Code of Federal Regulations (alpha)

CFR /  Title 12  /  Part 217  /  Sec. 217.63 Disclosures by Board-regulated institutions described in Sec. 217.61.

(a) Except as provided in Sec. 217.62, a Board-regulated institution described in Sec. 217.61 must make the disclosures described in Tables 1 through 10 of this section. The Board-regulated institution must make these disclosures publicly available for each of the last three years (that is, twelve quarters) or such shorter period beginning on January 1, 2015.

(b) A Board-regulated institution must publicly disclose each quarter the following:

(1) Common equity tier 1 capital, additional tier 1 capital, tier 2 capital, tier 1 and total capital ratios, including the regulatory capital elements and all the regulatory adjustments and deductions needed to calculate the numerator of such ratios;

(2) Total risk-weighted assets, including the different regulatory adjustments and deductions needed to calculate total risk-weighted assets;

(3) Regulatory capital ratios during any transition periods, including a description of all the regulatory capital elements and all regulatory adjustments and deductions needed to calculate the numerator and denominator of each capital ratio during any transition period; and

(4) A reconciliation of regulatory capital elements as they relate to its balance sheet in any audited consolidated financial statements.

(a)........................ The name of the top corporate entity in

the group to which subpart D of this

part applies.

(b)........................ A brief description of the differences in

the basis for consolidating entities \1\

for accounting and regulatory purposes,

with a description of those entities:

(1) That are fully consolidated;

(2) That are deconsolidated and deducted

from total capital;

(3) For which the total capital

requirement is deducted; and

(4) That are neither consolidated nor

deducted (for example, where the

investment in the entity is assigned a

risk weight in accordance with this

subpart).

(c)........................ Any restrictions, or other major

impediments, on transfer of funds or

total capital within the group.

(d)........................ The aggregate amount of surplus capital

of insurance subsidiaries included in

the total capital of the consolidated

group.

(e)........................ The aggregate amount by which actual

total capital is less than the minimum

total capital requirement in all

subsidiaries, with total capital

requirements and the name(s) of the

subsidiaries with such deficiencies.----------------------------------------------------------------------------------------------------------------\1\ Entities include securities, insurance and other financial subsidiaries, commercial subsidiaries (where

permitted), and significant minority equity investments in insurance, financial and commercial entities.

(a)........................ Summary information on the terms and

conditions of the main features of all

regulatory capital instruments.Quantitative Disclosures................ (b)........................ The amount of common equity tier 1

capital, with separate disclosure of:

(1) Common stock and related surplus;

(2) Retained earnings;

(3) Common equity minority interest;

(4) AOCI; and

(5) Regulatory adjustments and deductions

made to common equity tier 1 capital.

(c)........................ The amount of tier 1 capital, with

separate disclosure of:

(1) Additional tier 1 capital elements,

including additional tier 1 capital

instruments and tier 1 minority interest

not included in common equity tier 1

capital; and

(2) Regulatory adjustments and deductions

made to tier 1 capital.

(d)........................ The amount of total capital, with

separate disclosure of:

(1) Tier 2 capital elements, including

tier 2 capital instruments and total

capital minority interest not included

in tier 1 capital; and

(2) Regulatory adjustments and deductions

made to total capital.----------------------------------------------------------------------------------------------------------------

(a)........................ A summary discussion of the Board-

regulated institution's approach to

assessing the adequacy of its capital to

support current and future activities.Quantitative disclosures................ (b)........................ Risk-weighted assets for:

(1) Exposures to sovereign entities;

(2) Exposures to certain supranational

entities and MDBs;

(3) Exposures to depository institutions,

foreign banks, and credit unions;

(4) Exposures to PSEs;

(5) Corporate exposures;

(6) Residential mortgage exposures;

(7) Statutory multifamily mortgages and

pre-sold construction loans;

(8) HVCRE loans;

(9) Past due loans;

(10) Other assets;

(11) Cleared transactions;

(12) Default fund contributions;

(13) Unsettled transactions;

(14) Securitization exposures; and

(15) Equity exposures.

(c)........................ Standardized market risk-weighted assets

as calculated under subpart F of this

part.

(d)........................ Common equity tier 1, tier 1 and total

risk-based capital ratios:

(1) For the top consolidated group; and

(2) For each depository institution

subsidiary.

(e)........................ Total standardized risk-weighted assets.----------------------------------------------------------------------------------------------------------------

(a)........................ At least quarterly, the Board-regulated

institution must calculate and publicly

disclose the capital conservation buffer

as described under Sec. 217.11.

(b)........................ At least quarterly, the Board-regulated

institution must calculate and publicly

disclose the eligible retained income of

the Board-regulated institution, as

described under Sec. 217.11.

(c)........................ At least quarterly, the Board-regulated

institution must calculate and publicly

disclose any limitations it has on

distributions and discretionary bonus

payments resulting from the capital

conservation buffer framework described

under Sec. 217.11, including the

maximum payout amount for the quarter.----------------------------------------------------------------------------------------------------------------

(c) General qualitative disclosure requirement. For each separate risk area described in Tables 5 through 10, the Board-regulated institution must describe its risk management objectives and policies, including: Strategies and processes; the structure and organization of the relevant risk management function; the scope and nature of risk reporting and/or measurement systems; policies for hedging and/or mitigating risk and strategies and processes for monitoring the continuing effectiveness of hedges/mitigants.

(a)........................ The general qualitative disclosure

requirement with respect to credit risk

(excluding counterparty credit risk

disclosed in accordance with Table 6),

including the:

(1) Policy for determining past due or

delinquency status;

(2) Policy for placing loans on

nonaccrual;

(3) Policy for returning loans to accrual

status;

(4) Definition of and policy for

identifying impaired loans (for

financial accounting purposes);

(5) Description of the methodology that

the Board-regulated institution uses to

estimate its allowance for loan and

lease losses, including statistical

methods used where applicable;

(6) Policy for charging-off uncollectible

amounts; and

(7) Discussion of the Board-regulated

institution's credit risk management

policy.Quantitative Disclosures................ (b)........................ Total credit risk exposures and average

credit risk exposures, after accounting

offsets in accordance with GAAP, without

taking into account the effects of

credit risk mitigation techniques (for

example, collateral and netting not

permitted under GAAP), over the period

categorized by major types of credit

exposure. For example, Board-regulated

institutions could use categories

similar to that used for financial

statement purposes. Such categories

might include, for instance

(1) Loans, off-balance sheet commitments,

and other non-derivative off-balance

sheet exposures;

(2) Debt securities; and

(3) OTC derivatives.\2\

(c)........................ Geographic distribution of exposures,

categorized in significant areas by

major types of credit exposure.\3\

(d)........................ Industry or counterparty type

distribution of exposures, categorized

by major types of credit exposure.

(e)........................ By major industry or counterparty type:

(1) Amount of impaired loans for which

there was a related allowance under

GAAP;

(2) Amount of impaired loans for which

there was no related allowance under

GAAP;

(3) Amount of loans past due 90 days and

on nonaccrual;

(4) Amount of loans past due 90 days and

still accruing; \4\

(5) The balance in the allowance for loan

and lease losses at the end of each

period, disaggregated on the basis of

the Board-regulated institution's

impairment method. To disaggregate the

information required on the basis of

impairment methodology, an entity shall

separately disclose the amounts based on

the requirements in GAAP; and

(6) Charge-offs during the period.

(f)........................ Amount of impaired loans and, if

available, the amount of past due loans

categorized by significant geographic

areas including, if practical, the

amounts of allowances related to each

geographical area,\5\ further

categorized as required by GAAP.

(g)........................ Reconciliation of changes in ALLL.\6\

(h)........................ Remaining contractual maturity

delineation (for example, one year or

less) of the whole portfolio,

categorized by credit exposure.----------------------------------------------------------------------------------------------------------------\1\ Table 5 does not cover equity exposures, which should be reported in Table 9.\2\ See, for example, ASC Topic 815-10 and 210, as they may be amended from time to time.\3\ Geographical areas may consist of individual countries, groups of countries, or regions within countries. A

Board-regulated institution might choose to define the geographical areas based on the way the Board-regulated

institution's portfolio is geographically managed. The criteria used to allocate the loans to geographical

areas must be specified.\4\ A Board-regulated institution is encouraged also to provide an analysis of the aging of past-due loans.\5\ The portion of the general allowance that is not allocated to a geographical area should be disclosed

separately.\6\ The reconciliation should include the following: A description of the allowance; the opening balance of the

allowance; charge-offs taken against the allowance during the period; amounts provided (or reversed) for

estimated probable loan losses during the period; any other adjustments (for example, exchange rate

differences, business combinations, acquisitions and disposals of subsidiaries), including transfers between

allowances; and the closing balance of the allowance. Charge-offs and recoveries that have been recorded

directly to the income statement should be disclosed separately.

(a)........................ The general qualitative disclosure

requirement with respect to OTC

derivatives, eligible margin loans, and

repo-style transactions, including a

discussion of:

(1) The methodology used to assign credit

limits for counterparty credit

exposures;

(2) Policies for securing collateral,

valuing and managing collateral, and

establishing credit reserves;

(3) The primary types of collateral

taken; and

(4) The impact of the amount of

collateral the Board-regulated

institution would have to provide given

a deterioration in the Board-regulated

institution's own creditworthiness.

Quantitative Disclosures................ (b)........................ Gross positive fair value of contracts,

collateral held (including type, for

example, cash, government securities),

and net unsecured credit exposure.\1\ A

Board-regulated institution also must

disclose the notional value of credit

derivative hedges purchased for

counterparty credit risk protection and

the distribution of current credit

exposure by exposure type.\2\

(c)........................ Notional amount of purchased and sold

credit derivatives, segregated between

use for the Board-regulated

institution's own credit portfolio and

in its intermediation activities,

including the distribution of the credit

derivative products used, categorized

further by protection bought and sold

within each product group.----------------------------------------------------------------------------------------------------------------\1\ Net unsecured credit exposure is the credit exposure after considering both the benefits from legally

enforceable netting agreements and collateral arrangements without taking into account haircuts for price

volatility, liquidity, etc.\2\ This may include interest rate derivative contracts, foreign exchange derivative contracts, equity

derivative contracts, credit derivatives, commodity or other derivative contracts, repo-style transactions,

and eligible margin loans.

(a)........................ The general qualitative disclosure

requirement with respect to credit risk

mitigation, including:

(1) Policies and processes for collateral

valuation and management;

(2) A description of the main types of

collateral taken by the Board-regulated

institution;

(3) The main types of guarantors/credit

derivative counterparties and their

creditworthiness; and

(4) Information about (market or credit)

risk concentrations with respect to

credit risk mitigation.Quantitative Disclosures................ (b)........................ For each separately disclosed credit risk

portfolio, the total exposure that is

covered by eligible financial

collateral, and after the application of

haircuts.

(c)........................ For each separately disclosed portfolio,

the total exposure that is covered by

guarantees/credit derivatives and the

risk-weighted asset amount associated

with that exposure.----------------------------------------------------------------------------------------------------------------\1\ At a minimum, a Board-regulated institution must provide the disclosures in Table 7 in relation to credit

risk mitigation that has been recognized for the purposes of reducing capital requirements under this subpart.

Where relevant, Board-regulated institutions are encouraged to give further information about mitigants that

have not been recognized for that purpose.\2\ Credit derivatives that are treated, for the purposes of this subpart, as synthetic securitization exposures

should be excluded from the credit risk mitigation disclosures and included within those relating to

securitization (Table 8).

(a)........................ The general qualitative disclosure

requirement with respect to a

securitization (including synthetic

securitizations), including a discussion

of:

(1) The Board-regulated institution's

objectives for securitizing assets,

including the extent to which these

activities transfer credit risk of the

underlying exposures away from the Board-

regulated institution to other entities

and including the type of risks assumed

and retained with resecuritization

activity; \1\

(2) The nature of the risks (e.g.

liquidity risk) inherent in the

securitized assets;

(3) The roles played by the Board-

regulated institution in the

securitization process \2\ and an

indication of the extent of the Board-

regulated institution's involvement in

each of them;

(4) The processes in place to monitor

changes in the credit and market risk of

securitization exposures including how

those processes differ for

resecuritization exposures;

(5) The Board-regulated institution's

policy for mitigating the credit risk

retained through securitization and

resecuritization exposures; and

(6) The risk-based capital approaches

that the Board-regulated institution

follows for its securitization exposures

including the type of securitization

exposure to which each approach applies.

(b)........................ A list of:

(1) The type of securitization SPEs that

the Board-regulated institution, as

sponsor, uses to securitize third-party

exposures. The Board-regulated

institution must indicate whether it has

exposure to these SPEs, either on- or

off-balance sheet; and

(2) Affiliated entities:

(i) That the Board-regulated institution

manages or advises; and

(ii) That invest either in the

securitization exposures that the Board-

regulated institution has securitized or

in securitization SPEs that the Board-

regulated institution sponsors.\3\

(c)........................ Summary of the Board-regulated

institution's accounting policies for

securitization activities, including:

(1) Whether the transactions are treated

as sales or financings;

(2) Recognition of gain-on-sale;

(3) Methods and key assumptions applied

in valuing retained or purchased

interests;

(4) Changes in methods and key

assumptions from the previous period for

valuing retained interests and impact of

the changes;

(5) Treatment of synthetic

securitizations;

(6) How exposures intended to be

securitized are valued and whether they

are recorded under subpart D of this

part; and

(7) Policies for recognizing liabilities

on the balance sheet for arrangements

that could require the Board-regulated

institution to provide financial support

for securitized assets.

(d)........................ An explanation of significant changes to

any quantitative information since the

last reporting period.Quantitative Disclosures................ (e)........................ The total outstanding exposures

securitized by the Board-regulated

institution in securitizations that meet

the operational criteria provided in

Sec. 217.41 (categorized into

traditional and synthetic

securitizations), by exposure type,

separately for securitizations of third-

party exposures for which the bank acts

only as sponsor.\4\

(f)........................ For exposures securitized by the Board-

regulated institution in securitizations

that meet the operational criteria in

Sec. 217.41:

(1) Amount of securitized assets that are

impaired/past due categorized by

exposure type; \5\ and

(2) Losses recognized by the Board-

regulated institution during the current

period categorized by exposure type.\6\

(g)........................ The total amount of outstanding exposures

intended to be securitized categorized

by exposure type.

(h)........................ Aggregate amount of:

(1) On-balance sheet securitization

exposures retained or purchased

categorized by exposure type; and

(2) Off-balance sheet securitization

exposures categorized by exposure type.

(i)........................ (1) Aggregate amount of securitization

exposures retained or purchased and the

associated capital requirements for

these exposures, categorized between

securitization and resecuritization

exposures, further categorized into a

meaningful number of risk weight bands

and by risk-based capital approach

(e.g., SSFA); and

(2) Exposures that have been deducted

entirely from tier 1 capital, CEIOs

deducted from total capital (as

described in Sec. 217.42(a)(1), and

other exposures deducted from total

capital should be disclosed separately

by exposure type.

(j)........................ Summary of current year's securitization

activity, including the amount of

exposures securitized (by exposure

type), and recognized gain or loss on

sale by exposure type.

(k)........................ Aggregate amount of resecuritization

exposures retained or purchased

categorized according to:

(1) Exposures to which credit risk

mitigation is applied and those not

applied; and

(2) Exposures to guarantors categorized

according to guarantor creditworthiness

categories or guarantor name.----------------------------------------------------------------------------------------------------------------\1\ The Board-regulated institution should describe the structure of resecuritizations in which it participates;

this description should be provided for the main categories of resecuritization products in which the Board-

regulated institution is active.\2\ For example, these roles may include originator, investor, servicer, provider of credit enhancement,

sponsor, liquidity provider, or swap provider.\3\ Such affiliated entities may include, for example, money market funds, to be listed individually, and

personal and private trusts, to be noted collectively.\4\ ``Exposures securitized'' include underlying exposures originated by the bank, whether generated by them or

purchased, and recognized in the balance sheet, from third parties, and third-party exposures included in

sponsored transactions. Securitization transactions (including underlying exposures originally on the bank's

balance sheet and underlying exposures acquired by the bank from third-party entities) in which the

originating bank does not retain any securitization exposure should be shown separately but need only be

reported for the year of inception. Banks are required to disclose exposures regardless of whether there is a

capital charge under this part.\5\ Include credit-related other than temporary impairment (OTTI).\6\ For example, charge-offs/allowances (if the assets remain on the bank's balance sheet) or credit-related

OTTI of interest-only strips and other retained residual interests, as well as recognition of liabilities for

probable future financial support required of the bank with respect to securitized assets.

(a)........................ The general qualitative disclosure

requirement with respect to equity risk

for equities not subject to subpart F of

this part, including:

(1) Differentiation between holdings on

which capital gains are expected and

those taken under other objectives

including for relationship and strategic

reasons; and

(2) Discussion of important policies

covering the valuation of and accounting

for equity holdings not subject to

subpart F of this part. This includes

the accounting techniques and valuation

methodologies used, including key

assumptions and practices affecting

valuation as well as significant changes

in these practices.Quantitative Disclosures................ (b)........................ Value disclosed on the balance sheet of

investments, as well as the fair value

of those investments; for securities

that are publicly traded, a comparison

to publicly-quoted share values where

the share price is materially different

from fair value.

(c)........................ The types and nature of investments,

including the amount that is: (1)

Publicly traded; and

(2) Non publicly traded.

(d)........................ The cumulative realized gains (losses)

arising from sales and liquidations in

the reporting period.

(e)........................ (1) Total unrealized gains (losses).\1\

(1) Total unrealized gains (losses).\1\

(2) Total latent revaluation gains

(losses).\2\

(3) Any amounts of the above included in

tier 1 or tier 2 capital.

(f)........................ Capital requirements categorized by

appropriate equity groupings, consistent

with the Board-regulated institution's

methodology, as well as the aggregate

amounts and the type of equity

investments subject to any supervisory

transition regarding regulatory capital

requirements.----------------------------------------------------------------------------------------------------------------\1\ Unrealized gains (losses) recognized on the balance sheet but not through earnings.\2\ Unrealized gains (losses) not recognized either on the balance sheet or through earnings.

(a)........................ The general qualitative disclosure

requirement, including the nature of

interest rate risk for non-trading

activities and key assumptions,

including assumptions regarding loan

prepayments and behavior of non-maturity

deposits, and frequency of measurement

of interest rate risk for non-trading

activities.Quantitative disclosures................ (b)........................ The increase (decline) in earnings or

economic value (or relevant measure used

by management) for upward and downward

rate shocks according to management's

method for measuring interest rate risk

for non-trading activities, categorized

by currency (as appropriate).---------------------------------------------------------------------------------------------------------------- Sec. Sec. 217.64-217.99 [Reserved]