Form BE-605BANK Transactions of a U.S. Banking affiliate with Foreign Pa

BE-605 Bank

FORM
(REV. 11/2005)

U.S. DEPARTMENT OF COMMERCE Part I
BUREAU OF ECONOMIC ANALYSIS

TRANSACTIONS OF
U.S. BANKING AFFILIATE
WITH FOREIGN PARENT
MANDATORY CONFIDENTIAL
QUARTERLY REPORT

ELECTRONIC See our web site at
FILING
www.bea.gov/astar

MAIL
REPORTS
TO

DELIVER
REPORTS
TO

for details.
OR
U.S. Department of Commerce
Bureau of Economic Analysis,
BE-49(Q)
Washington, DC 20230
OR
U.S. Department of Commerce
Bureau of Economic Analysis,
BE-49(Q)
Shipping and Receiving Section,
M-100
1441 L Street, NW
Washington, DC 20005

REPORTING REQUIREMENTS
Who must report – A Form BE-605 Bank is
required from every U.S. business enterprise in
banking in which a foreign person had a direct
and/or indirect ownership interest of 10 percent
or more of the voting stock if an incorporated
business enterprise or an equivalent interest if an
unincorporated business enterprise at any time
during the reporting period. Reports are required
even though the foreign person’s equity interest
in the U.S. business enterprise may have been
established, acquired, liquidated, sold, or
inactivated during the reporting period.
Exemption – A U.S. affiliate is not required to file
a report if each of the following three items for
the U.S. affiliate (not the foreign parent’s share) is
equal to or less than $30 million, either positive or
negative: (1) Total assets, (2) Annual gross
operating revenues, and (3) Annual net income
(loss) after provision for U.S. income taxes.
A U.S. affiliate claiming exemption from filing a
report must complete the Certification of
Exemption and (1) give the levels of the three items
above, (2) complete the "Person to Consult" and
"Certification" sections on page 4 of Form BE- 605
Bank, and (3) return the entire form to BEA at the
address noted.
Change in reporting requirements – Starting
with the first quarter 2003 BE-605, U.S. affiliates
that are banks and bank holding companies that
directly or indirectly own more than a 50 percent
interest in one or more U.S. affiliates in
nonbanking industries must file a single
consolidated report on Form BE-605 BANK to
report BOTH the banking and nonbanking
operations.
Consolidated reporting by the U.S. affiliate –
A U.S. affiliate must file on a fully consolidated
domestic U.S. basis, including in the consolidation
all U.S. business enterprises in which it directly or
indirectly owns more than 50 percent of the
outstanding voting interest. The fully consolidated
entity is considered one U.S. affiliate. Foreign
subsidiaries of the U.S. affiliate are not to be
included in the consolidation, except as provided
under the equity method. See the General
Instructions regarding consolidations.
NOTE – If item 7 is marked, complete only
Parts III, IV,V and IX (to report direct transactions
of U.S. affiliate identified in item 2 with the
foreign parent and foreign affiliates of the foreign
parent), as applicable. (Do not duplicate amounts
consolidated in the BE-605 Bank or BE-605 report
for the U.S. affiliate identified in item 9.)
However, a U.S. affiliate that is indirectly
foreign owned and has no direct transactions or
positions, excluding ordinary banking operations,
with a foreign parent (or foreign affiliates of the
foreign parent) at any time during the year is
exempt from filing a Form BE-605 Bank provided
the Certificate of Exemption on page 4 of Form
BE-605 Bank is (or has been) filed.
001

BEA USE ONLY

1

OMB Control No. 0608-0009: Approval Expires 11/30/2008
BEA USE ONLY

IDENTIFICATION

1. Report for Month Day
quarter
ending
2. Name and
mailing
address of
U.S. affiliate

Year

Mark (X) if
revised

1

See General
Instructions
concerning
consolidated
reporting by
U.S. affiliate.

Public reporting burden for this collection of information is estimated to average 1 1/4 hours per
response, including the time for reviewing instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the collection of information. Send
comments regarding this burden estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to: Director, Bureau of Economic Analysis (BE-1),
U.S. Department of Commerce, Washington, DC 20230; and to the Office of Management and Budget,
Paperwork Reduction Project 0608-0009, Washington, DC 20503.
3. U.S. affiliate named in item 2 is –
Mark (X) one
a. A U.S. banking affiliate
incorporated in the United
003
States
b. An unincorporated U.S. banking
affiliate, such as a branch or
agency of a foreign bank

1

1

1

2

4. Name of foreign parent of U.S. affiliate –
The foreign parent is the first person outside
the U.S. which holds the direct investment
interest; its ownership in the U.S. affiliate
can be direct and/or indirect through another
U.S. affiliate.

5. Country of foreign parent of U.S.
affiliate

Foreign parent named in item 4 holds –
Mark (X) one
6. Only a direct equity interest in
the U.S. affiliate (as
006
consolidated).
7. Only an indirect equity interest in the
U.S. affiliate through another U.S.
affiliate. (See NOTE at lower left.)
8. Both a direct and an indirect equity
interest in the U.S. affiliate. (See the
General Instructions regarding
consolidations.)

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2

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3

BEA USE
ONLY

005 1

010 1

10. BEA USE ONLY

REPORT ALL AMOUNTS IN THOUSANDS OF U.S. DOLLARS
Part II

FOREIGN PARENT’S DIRECT EQUITY IN U.S. AFFILIATE’S:

Enter data for the current quarter in column 1; use column 2 to correct data that were incorrect,
revised, or were not given in the preceding quarter. Do not delay filing because currentquarter data are not available. Estimates may be used where necessary to file a timely
report.
11. Quarterly net income (loss) – Report net income
quarter,
Current quarter Preceding
on a quarterly basis, not on a cumulative or
if revised
year-to-date basis. Report the amount that
represents the foreign parent’s equity, based on its
Bil.
Mil.
Thou. Bil.
Mil.
Thou.
directly held equity interest in the U.S. affiliate’s net
income (loss) for the quarter, before provision for all
common dividends and preferred dividends owed to
foreign parent, and before any deduction for U.S.
2
1
withholding taxes on dividends, but after provision
for U.S. Federal, State, and local income taxes.
$
011 $
12. Certain realized and unrealized gains (losses),
net of tax effect:
a. Included in net income (item 11)
Examples include: (1) impairment losses, as defined
by FAS 115, (2) realized gains or losses on trading or
dealing (3) unrealized gains or losses due to changes
in the valuation of financial instruments that flow
through the income statement, and (4) goodwill
impairment as defined by FAS 142. See Specific
012
Instructions.
b. Not included in net income (item 11)
Include unrealized gains or losses due to changes in
the valuation of financial instruments that are taken
to other comprehensive income, excluding
translation adjustments. See Specific Instructions. 013
13. Translation adjustment – Report foreign parent’s
share of your foreign currency translation adjustment
resulting from the translation of foreign affiliate
financial statements from the affiliate’s functional
currencies into the U.S. dollar. Compute the adjustment
in accordance with FAS 52 or other current standards of
the Financial Accounting Standards Board. Report the
translation adjustment here on a quarterly basis, not
313
on a cumulative or year-to-date basis.
14. Dividends or remitted earnings – Dividends on
common and preferred stock, excluding stock and
liquidating dividends of incorporated U.S. banking
affiliate, or distributed earnings of a U.S. bank affiliate
that is a branch or agency. Exclude reimbursed losses.
(Report reimbursed losses in item 31a.) Report
dividends or remitted earnings as of the date they
were either paid, accrued, or transferred to the home
office, whichever occurred first. Any subsequent
settlement of dividends declared but not paid should
not be reported.
014

16. Net amount – Report net amount of dividends or
distributed earnings. Equals item 14 less item 15.

3

1

9. If either item 7 or 8 is marked, enter the name
of the U.S. affiliate(s) directly owned by
the foreign parent named in item 4.

15. U.S. tax withheld – Report U.S. tax withheld on
dividends or on distributed earnings of a U.S.
banking affiliate that is a branch or agency.

2

1

1

2

1

2

1

2

1

2

1

2

1

2

016

017

Part III

PAYMENTS AND RECEIPTS BETWEEN U.S. AFFILIATE AND FOREIGN PARENT, AND
BETWEEN U.S. AFFILIATE AND FOREIGN AFFILIATES OF THE FOREIGN PARENT (FAFP)

Enter amounts received, paid, or entered into intercompany accounts, whichever occurred
first. Include amounts for which payment was made in kind. For an item accrued prior to the
reporting period, do not report any subsequent settlement of the account in the items below.
Exclude interest related to the parent’s and affiliate’s ordinary banking business. Report
items 17 through 20 gross of tax withheld.
17. Interest on invested debt (item 21) – Do not include interest from other types of loans.
18. Royalties, license fees, and other fees for the use or sale of intangible property

Payments or accruals
by U.S. affiliate to
foreign parent
Bil.
018

Thou. Bil.

1

2

$

$

1

2

1

2

1

2

Mil.

Thou.

019

19. Charges for the use of tangible property – Include rentals for operating leases of
one year or less and net rent on operating leases of more than one year. Net rent is
equivalent to the total lease payment less the return of capital (depreciation)
component.

020

20. Allocated expenses and sales of services – Include: (1) allocated expenses or
reimbursements for management, professional, technical, or other services that would
normally be included in "other income" in the income statement of the provider of the
service and, (2) payments by the U.S. affiliate to, or receipts by the U.S. affiliate from, the
foreign parent and FAFP for services that are separately billed and that would normally
be included in gross operating revenues of the seller of the service. Also include as a
charge for services rendered any explicit fees paid to, or received from, the foreign
parent or FAFP for arranging an interest rate or foreign currency swap agreement. See
Specific Instructions.

022

Part IV

Mil.

Receipts by or accruals
to U.S. affiliate from
foreign parent

FOREIGN BANK PARENT’S PERMANENT DEBT INVESTMENT BALANCES IN U.S. AFFILIATE

Report the balance of foreign bank parent’s "permanent" debt investment that relates ONLY to consolidated
subsidiaries or units that are banks or bank holding companies. DO NOT include debt that arises from
ordinary banking operations or debt that relates to insurance, real estate, or leasing subsidiaries or units. If
the closing balance on the previous quarter’s report is incorrect, note the correction in column 2.
21. Foreign bank parent’s permanent debt investment balances in U.S. affiliate –
Include debt that is considered to be BOTH (a) permanently invested by the foreign bank
parent, and (b) positively identified as being used for nonbanking-type activities (e.g.,
debt used to acquire buildings, equipment, and other fixed assets). Exclude
non-permanent debt such as ordinary bank loans or deposits. Also exclude demand and
overnight accounts, debt used to fund investment activities, debt for which the proceeds
are used to meet regulatory and/or capital requirements, and debt with foreign parents
that are not banks.
Part V

End-of-quarter
Bil.

124

Mil.

Beginning-of-quarter
Thou. Bil.

1

2

$

$

Mil.

Thou.

INTERCOMPANY BALANCES BETWEEN THE INSURANCE, REAL ESTATE, AND LEASING
SUBSIDIARIES OR UNITS OF THE U.S. AFFILIATE AND THE FOREIGN PARENT AND FAFP

22. Does this Form BE-605 BANK include data for domestic U.S. subsidiaries or units that have
insurance, real estate, or leasing activities?
126

1

1

Yes – Answer items 23 through 25

1

2

No – Go to item 26
End-of-quarter

For items 23 and 24 report amounts that relate ONLY to insurance, real estate, and leasing
activities. Report amounts according to the books of the U.S. affiliate.
23. Liabilities – Report balances relating to your insurance, real estate, and leasing
activities, owed by U.S. affiliate to foreign parent and to FAFP both, current and
long-term.
24. Receivables – Report balances relating to your insurance, real estate, and leasing
activities, due to the U.S. affiliate from the foreign parent and from FAFP, both current
and long-term. Include certificates of deposit and other deposits (that would otherwise be
included in cash on your balance sheet) held by the foreign parent or FAFP.

Bil.

127

Mil.

Beginning-of-quarter
Thou. Bil.

1

2

$

$

1

2

Part VI

Thou.

128

Payments or accruals
by U.S. affiliate to
foreign parent and
FAFP
25. Interest – Report payments, receipts, and accruals of interest on liabilities and
receivables related to the insurance, real estate, and leasing activities above (items 23
and 24). For an account accrued prior to the reporting period, do not report any
subsequent settlement of the account in this item. Report gross of any taxes withheld.

Mil.

Bil.

129

Mil.

Receipts by or accruals
to U.S. affiliate from
foreign parent and
FAFP

Thou. Bil.

1

2

$

$

Mil.

Thou.

FOREIGN PARENT’S SHARE OF THE CHANGE DURING THE QUARTER IN U.S. AFFILIATE’S LOAN
LOSS RESERVE (LLR), EXCLUDING LOANS TRANSFERRED TO THE FOREIGN PARENT

Report the foreign parent’s (home office’s), equity share of the reporting bank’s loan losses or LLR. Calculate
the amounts by multiplying the reporting bank’s loan losses or LLR by the foreign parent’s percentage of
ownership. Report all reserves, including general reserves, reserves specific to individual loans, and reserves
allocated based on specific country risk. Bank holding companies should include the LLR’s of all banks
included in the consolidated enterprise.
26. Loan loss reserve – Balance at close of prior quarter.
If amended from previous quarter’s BE-605 BANK report, note revision.
27. Provision for loan losses – Amount charged to the LLR account during current quarter. Report the net
effect of all LLR transactions on current quarter net income. For example, include general and/or specific
allocations to the LLR less funds received against fully reserved loans that are not written off. Include the
amount of any direct write-offs in this item and in item 28.
28. Loan losses – Amount of actual loan losses incurred during current quarter, including direct write-offs.
Report both write-offs and sales of loans that are fully reserved. If revenue differs from net book value
include the difference in item 12a.

Amount
Bil.
1
134

$
1

135
1

136

29. Recovered losses and other adjustments – Specify amounts reinstated to the LLR resulting from prior
write-offs. If the LLR is being reinstated, report amount of the recovery included in income as a gain in item
12a. Report recoveries of funds against loans fully reserved, but not written off, in item 27 as a reduction.
Specify deposits made directly to the LLR by the foreign parent, adjustments due to changes in the foreign
parent’s ownership percentage and/or acquisition or disposal of an operating bank(s), and any
miscellaneous or other adjustments to the LLR not reported in items 27 or 28 – Specify
1
137
1

30. Loan loss reserve – Balance at close of current quarter
Equals sum of items 26, 27, and 29 minus 28.
FORM BE-605 BANK (REV. 11/2005)

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Mil.

Thou.

Part VII

CHANGES IN EQUITY HOLDINGS IN THE U.S. AFFILIATE BY THE FOREIGN PARENT

Report transactions by the foreign parent that changed its equity holdings in the U.S. affiliate.
Exclude changes caused by carrying net income to the equity account, the payment of stock or cash dividends (other than liquidating
dividends), or the remittance of earnings during the period. Exclude effect of treasury stock transactions with persons other than the
foreign parent, reimbursed losses, and reorganizations in capital structure that do not affect total equity. REPORT ALL AMOUNTS AT THE
TRANSACTION VALUE, i.e., the value of the consideration given or received by the foreign parent for the increases or decreases in the
foreign parent’s equity holdings in the U.S. affiliate.
• TRANSACTIONS BETWEEN FOREIGN PARENT AND U.S. AFFILIATE

Amount

31. Increase in equity interest

Bil.

31a. Increase from reimbursed losses – Report the foreign parent’s increase in the U.S.
affiliate’s equity (or home office account), excluding amounts reported in Parts II
and IV.
31b. Other Increases – Report purchases of capital stock by the foreign parent from the
U.S. affiliate and other contributions by the foreign parent of equity capital not
resulting in the issuance of stock to the foreign parent by the U.S. affiliate.

Mil.

Amount
Thou. Bil.

Mil.

Thou.

1
1
326

$
1

327
1

Total Increases in equity interest – Equals sum of 31a and 31b.
32. Decrease in equity interest – Report sales of capital stock by the foreign parent to the U.S. affiliate, returns of
contributed equity capital to the foreign parent not resulting in a reduction of issued stock, and distributions to the
foreign parent (excluding amounts reported in Parts II, IV, and V) following total liquidation of the U.S. affiliate.
Branches and agencies, report the foreign parent’s decrease in the U.S. affiliate’s equity (or home office account),
excluding amounts reported in Parts II, IV, and V.

026

$

1
027

• TRANSACTIONS BETWEEN FOREIGN PARENT AND A PERSON OTHER THAN THE U.S. AFFILIATE
Acquisition by foreign parent of equity interest in U.S. affiliate from —

1

33. U.S. persons other than the U.S. affiliate

028

34. All foreign persons

029

1

1

Sale by foreign parent of equity interest in U.S. affiliate to —
35. U.S. persons other than the U.S. affiliate

030
1

36. All foreign persons

031
1

37. TOTAL TRANSACTION VALUE – Equals sum of items 31, 33, and 34, minus sum of items 32, 35, and 36.
38. Book value – Report the book value (approximate) of the transactions reported in items 31 through 36, above.
Exclude changes caused by carrying net income to the equity account, payment of stock or cash dividends
other than liquidating dividends, distribution of earnings, and treasury stock transactions. Those items should
be reported in item 11, net income (loss), and in item 12a.
Part VIII

032
1

033

ANNUAL INCOME AND EQUITY POSITION

Complete once a year, not later than the second filing following the close of the calendar year (or fiscal year if the
U.S. affiliate’s books are not kept on a calendar year basis). For example, following a fiscal year ending December
31, this section must be completed on the report due within 30 days after the close of the first quarter, or April 30. If
actual amounts are not available, supply estimates and label them as such. When a data item cannot be fully
subdivided as required, supply a total and an estimated breakdown of the total.

Month

Year

1

39. U.S. affiliate’s calendar (or fiscal) year ending date

034

40. Foreign parent’s percentage of equity ownership interest in the U.S. affiliate at end of year – Enter to
tenth of one percent.

035

• INCOME STATEMENT ITEMS
See instructions for items 11, 12, and 13, except that these items refer to the annual amount for the year designated
in item 39. Please note in the Remarks section, page 4, any revisions to previously reported quarterly data made
after the annual audit.
41. Foreign parent’s direct equity in U.S. affiliate’s annual net income (loss) after provision for U.S. Federal,
State, and local income taxes.

Day

1

.

%

Amount
Bil.

Mil.

Thou.

1
036

$
1

42. Foreign parent’s share of certain realized and unrealized gains (losses), net of tax effect:
a. Included in net income (item 41)

037

b. Not included in net income (item 41) but taken directly to retained earnings or other comprehensive
income excluding translation adjustment

038

43. Foreign parent’s share of translation adjustment for the year (an adjustment to other comprehensive income)

338

1

1

• OWNER’S EQUITY ITEMS FOREIGN PARENT’S SHARE
Report the foreign parent’s share of the owner’s equity items of the U.S. affiliate as of the end of the year shown in
item 39. Items 44-46 must be computed on the equity method consistent with items 11 and 37.

1

44. Common and preferred stock and additional paid-in capital

039

45. Retained earnings (deficit)
46. Other equity accounts, including other comprehensive income – Specify

040

1

1

041
1

47. TOTAL – Equals sum of items 44, 45, and 46
Part IX

042

ANNUAL INSURANCE ACTIVITIES WITH FOREIGN PARENT AND FAFP

Important Note: Items 48 and 49 below are to be completed ONLY for subsidiaries or units included in this fully
consolidated report with operations in insurance.
Premiums earned and losses incurred. Complete once a year, not later than the second filing following the close
of the calendar year (or fiscal year if the U.S. affiliate’s books are not kept on a calendar year basis). In item 48
report the annual amount of premiums earned from the sale of insurance to the foreign parent and FAFP. In item 49
report the annual amount of losses incurred on such insurance sold.
48. Premiums earned – Calculate as premiums written during the year, plus unearned premiums at the
beginning of the year, minus unearned premiums at the end of the year.
49. Losses incurred – For property and casualty insurance, calculate as losses paid during the year, plus the
net increase (or minus the net decrease) during the year in case reserves and in losses incurred but not
reported. For life insurance, losses reflect policy claims on reinsurance assumed or ceded, or on primary
insurance sold, adjusted for changes in claims due, unpaid, and in course of collection. For both types of
insurance, do not include loss adjustment expenses.
FORM BE-605 BANK (REV. 11/2005)

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Amount
Bil.
1
148

$

1
149

Mil.

Thou.

CERTIFICATION OF EXEMPTION – Mark (X) below to indicate reason affiliate is exempt and complete the "Person to Consult" and
"Certification" sections below on this form. See "Reporting Requirements" for determining exempt status.
EXEMPT STATUS – Mark (X) one:
A01

1

1

This U.S. affiliate is exempt because each of the three items listed below is equal to or less than $30 million (positive or
negative). Enter the amount for each of the three items – Data should be for the fully consolidated U.S. business enterprise
and for, or as of the end of, the most recent financial year (use projections if annual data are unavailable).
Bil.

Mil.

Thous.

1
A11

• Total assets – Do not net out liabilities.
• Sales or gross operating revenues, excluding sales taxes –
Do not give gross margin.

$
1

A12

$
1

• Net income (loss) after provision for U.S. income taxes

A13

$
Month

Day

Year

1

• The above data are for the 12-month period ended . . . . . . . . . . . . .

A14

If any one of the three items above exceeds the exemption level, either positive or negative, the U.S. affiliate must report.
Quarterly reports for a year may be required retroactively when it is determined that the exemption level has been
exceeded. If a U.S. affiliate’s total assets, sales, or net income (loss) exceeded the exemption level in a given year, it is
deemed that the exemption level will also be exceeded in the following year.
1

2

This U.S. affiliate is consolidated, merged, or reorganized into another U.S. affiliate. Complete the following:
• Name and BEA ID number* of the directly owned U.S. affiliate in the consolidated group
1
A21

* If BEA ID number is not known, please provide contact information for the above company in the Remarks sections
below.
Month

Day

Year

1

• Date of change in status

A22

1

3

This U.S. affiliate is only indirectly foreign owned through another U.S. affiliate, and has no direct transactions or accounts
(e.g. debt investment balances or other direct transactions relating to insurance, real estate or leasing activities of the
consolidated U.S. affiliate) with the foreign parent(s) or any of its(their) foreign affiliates. NOTE If the other U.S. affiliate
has a majority interest (greater than 50%) in this U.S. affiliate, this item does not apply. See Instructions on
"Consolidations."

1

4

In a prior quarter, the foreign parent’s voting interest in this U.S. business enterprise was either –
(a) sold to a U.S. person that is not a U.S. affiliate,
(b) liquidated, or
(c) diluted, so that the foreign parent’s voting interest is below 10%.
Month

Complete the following:

Day

Year

1

• Date of change in status

A31

• Approximate sale or liquidation value – If this amount was not
reported in Part VII of a prior quarter’s Form BE-605 Bank, also
complete Part VII on page 1 of this form.

Bil.

Mil.

Thous.

1
A32

$

1

• If sold, name of other U.S. person(s)
to whom sold . . . . . . . . . . . . . .

A33

• If diluted, use "Remarks" space below to explain
1

A41

5

Other – Use Remarks section below to specify and include reference to section of regulations or instructions on which
claim is based.

Remarks

1

PERSON TO CONSULT CONCERNING QUESTIONS
ABOUT THIS REPORT – Enter name and address
Name 801
Address

CERTIFICATION – The undersigned official certifies that this report has been
prepared in accordance with the applicable instructions, is complete, and is
substantially accurate except that, in accordance with the Instructions,
estimates have been provided where data are not available from customary
accounting records or precise data could not be obtained without undue burden.

1

Authorized official’s signature
TELEPHONE
NUMBER
FAX
NUMBER

802 Area code
1

Number

Extension

2

3

803 Area code
1

Number

Print or type name and title

Date

2

May we use e-mail to correspond with you to discuss questions
relating to this Form BE-605 BANK, including questions that may
contain information about your company that you may consider
confidential? (Note that electronic mail is not inherently confidential;
we will treat information we receive as confidential, but your e-mail
is not necessarily secure against interception by a third party.)
FORM BE-605 BANK (REV. 11/2005)

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804

1

1

Yes – If yes, please
provide your
e-mail address.

1

2

No

Page 4

Email address
1