition and Income:

  • Deletions of certain existing data items in five schedules
  • Increases in existing reporting thresholds and the establishment of a new threshold for certain data items in six Call Report schedules
  • Instructional revisions pertaining to gain (loss) reporting on certain equity securities and the custodial bank deduction for assessment purposes
  • New and revised data and informational items, some of which are of limited applicability. These revisions involve chief executive officer contact information, the legal entity identifier, preprinted captions for itemizing components of certain data items, extraordinary items, time deposit data, external auditing programs, fair value option loans, trading revenue, “dually payable” deposits in foreign branches and supplementary leverage ratio data.

There were minor changes to the proposed revisions before they were approved. The agencies elected not to proceed with the proposed instructional clarification addressing the reporting of home equity credit lines that convert from revolving to nonrevolving status in Schedule RC-C, Loans and Lease Financing Receivables, and securities where the fair value option was elected in Schedule RC, Balance Sheet.

FIL-44-2016, Revisions to the Consolidated Reports of Condition and Income, has a full listing of the approved changes, including each change’s effective date. Revised Call Report schedules and draft instructions for the reporting changes also are available on the FFIEC’s website.

Proposal for Streamlined Call Report for Small Institutions

The FFIEC announced another step in the initiative to reduce the burden on community banks associated with Call Report requirements in an August 5, 2016, press release. The release invited public comment on a new and streamlined Call Report for small financial institutions proposal, which would be form FFIEC 051, Proposed Consolidated Reports of Condition and Income for Eligible Small Institutions.

Under the proposal, financial institutions with domestic offices only and less than or equal to $1 billion in total assets would qualify for the streamlined report. The proposed effective date is March 31, 2017; the measurement date of total assets is June 30, 2016. If an institution’s consolidated assets were more than $1 billion and fall below the threshold for four consecutive quarters, the institution can change to the streamlined Call Report, unless the total assets exceed the threshold as of a subsequent June 30 report date.

The proposed report would remove approximately 40 percent of the Call Report’s nearly 2,400 data items. The reduction comes from the removal of data items that aren’t required for institutions with assets less than $1 billion as well as various data items infrequently reported by institutions of this size. A supplemental schedule will be included in the form to collect indicator questions and data items on certain complex and specialized activities.

The proposal also includes various revisions to forms FFIEC 041, Consolidated Reports of Condition and Income for a Bank with Domestic Offices Only, and FFIEC 031, Consolidated Reports of Condition and Income for a Bank with Domestic and Foreign Offices. Detailed instructions on where to submit comments on this proposal, including specific areas of comment the FFIEC has requested, can be found in the agency’s comment request.

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