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Thrift Financial Report

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Table of Contents
General Instructions ...............................................................................................................................101
Schedule SC – Consolidated Statement of Condition ........................................................................ 201
Schedule SO – Consolidated Statement of Operations ...................................................................... 301
Schedule VA – Consolidated Valuation Allowances ........................................................................... 401
Schedule PD – Consolidated Past Due and Nonaccrual..................................................................... 501
Schedule LD – Consolidated Loan Data ............................................................................................... 601
Schedule CC – Consolidated Commitments and Contingencies....................................................... 701
Schedule CF – Consolidated Cash Flow Information ......................................................................... 801
Schedule DI – Consolidated Deposit Information ............................................................................... 901
Schedule SI – Supplemental Information ........................................................................................... 1001
Schedule SQ – Consolidated Supplemental Questions.................................................................... 1101
Schedule SB – Consolidated Small Business Loans........................................................................ 1201
Schedule FS – Fiduciary and Related Services ................................................................................. 1301
Schedule HC – Thrift Holding Company.............................................................................................1401
Schedule CSS – Subordinate Organization Schedule ...................................................................... 1501
Schedule CCR – Consolidated Capital Requirements ...................................................................... 1601
Schedule CMR – Consolidated Maturity and Rate............................................................................. 1701
Glossary ................................................................................................................................................. 1901
Index ....................................................................................................................................................... 2001
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GENERAL INSTRUCTIONS
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
1. REQUESTS FOR INFORMATION OR ASSISTANCE
Please direct all requests for assistance in Thrift Financial Report (TFR) preparation to your assigned financial reporting analyst in the Office of Thrift Supervision (OTS) Financial Reporting Division (FRD), Dallas, Texas. A list of Financial Reporting Division contacts is on the OTS web site and is included in most Financial Reporting Bulletins. If you do not know the name or phone number of your assigned FRD analyst, call 972-277-9618. If you have questions concerning the EFS (Electronic Filing System) software or transmission, call the EFS Helpline Message Center at 866-314-1744 or email
[email protected].
OTS maintains a series of TFR questions and answers on its web site at www.ots.treas.gov. If you have a question for which you would like an e-mail response, please submit it to your financial reporting analyst or to [email protected].
OTS provides one free copy of the TFR Instruction Manual and Financial Reporting Bulletin to report preparers of all OTS-regulated institutions. You can access the TFR forms, Instruction Manual, and Financial Reporting Bulletins on the OTS web site at www.ots.treas.gov.
2. SCHEDULES
The TFR comprises the following schedules: The filing deadline for all schedules except Schedules HC and CMR is no later than the 30th day following the end of the reporting period. The filing deadline for Schedules HC and CMR is no later than the 45th day following the end of the reporting period.
NS
Optional Narrative Statement: Statement by institution management concerning issues

relevant to the TFR
SC
Consolidated Statement of Condition: Assets, liabilities, and equity capital
SO
Consolidated Statement of Operations: Income and expense
VA
Consolidated Valuation Allowances and Related Data: Reconciliation of valuation

allowances, charge-offs and recoveries, and other data on troubled assets
PD
Consolidated Past Due and Nonaccrual: Information on delinquent and nonaccrual loans
LD
Loan Data: Information on high loan-to-value loans secured by 1-4 family residential properties without PMI or government guarantee
CC
Consolidated Commitments and Contingencies: Information on commitments and contingencies
CF
Consolidated Cash Flow Information: Information on mortgage, deposit, and other activity affecting cash flow during the quarter
DI
Consolidated Deposit Information: Information on deposits and escrows
SI
Consolidated Supplemental Information: Information on QTL, loans to insiders, reconciliation of equity capital, transactions with affiliates, mutual fund and annuity sales, average balance sheet data, and other data
SQ
Consolidated Supplemental Questions: Questions concerning structural and other activity during the quarter
SB
Consolidated Small Business Loans: Data completed annually as of June 30 to comply with Section 122 of the FDIC Improvement Act
FS
Fiduciary and Related Services: Data on trust assets and activities. Summary data is completed quarterly; more detailed information is reported annually at December 31st
HC
Thrift Holding Company: Summary of holding company financial data for both the parent only and consolidated
CSS
Subordinate Organization Schedule: Listing of information on required subordinate organizations and joint ventures, completed annually at December 31
CCR
Consolidated Capital Requirement: Balances necessary to compute the OTS minimum capital requirement
CMR
Consolidated Maturity and Rate: Information on interest rate and repricing/maturity characteristics of selected balance-sheet and off-balance-sheet items
3.
FILING DEADLINES
The Filing Schedule for Regulatory Reports is included as an attachment to the quarterly Financial Reporting Bulletin that is e-mailed to institution report preparers. The Filing Schedule is also available on the OTS web site at www.ots.treas.gov.
4. FILING THE TFR
OTS provides all savings associations with EFS (Electronic Filing System) software for filing the TFR. The software facilitates the preparation, edit, and transmission of the TFR and other financial reports. Please direct your questions concerning EFS to the EFS Helpline Message Center at 866-314-1744 or by email to [email protected].
All institutions regulated by OTS as of the last day of the quarter are required to file the TFR for the entire quarter. If the documentation submitted to OTS by an institution reflects that the effective date of a charter conversion to OTS-regulation from another banking agency is either during the quarter or prior to the close of business on the last day of the quarter, the institution is required to file a TFR for that quarter. An institution with a charter conversion from OTS to another banking regulator or merger with a non-OTS regulated institution, effective after close of business on the last day of the quarter, is required to file a TFR for the entire previous quarter. Institutions changing banking charters are never required to file a partial report to their former banking regulator; they must file a financial report only with the agency regulating them on the last day of the quarter, reporting activities for the entire quarter. Therefore, an institution that is required to file a TFR is not required to file a Call Report and vice versa. If a newly formed OTS-regulated institution opens for business at any time during the quarter, even if on the last day of the quarter, it is required to file a TFR for the period of operations during the quarter.
5. RECORD RETENTION
You should retain at least one copy of your completed TFR for reference; do not send paper copies to OTS. Section 7(b)(5) of the Federal Depository Institutions Act requires each insured depository institution to maintain records for verifying the correctness of the institution’s insurance assessment for five (5) years from the date of filing.
6. AMENDING THE TFR
To have amendments included in the first public release of the OTS data file, you must transmit your TFR amendments within 45 calendar days of the end of the quarter; that is, within 15 days after the TFR filing deadline. Amendments submitted after the 45-day period should have the approval of FRD in Dallas, before transmission. In no case can OTS process amendments beyond 135 days after the end of the quarter. With every amendment you file, you should send a user note explaining the reason for the amendment.
You may correct material errors in prior-period TFRs in one of the following ways depending on the time period being corrected:
1. If you can file an amendment within 135 days of the end of the quarter being corrected, transmit the amendment correcting the TFR in which the error occurred after you discuss it with your FRD analyst in Dallas.
2. If the correction is to an income statement in a quarter that can no longer be amended and is within the current calendar year, include the correction with the current TFR in the same data field that would have carried it in the original report. If the adjustment distorts yields or results in negative numbers in fields that do not permit negatives, you may include the amendment in Other Noninterest Income, SO488, or Other Noninterest Expense, SO580.
3. If the correction is to an income statement for a quarter from a prior calendar year that can no longer be amended, make the adjustment directly to retained earnings on SI668, Prior Period Adjustments.
You must file TFR amendments electronically, rather than by phone or fax in order to automatically update your EFS files on your computer. Please direct questions regarding the electronic filing of amended TFRs to the EFS Helpline Message Center at 866-314-1744 or email [email protected].
The amendment filing deadlines above also apply to amending Schedule CMR. All amendments to Schedule CMR must be submitted within 135 days of the end of the quarter.
7. REPORTING BASIS
Prepare the TFR on a consolidated basis in accordance with generally accepted accounting principles (GAAP) unless specifically stated otherwise, and based on calendar year reporting. Unless otherwise specified, all data is reported as of the end of the calendar quarter or in the case of income, expense, and other activity data, for the period of one calendar quarter. Note that Schedule FS requires reporting income and expense on a calendar year-to-date basis.
Report subordinate organizations that are not GAAP-consolidated subsidiaries using the equity or cost methods of accounting. Subordinate organization is defined by OTS regulation. It includes any corporation, partnership, business trust, association, joint venture, pool, syndicate, or other similar business organization in which a savings association has a direct or indirect ownership interest. It excludes an ownership interest that qualifies as a pass-through investment pursuant to 12 CFR § 560.32 and is so designated by the reporting savings association. GAAP-consolidated subsidiaries as defined in 12 CFR § 559.2 mean entities in which a savings association has a direct or indirect ownership interest and whose assets are consolidated with those of the savings association for purposes of reporting under GAAP.
You should apply GAAP unless we specifically state otherwise in these instructions. Accordingly, the instructions for each data field reflect, to the extent possible, GAAP applicable to savings associations. Note, however, that financial statements of savings associations prepared in accordance with GAAP have flexible presentation formats and may require significantly less detail on a less frequent basis than the TFR. The TFR collects additional detail to facilitate supervision by the OTS and to provide uniform information on industry activities. Certain GAAP reporting and presentation concepts may not be consistent with the conventions and frequency of the TFR. In these cases, the TFR instructions override GAAP presentation practices.
The amounts reported on the TFR must be readily reconcilable to the savings association’s books and records.
8. EXEMPTION FROM FILING SCHEDULE CMR
Savings associations with less than $300 million in assets and with risk-based capital ratios in excess of 12 percent for two consecutive quarters are exempt from filing Schedule CMR. All savings associations newly regulated by the OTS are exempt from filing Schedule CMR for the first two quarters that they are under OTS regulation.
You lose your exemption from filing Schedule CMR if you do not meet the exemption criteria for two consecutive quarters. You must file Schedule CMR beginning the quarter after the second consecutive quarter in which you do not meet the criteria. For example, you fail the criteria in March and June, therefore, you must file Schedule CMR for the September quarter, and each quarter thereafter until your OTS Regional Director reinstates the exempt status.
You may also lose your exempt status if your OTS Regional Director requires you to file Schedule CMR. You must continue to file Schedule CMR until your OTS Regional Director reinstates the exemption in writing.
9. TFR PREPARATION
a.
Round all dollar amounts to the nearest thousand. If any balance sheet data field or other balance as of the end of the reporting period is less than $500, enter a 1 in the data field to indicate that the amount is not zero. This does not apply to the data fields representing income, expense, and other activity. Where necessary for balancing purposes, make adjustments to the appropriate other category.
b.
Data fields that we indicate in the instructions and forms as being deducted should not be input as negative; these data fields will be subtracted by EFS. Indicate these data fields as negative only when the instructions say that the netting of certain amounts within these data fields might result in an amount that should be added rather than subtracted. We identify these data fields in italics on the form and mention them in the accompanying instructions.
c.
You should check all data before and after input. Crosscheck data fields that should agree with other data fields. All edit failures indicated in EFS should be thoroughly verified and corrected where necessary prior to submission. Explain edit exceptions with the user note function of the filing software.
d.
Persons knowledgeable of the overall financial condition and operations of the savings association should review the final TFR. The Officers’ and Directors’ Certification at the front of the paper copy of the TFR must be signed by an officer and three directors of the savings association for each TFR submitted, including amendments. You must retain this certification form and have it available for inspection by OTS.
e.
Input into EFS (use institution setup, report preparer info) the name and telephone number of the person we should contact if questions arise concerning the TFR. This person should be familiar with OTS’s reporting requirements. When someone other than the savings association’s personnel prepares the TFR, the contact should be someone who can either answer questions or can quickly obtain such answers from savings association personnel. The name and address of the TFR contact that you enter is used for the mailing list to distribute quarterly TFR mailings.
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SCHEDULE SC – CONSOLIDATED STATEMENT OF CONDITION
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete this Statement of Condition, Schedule SC, on a consolidated basis from the savings association downward. Do not consolidate your holding company in this statement of condition. You should apply generally accepted accounting principles (GAAP) unless we specifically state otherwise in these instructions.
ASSETS
In general, report all assets net of all appropriate carrying value adjustments. Such adjustments include specific valuation allowances (SVAs), charge-offs, unamortized yield adjustments, unearned income, loans-in-process (LIP), and the accumulated gain or loss (change in fair value) on the asset attributable to the designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133.
For the following assets that may be included on various lines on this schedule, also report the balances on Schedule SI: SI375, Assets Held in Trading Accounts To be renamed (in 2008) - Financial Assets Held for Trading Purposes SI376, Assets Recorded on Schedule SC Under a Fair Value Option To be renamed (in 2008) - Financial Assets Carried at Fair Value SI385, Available-for-Sale Securities SI387, Assets Held for Sale SI402, Residual Interests in the Form of Interest-Only Strips
SI404, Other Residual Interests (Do not include Servicing Assets on these Schedule SI line items, as they are not considered financial assets per FAS141).
CASH, DEPOSITS, AND INVESTMENT SECURITIES
In accordance with FASB Statement No. 115, Accounting for Certain Investments in Debt and Equity Securities, securities reported on SC130, SC140, SC180, SC182, and SC185 fall into one of the following categories:
1. Held-to-maturity securities: Applies to debt securities only if there is a positive intent and ability to hold these securities to maturity. You must report held-to-maturity securities at amortized cost.
2. Trading securities: Applies to securities purchased and held for sale in the near term. You must report trading securities at fair value, with unrealized gains or losses reported in earnings on SO485.
3. Available-for-sale securities: Applies to securities not classified as trading or as held-tomaturity. You must report available-for-sale securities at fair value. The unrealized gains and losses of available-for-sale securities are excluded from earnings and reported, net of taxes, as a separate component of equity capital on SC860.
SC11: Total
The EFS software will compute this line as the sum of SC110 through SC191.
SC110: Cash and Non-interest-earning Deposits
Report the total amount of cash, cash items, and non-interest-earning deposits.
Include:
1. Non-interest-earning deposits in a bank or savings association under the control of a supervisory authority.
2. Cash items in the process of collection, such as redeemed U.S. Savings Bonds.
3. Checks or drafts in the process of collection that are drawn on another depository institution, Federal Reserve Bank, Federal Home Loan Bank (FHLBank), or the U.S. government.
Do not include:
1. Checks drawn against zero-balance accounts or accounts not routinely maintained with sufficient balances to cover checks drawn in the normal course of business. Report on SC710, Deposits.
2. All other accounts with credit balances that do not have the right of offset. Report on SC760, Other Borrowings.
SC112: Interest-Earning Deposits In FHLBs
Report all interest-earning checking accounts and time deposits (CDs) held with FHLBanks.
Do not include:
Accounts with credit balances that do not have the right of offset. Report on SC760, Other Borrowings, except for credit balances in zero-balance accounts, which are reported on SC710, Deposits.
SC118: Other Interest-Earning Deposits
Report all interest-earning checking accounts and time certificates held with banks and other depository institutions.
Do not include:
Accounts with credit balances that do not have the right of offset. Report on SC760, Other Borrowings, except for credit balances in zero-balance accounts, which are reported on SC710, Deposits.
SC125: Federal Funds Sold and Securities Purchased Under Agreements to Resell
Include:
1. The balance of excess Federal Funds invested.
2. Securities purchased under agreements to resell that do not meet the criteria for a sale under FASB Statement No. 140, including dollar-repurchase and fixed-coupon agreements.
Do not include:
1. Term Federal Funds Treat as a commercial loan, not as federal funds sold any lending of immediately available funds where the loan has an original maturity of more than one business day, other than securities
purchased under agreements to resell. Such transactions are sometimes referred to as Term Fed Funds.
SC130: U.S. Government, Agency, and Sponsored Enterprise Securities
Report nonmortgage debt instruments issued by the U.S. government, its agencies, and sponsored enterprises.
Include:
1. Interest-only and principal-only strips.
2. U.S. Treasury bills, certificates, notes, and bonds.
3. Nonmortgage debt issued by FHLBanks, Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation (Freddie Mac), and Government National Mortgage Association (Ginnie Mae).
4. Federal agency debt securities, such as those of: Small Business Administration (SBA) nonmortgage pools, Tennessee Valley Authority (TVA), Federal Farm Credit Bank, Federal Land Bank, Federal Intermediate Credit Bank, Student Loan Marketing Association (Sallie Mae), and the Export-Import Bank.
5. Financing Corporation (FICO) bonds.
6. U.S. government and agency securities pledged as collateral on margin accounts for futures and options.
Do not include:
1. Investments in mutual funds that invest in U.S. government, agency, and sponsored enterprise securities. Report on SC140, Equity Securities Subject to FASB Statement No. 115.
2. Stock of FHLBanks. Report on SC510, Federal Home Loan Bank Stock.
3. Equity securities issued by sponsored enterprises of the U.S. government, such as Freddie Mac preferred stock. Report on SC140.
4. Securities issued by state and local governments. Report on SC180.
5. Securities purchased under a repurchase or dollar-repurchase agreement. Report on SC125, Federal Funds Sold and Securities Purchased Under Agreements to Resell.
6. Mortgage-backed instruments and derivatives issued or guaranteed by Fannie Mae, Freddie Mac, or Ginnie Mae. Report on SC210 or SC217.
SC140: Equity Securities Subject to FASB Statement No. 115
Report all investments in equity securities that have readily determinable fair values and that are accounted for pursuant to FASB Statement No. 115.
Include:
1. Common and preferred stock that has a readily determinable market value, including Freddie Mac and Fannie Mae stock.
2. Shares of all mutual funds, including those restricting their investments to debt instruments, such as U.S. government, agency, and sponsored enterprise securities.
Do not include:
1. FHLBank stock. Report on SC510, Federal Home Loan Bank Stock.
2. Other equity investments not subject to FASB Statement No. 115, including ownership interests in unconsolidated subordinate organizations and entities designated as pass-through investments, even though they are not subordinate organizations. Report on SC540, Other Equity Investments Not Subject to FASB Statement No. 115.
3. Your association’s own treasury stock. Report as a reduction of capital on SC891, Other
Components of Equity Capital.
SC180: State and Municipal Obligations
Report debt securities issued by state and local governments.
SC182: Securities Backed By Nonmortgage Loans
Report the outstanding balance, as determined in accordance with GAAP, of all securities collateralized by nonmortgage loans such as credit card loans and auto loans.
SC185: Other Investment Securities
Report investment securities and other instruments not reported on SC110 through SC182 or SC510 or SC540.
Include:
1. Investments in commercial paper and corporate debt securities.
2. Promissory notes.
3. Mortgage-backed bonds and notes.
SC191: Accrued Interest Receivable
Report accrued interest and dividends receivable on deposits and investment securities reported on SC110 through SC185.
MORTGAGE-BACKED SECURITIES:
In accordance with FASB Statement No. 115, Accounting for Certain Investments in Debt and Equity Securities, mortgage-backed securities fall into one of the following three categories:
1. Held-to-maturity securities: Applies to mortgage-backed securities only if there is a positive intent and ability to hold these securities to maturity. You report held-to-maturity mortgage-backed securities at amortized cost.
2. Trading securities: Applies to mortgage-backed securities that you hold for sale in the near term. Report them at fair value, with unrealized gains or losses reported in earnings, on SO485.
3. Available-for-sale securities: Applies to mortgage-backed securities not classified as trading or as held-to-maturity. Report available-for-sale securities at fair value. Report the accumulated unrealized gains and losses on such securities, net of taxes, as a separate component of equity capital on SC860.
Adjust the balances in this section for:
1. Discounts and premiums on the purchase of the securities.
2. Specific valuation allowances.
3. The accumulated fair value gain or loss on the security attributable to the designated risk being
hedged on a qualifying fair-value hedge under FASB Statement No. 133. Do not adjust the balances in this section for: General valuation allowances. Report on SC229.
Do not include:
Mortgage-backed securities purchased subject to repurchase agreements. Report on SC125,
Federal Funds Sold and Securities Purchased Under Agreements to Resell.
SC22: Total
The EFS software will compute this line as the sum of SC210 through SC228, less SC229.
PASS-THROUGH:
A security must meet all of the following criteria to be classified as a pass-through security:
1. The security is collateralized by mortgage loans.
2. The security provides each investor with a proportional ownership interest in the underlying collateral.
3. Payments received by the issuer are passed through to the investor proportionate to ownership
interest and with the same timing with which they are received. You should report a security that meets item 1 but not 2 or 3 on SC217, SC219, or SC222, unless it is a mortgage-backed bond, in which case you should report it on SC185, Other Investment Securities. You should report a security collateralized by loans that meets items 2 and 3 but does not meet item 1 on SC182, Securities Backed by Nonmortgage Loans. Report a debt security that does not meet any of the above or meets only item 2 or item 3, but not both, on SC185, Other Investment Securities, except for those government securities reported on SC130 and SC180.
If the subordinate piece of a senior-subordinated security (1) exists solely for the purpose of credit enhancements and not for redirecting cash flows, (2) is no larger than necessary to provide the credit enhancement, and (3) meets the criteria of mortgage pass-through securities, above, then the senior piece is essentially a pass-through security, and you should report it in this section.
Include pass-through securities collateralized by home equity mortgages.
SC210: Insured or Guaranteed by an Agency or Sponsored Enterprise of the U.S.
Report all mortgage pass-through securities insured or guaranteed by an agency or sponsored enterprise of the United States.
Include:
1. Freddie Mac participation certificates.
2. Ginnie Mae and Fannie Mae pools.
Do not include:
1. Fannie Mae and Freddie Mac bonds. Report on SC130, U.S. Government, Agency, and
Sponsored Enterprise Securities.
2. Mortgage derivatives, including CMOs collateralized by Fannie Mae, Ginnie Mae, and Freddie Mac mortgage-backed securities. Report on SC217, SC219, or SC222.
3. Mortgage pass-through securities not insured or guaranteed by an agency or instrument of the United States, even if they are issued by a government-sponsored enterprise. Report on SC215.
SC215: Other
Report mortgage pass-through securities that are not insured or guaranteed by an agency or sponsored enterprise of the United States.
OTHER MORTGAGE-BACKED SECURITIES (EXCLUDING BONDS):
SC217: Issued or Guaranteed By FNMA, FHLMC, or GNMA
Report the outstanding balance, as determined in accordance with GAAP, of securitized mortgage derivatives that FannieMae, FreddieMac, or Ginnie Mae issues or guarantees. Include the following instruments FannieMae, FreddieMac, or Ginnie Mae issues or guarantees: REMICs, IO and PO strips, collateralized mortgage obligations (CMOs), securitized residual interests of such derivatives, and other subordinated tranches.
SC219: Collateralized By Mortgage-Backed Securities Issued or Guaranteed By FNMA, FHLMC, or GNMA
Report the outstanding balance, as determined in accordance with GAAP, of securitized mortgage derivatives that are collateralized by mortgage derivatives that FannieMae, FreddieMac, or Ginnie Mae issues or guarantees. Include the following instruments issued or guaranteed by FannieMae, FreddieMac, or Ginnie Mae: REMICs, IO and PO strips, collateralized mortgage obligations (CMOs), securitized residual interests of such derivatives, and other subordinated tranches.
SC222: Other
Report the outstanding balance, as determined in accordance with GAAP, of all other mortgage-backed securities not reported on SC210 through SC219. Include: REMICs, IO and PO strips, collateralized mortgage obligations (CMOs), securitized residual interests of such derivatives, and other subordinated tranches.
SC228: Accrued Interest Receivable
Report accrued interest receivable on mortgage backed securities reported on SC210 through SC222.
SC229: General Valuation Allowances
Report all general valuation allowances established on mortgage-backed securities reported on SC210 through SC222. Report all valuation allowances in the reconciliation of valuation allowances in Schedule VA.
MORTGAGE LOANS
Mortgage loans are defined as all real estate loans subject to 12 CFR 560.100-101 (real estate lending standards) and OTS Thrift Bulletin 72a and include all loans predicated upon a security interest in real property. When a loan to finance a small business is primarily secured by a single-family residence, you may classify the loan as either a single-family mortgage loan or a commercial nonmortgage loan.
Mortgage loans reported on SC230 through SC265 fall into four categories:
1. Those held for investment: Report these at cost.
2. Those originated for sale: Report these at the lower of cost or market value at the reporting date.
3. Those previously held for investment and now held for sale: Report these at the lower of cost or market value at the reporting date.
4. Those held in a trading portfolio: Report these at market value at each reporting date by directly adjusting the asset balance. Do not include adjustments to mark a trading portfolio to market in valuation allowances.
Report all loans at recorded investment reduced by specific valuation allowances, but not reduced by the allowance for loan and lease losses.
Recorded investment is the principal balance of a loan adjusted for:
1. Direct write-downs.
2. Deferred loan fees net of direct costs.
3. Discounts and premiums on the purchase of mortgage loans and contracts.
4. Application of lower-of-cost-or-market accounting treatment to mortgages held for sale but not in a trading account.
5. Any undisbursed balances of loans closed, loans-in-process. Report the undisbursed amounts as commitments on CC105-115.
6. The undisbursed portion of mortgage lines of credit on 1-4 dwelling units. Report these amounts as commitments on CC412.
7. The undisbursed portion of mortgage lines of credit on multifamily residential property. Report these amounts as commitments on CC290.
8. Unearned interest.
9. Interest receivable that is capitalized to the loan balance.
10. Deposits accumulated for the payment of loans, hypothecated deposits.
11. Accumulated fair value gain or loss on mortgage loans attributable to the designated risk being
hedged on a qualifying fair-value hedge under FASB Statement No. 133. Report the related allowance for loan and lease losses on SC283. Report accrued interest and advances for taxes and insurance on SC272 and SC275, respectively.
Do not divide a loan between categories. You should report loans secured by property with more than one use, such as residential and commercial, in the data field that describes the property type comprising the largest percentage of the value of the property securing the loan.
Include:
1. FHA/VA and conventional first mortgage loans.
2. Junior mortgage liens, both open-end and closed-end.
3. Your share of participating interests in loans.
4. Loans to commercial entities collateralized by mortgages of third-party borrowers, such as warehouse loans, provided the underlying loans are secured by real estate.
5. Disbursed portion of open-end home equity loans if you secure the loan by a lien on real estate.
6. The unpaid balance of the gross loan in a wrap-around mortgage if you wrapped a loan held by a third party. Report the loan payable to the third party as a liability on SC760, Other Borrowings.
7. Loans on units in cooperative buildings.
Do not include:
1. Mortgage-backed securities. Report on SC210 through SC222.
2. The portion of participations sold qualifying as a sale under GAAP; you should no longer report the sold portion in your statement of condition.
3. Mortgage-backed bonds. Report on SC185.
4. Real estate loans where the characteristics dictate treatment as an investment in real estate in accordance with GAAP. Report on SC45, Real Estate Held for Investment.
5. Foreclosed assets. Report on SC405 through SC428, Repossessed Real Estate.
6. Loans secured by assets that you physically possess, although foreclosure has not yet occurred, in-substance foreclosures. Report on SC405 through SC428, Repossessed Real Estate.
7. Loans purchased subject to agreements to resell, that is, you hold these loans as collateral received for loans made to others. Report on SC125, Federal Funds Sold and Securities Purchased Under Agreements to Resell.
8. Loan commitments that you have not yet taken down, even if you have received fees. Prior to disbursement of the loan, report refundable fees on SC712, Escrows, and nonrefundable fees on SC796, Other Liabilities and Deferred Income, as Code 04.
9. Loans on timeshare arrangements. Report on SC330, Other Consumer Loans.
10. Unsecured home improvement loans. Report on SC316, Home Improvement Loans.
SC26: TOTAL
The EFS software will compute this line as the sum of SC230 through SC275, less SC283.
Construction Loans on:
SC230: 1-4 Dwelling Units
Report the outstanding balance of all construction loans secured by 1-4 dwelling units. Adjust balances as described above in the general instructions to mortgage loans.
Include:
1. Construction loans to developers secured by tracts of land on which single-family houses, including townhouses, are being constructed.
2. Construction loans secured by single-family dwelling units in detached or semidetached
structures, including manufactured housing.
3. Construction loans secured by duplex units and town houses, excluding garden apartment projects where the total number of units that will secure the permanent mortgage is greater than four.
4. Combination land and construction loans on 1-4 dwelling units regardless of the current stage of construction or development;
5. Combination construction-permanent loans on 1-4 dwelling units until construction is completed or principal amortization payments begin, whichever comes first.
6. Bridge loans to developers on 1-4 dwelling units where the buyer will not assume the same loan, even if construction is completed or principal amortization payments have begun.
Do not include:
Loans for the development of building lots unless the same loan finances the erection of building improvements. Report on SC265.
SC235: Multifamily (5 or More Dwelling Units)
Report the outstanding balance of all construction loans secured by 5 or more dwelling units. Adjust balances as described above in the general instructions to mortgage loans.
Include:
1. Loans for the construction of apartment buildings including condominium and cooperative apartments.
1. Loans for the construction of fraternity or sorority houses offering sleeping accommodations.
2. Loans for the construction of living accommodations for students or staff of a college or hospital.
3. Loans for the construction of retirement homes with sleeping and eating accommodations for permanent residents. Each bedroom equals one dwelling unit.
4. Combination land-construction loans on 5 or more dwelling units regardless of the current stage of construction or development.
5. Combination construction-permanent loans on 5 or more dwelling units until construction is completed or principal amortization payments begin, whichever comes first.
6. Bridge loans to developers on 5 or more dwelling units where the buyer will not assume the same loan, even if construction is completed or principal amortization payments have begun.
7. Loans for the construction of mobile home parks.
SC240: Nonresidential Property
Report the outstanding balance of all construction loans secured by nonresidential property. Adjust balances as described above in the general instructions to mortgage loans.
Include:
1. Loans for the construction of hospitals, nursing and convalescent homes, hotels, churches, stores, and other commercial properties.
2. Combination land and construction loans on nonresidential property regardless of the current stage of construction or development.
3. Combination construction and permanent loans on nonresidential property until construction is completed or principal amortization payments begin, whichever comes first.
4. Bridge loans to developers on nonresidential property where the buyer will not assume the same loan, even if construction is completed or principal amortization payments have begun.
Do not include:
1. Loans to purchase land. Report on SC265.
2. Loans to purchase land used for farming. Report on SC260.
Permanent Mortgages on:
1-4 Dwelling Units:
Include:
1. Mortgages secured by all 1-4 dwelling units where construction has been completed.
2. Refinancing loans on 1-4 dwelling units where the original loan was a permanent mortgage.
3. Junior liens on 1-4 dwelling units where the senior lien is a permanent mortgage.
Do not include:
1. Combination land-construction loans regardless of the current stage of construction or
development. Report on SC230.
2. Combination construction-permanent loans until construction is completed or principal
amortization payments begin, whichever comes first. Report on SC230.
3. Bridge loans to developers where the buyer will not assume the same loan. Report on SC230.
4. Timeshare loans. Report on SC330, Other Consumer Loans.
SC251: Revolving, Open-End Loans
Report the outstanding balance of all revolving, open-end lines of credit secured by 1-4 dwelling units and extended under lines of credit, where you secured the loan with a lien on the real estate. You generally secure these loans, called “home equity lines of credit,” by a junior lien, and the funds may be accessible by check or credit card. However, where no senior lien exists, you may secure these lines by a first lien on the real estate. .
SC254: Secured by First Liens
Report the outstanding balance of all closed-end loans secured by first liens on 1-4 family residential properties.
SC255: Secured by Junior Liens
Report the outstanding balance of all closed-end loans secured by junior liens on 1-4 family residential properties.
SC256: Multifamily (5 or More Dwelling Units)
Report the outstanding balance of all loans secured by 5 or more dwelling-unit property. Adjust balances as described above in the general instructions to mortgage loans.
Include:
1. Mortgages on 5 or more dwelling units where construction has been completed.
2. Mortgages on apartment buildings.
3. Refinancing loans on 5 or more dwelling units where the original loan was a permanent
mortgage.
4. Junior liens on 5 or more dwelling units where the senior lien is a permanent mortgage.
5. Permanent mortgages secured by fraternity or sorority houses offering sleeping accommodations.
6. Permanent mortgages secured by living accommodations for students or staff of a college or hospital.
7. Permanent mortgages secured by retirement homes with sleeping and eating accommodations for permanent residents, where the units are not condominiums or cooperatives. Each bedroom equals one dwelling unit. Report mortgages secured by retirement community condominiums or cooperatives on SC254 or SC255.
8. Permanent mortgages secured by developed mobile home parks.
Do not include:
1. Mortgages on individual condominium units where the mortgage covers fewer than five units in the same project. Report on SC251 through SC255.
2. Combination land and construction loans regardless of the current stage of construction or development. Report on SC235.
3. Combination construction and permanent loans until construction is completed or principal amortization payments begin, whichever comes first. Report on SC235.
4. Bridge loans to developers where the buyer will not assume the same loan. Report on SC235.
SC260: Nonresidential Property, Except Land
Report the outstanding balance of all loans secured by nonresidential property excluding land. Adjust balances as described above in the general instructions to mortgage loans.
Include:
1. Mortgages on nonresidential properties where construction has been completed.
2. Mortgages on properties to be used extensively for farming, regardless of the presence or absence of a dwelling unit on the property.
3. Refinancing loans where the original loan was a permanent mortgage on nonresidential property.
4. Junior liens on property where the senior lien is a permanent mortgage on nonresidential
property.
5. Permanent loans on hospitals, nursing and convalescent homes, hotels, churches, stores, and other commercial properties.
Do not include:
1. Combination land and construction loans regardless of the current stage of construction or development. Report on SC240.
2. Combination construction and permanent loans until construction is completed or principal amortization payments begin, whichever comes first. Report on SC240.
3. Bridge loans to developers where the buyer will not assume the same loan. Report on SC240.
SC265: Land
Report the outstanding balance of all mortgage loans secured by land. Adjust balances as described above in the general instructions to mortgage loans. .
Include:
1. Loans for the acquisition and development of land, that is, loans to finance the purchase of land and the accomplishment of all improvements to convert it to developed building lots.
2. Loans for the acquisition of developed building lots.
3. Loans secured by vacant land.
4. Refinancing loans where the original loan was a permanent mortgage on land.
5. Junior liens on land where the senior lien is a permanent mortgage.
Do not include:
1. Combination land-construction loans. Report on SC230 through SC240.
2. Land used for farming. Report on SC260, Permanent Mortgages on Nonresidential Property, Except Land.
SC272: Accrued Interest Receivable
Report accrued interest receivable on mortgage loans reported on SC230 through SC265 if collection was probable at the time of accrual. You should place loans on which collection of interest is not probable in a nonaccrual status.
Do not include:
1. Interest receivable if collection was not probable at the time it was recorded.
2. Interest receivable on loans or participations serviced for others. Report on SC689, Other Assets.
3. Interest receivable that is capitalized to the loan balance. Report with the loan balance on SC230 through SC265.
SC275: Advances for Taxes and Insurance
Report amounts you paid by on behalf of borrowers for taxes and insurance on loans reported on SC230 through SC265. This line primarily contains negative balances in tax and insurance escrows for loans you own.
Do not include:
1. Credit balances. Report on SC712, Escrows.
2. Advances for taxes and insurance on loans and participations serviced for others. Report on SC689, Other Assets, as Code 09.
SC283: Allowance for Loan and Lease Losses
Report all allowances for loan and lease losses (ALLL) established to recognize credit losses on mortgage loans reported on SC230 through SC275. You must include all ALLL in the reconciliation of valuation allowances in Schedule VA.
Do not include:
1. Mark-to-market adjustments to mortgage loans held in a trading portfolio; these directly adjust the asset balance.
2. Specific valuation allowances; these directly adjust the asset balance.
NONMORTGAGE LOANS
Adjust the balances in this section for:
1. Specific valuation allowances.
2. Deferred loan fees net of direct costs.
3. Discounts and premiums on the purchase of nonmortgage loans and contracts.
4. Application of lower-of-cost-or-market accounting treatment to loans held for sale but not in a trading account.
5. Any undisbursed balance of closed-end loans, loans-in-process. Report the undisbursed amount of nonmortgage loans on CC125.
6. The undisbursed portion of lines of credit. Report the undisbursed amount on CC420-425.
7. Unearned interest, such as add-on interest of loans issued at a discount.
8. Deposits accumulated for the payment of loans, hypothecated deposits.
9. Accumulated gain or loss (change in fair value) on nonmortgage loans attributable to the designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133.
Do not adjust the balances in this section for: Allowance for loan and lease losses. Report these on SC357.
Include:
1. Unsecured loans.
2. Loans secured with tangible property other than real estate, except as noted below.
Do not include:
1. Investments in securities collateralized by nonmortgage loans. Report these securities on SC182, Securities backed by Nonmortgage Loans. Note: Although you report pass-through securities backed by nonmortgage loans with nonmortgage loans in Schedule CMR, in Schedule SC report securities backed by nonmortgage loans with Investment Securities.
2. Loan commitments that you have not yet taken down, even if you have received fees. Prior to disbursement of the loan, report refundable fees on SC712, Escrows, and nonrefundable fees on SC796, Other Liabilities and Deferred Income, as Code 04.
SC31: Total
The EFS software will compute this line as the sum of SC300 through SC348 less SC357.
Commercial Loans:
SC32: Total
The EFS software will compute this line as the sum of SC300 through SC306.
SC300: Secured
Report all loans to corporations, partnerships, and individuals for business purposes that are secured by tangible property or insured or guaranteed by a federal, state, or municipal government or agency thereof.
Include:
1. Secured loans for farming operations.
2. Floor-planning, inventory and wholesale, loans to dealers for automobiles or mobile homes.
3. Retail auto loans if the autos are for commercial use.
4. Nonmortgage loans insured or guaranteed by state or municipal government authority or an agency of the federal government, including Farmers Home Administration, Agency for International Development, and the insured portion of nonmortgage Small Business Administration (SBA) loans.
5. Secured nonmortgage loans to unconsolidated subordinate organizations.
6. Outstanding balances of secured commercial lines of credit.
7. Loans secured by residential property to finance small businesses if the loans are not reported as mortgages.
Do not include:
1. Commercial financing leases. Report on SC306.
2. The uninsured portion of SBA loans. Report on SC303.
SC303: Unsecured
Report all unsecured loans to corporations, partnerships, and individuals for business purposes.
Include:
1. Unsecured construction loans to builders.
2. Unsecured loans for the improvement of multifamily and other commercial property.
3. The outstanding balance of unsecured commercial lines of credit, overdrafts on commercial demand deposits, and business credit cards.
4. Unsecured loans for farming operations.
5. Term Federal Funds - Any lending of immediately available funds where the loan has an original maturity of more than one business day, other than securities purchased under agreements to resell, is to be treated as a loan. Such transactions are sometimes referred to as Term Fed Funds.
6. All other unsecured loans made for commercial purposes.
Do not include:
1. Unsecured loans to unconsolidated subordinate organizations. Report on SC540, Other Equity Investments Not Subject to FASB Statement No. 115.
2. Corporate debt securities even if included in calculating OTS commercial loan limitations. Report on SC185, Other Investment Securities.
3. Non-interest-bearing overdrafts on commercial deposit accounts where the institution grants modest sized overdrafts for the convenience of the customer. Typically, such overdraft protection plans are offered to most customers on a fee for service basis rather than incurring interest charges. Report such overdrafts on SC 689, “Other Assets.” Report fee income on such overdrafts as SO 420, “Other Fees and Charges.”
SC306: Lease Receivables
Report all direct financing leases and leveraged leases to corporations, partnerships, and individuals for business purposes. Include ground rents on commercial properties.
Consumer Loans:
Report loans issued at a discount net of the related unearned interest in accordance with APB No. 21.
SC35: Total
The EFS software will compute this line as the sum of SC310 through SC330.
SC310: Loans on Deposits
Report share loans and other loans to individuals for household, family, and other personal expenditures fully secured by the pledge or assignment of the borrower’s deposits or other credits held by your institution. When a loan is secured by a lien on real estate or chattel and is also secured by a pledge on deposits, you should classify the entire loan based on what you consider the loan’s primary collateral.
SC316: Home Improvement Loans (Not Secured by Real Estate)
Report all unsecured home improvement loans, insured or uninsured, for the equipping, alteration, repair, or improvement of 1-4 dwelling units.
Do not include:
1. Unsecured loans for the improvement of multifamily housing, 5 or more dwelling units, or for nonresidential property. Report on SC303, Unsecured Commercial Loans.
2. Home equity lines of credit. Report on SC251.
SC320: Education Loans
Report loans originated solely for funding educational expenses.
SC323: Auto Loans
Report all loans to consumers secured by automobiles, including pickup or panel trucks, vans, and sport utility vehicles that are primarily for personal use.
Do not include:
1. Loans on cars or trucks intended primarily for commercial, industrial, and professional purposes. Report on SC300, Secured Commercial Loans.
2. Loans on motorcycles. Report on SC330, Other Consumer Loans, Including Lease Receivables.
3. Loans on recreational vehicles such as boats and airplanes. Report on SC330, Other Consumer Loans, Including Lease Receivables.
4. Floor-planning loans, both inventory and wholesale. Report on SC300, Secured Commercial Loans.
SC326: Mobile Home Loans
Report consumer loans secured by mobile homes.
Do not include:
Floor-planning loans, both inventory and wholesale. Report on SC300, Secured Commercial Loans.
SC328: Credit Cards
Report the disbursed portion of open-end consumer credit cards.
Do not include:
1. Credit extended under credit card plans to business enterprises; report as commercial loans on SC303.
2. Credit extended to individuals through credit cards secured by real estate; report as mortgage loans.
3. Credit extended to individuals under prearranged overdraft plans underwritten as loans; report on SC330.
SC330: Other, Including Lease Receivables
Report loans to individuals for household, family, and other personal expenditures not included elsewhere, and direct financing leases to consumers.
Include:
1. Loans on timeshare units.
2. Loans on motorcycles.
3. Loans on boats.
4. Loans on airplanes.
5. Loans on other recreational vehicles.
6. Open-ended personal lines of credit extended to individuals including prearranged overdraft lines of credit underwritten as loans.
7. Overdrafts of consumer accounts.
8. Ground rents on properties used for one-to-four dwelling units.
Do not include:
1. Loans on units in cooperative buildings. Report on SC254 or SC255, Permanent Mortgages on 1-4 Dwelling Units.
2. Non-interest-bearing overdrafts on consumer deposit accounts where the institution grants modest sized overdrafts for the convenience of the customer. Typically, such overdraft protection plans are offered to most customers on a fee for service basis rather than incurring interest
charges. Report such overdrafts on SC 689, “Other Assets.” Report fee income on such overdrafts as SO 420, “Other Fees and Charges.”
SC348: Accrued Interest Receivable
Report accrued interest receivable on nonmortgage loans reported on SC300 through SC330, if collection was probable at the time of accrual. You must place loans on which the collection of interest is not probable in a nonaccrual status.
Do not include:
1. Interest receivable if collection was not probable at the time the interest was recorded.
2. Interest receivable on loans or participations serviced for others. Report on SC689, Other Assets.
SC357: Allowance for Loan and Lease Losses
Report all allowances for loan and lease losses (ALLL) established to recognize credit losses on nonmortgage loans reported on SC300 through SC348. You must include all ALLL in the reconciliation of valuation allowances in Schedule VA.
REPOSSESSED ASSETS
Throughout these instructions, we use foreclosure and repossession and other forms of those terms interchangeably. In addition, foreclosed assets and repossessed assets include in-substance foreclosures.
Foreclosed assets are deemed held for sale and are initially recorded at the lower of: (1) recorded investment in the loan, carrying value before deduction for valuation allowances, or; (2) fair value, less cost to sell, of the foreclosed asset.
At foreclosure, any excess of recorded investment over fair value less cost to sell is classified Loss and is charged off. This loss classification may not be represented by a valuation allowance. Accordingly, the lower of: (1) recorded investment in the loan, or (2) fair value less cost to sell of the foreclosed asset, becomes the new recorded investment in the foreclosed asset. Legal fees and direct costs of acquiring title to foreclosed assets are expensed as incurred, and thus are not part of the recorded investment.
After foreclosure, any excess of recorded investment over the current fair value less cost to sell is classified Loss and is charged off, or may be represented by a specific valuation allowance. Deduct valuation allowances from recorded investment to arrive at carrying value. You should report repossessed assets net of specific valuation allowances.
For a foreclosed asset subject to a third-party liability – a lien senior to that settled by the foreclosure, you should report the third-party liability on SC760, Other Borrowings. Therefore, you do not offset the carrying value of such a foreclosed asset by the third-party liability.
Include:
1. Real estate and other assets for which you have acquired a marketable title by foreclosure or by a deed in lieu of foreclosure.
2. Real estate and other assets acquired through in-substance foreclosure for which you have not yet acquired a marketable title.
3. Real estate and other assets you acquired as part of a troubled debt restructuring.
4. Capitalized costs for repossessed assets during construction not exceeding fair value less cost to sell.
5. Property that a loan servicer has acquired through foreclosure on your behalf, including in-substance foreclosures, where there is no recourse to a third party.
6. Real estate originally acquired for future use by you but no longer intended for that purpose.
Do not include:
1. Real estate held for investment or development. Report on SC45, Real Estate Held for
Investment.
2. Real estate intended for your future use. Report on SC55, Office Premises and Equipment.
3. Foreclosed real estate from a loan treated as an investment in real estate in accordance with GAAP; continue to report these on SC45, Real Estate Held for Investment.
4. Foreclosed real estate from loans to entities such as joint ventures in which you or your
subsidiaries are investors. Report these on SC45, Real Estate Held for Investment.
SC40: Total
The EFS software will compute this line as the sum of SC405 through SC430 less SC441.
Real Estate:
SC405: Construction
Report repossessed real estate that is under construction. Do not include land being developed into building lots prior to constructing improvements, which you report on SC428.
SC415: 1-4 Dwelling Units
Report repossessed property consisting of 1-4 dwelling units that is not under construction.
SC425: Multifamily (5 or More Dwelling Units)
Report repossessed property consisting of 5 or more dwelling units that is not under construction.
SC426: Nonresidential, Except Land
Report repossessed nonresidential property. Do not include land, which you report on SC428.
SC428: Land
Report repossessed land.
Include:
1. Vacant land.
2. Developed building lots on which no building construction has begun.
3. Land being subdivided and developed into lots.
SC429: U.S. Government-Guaranteed or -Insured Real Estate Owned
Report repossessed property where the loans were wholly or partially guaranteed or insured by agencies of the U.S. government.
SC430: Other Repossessed Assets
Report all other repossessed property, excluding real estate.
SC441: General Valuation Allowances
Report all general valuation allowances established on repossessed assets.
Do not include:
1. Specific valuation allowances; these must directly reduce the asset balance.
2. Write-downs to mark repossessed assets to fair value less cost to sell at foreclosure; these must directly reduce the asset balance.
3. Valuation allowances established prior to transfer to REO.
SC45: REAL ESTATE HELD FOR INVESTMENT
Report the recorded investment of all real estate you acquired for development, investment, or resale, net of specific valuation allowances, general valuation allowances, and accumulated depreciation.
Include:
1. Real estate acquired and held for investment purposes.
2. Real estate loans that are accounted for as investments in real estate in accordance with GAAP.
3. Real estate that you formerly occupied, unless you are holding it for sale, in which case you report it on SC55.
4. Real estate you acquired through foreclosure that no longer qualifies as repossessed real estate because of the length of time you have held it or the purpose for which you are holding it.
5. Capitalized carrying costs of real estate under construction in accordance with FASB Statement No. 34, Capitalization of Interest Costs.
Do not include:
1. Office buildings and land that you own and use in your business operations. Report on SC55, Office Premises and Equipment.
2. Real estate acquired as part of a troubled debt restructuring. Report on SC405 through SC428, Repossessed Assets: Real Estate.
3. Real estate acquired indirectly through an entity designated as a pass-through investment as described in 12 CFR § 560.32. Report the pass-through investment on SC540, Other Equity Investment Not Subject to FASB Statement No. 115.
4. The share of investments owned in real estate joint ventures qualifying as unconsolidated subordinate organizations. Report on SC540, Other Equity Investment Not Subject to FASB Statement No. 115.
5. Real estate originally acquired for your future use but no longer intended for that purpose. Report as REO on SC405 through SC428.
EQUITY INVESTMENTS NOT SUBJECT TO SFAS NO. 115
SC51: Total
The EFS software will compute this line as the sum of SC510 and SC540.
SC510: Federal Home Loan Bank Stock
Report the carrying value of Federal Home Loan Bank Stock.
SC540: Other
Report (1) investments in all unconsolidated subordinate organizations, and (2) pass-through investments, where such investments are accounted for at either cost or using the equity method. Include in the reported amount any advances (secured or unsecured) to the investee entity.
SC55: OFFICE PREMISES AND EQUIPMENT
Report the book value of all premises and equipment that are used in your business operations net of accumulated depreciation whether they were purchased directly or acquired by means of a capital lease. In a sale-leaseback where the resulting lease is a capital lease, report the capital lease net of the unamortized deferred gain or loss.
Report depreciation expense for the quarter on SO530, Office Occupancy and Equipment Expense.
Include:
1. All land, buildings, and parking lots occupied by you, including those that you only partially occupy.
2. Land or improved real estate intended for future use in your business operations.
3. Real estate you formerly occupied, if the real estate is held for sale.
4. Capital leases for your office premises and equipment.
5. Carrying costs capitalized during the construction of your premises.
6. The unamortized balance of all improvements to leased quarters and any capital improvements made to land leased for your use.
7. Office furniture, fixtures, equipment, and vehicles you own.
Do not include:
1. Repossessed assets, unless you used them on other-than-a-temporary basis. Report on SC405 through SC430.
2. Real estate held for investment. Report on SC45.
3. Real estate you originally acquired for future use but no longer intend to use for that purpose. Report as REO on SC405 through SC428.
4. Real estate you formerly occupied and did not actively hold for sale. Report on SC45.
5. Real estate you acquired as part of a troubled debt restructuring. Report on SC405 through SC428, Repossessed Real Estate.
6. Technology-based intangible assets, such as computer software. Report on SC660.
OTHER ASSETS:
SC59: Total
The EFS software will compute this line as the sum of SC615 through SC689 less SC699.
Bank-Owned Life Insurance:
SC615: Key Person Life Insurance
Include the value of bank-owned life insurance that you consider key-person insurance, where the intended purpose is to provide the institution protection against the potential for losses arising from the untimely death of a key employee or borrower. You generally surrender these policies when the key employee leaves your institution or when the borrower pays off his loan. Include amounts represented in the contractual terms of the policy as defined by FASB Technical Bulletin No. 85-4 and EITF Issue No. 06-5 (i.e. cash surrender value, claim stabilization reserves, and tax on deferred acquisition costs.
SC625: Other
Report the value of all bank-owned life insurance that you do not consider key-person insurance, and therefore that you do not include on SC615. Include amounts represented in the contractual terms of the policy (i.e. cash surrender value, claim stabilization reserves, and tax on deferred acquisition costs).
Intangible Assets: Servicing Assets:
Report the carrying amount of servicing assets on mortgage and nonmortgage loans. Servicing assets may be carried at either a.) the lower of cost or fair value, or b.) fair value.
For servicing assets carried at the lower of cost or fair value, adjust the carrying amount for:
1. Accumulated gain or loss (change in fair value) on the servicing asset attributable to the
designated risk being hedged on a qualifying fair-value hedge.
2. Any valuation allowances.
Servicing assets are subject to certain regulatory capital limitations. Refer to the instructions for data field CCR133.
Do not include amounts for any rights to future interest income from the serviced loans that exceed contractually specified servicing fees, defined below. Such rights are not servicing assets. Report such amounts on SC665, Interest-only Strip Receivables and Certain Other Instruments.
Contractually specified servicing fees are all amounts that, per the contract, are due to you as the servicer in exchange for the servicing. In other words, you would no longer receive fees if the beneficial owners of the serviced assets were to exercise their actual or potential authority under the contract to shift the servicing to another servicer.
SC642: Mortgage Loans
Report servicing assets on mortgage loans only.
SC644: Nonmortgage Loans
Report servicing assets of loans other than mortgages, such as automobile and credit card loans.
SC660: Goodwill and Other Intangible Assets
Report the balance of goodwill and other intangible assets.
Include:
1. Goodwill.
2. Core deposit premium.
3. Intangible pension assets.
4. Technology-based intangible assets, such as computer software.
5. Other intangible assets (i.e., purchased credit card relationships (PCCRs)) excluding servicing assets reported on SC642 and SC644.
Do not include:
1. Servicing assets; report on SC642 and SC644.
2. Interest-only strip receivables and certain other instruments; report on SC665.
3. Organization costs, which should be expensed as incurred.
SC665: Interest-only Strip Receivables and Certain Other Instruments
Report the amortized cost of certain nonsecurity financial instruments (CNFIs) accounted for under FASB Statement No. 140. CNFIs include interest-only strip receivables, loans receivable, other receivables, or retained interests in securitizations that can be contractually prepaid or otherwise settled in such a way that the holder would not recover substantially all of its recorded investment. Adjust the carrying amount for: (1) accumulated gain or loss (change in fair value) on CNFIs attributable to the designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133; and (2) any valuation allowances.
Do not include interest-only strips in security form. Report on SC217 through SC222, Other Mortgage-Backed Securities, or SC185, Other Investment Securities, as appropriate.
In general, CNFIs are initially recorded at cost, which often approximates fair value. Subsequent to initial recording, CNFIs are measured at fair value, like investments in debt securities classified as available for sale or trading under FASB Statement No. 115. All CNFIs should be reported on either SI375 or SI385, depending on whether they are classified as held for trading or available-for-sale pursuant to FASB Statement No. 115.
SC689: Other Assets
Report the total of assets not reported elsewhere on Schedule SC. You can find examples of the types of assets to be included in the memo items detailing other assets below.
Do not include:
1. Premiums on deposits and borrowed money that you purchased. Report premiums on deposits on SC715 and premiums on borrowed money with the related borrowing.
2. Deferred credits, deferred income, that do not have a related asset. Report on SC796, Other Liabilities and Deferred Income.
3. Accounts with a material credit balance that are not contra-assets. Report on SC796, Other Liabilities and Deferred Income.
4. Identified core deposit intangibles. Report on SC660, Goodwill and Other Intangible Assets.
Memo: Detail of Other Assets
Report the three largest items constituting the amount reported in SC689. You should select codes best describing these items from the list below and report them on SC691, 693, and 697; report the corresponding amounts on SC692, 694, and 698. You must complete this detail if you report an amount on SC689. You should combine similar accounts, for example, all prepaid expenses should be combined and reported as 07. However, you should not combine unlike accounts in reporting code 99. You may have more than one code 99 if you cannot find codes describing the items you report.
SC691, 693 and 697: Codes
01 No longer used
02 Accrued Federal Home Loan Bank dividends.
03 Federal, state, or other taxes receivable, whether as the result of prepayment or net operating
loss carrybacks.
04 Net deferred tax assets in accordance with FASB Statement No. 109.
06 Prepaid deposit insurance premiums.
07 Prepaid expenses.
08 Deposits for utilities and other services.
09 Advances for loans serviced for others, including advances for taxes and insurance and advances to investors. 10 Property leased to others under an operating lease as provided in 12 CFR § 560.41, net of accumulated depreciation. 11 Deferred issuance costs related to subordinated debentures, mandatory convertible securities, and redeemable preferred stock. 12 Amounts receivable under interest rate swap agreements. 13 Non-interest-bearing accounts receivable from a holding company or affiliate. 14 Other miscellaneous, non-interest-bearing, short-term accounts receivable. 15 No longer used 16 No longer used 17 No longer used 18 No longer used
19 Receivables from a broker for unsettled transactions. Include all receivables from a broker or other party for unsettled transactions between trade and settlement dates.
20 Fair value of all derivative instruments reportable as assets under FASB Statement No. 133.
21 No longer used
22 Unapplied loan disbursements.
Include only those loan disbursements that you cannot categorize. 23 No longer used 24 No longer used 25 No longer used 26 Non-interest-bearing overdrafts of consumer and commercial deposit accounts where the
institution does not perform a credit analysis but offers overdraft protection to most customers for their convenience. 99 Other. Use this code only for those items not identified above.
SC692, 694, and 698: Amounts
Report the dollar amounts corresponding to the codes reported on SC691, 693, and 697.
SC699: General Valuation Allowances
Report all general valuation allowances established to recognize credit losses on receivables included in Other Assets.
You must include all valuation allowances in the reconciliation of valuation allowances in Schedule VA.
SC60: TOTAL ASSETS
The EFS software will compute this line as the sum of SC11, SC22, SC26, SC31, SC40, SC45, SC51, SC55, and SC 59. This amount must equal SC90, Total Liabilities, Redeemable Preferred Stock, Noncontrolling Interest, and Equity Capital.
LIABILITIES
For the following liabilities that may be included on various lines on this schedule, also report the balance on Schedule SI if the liability is recorded under a fair value option on:
SI377, Liabilities Recorded on Schedule SC Under a Fair Value Option
To be renamed (in 2008) - Financial Liabilities Carried at Fair Value
DEPOSITS AND ESCROWS:
SC71: Total Deposits and Escrows
The EFS software will compute this line as the sum of Deposits (SC710), Escrows (SC712), and Unamortized Yield Adjustments on Deposits and Escrows (SC715).
SC710: Deposits
Report all deposits at their face value except zero-coupon deposits, which you report at face value net of the unamortized discount.
Include:
1. All deposits whether interest-bearing or not.
2. Deposits exceeding DIF insurance limits, including those collateralized by your assets, such as deposits of public funds.
1. Unposted credits, such as:
1. Deposit transactions that you include in a general ledger account and have not yet posted to a deposit account.
2. Deposits you received in one branch for deposit into another branch, typically another branch in another state or outside of continental USA.
You should report unposted credits net of unposted debits. We define unposted debits as cash items in your possession that are drawn on you and immediately chargeable, but not yet charged, against your deposits at the close of business on the reporting date.
Exclude the following from unposted credits:
a.
Cash items drawn on other financial institutions.
b.
Overdrafts and nonsufficient fund (NSF) items.
c.
Cash items returned unpaid to the last endorser for any reason.
d.
Drafts and warrants that are payable at or payable through you for which there is no written authorization from the depositor and no state statute allowing you at your discretion to charge the items against the deposit accounts of the drawees.
Report the above excluded unposted debit amounts in assets on SC110. Note: If the total of unposted credits is negative, that is, a debit, you can deduct it from SC710.
1. Outstanding cashier’s checks, money orders, or other official checks drawn on an internal account issued in the usual course of business for any purpose, including, without being limited to, those that you issued in payment for your debts or expenses, or payable to a third party named by a customer making the withdrawal.
2. Accounts pledged by your directors and organizers as protection against operating deficits and other nonwithdrawable accounts, whether or not they are used in determining compliance with minimum capital requirements.
3. U.S. Treasury tax and loan accounts that represent funds received as of the close of business of the reporting date. Do not include funds credited prior to the reporting date that are automatically converted into open-ended interest-bearing notes. Report such balances on SC796, Other Liabilities and Deferred Income.
4. Unapplied loan balances, such as receipts from borrowers that have not yet been classified as principal, or interest, unless you credit the applicable customer accounts as of the date you initially received the funds.
5. Credit balances in credit card accounts, credit card customer overpayments.
6. Funds you received or held in connection with drafts or checks that you have drawn on another depository institution, a Federal Home Loan Bank, or a Federal Reserve Bank. The funds reported here are only those drawn either on a zero-balance account or on an account that is not routinely maintained with sufficient balances to cover checks drawn in the normal course of business, including accounts where you remit funds only when the checks or drafts are presented. For example, funds received from a customer for a cashier’s check that is drawn on a zero-balance account in another financial institution.
7. Dealer reserve accounts, when considered a liability under GAAP. Dealer reserve accounts are refundable amounts held as collateral in the purchase of installment notes from a dealer. For example, a savings association purchases $100,000 in installment notes from a dealer for the full face amount, for which it pays $90,000 to the dealer and holds the remaining $10,000 as collateral. The $10,000 held is a dealer reserve account, which you should report as a deposit. If you hold dealer reserves that under GAAP are reported as contra-assets, then you should report the assets net of these dealer reserves in Schedule SC.
8. Outstanding travelers’ letters of credit and other letters of credit you issued for cash or its equivalent (prepaid letters of credit), less outstanding drafts accepted against the letters of credit.
9. Funds you hold as security for an obligation due to the bank or others, except hypothecated deposits, and funds deposited by a debtor to meet maturing obligations, such as amounts pledged against sinking fund mortgages and as collateral for loans.
Certain items should be added back to the appropriate deposit control totals and reported on SC689, Other Assets, as Code 99. Such items are: the gross amount of debit items (rejects) that you cannot post to the individual deposit accounts without creating overdrafts or that you cannot post for some other reason, such as stop payment, missing endorsement, post or stale date, or account closed, but which have been charged to the control accounts of the various deposit categories on the general ledger.
You should report assets and liabilities in Schedule SC in accordance with GAAP. Certain items defined in the Federal Deposit Insurance Act as includable in the deposit premium assessment base may, under GAAP, be considered contra-assets rather than liabilities. Report assets in Schedule SC net of such items, but you must also report these items on Schedule DI, as appropriate, so that they will be included in the deposit premium assessment base.
You should report reciprocal balances with commercial banks and other savings associations on a net basis where the right of set-off exists. Reciprocal demand balances arise when two depository institutions maintain deposit accounts with each other. In certain cases you will need to report reciprocal demand balances on DI520, Total Allowable Exclusions (Including Foreign Deposits).
Do not include:
1. Escrow accounts. Report on SC712, Escrows.
2. Custodial accounts established pursuant to loan servicing agreements. Report on SC712, Escrows.
3. Deposit accounts that you set up in your own name for which there is a corresponding cash account in assets. Eliminate the cash account from assets and the same amount from deposits. See item 4 under Include above concerning outstanding checks.
1. Outstanding checks drawn on, or payable at or through, a non-zero-balance account at a Federal Reserve Bank or a Federal Home Loan Bank. Deduct these amounts from cash-in-bank,
2. typically, from amounts on SC110 or SC112, as appropriate, and also report them on DI510 for inclusion in the deposit base for FDIC insurance assessment purposes. See item 9 under Include above concerning outstanding checks drawn on zero-balance accounts.
4. Outstanding checks written against accounts in other depository institutions, as defined by the Federal Deposit Insurance Act. Deduct these from the related deposit reported on SC110 or SC118.
5. Discounts and premiums that result from marking assets and liabilities to fair value because of an acquisition, merger, or change in control. Report on SC715, Unamortized Yield Adjustments on Deposits and Escrows.
6. Deductions for commissions and other capitalized items. Report on SC715, Unamortized Yield Adjustments on Deposits and Escrows.
7. Deductions for customers’ overdrafts in NOW and demand accounts unless the right of set-off under a valid cash management arrangement exists for accounts of the same legal entity. Report as loans on SC303, Unsecured Commercial Loans, or SC330 Other Consumer Loans.
8. U.S. Treasury tax and loan account balances credited prior to the reporting date that are
automatically converted into open-ended interest-bearing notes. Report such balances in
liabilities on SC796, Other Liabilities and Deferred Income.
9. Hypothecated deposits, deposits accumulated for the payment of loans. Deduct these from the related loan.
10. Accumulated gain or loss, change in fair value, on deposits attributable to the designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133. Report on SC715, Unamortized Yield Adjustments on Deposits and Escrows.
SC712: Escrows
Report all escrow funds held by your savings association and your consolidated subsidiaries on behalf of others. Include only those accounts where the institution or its consolidated subsidiary is a party to the escrow agreement.
Include:
1. Tax and insurance escrows for mortgage loans.
2. Escrow accounts you have established pursuant to loan servicing agreements, including both tax and insurance and principal and interest escrows.
3. Custodial accounts you have established pursuant to loan servicing agreements.
4. Credit balances of uninvested trust funds that you hold. Do not offset balances of different accounts. Report only accounts with credit balances; accounts with debit balances should be reported as loans. However, we permit netting for overdrafts in principal or income cash in individual trust accounts maintained in the same right and capacity.
5. Amounts that you hold in conjunction with the sale of travelers’ checks, money orders, and similar instruments.
6. Amounts you hold and have not yet remitted in conjunction with the sale or issuance of
government bonds, mutual funds, or other securities.
7. Refundable loan commitment fees you have received prior to loan disbursement.
8. Refundable amounts you received from stock subscribers for unissued stock.
9. Amounts that you have withheld from employee compensation for payment to a third party such as withholding taxes, health and life insurance premiums, and pension funds.
10. Interest you have withheld from deposits for remittance to taxing authorities. .
11. Interest you have accrued on escrows included above.
Do not include:
1. Advances for borrowers’ taxes and insurance, T&I escrow accounts with debit balances. If you or your consolidated subsidiaries own the related loan, report the advances on SC275, Advances for Taxes and Insurance. If you service the related loan for others, report them on SC689, Other Assets, as Code 09.
2. Advances to investors for loans you serviced for others prior to receipt from the borrower. Report as assets on SC689, Other Assets, Code 09.
3. Custodial accounts held by a depositor for another for example, a custodial account held for a minor where the parent or some other depositor is the custodian. Report as deposits on SC710.
4. IRA and Keogh accounts. Report as deposits on SC710.
5. Escrows where the funds are deposited in other depository institutions. Report as liabilities on SC796, Other Liabilities, Code 99.
6. Accumulated gain or loss on escrows attributable to the designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133. Report on SC715, Unamortized Yield Adjustments on Deposits and Escrows.
7. Escrows where your holding company or unconsolidated affiliate is a party to the escrow agreement and where you are not a party to the escrow agreement. Report on SC710, Deposits.
SC715: Unamortized Yield Adjustments on Deposits and Escrows
Report the unamortized balance of discounts and premiums on deposits. Report the face amounts of the related deposits on SC710 and SC712. These yield adjustments are amortized to interest expense on SO215, Interest Expense on Deposits. This data field may be negative, representing a debit. .
Include:
1. Discounts and premiums resulting from initially recording purchased deposits and escrows at fair value.
2. Discounts and premiums related to accounting for a derivative instrument embedded in deposits and escrows as either a separate asset or liability, when required by FASB Statement No. 133.
1. The accumulated gain or loss (the change in fair value) on deposits and escrows attributable to the designated risk being hedged on a qualifying fair value hedge under FASB Statement No.
2. 133.
3. Unamortized brokers fees.
Do not include:
1. Yield adjustments related to advances and borrowings; these directly reduce the related
borrowing.
2. Core deposit intangibles resulting from an acquisition, merger, or change in control. Report on SC660, Goodwill and Other Intangible Assets.
BORROWINGS
Adjust the balance due for (1) discounts and premiums in accordance with APB No. 21, Paragraph 16; and (2) the accumulated gain or loss on borrowings attributable to the designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133. Amortize the discounts and premiums to interest expense. Report issuance costs related to borrowings in SC689, Other Assets.
SC72: Total
The EFS software will compute this line as the sum of SC720 through SC760
SC720: Advances from FHLBank
Report all FHLBank borrowings.
Include:
1. All FHLBank advances.
2. Deferred commitment fees you paid on FHLBank advances; these reduce the outstanding balance.
3. Prepayment penalties you paid on FHLBank advances that qualify for deferral under GAAP; these reduce the outstanding balance. Generally FHLBank prepayment penalties should be expensed on SO580, Other Noninterest Expense. However, in limited circumstances (outlined in EITF 96-19), prepayment penalties may be deferred and amortized as a yield adjustment on SO230, Interest Expense: Advances from FHLBank.
Do not include:
1. Amounts due a FHLBank in the form of securities sold under agreements to repurchase. Report on SC730.
2. Accrued interest. Report on SC766, Other Accrued Interest Payable.
SC730: Federal Funds Purchased and Securities Sold Under Agreements to Repurchase
Include:
1. Funds you received from securities sold under agreements to repurchase that do not meet the criteria for a sale under FASB Statement No. 140, including retail repurchase, dollar-reverserepurchase, and dollar-roll agreements.
2. Amounts due a FHLBank in the form of securities sold under agreements to repurchase.
3. Federal Funds purchased. Include in the gain or loss on the sale funds received from transactions accounted for as a sale, such as, yield maintenance, dollar-reverse-repurchase agreements, and certain dollar-roll transactions. Note that the repurchase transaction and subsequent investment of these borrowed funds are independent transactions. Therefore, you should not offset any income generated by this subsequent investment by the interest expense incurred in the reverse repurchase transaction. Report interest income on SO115,
Interest Income on Deposits and Investment Securities, and interest expense on SO260, Interest Expense: Other Borrowed Money.
SC736: Subordinated Debentures (Including Mandatory Convertible Securities and Limited-Life Preferred Stock)
Report subordinated debentures and mandatorily convertible securities that you or your consolidated subsidiaries issued, net of premiums and discounts. Include REIT preferred stock issued by a consolidated subsidiary to a third party that you report as a liability. Report related issuance costs on SC689, Other Assets.
SC740: MORTGAGE-COLLATERALIZED SECURITIES ISSUED
Report all mortgage-collateralized securities issued by you and your consolidated subsidiaries adjusted for issuance costs, discounts, and premiums.
SC760: Other Borrowings
Report all other borrowings not included on SC720 through SC745.
Include:
1. Redeemable preferred stock issued by consolidated subsidiaries to third parties.
2. Mortgages and other encumbrances on your office premises or real estate owned for which you are liable.
3. Obligations of an employee stock ownership plan (ESOP) to a lender other than yourself, when such reporting is required under GAAP, including AICPA SOP No. 93-6, Employers’ Accounting for Employee Stock Ownership Plans.
4. The underlying mortgage in a wrap-around loan unless the holder of the underlying mortgage has accepted a subordinated position, in which case you deduct the underlying loan against the related loan.
5. Senior liens on foreclosed real estate.
6. Overdrafts in your transaction accounts in other depository institutions, where there is no right of set-off against other accounts in the same financial institution. If the overdraft is in a zero-balance account or an account that is not routinely maintained with sufficient balances to cover checks drawn in the normal course of business, you should include in deposits the funds received or held in connection with checks drawn on the other depository institutions.
7. Commercial paper that you have issued.
8. Liabilities for capital leases related to assets that you’ve reported on SC55.
9. Eurodollar issues.
10. The liability from a sale of loans with recourse accounted for as a financing. Refer to FASB Statement No. 77, Reporting by Transferors for Transfers of Receivables with Recourse.
11. The related liability for delinquent mortgage loans previously securitized with Ginnie Mae, where you have an unconditional repurchase option. The recording of such mortgage loans and the related liability is required under GAAP (including FASB Statement No. 140).
12. Clearing items.
13. Purchase acquisition debt.
14. Borrowings from the Federal Reserve Bank.
Do not include:
1. Accrued interest due and payable. Report on SC766, Other Accrued Interest Payable.
2. Redeemable preferred stock you have issued. Report on SC800, Noncontrolling Interest. You must charge the interest and dividends on all borrowings and yield adjustments reported on this line
to expense on SO260, Other Borrowed Money. You must not net the interest expense against the interest income on the related asset.
OTHER LIABILITIES
SC75: Total
The EFS software will compute this line as the sum of SC763 through SC796.
SC763: Accrued Interest Payable - Deposits
Report accrued interest that has not been credited to deposit or escrow accounts.
Do not include:
Interest withheld from deposits for remittance to taxing authorities. Report on SC712, Escrows.
SC766: Accrued Interest Payable - Other
Include:
Accrued interest and dividends due on borrowings that you have reported on SC720 through SC760.
SC776: Accrued Taxes
Include:
1. Current portion of federal, state, and local income taxes.
2. Real estate taxes.
3. Employer’s share of payroll taxes.
4. Other miscellaneous taxes.
Do not include:
1. Taxes withheld from employees’ salaries. Report on SC712, Escrows.
2. Tax accrual accounts with debit balances. Report as accounts receivable on SC689, Other Assets, as Code 03.
3. Interest withheld from deposits for remittance to taxing authorities. Report on SC712, Escrows.
SC780: Accounts Payable
Report the amount accrued for services, supplies, materials, and other expenses.
Reclassify accounts payable with material debit balances to accounts receivable. Report on SC689, Other Assets, as Code 14.
SC790: Deferred Income Taxes
Report net deferred income taxes with a credit balance. Report deferred income taxes from the same jurisdiction net. Report net debit balances as deferred tax assets on SC689, Other Assets, Code 04.
SC796: Other Liabilities and Deferred Income
Report the total of liabilities not reported elsewhere on Schedule SC. You can find a list of the types of liabilities to be included in the memo items detailing other liabilities below.
Memo: Detail of Other Liabilities
Report the three largest items constituting the amount reported on SC796. You should select codes best describing these items from the list below and report them on SC791, 794, and 797; report the corresponding amounts on SC792, 795, and 798. You must complete this detail if you report an amount on SC796. You should combine similar accounts, for example, all nonrefundable loan fees received prior to loan disbursement should be combined and reported as 04. However, you should not combine unlike accounts in reporting code 99. You may have more than one code 99 if you cannot find codes describing the items you report.
SC791, 794 and 797: Codes
01 Dividends payable on stock.
02 No longer used
03 No longer used
04 Nonrefundable loan fees received prior to loan disbursement.
05 Deferred gains from sale/leaseback where the resulting lease is an operating lease.
06 Balances in U.S. Treasury tax and loan accounts administered under the note option that provide for the conversion of the previous day’s balance to an interest-bearing demand note. 07 Deferred gains from the sale of real estate recorded under the percentage-of-completion or deposit methods pursuant to FASB Statement No. 66, Accounting for Sales of Real Estate. 08 Negative investments in entities accounted for under the equity method. 09 Fees received for standby contracts and other option arrangements where the savings association is obligated to purchase or sell securities at the option of the other party. 10 Amounts due brokers for unsettled transactions. 11 The liability recorded for pensions and other postretirement benefits. 12 No longer used. 13 Amounts payable under interest-rate-swap agreements. 14 Unapplied loan payments received for which the customer’s account will be credited as of the date of receipt. 15 Liability when the benefits of a loan servicing contract are not expected to adequately compensate the servicer.
16 Recourse loan liability. Do not include liabilities for credit losses on off-balance-sheet credit exposures; include these under code 21.
17 Non-interest-bearing payables due to holding companies and affiliates.
18 Litigation reserves.
19 Nonrefundable stock subscriptions. Note that refundable stock subscriptions are reported as
escrows on SC712. 20 Fair value of all derivative instruments reportable as liabilities under FASB Statement No. 133. 21 Liabilities for credit losses on off-balance-sheet credit exposures.
Include liabilities established for credit losses on commitments, standby letters of credit, and guarantees. Do not include liabilities for sale of loans with recourse; include these under code
16.
99 Other. Use this code only for those items not identified above.
Do not include:
1. Escrows. Report on SC712, Escrows.
2. Deferred credits classified as contra-assets, such as loans in process and deferred loan fees. Deduct these from the related asset.
3. Yield adjustments on deposits. Report on SC715, Unamortized Yield Adjustments on Deposits and Escrows.
4. Yield adjustments, commitment fees, and issue costs on FHLBank advances and other
borrowings. Report as part of the borrowings’ balance.
5. Accrued interest on escrow accounts. Report on SC712, Escrows, or SC763, Accrued Interest Payable - Deposits.
6. U.S. Treasury tax and loan accounts administered under the remittance option requiring the remittance of the previous day’s balance to a federal reserve bank. Report on SC710, Deposits.
7. Unapplied loan payments received for which the customer’s account will be credited as of the date of transfer rather than the date of receipt from the customer. Report on SC710, Deposits.
SC792, 795, and 798: Amount
Report the dollar amounts corresponding to the codes reported on SC791, 794, and 797.
SC70: TOTAL LIABILITIES
The EFS software will compute this line as the sum of SC71, SC72, and SC75.
EQUITY CAPITAL
PERPETUAL PREFERRED STOCK
Include:
1. Preferred stock you issued that is nonredeemable by the purchaser and that qualifies as equity capital under GAAP.
2. Preferred stock convertible into common stock.
Report preferred stock net of issuance costs, premiums, and discounts. If you issued preferred stock above par value, include the amount paid in excess of par with the par value.
Dividends on perpetual preferred stock reduce retained earnings when declared. Report them on SI620, Dividends Declared on Preferred Stock.
Do not include:
1. Redeemable preferred stock you issued. Report on SC800, Noncontrolling Interest.
2. Redeemable preferred stock issued by a consolidated subsidiary. Report on SC760, Other Borrowings.
3. Permanent preferred stock issued by a consolidated subsidiary. Report on SC800,
Noncontrolling Interest.
SC812: Cumulative
Report permanent preferred stock where the stockholders are entitled to receive unpaid dividends before the payment of dividends on other classes of stock.
SC814: Noncumulative
Report permanent preferred stock whose dividends do not accumulate if unpaid.
COMMON STOCK
SC820: Par Value
Report the par value of all outstanding common stock – permanent, reserve, or guaranty stock – that you have issued.
If the par value of common stock issued is less than $500, report “1” in this data field to indicate that it is not zero, and, if necessary, reduce the amount that you report on SC830 by one.
You must reduce retained earnings at the time that you declare dividends on common stock. Report the reduction of retained earnings on SI630, Dividends Declared on Common Stock.
Do not include deductions for:
1. Stock you reacquired – treasury stock. Report as a negative on SC891, Other Components of Equity Capital.
2. Unallocated ESOP shares. Report as a negative on SC891, Other Components of Equity Capital.
SC830: Paid in Excess of Par
Include:
1. Amounts paid in excess of par value from the issuance of common stock for cash or nonmonetary assets. Deduct the costs of issuing common stock.
2. Permanent capital contributions by the stockholders not related to the purchase of stock.
Do not include:
Paid-in capital from the issuance of preferred stock. Report on SC812 or SC814, Perpetual Preferred Stock.
ACCUMULATED OTHER COMPREHENSIVE INCOME
SC86: Total
The EFS software will compute this line as the sum of Unrealized Gains (Losses) on Available-for-Sale Securities (SC860), Gains (Losses) on Cash Flow Hedges (SC865), and Other Accumulated Other Comprehensive Income (SC870).
SC860: Unrealized Gains (Losses) on Available-for-Sale Securities
Report unrealized gains (losses), net of taxes, for you and your subordinate organizations on available-for-sale securities and on certain nonsecurity financial instruments, CNFIs, classified as available for sale, pursuant to FASB Statement No. 115, Accounting for Certain Investments in Debt and Equity Securities.
Gains and losses reported here are not reported in the statement of operations until either the asset is sold, a loss is considered other than temporary, or this amount is amortized in accordance with the following paragraph.
Include the unamortized amount of the unrealized gain or loss at the date of transfer of debt securities transferred from available-for-sale to held-to-maturity category. Continue to report this gain or loss on this line until it is completely amortized over the remaining life of the security as an adjustment of yield in the same manner as a discount or premium.
Do not report unrealized gains (losses) on securities and CNFIs as valuation allowances.
Report this data field as negative when your unrealized losses exceed unrealized gains.
Do not include declines in fair value that you judge to be other than temporary. Report such losses in earnings on SO321, Net Provision for Losses on Interest-Bearing Assets.
SC865: Gains (Losses) on Cash Flow Hedges
Report the accumulated fair value gain or loss, net of taxes, on cash flow hedges pursuant to FASB Statement No. 133.
SC870: Other
Report any accumulated other comprehensive income not included on SC860 or SC865.
Include:
1. Any minimum pension liability adjustment recognized in accordance with FASB Statement No. 87, Employers’ Accounting for Pensions and FAS Statement No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans.
2. Cumulative foreign currency translation adjustments and qualifying foreign currency transaction gains and losses, net of applicable income taxes.
3. Any other items of accumulated other comprehensive income.
SC880: RETAINED EARNINGS
Retained earnings are your accumulated net income since inception less distributions to shareholders and amounts transferred to other equity capital accounts.
Include:
1. Undistributed income – net income from interim periods of operation prior to closing your books;
2. Retained earnings from prior operating periods.
3. Restrictions or appropriations of retained earnings as designated by your board of directors.
4. If you are in receivership, a deduction for the amount by which liabilities exceed identified assets, because you may not report goodwill upon conversion to receivership. Refer to EITF Consensus No. 85-41.
SC891: OTHER COMPONENTS OF EQUITY CAPITAL
Report amounts reported under GAAP as separate components of equity capital. In most cases the amounts in this data field will be negative, as these items typically reduce equity capital.
Include:
1. Treasury stock.
2. Unearned employee stock ownership plan (ESOP) shares, when such reporting is required under GAAP, including AICPA SOP No. 93-6, Employers’ Accounting for Employee Stock Ownership Plans.
SC80: TOTAL SAVINGS ASSOCIATION EQUITY CAPITAL
The EFS software will compute this line as the sum of SC812, SC814, SC820, SC830, SC86, SC880, plus SC891.
SC800: NONCONTROLLING INTERESTS IN CONSOLIDATED SUBSIDIARIES
Include:
1. Common and perpetual preferred stock issued by consolidated subsidiaries to third parties constituting a noncontrolling interest.
Do not include:
1. Mandatorily redeemable preferred stock that should be classified as a liability. Report on SC760, Other Borrowings.
2. Preferred stock, both redeemable and perpetual, that consolidated subsidiaries issued to you or your other subordinate organizations that, on a nonconsolidated basis, you report as an investment asset. When you are making your consolidating entries, you must eliminate this preferred stock of the consolidated subsidiary.
Report any net income or loss attributable to a noncontrolling interest in a consolidated subsidiary on SO880, Net Income (Loss) Attributable to Noncontrolling Interests.
SC84: TOTAL EQUITY CAPITAL
The EFS software will compute this line as the sum of SC80 plus SC800.
SC90: TOTAL LIABILITIES AND EQUITY CAPITAL
The EFS software will compute this line as the sum of SC70 and SC84. This line must equal SC60, Total Assets.
SCHEDULE SO — CONSOLIDATED STATEMENT OF OPERATIONS
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete this Statement of Operations, Schedule SO, on a consolidated basis from the savings association downward. Do not consolidate your holding company. You should apply generally accepted accounting principles (GAAP) unless we specifically state otherwise in these instructions. Report net income or loss allocable to noncontrolling shareholders on SO488, Other Noninterest Income.
Report income and expense for the quarter ending on the report date, regardless of your fiscal year end. Do not report data in Schedule SO on a year-to-date basis. Note that GAAP requires the accrual basis of accounting.
When you correct errors made in prior periods within the current calendar year, you should report them in the same data field in which you would have reported them on the original report. However, you should not report them in the same data field if the adjustment distorts yields for the quarter or results in negative numbers in fields that do not permit negatives. Where the latter would occur, you may include the adjustments in Other Noninterest Income, SO488, or Other Noninterest Expense, SO580. Generally, you may file amendments only within 45 days of the report date. For further information on correcting prior period errors, see Item 5 in the General Instructions.
INTEREST INCOME
The balance of financial assets carried at fair value where the changes in fair value are reflected in current earnings is reported on SI376. For such assets, report the interest income earned on the appropriate lines described in this section, unless it is not appropriate under GAAP to recognize income (for example, where a loan is on nonaccrual status because of collectibility concerns). Report the changes in fair value of such assets in noninterest income on SO485.
SO11: TOTAL
The EFS software will compute this line as the sum of SO115 through SO172.
SO115: DEPOSITS AND INVESTMENT SECURITIES
Report income on all deposits and investments included in SC112 through SC185.
Include:
1. The gross income earned on all deposits and investment securities including those you use as collateral under agreements to resell.
2. The net amount of yield adjustments made to interest and dividend income on deposits and investment securities.
Do not include:
Interest on assets reported on SC689, Other Assets. Report this interest on SO488, Other Noninterest Income.
SO125: MORTGAGE-BACKED SECURITIES
Report income on mortgage-backed securities reported on SC210 through SC228, including amortization of premiums and discounts.
SO141: MORTGAGE LOANS
Report income on mortgage loans, including amortization of yield adjustments, reported on SC230 through SC265. Do not include prepayment fees, late fees, and assumption fees on mortgage loans.
If you have bought or sold a participating interest in mortgage loans, report only the interest applicable to the portion of the loans you own. If you have purchased mortgage loans or participating interests in mortgage loans on a net-yield basis, report the net interest earned.
If you assume a liability to a third party in connection with a wrap-around mortgage loan where you report the assumed liability on SC760, Other Borrowings, report the gross interest income and charge the interest incurred on the assumed liability to expense on SO260, Interest Expense on Other Borrowed Money.
SO142: PREPAYMENT FEES, LATE FEES, AND ASSUMPTION FEES FOR MORTGAGE LOANS
Report the total prepayment fees, late fees, and assumption fees received for mortgage loans.
NONMORTGAGE LOANS:
Report the contractual interest earned and the net yield adjustments on nonmortgage loans.
SO160: Commercial Loans and Leases
Report the net interest earned, including any yield adjustments, on commercial nonmortgage loans that you reported on SC300 through SC306, Secured and Unsecured Commercial Loans and Financing Leases. Do not include prepayment fees, late fees, and assumption fees on commercial loans and leases.
SO162: Prepayment Fees, Late Fees, and Assumption Fees for Commercial Loans
Report the total prepayment fees, late fees, and assumption fees received for commercial loans.
SO171: Consumer Loans and Leases
Report income including any yield adjustments on consumer loans reported on SC35. Include with yield adjustments the amortization of credit card fees. Do not include prepayment fees, late fees, and assumption fees on consumer loans and leases.
SO172: Prepayment Fees, Late Fees, and Assumption Fees for Consumer Loans
Report the total prepayment fees, late fees, and assumption fees received for consumer loans.
DIVIDEND INCOME ON EQUITY INVESTMENTS NOT SUBJECT TO FASB STATEMENT NO. 115
SO18: TOTAL
The EFS software will compute this line as the sum of SO181 and SO185.
SO181: FEDERAL HOME LOAN BANK STOCK
Report cash and stock dividends on FHLBank stock reported on SC510.
SO185: OTHER
Report dividend and interest income on investments reported on SC540 accounted for using the cost method, including interest income on advances (secured and unsecured) that are included in SC540. Do not include net income or loss recorded under the equity method; include this on SO488, Other Noninterest Income, using Code 06.
INTEREST EXPENSE
The balance of financial liabilities carried at fair value where the changes in fair value are reflected in current earnings is reported on SI377. For such liabilities, report the interest expense incurred on the appropriate lines described in this section. Report the changes in fair value of such liabilities in noninterest income on SO485.
SO21: TOTAL
The EFS software will automatically compute this line as the sum of SO215 through SO260, less SO271.
SO215: DEPOSITS
Report the sum of the following:
1. All interest expense on deposits that you reported on SC710, Deposits.
2. The amortization of yield adjustments to deposits that you reported on SC715, Unamortized Yield Adjustments, less the amount for penalties charged to depositors for early withdrawals.
Do not include:
Interest on escrow accounts that you reported on SC712, Escrows. Report the interest on escrow accounts on SO225.
SO225: ESCROWS
Report interest expense on escrows reported on SC712, Escrows.
SO230: ADVANCES FROM FHLBANK
Report interest expense and the amortization of any related yield adjustments on FHLBank advances that you reported on SC720, Advances from FHLBank.
Generally FHLBank prepayment penalties should be expensed on SO580, Other Noninterest Expense. However, in limited circumstances (outlined in EITF Issue No. 96-19), prepayment penalties may be deferred and amortized as a yield adjustment increasing interest expense.
SO240: SUBORDINATED DEBENTURES (INCLUDING MANDATORY CONVERTIBLE SECURITIES)
Report interest, dividends, and the amortization of yield adjustments on all subordinated debentures, mandatory convertible securities, and REIT preferred stock that you or your consolidated subsidiaries issued and that you reported on SC736, Subordinated Debentures (Including Mandatory Convertible Securities and Limited Life Preferred Stock).
SO250: MORTGAGE COLLATERALIZED SECURITIES ISSUED
Report interest expense and amortization of yield adjustments on all mortgage collateralized securities that you issued and that you reported on SC740 and SC745, Mortgage Collateralized Securities Issued.
SO260: OTHER BORROWED MONEY
Report interest expense and amortization of yield adjustments on borrowings not included above.
Include interest on:
1. SC730, Federal Funds Purchased and Securities Sold Under Agreements to Repurchase.
2. SC760, Other Borrowings. Report the gross amount of interest that you pay on securities sold under agreements to repurchase and loans sold with recourse accounted for as financings. Do not reduce the amount of interest that you paid
for such securities or loans by the amount of interest income you received on the securities and loans sold under such agreements.
SO271: CAPITALIZED INTEREST
Report all capitalized interest costs in accordance with FASB Statement No. 34, Capitalization of Interest Costs. Do not use an interest rate that exceeds the weighted average rate for total interest-bearing deposits and other liabilities. Capitalized interest will be deducted from interest expense. Therefore, report this as a positive number even though it will always be a credit balance.
SO312: NET INTEREST INCOME (EXPENSE) BEFORE
PROVISION FOR LOSSES ON INTEREST-BEARING
ASSETS
The EFS software will automatically compute this line as SO11 plus SO18 less SO21.
SO321: NET PROVISION FOR LOSSES ON INTERESTBEARING ASSETS
Report the provision for losses on all earning assets, including loans, as well as debt and equity securities Report credit balances as negative.
For a discussion on how to calculate provision for losses, refer to the general instructions for Schedule VA.
Do not report adjustments to valuation allowances as prior period expenses. Report adjustments to valuation allowances as an expense in the period in which you determined the amount of the loss even if the loss actually occurred in a prior period.
Include:
1. Other-than-temporary impairment charges on debt and equity securities. As no valuation allowances on these assets will remain, also report these losses as charge-offs on VA115, and also on VA370 and/or VA930, as appropriate.
2. Losses you recognized in marking loans to fair value at the time of foreclosure or in-substance foreclosure.
Do not include:
1. Adjustments to available-for-sale securities for unrealized gains or losses in accordance with FASB Statement No. 115. Report the adjustments on SC860, Unrealized Gains (Losses) on Available-for-Sale Securities.
2. Adjustments to trading assets. Report on SO485, Net Income (Loss) from Trading Assets (Realized and Unrealized).
3. Recoveries of valuation allowances at the time of sale. Include these in the gain or loss on the sale.
4. Provisions for losses on noninterest-bearing assets. Report the provision for losses on SO570, Net Provision for Losses on Non-interest-bearing Assets.
5. Adjustments to or recording of a liability for off-balance-sheet commitments or contingencies; include these in SO580, Other Noninterest Expense.
SO332: NET INTEREST INCOME (EXPENSE) AFTER PROVISION FOR LOSSES ON INTEREST-BEARING ASSETS
The EFS software will automatically compute this line as SO312 less SO321.
NONINTEREST INCOME
Do not include material adjustments to income from prior calendar years; refer to page 3 of the General Instructions for procedures to correct prior periods.
SO42: TOTAL
The EFS software will compute this line as the sum of SO410 through SO488.
SO410: MORTGAGE LOAN SERVICING FEES
Include:
1. Fees earned from servicing mortgage loans for others.
2. Impairment losses on servicing assets reported on SC642.
Do not include:
1. Servicing fees for nonmortgage loans. Report the servicing fees on nonmortgage loans on SO420, Other Fees and Charges.
2. Amortization of loan servicing assets or liabilities and valuation adjustments for classes of loan servicing accounted for using the amortization method.
3. Fair value adjustments for classes of servicing carried at fair value.
Report the difference between the net interest retained from mortgage loan servicing and the amortization or other write-down of mortgage servicing assets. Do not deduct servicing expenses.
SO411: AMORTIZATION OF AND FAIR VALUE ADJUSTMENTS TO LOAN SERVICING ASSETS AND LOAN SERVICING LIABILITIES
Report the total servicing amortization and valuation adjustments.
Include:
1. Amortization of loan servicing assets or liabilities and valuation adjustments for classes of loan servicing accounted for using the amortization method
2. Fair value adjustments for classes of servicing carried at fair value.
SO420: OTHER FEES AND CHARGES
Report all fees and charges not reported on SO410.
Include:
1. Loan servicing fee income on nonmortgage loans, including credit card servicing income.
2. Trust fee income.
3. Amortization of commitment fees when it is unlikely that the borrower will exercise the
commitment.
4. Brokerage fee income.
5. Annuity fee income.
6. Insurance premiums, fees, and commissions.
7. Transaction account fees, including overdraft and non-sufficient funds (NSF) fees.
8. Credit enhancement fees.
9. All other fees not reported on SO410.
Do not include:
Amortization of loan fees. Report amortization of loan fees as a yield adjustment to interest income.
NET INCOME (LOSS) FROM:
Report net income or loss on the categories below. Enter a loss as negative.
SO430: Sale of Assets Held for Sale and Available-for-Sale Securities
Include:
1. Profit or loss from the disposition of assets held for sale.
2. Profit or loss from the disposition of available-for-sale securities pursuant to FASB Statement No.
115. When you sell securities classified as available-for-sale pursuant to FASB Statement No. 115, reverse the amount of the unrealized gain or loss previously recorded on SC860, Unrealized Gains (Losses) on
Available-for-Sale Securities, and report the entire difference between amortized cost and net sales proceeds in earnings.
Because you recognize in income the lower-of-cost-or-market adjustments to assets held for sale as they occur, when you sell the assets, you recognize the difference between the recorded value and the net sales proceeds.
Do not include:
1. Gains or losses on trading assets. Report on SO485.
2. Lower-of-cost-or-market adjustments to assets held for sale. Report these adjustments on SO465.
SO441: OTHER-THAN-TEMPORARY IMPAIRMENT CHARGES ON DEBT AND EQUITY SECURITIES
Report other-than-temporary charges on debt and equity securities. Such charges reflect losses resulting from write-downs to fair value. These fair value losses are not necessarily related to any sale of the securities.
Do not report losses from the sale of securities on this line. Rather report those losses on SO430, SO467, SO475, or SO477, as appropriate.
SO461: Operations and Sale of Repossessed Assets
Include:
1. Net income or loss from repossessed assets reported on SC40, Repossessed Assets. Report direct expenses on repossessed assets, even if there is no income.
2. Gains and losses from the sale of repossessed assets reported on SC40, Repossessed Assets.
Do not include:
1. Adjustments to valuation allowances established on REO. Report these adjustments on SO570, Net Provision for Losses on Noninterest-Bearing Assets.
2. Write-downs taken when marking foreclosed assets to fair value at time of foreclosure. Report these write-downs on SO321, Net Provision for Losses on Interest-bearing Assets.
SO465: LOCOM Adjustments Made to Assets Held for Sale
Report adjustments to assets held for sale to value them at the lower-of-cost-or-market. The amounts reported here should directly adjust the asset and should not be established as a valuation allowance.
Do not include:
1. Any unrealized gains or losses on available-for-sale securities recorded pursuant to FASB Statement No. 115. Report these unrealized gains or losses only as a separate component of equity capital on SC860.
2. Profit or loss on the sale of assets held for sale. Report the profit or loss on SO430.
3. Operating income and expense from mortgage banking activities. Report in the appropriate income or expense category.
SO467: Sale of Securities Held-to-Maturity
Include:
1. Gains and losses from the sale or other disposition of mortgage-backed securities that you reported on SC210 through SC228, Mortgage-Backed Securities, and that were held-to-maturity.
2. Gains and losses from the sale or other disposition of securities that you reported on SC130 through SC185, Cash, Deposits and Investment Securities, and that were held-to-maturity.
Do not include:
1. Gains and losses from the sale of securities held in a trading portfolio. Report these gains or losses on SO485.
2. Gains and losses from the sale of available-for-sale securities. Report these gains and losses on SO430.
SO475: Sale of Loans Held for Investment
Report gains and losses from the sale or other disposition of mortgage and nonmortgage loans that you reported on SC230 through SC265 and SC300 through SC330.
Do not include:
1. Gains and losses from the sale of loans and securities in a trading portfolio. Report these gains and losses on SO485;
2. Gains and losses from the sale of loans held for sale. Report these gains and losses on SO430.
3. Recoveries of losses previously written off. Report on VA140, Recoveries.
SO477: Sale of Other Assets Held for Investment
Report gains and losses from the sale or other disposition of any assets that you did not report on SO430 through SO475 or SO485.
Include:
1. Gains and losses from the sale of real estate held for investment reported on SC45, Real Estate Held for Investment, that you may account for as current income in accordance with FASB Statement No. 66, Accounting for Sales of Real Estate.
2. Gains and losses from the sale of a branch operation or a portion thereof, such as deposits.
3. Gains and losses from the sale of loan servicing rights when sold separately from the loan.
4. Gains and losses from the sale of subsidiaries.
SO485: Gains and Losses on Financial Assets and Liabilities Carried at Fair Value
The balances of financial assets and liabilities carried at fair value where the change in fair value is reflected in current earnings are reported on SI376 and SI377. For such instruments, report interest income earned and interest expense incurred on the appropriate lines under Interest Income and Interest Expense, and report the changes in fair value in noninterest income on this line.
Derivatives are financial assets and liabilities, and therefore the balances of derivatives are included on SI376 and SI377. In general for derivatives, include the changes in fair value in noninterest income on this line. However, for derivatives subject to fair value or cash flow hedge accounting, it may be appropriate under GAAP to include the changes in fair value that are reflected in current earnings in other lines on Schedule SO, including interest income or interest expense.
The balance of available-for-sale securities (carried at fair value) is reported on SI385. For such instruments, the changes in fair value are not reflected in current earnings, but rather in other comprehensive income net of any deferred tax impact. Accordingly, do not include the changes in fair value on available-for-sale securities on this line. Rather, report such changes in other comprehensive income on SI662.
Under a “fair value option”, servicing assets may be carried at fair value with the changes in fair value reflected in current earnings. However, servicing assets are not financial assets, and therefore the balance is not included on SI376. Accordingly, do not include the changes in fair value on servicing assets on this line. Rather, report such changes in noninterest income on SO411.
Include:
1. Realized and unrealized gains and losses on financial assets and liabilities carried at fair value where the balances are reported on SI376 and SI377.
2. Realized and unrealized gains and losses on financial assets held for trading purposes where the balance is reported on SI375 (and where the balance is also included on SI376).
SO488: Other Noninterest Income
Report the total of all noninterest income that you did not include on SO410 through SO485. You can find a list of the types of income to include under Memo: Detail of Other Noninterest Income below.
Do not include:
1. Loan servicing fees. Report these fees on SO410 or SO420, as appropriate;
2. Trust fee income. Report this income on SO420.
3. Other fees. Report these fees on SO420.
Memo: Detail of Other Noninterest Income
SO489, 495, 497 and SO492, 496, and 498:
Report the three largest items comprising the amount reported on SO488, excluding dividends on FHLBank stock. Codes best describing these items should be selected from the list below and reported on SO489, 495, and 497. You must complete this detail if you reported an amount on SO488.
Because SO488 may consist of both positive and negative amounts – for example, net income or loss from leasing operations, you should report the three amounts that have the greatest impact on the total, regardless of their sign. Therefore, when selecting the three largest amounts comprising the amount reported on SO488, disregard the sign of the number. However, although you should disregard the sign when you select the three largest numbers; you should use the correct sign when you report the amount.
Combine similar accounts with the same code; that is, do not report a code more than once. However, you should not combine unlike accounts in reporting code 99. You may have more than one code 99 if you cannot find codes describing the items you report.
SO489, 495, and 497: Codes
01 No longer used 02 Interest income from income tax refunds. 03 No longer used 04 Net income or loss from leasing or subleasing space in the association’s office quarters, future
office quarters, and parking lots. 05 Net income or loss from real estate held for investment. 06 Net income or loss from investments in unconsolidated subordinate organizations and pass-
through investments, accounted for using the equity method, after the elimination of intercompany profits. 07 Net income or loss from leased property. 08 Net loss allocable to noncontrolling shareholders. 09 Net income from data processing equipment leased or services provided to others. 10 No longer used. 11 Adjustments to prior periods. 12 Income received on real estate acquired through foreclosure or deed in lieu of foreclosure on VA or FHA loans pending conveyance to the insuring agency. 13 No longer used 14 Income from interest-only strip receivables and certain other instruments reported on SC665.
15 Income from corporate-owned life insurance
Report adjustments to cash surrender value of corporate-owned life insurance that you
reported on SC615 and SC625.
99 Other. (Use this code only for an item not identified above.)
SO492, 496, and 498: Amounts
Report the dollar amounts (using the correct positive or negative sign) corresponding to the codes reported on SO489, 495, and 497.
NONINTEREST EXPENSE
Do not include material adjustments to expenses from prior calendar years; refer to page 3 of the General Instructions for procedures to correct prior periods.
SO51: TOTAL
The EFS software will compute this line as the sum of SO510 through SO580.
SO510: ALL PERSONNEL COMPENSATION AND EXPENSE
Report gross salaries, wages, bonuses, and other compensation and expenses of officers, directors and employees, whether employed full- or part-time.
Include:
1. The cost of temporary help and employment contractors.
2. Fringe benefits such as the employer’s share of payroll taxes, insurance premiums, lunchroom expenses, tuition fees, uniforms, parking, and other such benefits.
3. Bonuses and awards.
4. Employer contributions to pension and retirement funds and ESOP plans.
5. Pensions paid directly by you.
6. Lump-sum pension contributions.
7. Payments related to past services, such as severance pay.
8. Directors’ fees.
9. Travel and other expenses for directors, officers, and employees.
10. The fair value of employee stock options granted.
Do not include:
Allowances for privately owned automobiles used in connection with your business, or any depreciation and other noninterest expense incurred on leased automobiles. Report these figures on SO530.
SO520: LEGAL EXPENSE
Report all legal fees and retainers, including accruals and amortization.
Do not include material legal settlements; most settlement payments should be reported on SO580.
SO530: OFFICE OCCUPANCY AND EQUIPMENT EXPENSE
Include:
1. Depreciation and other expenses of association-owned space, capital leases, furniture and fixtures, automobiles and equipment reported on SC55, Office Premises and Equipment.
2. Amortization of leasehold improvements.
3. Rent, net of the amortization of deferred gain on a sale/leaseback.
4. Uncapitalized equipment purchases.
5. Taxes, assessments, and insurance premiums on office premises, equipment, and land for future use.
6. Rental costs, maintenance contracts, and expenses on office furniture, machines, and data processing equipment.
7. Accounting servicing fees paid to a data center. If a portion of office premises and equipment is leased to others, allocate related expenses to SO488,
Other Noninterest Income. When actual data are not available, a reasonable, consistent, and documented estimate is acceptable.
SO540: MARKETING AND OTHER PROFESSIONAL SERVICES
Include:
1. Advertising, production, agency fees, and direct mail.
2. Market research, including consultants.
3. Public relations, including consultants, seminars, or customer magazines.
4. Sales training by consultants.
5. Public accountants’ fees.
6. Management services.
7. Consulting fees for economic surveys.
8. Other special advisory services.
Do not include:
1. Legal fees; report on SO520.
2. Data processing fees; report on SO530.
3. Supervisory examination fees; report on SO580.
4. Deposit promotions, giveaways, premiums, and commissions that are capitalized. Report amortization on SO215, Interest Expense on Deposits.
SO550: LOAN SERVICING FEES
Report fees paid to others to service mortgage and nonmortgage loans.
Include:
1. Fees for servicing loans owned by you.
2. Fees for servicing loans owned by others where you own the servicing rights.
Do not include:
1. Amortization of loan servicing assets. Report the amortization on SO411.
2. Servicing fees for loans acquired on a net yield basis. Deduct the servicing fees from related interest income.
SO560: GOODWILL AND OTHER INTANGIBLES EXPENSE
Report write-downs and expense of SC660, Goodwill and Other Intangible Assets.
Include amortization of:
1. Goodwill, an unidentifiable intangible asset, recorded pursuant to APB No. 16 or FASB Statement No. 141.
2. The unidentifiable intangible asset recorded pursuant to FASB Statement No. 72.
3. Core deposit premium, an identifiable intangible asset.
4. Intangible pension assets recorded pursuant to FASB Statement No. 87.
5. Technology-based intangible assets, such as computer software.
6. Other intangible assets, excluding servicing assets. Also, include impairment write-downs on goodwill and other intangible assets.
Do not include amortization of Servicing assets; report this on SO410.
Upon adoption of FASB Statement No. 142 in 2002, goodwill recorded pursuant to APB No. 16 or FASB Statement No. 141 will no longer be amortized. However, this unidentifiable intangible asset will continue to be subject to impairment write-downs. The exact adoption date of FASB Statement No. 142 in 2002 will depend on your fiscal year-end.
SO570: NET PROVISION FOR LOSSES ON NON-INTEREST-BEARING ASSETS
Report the provision for losses on all non-interest-bearing assets. Report credit balances as negative.
Refer to the general instructions for Schedule VA for a discussion of how to properly calculate provision for losses. Report adjustments to valuation allowances as an expense in the period in which you determine the amount of the loss even if that loss actually occurred in a prior period.
Include adjustments to valuation allowances on:
1. Real estate owned.
2. Other assets.
Do not include:
1. Recoveries of valuation allowances at the time of sale. Include these recoveries in the gain or loss on the sale.
2. Provisions for losses on interest-bearing assets. Report the losses on SO321, Net Provision for Losses on Interest-bearing Assets.
3. Direct charge-offs of servicing assets. Report the direct charge-offs on SO410, Mortgage Loan Servicing Fees.
4. Losses recognized in marking foreclosed assets to fair value at the time of foreclosure or in-substance foreclosure. Report these as losses on loans on SO321, Net Provision for Losses on Interest-bearing Assets.
SO580: OTHER NONINTEREST EXPENSE
Report the total of all noninterest expense not included on SO510 through SO570. A list of the types of expense you should include appears below in the memo items detailing other noninterest expense.
Memo: Detail of Other Noninterest Expense
Report the three largest items comprising the amount you reported on SO580. Select codes best describing these items from the list below and report the codes on SO581, 583, and 585. Report the corresponding amounts on SO582, 584, and 586. You must complete this detail if an amount is reported on SO580.
If SO580 consists of both positive and negative amounts, you should report the three amounts that have the greatest impact on the total, regardless of their sign. Therefore, when selecting the three largest amounts comprising the amount reported on SO580, disregard the sign of the number. However, although you should disregard the sign when you select the three largest numbers; you should use the correct sign when you report the amount.
Combine similar accounts with the same code; that is, do not report a code more than once. However, you should not combine unlike accounts in reporting code 99. You may have more than one code 99 if you cannot find codes describing the items you report.
SO581, 583, and 585: Codes
01 Deposit Insurance premiums.
02 OTS assessments.
03 Interest expense on income taxes.
04 Interest expense on Treasury tax and loan accounts administered under the note option.
05 Forfeited commitment fees on FHLBank advances not taken down by the association.
06 Supervisory examination fees.
07 Office supplies, printing, and postage.
08 Telephone, including data lines.
09 Loan origination expense
Include appraisal reports, credit reports, and other similar expenses; also include, as a negative amount, reversals of origination costs when such costs are capitalized. 10 ATM expense. 11 Adjustments to prior periods (and other immaterial audit adjustments). 12 Acquisition and organization costs, including mergers and branch office acquisitions. 13 Miscellaneous taxes other than income taxes and real estate taxes. 14 Losses from fraud. 15 Foreclosure expenses. 16 Web site expenses. 17 Charitable Contributions. 99 Other. (Use this code only for an item not identified above.)
SO582, 584, and 586: Amounts
Report the dollar amounts corresponding to the codes reported on SO581, 583 and 585.
SO60: INCOME (LOSS) BEFORE INCOME TAXES
The EFS software will compute this line as the sum of SO332 plus SO42 less SO51.
INCOME TAXES
SO71: TOTAL
The EFS software will compute this line as the sum of SO710 and SO720.
SO710: FEDERAL
Report federal income tax expense. Report a net credit as negative.
Include:
1. Deficiency payments, penalties.
2. Immaterial adjustments to correct prior period accruals for which the amendment cycle is no longer open.
3. Amortization of prepaid or deferred federal income taxes.
4. Reductions for refunds from prior periods not previously reported.
5. Reductions for NOL carrybacks.
Do not include:
Interest income and expense on tax accounts. Report these on SO488, Other Noninterest Income, or SO580, Other Noninterest Expense.
SO720: STATE, LOCAL, AND OTHER
Report state, local, and other income tax expenses. Report a net credit as negative.
Include:
1. Deficiency payments, penalties.
2. Immaterial adjustments to correct prior period accruals for which the amendment cycle is no longer open.
3. Amortization of prepaid or deferred state, local and other income taxes.
4. Reductions for refunds from prior periods not previously reported.
5. Reductions for NOL carrybacks.
6. Gross receipts taxes.
Do not include:
1. Interest income and expense on tax accounts. Report these on SO488, Other Noninterest Income, or SO580, Other Noninterest Expense.
2. Any local taxes other than those based on income. Report real estate taxes on SO530, Office Occupancy and Equipment Expense; report franchise and other local taxes on SO580, Other Noninterest Expense.
SO81: INCOME (LOSS) BEFORE EXTRAORDINARY ITEMS
The EFS software will compute this line as the sum of SO60 less SO71.
SO811: EXTRAORDINARY ITEMS
Extraordinary items are material events and transactions that are unusual and infrequent. Both of these conditions must exist for an event or transaction to be an extraordinary item.
• Unusual – To be unusual, an event or transaction must be highly abnormal or clearly unrelated to the ordinary and typical activities of the association. An event or transaction beyond the control of management is not automatically considered unusual.
• Infrequent – To be infrequent, an event or transaction should not reasonably be expected to recur in the foreseeable future. Although the past occurrence of an event or transaction provides a basis for estimating the likelihood of its future occurrence, the absence of a past occurrence does not automatically imply that an event or transaction is infrequent.
Rarely do events or transactions qualify for treatment as extraordinary items. Among those that qualify are:
• The excess of fair value over cost of net assets acquired in a purchase business combination (negative goodwill) recognized in earnings at the date of combination;
• Losses that result directly from a major disaster such as an earthquake (except in areas where earthquakes are expected to recur in the foreseeable future);
• Gains or losses from a government expropriation;
• Gains or losses from discontinued operations; or
• Losses from a prohibition under a newly enacted law or regulation.
Do not include:
1. Adjustments to valuation allowances. Report these on SO32, Net Provision for Losses on Interest-Bearing Assets, or SO570, Net Provision for Losses on Noninterest-Bearing Assets, even if the actual loss occurred in a prior period.
2. Audit adjustments for corrections of accruals. For information on correcting prior period errors, see Item 5 in the General Instructions.
3. Adjustments for periods where the cycle is open for amendments to the TFR. Refer to the general instructions for the submission of amended reports.
4. Adjustments related to prior interim periods of your current fiscal year. Report these adjustments currently in the appropriate current income or expense data field.
5. Net income or loss allocable to noncontrolling shareholders. Report in SO488, Other Noninterest Income.
6. Gains and losses on extinguishments of debt that do not meet the criteria in APB Opinion No. 30 for classification as an extraordinary item. Generally prepayment penalties should be expensed on SO580, Other Noninterest Expense.
SO88: NET INCOME (LOSS) ATTRIBUTABLE TO SAVINGS ASSOCIATION AND NONCONTROLLING INTERESTS
The EFS software will compute this line as the sum of SO81 plus SO811.
SO880: NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Report the net income or loss attributable to noncontrolling interests in consolidated subsidiaries.
SO91: NET INCOME (LOSS) ATTRIBUTABLE TO SAVINGS ASSOCIATION
The EFS software will compute this line as the sum of SO88 less SO880.
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SCHEDULE VA — CONSOLIDATED VALUATION ALLOWANCES
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
This schedule reports the combined activity for the period in all valuation allowance accounts. The reconciliation consists of three columns:
1. General valuation allowances, including allowances for loan and lease losses, ALLL.
2. Specific valuation allowances, including valuation allowances established for assets classified as loss.
3. Total valuation allowances. The EFS software generates this column. Valuation allowances are contra-asset accounts that reduce the recorded investment in an asset to its carrying amount. In preparing financial statements, management should review the carrying amount of all
assets and adjust the related valuation allowances as necessary. Assessing the adequacy of valuation allowances is crucial to preparing the financial statement.
The ending balance in a valuation allowance account is the balance at the beginning of the period adjusted for the activity during the period. The following table shows the types of activity that flow through the valuation allowance account:
Beginning Balance (ending balance from previous period)
Add:
Provision for Loss
Recoveries
Adjustments
Deduct:
Charge-offs
Ending Balance
Charge-offs
When you charge off an asset, the accounting entries reduce the total recorded investment of the asset and reduce the valuation allowance. However, since the carrying value is the recorded investment less the specific valuation allowance, the carrying value decreases when you charge-off a general valuation allowance. The carrying value does not change when you charge-off a specific valuation allowance. Record direct charge-offs in this schedule even though there is no valuation allowance relating to the asset. You should also record a charge-off if the established valuation allowance is inadequate to absorb the entire charge-off. You can record a charge-off against either a general or specific valuation allowance.
The Sales section discusses eliminating valuation allowances when you sell the related asset.
Recoveries
A recovery is a payment received after you charge-off an asset. A recovery increases both the general valuation allowance and cash accounts.
In Schedule VA, recoveries do not include profits from assets that you had previously written down and later sold at a price exceeding the carrying value. For example, you would record profits from the sale of REO as a gain on the sale.
Provision for Loss
Calculate the provision for loss as the amount required to establish the appropriate ending balance in the valuation allowance account. You should base the amount of the ending balance on your management’s review of the following:
• An assessment of all assets.
• Valuation calculations for troubled real estate assets.
• Estimates of credit and other losses inherent in the portfolios of homogeneous assets.
• The results of your self-classification of assets.
The following formula reconciles the provision for loss with the valuation allowance accounts:
+ The valuation allowance ending balance per analysis (VA165 and 168)
-The valuation allowance beginning balance (VA105 and 108)
= Net change in valuation allowances
+ Charge-offs (including sales) (VA155 and 158)
-Adjustments (VA145 and 148)
-Recoveries (VA135)
= Provision for loss (VA115 and 118)
The process of determining the appropriateness of the ending balances in valuation allowance accounts results in the provision for loss being a net adjustment. For example, in the rare circumstance that a troubled real estate asset with a valuation allowance increases in value, you should adjust the required valuation allowance downward. This increase in the asset’s value is a reduction of the current provision. Do not confuse this with a recovery of assets previously charged-off discussed above. Carefully analyze the total valuation allowance before you record a gain or reduction of the provision for loss.
The total provision for loss consists of the provision for loss on interest-bearing assets, SO321, and the provision for loss on non-interest-bearing assets, SO570. Do not include the LOCOM adjustments for assets held for sale, SO465, because LOCOM adjustments are due to changes in interest rates, and not due to credit losses. You should not establish a valuation allowance for the credit to assets resulting from LOCOM adjustments, but rather should directly reduce the asset.
You may record a negative provision for loss when management determines that the valuation allowance is higher than required. If this occurs, management should consider whether it has analyzed all possible situations and determine if the previously established valuation allowances were higher than necessary. To reverse a portion of the valuation allowance, report a negative amount in the provision for loss on SO321 or SO570.
Sales
When you sell an asset with a previously established valuation allowance or that had been reduced by a direct charge-off, compute the gain or loss as follows: Sales price minus the asset’s carrying value, which is net of the specific valuation allowance and charge-off.
The sale of an asset in excess of its carrying value is not a recovery when reconciling valuation allowances. Do not report profits from this type of sale in the net provision for loss. Report the profit as a gain on sale.
To remove an existing specific valuation allowance after selling the related asset, you must report the valuation allowance on VA158, Charge-offs of Specific Valuation Allowances.
Foreclosures
In cases involving foreclosure, including in-substance foreclosure, compare the recorded investment to the current fair value less cost to sell. Classify as loss any excess of recorded investment over fair value less cost to sell. Record this excess as a charge-off against the existing specific valuation allowance. If the specific valuation allowance is not sufficient to absorb the loss, you should record an additional charge-off against the loan. Record assets acquired through in-substance foreclosures as REO at the fair value less cost to sell at date of transfer. You should apply the same procedures described above.
VALUATION ALLOWANCE RECONCILIATION
VA105, 108, AND 110:BEGINNING BALANCE
The EFS software automatically generates beginning balances from the prior quarter’s ending balances. Generally, the beginning balances must equal the amounts reported on VA165, 168 and 170, Ending Balances, from the immediately preceding reporting period.
If during the quarter you have consummated a business combination accounted for under the purchase method, report the beginning balance of the surviving association only. Report valuation allowances on purchased assets on VA145, 148, and 150, Adjustments.
ADD OR DEDUCT:
Report increases in valuation allowance accounts, net credits, as positive numbers and decreases in valuation allowance accounts, net debits, as negative numbers.
VA115, 118, and 120: Net Provision for Loss
The EFS software automatically generates the total net provision for loss, VA120, from SO321 plus SO570. The EFS software also automatically generates VA118 after you enter VA115. On VA115, report the provision for loss related to general valuation allowances, and also other-than-temporary impairment charges on debt and equity securities.
A net credit to assets increases valuation allowances and charge-offs and flows through to the Statement of Operations as a debit, which is an expense. You should report a net credit as a positive number. Conversely, a net debit to assets decreases valuation allowances and flows through to the Statement of Operations as a credit or income. Report a net debit as a negative number on these lines.
VA125 and 128: Transfers
Report transfers between general and specific valuation allowances. VA125 and VA128 will have opposite signs even though they are always equal. Once you enter VA125, the transfer from general valuation allowances, the EFS software automatically generates VA128, the corresponding transfer to specific valuation allowances.
ADD:
VA135 and 140: Recoveries
You should report any amount recovered during the quarter due to repayment of assets previously charged off. Refer to the discussion of recoveries in the general instructions to Schedule VA. VA135 always equals VA140, and VA 140 is the sum of VA371, 47, 57, and 931. Therefore, once you enter VA371, 47, 57, and 931, the EFS software automatically sums these and generates VA135 and 140.
VA145, 148, and 150: Adjustments
Acquisitions
Report the amount of valuation allowances on assets you purchased but for which you did not take a direct charge-off. Under certain circumstances, you may carry the existing valuation allowances of assets that you purchase forward to your books. You should include any valuation allowances acquired in a business combination accounted for under the purchase method. You should also include necessary adjustments that resulted from purchasing or selling a consolidated subsidiary, where the valuation allowances on the books of the subsidiary are consolidated with yours. The EFS software automatically generates VA150, which is the sum of VA145 and VA148.
Do not include:
Additional valuation allowances established after an acquisition, even if previous management should have established the valuation allowances. Report such additions to the valuation allowances in VA120, Net Provision for Loss.
Adjustments for Charge-Offs on Credit Card Loans
On VA145, report as a positive number that portion of charge-offs included on VA556 that reduce an account other than a valuation allowance (for example, interest income). This reporting will permit the valuation allowance reconciliation to balance, because on VA556 you should report all charge-offs on credit card loans, including those that do not reduce valuation allowances.
DEDUCT:
VA155, 158 and 160: Charge-Offs
VA155 equals the sum of the charge-off detail below, VA370, 46, 56, 60, and 930. The EFS software automatically generates VA 155 once you enter charge-offs on VA370, 46, 56, 60, and 930. The software also generates VA160, total charge-offs. VA160 is the sum of VA155, charge-offs against general valuation allowances, and VA158, charge-offs against specific valuation allowances.
Report charge-offs as positive amounts, since EFS will deduct them from the ending valuation allowance balance.
If there is no specific valuation allowance established for the asset you are charging off, report chargeoffs in the detail below and on VA155. If there is a specific valuation allowance for the asset, report the charge-off on VA158 for purposes of reconciliation. You should not report charge-offs of specific valuation allowances in the detail below because they have no effect on the balance sheet, Schedule SC, or on the income statement, Schedule SO.
Include:
1. Charge-offs to mark repossessed assets, including in-substance foreclosures, to fair value.
2. Charge-offs to eliminate valuation allowances of sold assets. See Sales above.
3. Charge-offs on credit card loans that do not reduce valuation allowances, as described in the instructions for VA556.
Do not include:
1. Charge-offs due to recognizing unrealized losses on trading assets.
2. Charge-offs in connection with marking assets to market in a business combination accounted for as a purchase.
VA165, 168 AND 170: ENDING BALANCE
The EFS software automatically generates these balances as the sum of the General, Specific, and Total columns, and brings them forward as the beginning balances for the next reporting period. VA165 must equal the sum of the general valuation allowances that you reported in Schedule SC on SC229, SC283, SC357, SC441, and SC699.
CHARGE-OFFS, RECOVERIES, AND SPECIFIC VALUATION ALLOWANCE ACTIVITY
CHARGE-OFFS
Report the amount of loss that you charged off during the quarter against general valuation allowances. You should only include charge-offs for which no specific valuation allowance has previously been established.
The sum of VA370, 46, 56, 60, and 930 must equal VA155. The EFS software automatically generates VA155 once you enter charge-offs on VA370, 46, 56, 60, and 930.
VA370: Mortgage-Backed Securities
Report the amount of loss that you charged off on SC210 through SC228, Mortgage-Backed Securities. Include other-than-temporary impairment charges on mortgage-backed securities where the associated provision is included in SO321 and VA115.
Mortgage Loans:
Report charge-offs of mortgage loans, accrued interest receivable, and advances for taxes and insurance in the appropriate mortgage loan category below.
Include charge-offs to mark repossessed assets to fair value at the date of foreclosure.
VA46: Total
The EFS software automatically generates this amount as the sum of VA420, 430, 440, 446, 456, 466, 470, 480, and 490.
Construction:
VA420: 1-4 Dwelling Units
Report the amount of loss that you charged off on SC230, Construction Loans on 1-4 Dwelling Units.
VA430: Multifamily (5 or More) Dwelling Units
Report the amount of loss that you charged off on SC235, Construction Loans on 5 or More Dwelling Units.
VA440: Nonresidential Property
Report the amount of loss that you charged off on SC240, Construction Loans on Nonresidential Property.
Permanent:
VA446: 1-4 Dwelling Units: Revolving, Open-End Loans
Report the amount of loss that you charged off on SC251, Permanent: 1-4 Dwelling Units: Revolving, Open-End Loans.
VA456: 1-4 Dwelling Units: Secured By First Liens
Report the amount of loss that you charged off on SC254, Permanent: 1-4 Dwelling Units: Secured By First Liens.
VA466: 1-4 Dwelling Units: Secured by Junior Liens
Report the amount of loss that you charged off on SC255, Permanent: 1-4 Dwelling Units: Secured by Junior Liens.
VA470: Multifamily (5 or More) Dwelling Units
Report the amount of loss that you charged off on SC256, Permanent Mortgages on 5 or More Dwelling Units.
VA480: Nonresidential Property (Except Land)
Report the amount of loss that you charged off on SC260, Permanent Mortgages on Nonresidential Property.
VA490: Land
Report the amount of loss that you charged off on SC265, Permanent Mortgages on Land.
Nonmortgage Loans
Report charge-offs of nonmortgage loans and accrued interest receivable in the appropriate loan category below.
VA56: Total
The EFS software automatically generates this line as the sum of VA520, 510, 516, 530, 540 550, 556, and 560.
VA520: Commercial Loans
Report the amount of loss that you charged off on SC300, Secured Commercial Loans, SC303, Unsecured Commercial Loans, and SC306, Commercial Financing Leases.
Consumer Loans
VA510: Loans on Deposits
Report the amount of loss that you charged off on SC310, Consumer Loans on Deposits.
VA516: Home Improvement Loans
Report the amount of loss that you charged off on SC316, Consumer Home Improvement Loans.
VA530: Education Loans
Report the amount of loss that you charged off on SC320, Consumer Education Loans.
VA540: Auto Loans
Report the amount of loss that you charged off on SC323 Consumer Auto Loans.
VA550: Mobile Home Loans
Report the amount of loss that you charged off on SC326, Consumer Mobile Home Loans.
VA556: Credit Cards
Report the amount of loss that you charged off on SC328, Credit Cards.
VA560: Other
Report the amount of loss that you charged off on SC330, Other Closed-End Consumer Loans.
Repossessed Assets:
Report all direct charge-offs on repossessed assets. You should mark repossessed assets to fair value at the date of foreclosure and charge the markdown against the loan balance.
VA60: Total
The EFS software automatically generates this amount as the sum of VA605 through VA630.
Real Estate:
VA605: Construction
Report the amount of loss that you charged off on SC405, Repossessed Real Estate Construction.
VA613: 1-4 Dwelling Units
Report the amount of loss that you charged off on SC415, Repossessed 1-4 Dwelling Unit Real Estate.
VA616: Multifamily (5 or More) Dwelling Units
Report the amount of loss that you charged off on SC425, Repossessed 5 or More Dwelling Unit Real Estate.
VA625: Nonresidential (Except Land)
Report the amount of loss that you charged off on SC426, Repossessed Nonresidential Real Estate, Except Land.
VA628: Land
Report the amount of loss that you charged off on SC428, Repossessed Land.
VA630: Other Repossessed Assets
Report the amount of loss that you charged off on SC430, Other Repossessed Assets.
VA930: Other Assets
Report the amount of loss that you charged off on SC689, Other Assets, and on any other assets not otherwise reported as charge-offs. Include other-than-temporary impairment charges on nonmortgage debt securities and equity securities where the associated provision is included in SO321 and VA115.
Do not include:
1. Write-downs of office buildings, leasehold improvements, furniture, fixtures, equipment, and automobiles. Report these write-downs as an adjustment of depreciation on SO440, Net Income (Loss) from Office Building Operations, and SO530, Office Occupancy and Equipment Expense.
2. Write-downs on SC660, Goodwill and Other Intangible Assets. Report these write-downs as an adjustment of amortization on SO560, Amortization of Goodwill.
RECOVERIES
Report the amount of recoveries during the quarter due to the repayment of assets previously charged off in the recovery column. For additional information, see the general instructions to Schedule VA.
The EFS software automatically generates VA135 once you enter recoveries on VA371, 47, 57, and 931.
Do not include:
1. Sale of an asset at a sales price exceeding the carrying value. Report this amount in income on SO430 and SO467 through SO477.
2. Payments received on assets for which a valuation allowance has been established. Adjust the ending balance of the valuation allowance appropriately.
VA371: Mortgage-Backed Securities
Report the amount of recoveries on mortgage-backed securities that you reported on SC210 through SC228.
Mortgage Loans
Include recoveries of accrued interest receivable and advances for taxes and insurance in the appropriate mortgage loan category below. Report recoveries on deficiency judgments in the mortgage loan category to which the judgment applies.
VA47: Total
The EFS software automatically generates this amount as the sum of VA421, 431, 441, 447, 457, 467, 471, 481, and 491.
Construction:
VA421: 1-4 Dwelling Units
Report the amount of recoveries on SC230, Construction Loans on: 1-4 Dwelling Units.
VA431: Multifamily (5 or More) Dwelling Units
Report the amount of recoveries on SC235, Construction Loans on: 5 or More Dwelling Units.
VA441: Nonresidential Property
Report the amount of recoveries on SC240, Construction Loans on: Nonresidential Property.
Permanent:
VA447: 1-4 Dwelling Units: Revolving, Open-End Loans
Report the amount of recoveries on SC251, Permanent: 1-4 Dwelling Units: Revolving, Open-End Loans.
VA457: 1-4 Dwelling Units: Secured By First Liens
Report the amount of recoveries on SC254, Permanent: 1-4 Dwelling Units: Secured By First Liens.
VA467: 1-4 Dwelling Units: Secured by Junior Liens
Report the amount of recoveries on SC255, Permanent: 1-4 Dwelling Units: Secured by Junior Liens.
VA471: Multifamily (5 or More) Dwelling Units
Report the amount of recoveries on SC256, Permanent Mortgages on: 5 or More Dwelling Units.
VA481: Nonresidential Property (Except Land)
Report the amount of recoveries on SC260, Permanent Mortgages on: Nonresidential Property (Except Land).
VA491: Land
Report the amount of recoveries on SC265, Permanent Mortgages on: Land.
Nonmortgage Loans
Report recoveries of nonmortgage loans and accrued interest receivable in the appropriate loan category below.
VA57: Total
The EFS software automatically generates this amount as the sum of VA521, VA511, VA517, 531, 541, 551, 557, and 561.
VA521: Commercial Loans
Report the amount of recoveries on Commercial Loans on SC300, Commercial Loans: Secured, SC303, Commercial Loans: Unsecured, and SC306, Commercial Loans: Financing Leases.
Consumer Loans
VA511: Loans on Deposits
Report the amount of recoveries on SC310, Closed-End Consumer Loans: Loans on Deposits.
VA517: Home Improvement Loans
Report the amount of recoveries on SC316, Closed-End Consumer Loans: Home Improvement Loans.
VA531: Education Loans
Report the amount of recoveries on SC320, Closed-End Consumer Loans: Education Loans.
VA541: Auto Loans
Report the amount of recoveries on SC323, Closed-End Consumer Loans: Auto Loans.
VA551: Mobile Home Loans
Report the amount of recoveries on SC326, Closed-End Consumer Loans: Mobile Home Loans.
VA557: Credit Cards
Report the amount of recoveries on SC328, Credit Cards.
VA561: Other
Report the amount of recoveries on SC330, Consumer Loans: Other, Including Lease Receivables.
VA931: Other Assets
Report the amount of recoveries on all other financial assets that you did not include above. Include recoveries on miscellaneous receivables that you reported on SC689, Other Assets.
Do not include:
1. Gains on the sale of REO. Report these gains on SO461, Operations and Sale of Repossessed Assets.
2. Recoveries on deficiency judgments or other recoveries of loans foreclosed upon. Report these recoveries as a recovery of the loan in the appropriate loan category above.
SPECIFIC VALUATION ALLOWANCE PROVISIONS & TRANSFERS FROM GENERAL ALLOWANCES
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances during the quarter. This applies to any specific valuation allowance activity with the exception of charge-offs and acquisitions.
The sum of VA38, 372, 48, 58, 62, 72, 822, and 932 must equal the sum of VA118 and 128.
VA38: Deposits, and Investment Securities
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on all deposits and investment securities that you reported on SC110 through SC191.
VA372: Mortgage-Backed Securities
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC210 through SC228, Mortgage-Backed Securities.
Mortgage Loans:
Report the provision for loss established for specific valuation allowances and the transfers between general valuation allowances of mortgage loans in the appropriate mortgage loan category below. You should report specific valuation allowance activity of accrued interest receivable and advances for taxes and insurance in the appropriate mortgage loan category of the related loan.
VA48: Total
The EFS software automatically generates this amount as the sum of VA422, 432, 442, 452, 462, 472, 482, and 492.
Construction:
VA422: 1-4 Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC230, Construction Loans on: 1-4 Dwelling Units.
VA432: Multifamily (5 or More) Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC235, Construction Loans on: 5 or More Dwelling Units.
VA442: Nonresidential Property
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC240, Construction Loans on: Nonresidential Property.
Permanent:
VA448: 1-4 Dwelling Units: Revolving, Open-End Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC251, Permanent: 1-4 Dwelling Units: Revolving, Open-End Loans.
VA458: 1-4 Dwelling Units: Secured By First Liens
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC254, Permanent: 1-4 Dwelling Units: Secured By First Liens.
VA468: 1-4 Dwelling Units: Secured by Junior Liens
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC255, Permanent: 1-4 Dwelling Units: Secured by Junior Liens.
VA472: Multifamily (5 or More) Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC256, Permanent Mortgages on: 5 or More Dwelling Units.
VA482: Nonresidential Property (Except Land)
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC260, Permanent Mortgages on: Nonresidential Property.
VA492: Land
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC265, Permanent Mortgages on: Land.
Nonmortgage Loans
Report the provision for loss established for specific valuation allowances and the transfers between general valuation allowances of mortgage loans in the appropriate nonmortgage loan category below. You should report specific valuation allowance activity of accrued interest receivable in the related loan category.
VA58: Total
The EFS software automatically generates this amount as the sum of VA522, 512, 518, 532, 542, 552, 558, and 562.
VA522: Commercial Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC300, Commercial Loans: Secured, SC303, Commercial Loans: Unsecured, and SC306, Commercial Loans: Financing Leases.
Consumer Loans
VA512: Loans on Deposits
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC310, Closed-End Consumer Loans: Loans on Deposits.
VA518: Home Improvement Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC316, Closed-End Consumer Loans: Home Improvement Loans.
VA532: Education Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC320, Closed-End Consumer Loans: Education Loans.
VA542: Auto Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC323, Closed-End Consumer Loans: Auto Loans.
VA552: Mobile Home Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC326, Closed-End Consumer Loans: Mobile Home Loans.
VA556: Credit Cards
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC328, Credit Cards.
VA562: Other
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC330, Consumer Loans: Other, Including Lease Receivables.
Repossessed Assets:
Report the provision for loss established for specific valuation allowances and the transfers between general valuation allowances of repossessed assets after the date of foreclosure. Do not include adjustments to mark repossessed assets to fair value at the date of foreclosure; these adjustments should be charged off against the loan balance and reported on VA420 through VA560.
VA62: Total
The EFS software automatically generates this amount as the sum of VA606, 614, 617, 626, 629, and
632.
Real Estate:
VA606: Construction
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC405, Repossessed Assets: Real Estate: Construction.
VA614: 1-4 Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC415, Repossessed Assets: Real Estate: 1-4 Dwelling Units.
VA617: Multifamily (5 or More) Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC425, Repossessed Assets: Real Estate: 5 or More Dwelling Units.
VA626: Nonresidential (Except Land)
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC426, Repossessed Assets: Real Estate: Nonresidential (Except Land).
VA629: Land
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC428, Repossessed Assets: Real Estate: Land.
VA632: Other Repossessed Assets
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC430, Other Repossessed Assets.
VA72: Real Estate Held for Investment
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC45, Real Estate Held for Investment.
VA822: Equity Investments Not Subject to FASB Statement No. 115
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC51, Equity Investments Not Subject to FASB Statement No.
115.
VA932: Other Assets
Report the amount of provision for loss established for specific valuation allowances and the transfers between general valuation allowances on SC689, Other Assets.
ADJUSTED NET CHARGE-OFFS
The EFS software automatically generates this column.
This column totals:
• Charge-offs
• Less Recoveries
• Plus specific valuation allowance provisions and transfers from general allowances Therefore, this total represents adjusted net charge-offs.
OTHER ITEMS
TROUBLED DEBT RESTRUCTURED:
A troubled debt restructuring (TDR) occurs when you, as a creditor, for economic or legal reasons related to the debtor’s financial difficulties, grant a concession to the debtor that you would not otherwise consider. That concession either stems from an agreement between you and the debtor or is imposed by law or a court. Whatever the form of concession you grant to the debtor, your objective is to make the best of a difficult situation. Additionally, you expect to obtain more cash or other value from the debtor by granting the concession than by not granting it.
You may accept any of the following when you restructure a troubled debt:
1. A note, secured or unsecured, from a third party as payment of your receivable from the
borrower.
2. The underlying collateral as payment of the loan, either through foreclosure, other title transfer, or in-substance foreclosure.
3. Other assets in payment of a loan.
4. An equity interest in either the borrower or its assets in lieu of its receivable.
5. A modification of the debt terms, including, but not limited to the following:
a.
Reduction in stated interest rate.
b.
Extension of maturity.
c.
Reduction in the face amount of the debt.
d.
Reduction in the accrued interest.
Include:
1. Restructured real estate loans that are equity investments under GAAP and that you reported on SC45, Real Estate Held for Investment.
2. Restructured loans that you reported on SC230 through SC265 (Mortgage Loans) and SC300 through SC330 (Nonmortgage Loans).
3. Foreclosed assets that you reported on SC405 through SC430 (Repossessed Assets).
4. Troubled debt restructurings even if you recorded no losses this quarter, but had previous charge-offs.
VA940: Amount this Quarter
Report the amount of new TDR this quarter. Report the recorded investment less specific valuation allowances in the restructured asset after restructuring. The recorded investment is the outstanding principal balance, adjusted for charge-offs and unamortized yield adjustments. The restructured asset would comprise, for instance, a modified loan or foreclosed asset. Report all new TDR even if you subsequently sold or otherwise disposed of the asset during the quarter
VA942: Included in Schedule SC in Compliance with Modified Terms
Report the recorded investment of loans that have been modified in troubled debt restructurings, reduced by specific valuation allowances, that remain on the books at the end of the quarter that are not past due or in nonaccrual status, and, therefore, that you do not report in Schedule PD. Report such TDRs regardless of the quarter in which the restructuring took place.
In general, you should continue to report loans as TDRs until they are paid off. However, you only need to report a TDR that yields a market rate at issuance during the first year of the restructuring if the borrower complies with the terms of the restructured contract.
Do not include repossessed assets acquired in troubled debt restructurings.
MORTGAGE LOANS FORECLOSED DURING THE QUARTER
Report the recorded investment less specific valuation allowances of mortgage loans foreclosed during the quarter.
Include the types of mortgages that you reported on SC230 through SC265 and real estate loans that are considered equity investments under GAAP that you reported on SC45, that you either foreclosed on and acquired a voluntary deed in lieu of foreclosure or on which you performed an in-substance foreclosure during the quarter.
Note: Even though foreclosed real estate loans that are considered equity investments under GAAP are reported here as foreclosures, do not transfer them on Schedule SC to Repossessed Assets, SC405 through SC430. These foreclosures should remain in Real Estate Held For Investment, SC45.
Report all foreclosures during the quarter, even if you have sold or otherwise disposed of the property since foreclosure.
Include:
1. Cancellations of real estate contracts or similar actions where you reacquire any property you previously owned that you sold on contract or on installment basis.
2. FHA/VA mortgage loans, other federally insured or guaranteed mortgage loans, or privately insured mortgage loans that have been foreclosed, whether or not title has been subsequently transferred to the insurer.
3. The portion of participations that you held at the time of foreclosure whether or not you were the lead lender or initiated foreclosure proceedings.
4. Loans and participations that you sold with recourse and reacquired prior to foreclosure. If you reacquired a loan and obtained a foreclosure judgment, in fact or in substance, in the same quarter, report it as a purchase on CF280 through CF300, Loans and Participations Purchased, and as a foreclosure on VA95.
Do not include:
1. Loans to which title reverted to the seller prior to foreclosure.
2. Loans serviced for others unless you reacquired the loan prior to foreclosure.
VA95: Total
The EFS software will compute this line as sum of VA951 through VA955.
VA951: Construction
Report foreclosures during the quarter on loans that you previously reported on SC230 through SC240, Mortgage Construction Loans, and SC450 through SC470, Real Estate Held for Investment.
Permanent Loans Secured By:
VA952: 1-4 Dwelling Units
Report foreclosures during the quarter on permanent mortgages secured by one-to-four dwelling unit property that you previously reported on SC251 through SC255, Permanent Mortgages on 1-4 Dwelling Units.
VA953: Multifamily (5 or More Dwelling Units)
Report foreclosures during the quarter on permanent mortgages secured by five or more dwelling unit property that you previously reported on SC256, Permanent Mortgages on Multifamily (5 or More) Dwelling Units.
VA954: Nonresidential (Except Land)
Report foreclosures during the quarter on permanent mortgages secured by nonresidential property that you previously reported on SC260, Permanent Mortgages on: Nonresidential Property (Except Land).
VA955: Land
Report foreclosures during the quarter on permanent mortgages secured by land that you previously reported on SC265, Permanent Mortgages on Land.
CLASSIFICATION OF ASSETS
Report classified assets and assets designated special mention, net of related specific valuation allowances, accumulated charge-offs, and recorded liabilities. Include off-balance-sheet items, such as loan commitments, loans sold with recourse, and lines and letters of credit that you are required to classify.
End of Quarter Balances:
VA960: Special Mention
Report all assets, portions of assets, and off-balance-sheet items as of the end of the quarter that are not classified but are designated as special mention pursuant to the Examination Handbook Section 260 and 12 CFR § 560.160.
VA965: Substandard
Report all assets, portions of assets, and off-balance-sheet items as of the end of the quarter classified as substandard pursuant to the Examination Handbook Section 260 and 12 CFR § 560.160.
VA970: Doubtful
Report all assets, portions of assets, and off-balance-sheet items classified doubtful as of the end of the quarter pursuant to the Examination Handbook Section 260 and 12 CFR § 560.160.
VA975: Loss
Report all assets, portions of assets, and off-balance-sheet items classified loss as of the end of the quarter pursuant to Examination Handbook Section 260 and 12 CFR. § 560.160.
You should deduct any related specific valuation allowances, accumulated charge-offs, and recorded liabilities prior to reporting the amount of assets classified loss. Accordingly, you should generally report zero in this data field.
PURCHASED IMPAIRED LOANS HELD FOR INVESTMENT ACCOUNTED FOR IN ACCORDANCE WITH AICPA SOP 03-3 (EXCLUDE LOANS HELD FOR SALE)
Report purchased impaired loans as defined by SOP 03-3 that your savings association has purchased, including those acquired in a purchase business combination, when there is evidence of deterioration of credit quality since the origination of the loan and it is possible, at the purchase date, that the savings association will be unable to collect all contractually required payments receivable. SOP 03-3 does not prohibit placing loans on nonaccrual status and any nonaccrual purchased impaired loans should be reported accordingly in Schedule PD. For those purchased impaired loans that are not on nonaccrual status, you should determine the loans’ delinquency status in accordance with the contractual repayment terms of the loans without regard to the purchase price of (initial investment in) these loans or the amount and timing of the cash flows expected at acquisition.
VA980: Outstanding Balance (Contractual)
Report the outstanding balance of purchased impaired loans. The outstanding balance is the undiscounted sum of all amounts, including amounts deemed principal, interest, fees, penalties, and other under the loan, owed to the savings association at the report date, whether or not currently due and whether or not any such amounts have been charged off by the savings association. However, the outstanding balance does not include amounts that would be accrued under the contract as interest, fees, penalties, and other after the report date.
VA981: Recorded Investment (Carrying Amount Before Deducting Any Loan Loss Allowances)
Report the recorded investment (carrying amount before deducting any loan loss allowances) as of the report date of the purchased impaired loans held for investment. Loans held for investment are those loans that the savings association has the intent and ability to hold for the foreseeable future or until maturity or payoff. Thus, the outstanding balance and recorded investment of any purchased impaired loans that are held for sale would not be reported in these memorandum items.
VA985: Allowance Amount Included In Allowance for Loan and Lease Losses (SC283, SC357)
Report the amount of post-acquisition loan loss allowances for purchased impaired loans held for investment that is included in the total amount of the allowance for loan and lease losses as of the report date.
SCHEDULE PD – CONSOLIDATED PAST DUE AND NONACCRUAL
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Report all loans and leases that you own that are contractually past due or are in nonaccrual status, regardless of whether such loans are held for sale or are secured, unsecured, or guaranteed by the Government or by others. Report the entire loan, not simply the amount of the delinquent payment. You should report the balance of the recorded investment after deducting specific valuation allowances. Recorded investment is the principal balance, adjusted for charge-offs and unamortized yield adjustments.
PAST DUE
1. Do not take grace periods into account when determining past due status.
2. Report loans and lease financing receivables as past due when either interest or principal is unpaid in the following circumstances:
a) Amortizing closed-end mortgage loans, closed-end nonmortgage installment loans, and any other loans and lease financing receivables with:
i) Payments scheduled monthly – when the borrower’s interest and/or principal amount is past due thirty or more days (or one calendar month). For example, a loan payment is due March 15th. At March 31, the loan is not a full month past due, so it would not be reported in Schedule PD until after April 15th. On April 30 it would be 30 – 89 days past due.
ii) Payments scheduled other than monthly – when one scheduled payment of interest and/or principal is due and unpaid for 30 calendar days or more.
b) Open-end loans such as home equity loans, charge-card plans, check credit, and other revolving credit plans when the customer has not made the minimum payment for two or more billing cycles.
c) Single payment and demand notes providing for the payment of interest at stated intervals (such as certain construction loans) after one interest payment is due and unpaid for 30 days or more.
d) Single payment notes providing for the payment of interest at maturity if interest or principal remains unpaid for 30 days or more after maturity.
e) Unplanned overdrafts if the account remains continuously overdrawn for 30 days or more.
You have the option to use actual days as stated in the schedule headings in lieu of months when you calculate the past due period.
Example using months (instead of actual days):
In this example, the payment is due on the first of the month and the first payment missed is the one due March first.
Actual Days Complete Months Past-Due
Payment Payments Overdue At Overdue At Category At
Due Date Missed Month-End Month-End Month-End
March 1 (one) 30 0 Under 30 Days
April 1 (two) 60 1 30 - 89 Days
May 1 (three) 91 2 30 - 89 Days
June 1 (four) 121 3 90 Days or More
In the March TFR, you would not report this loan in Schedule PD. In the June TFR, you would report this loan in either the 90 Days or More or Nonaccrual category.
Example using actual days:
In this example, the payment is due on the first of the month and the first payment missed is the one due first.
Actual Days Past-Due
Payment Payments Overdue At Category At
Due Date Missed Month-End Month-End
March 1 (one) 30 30 - 89 Days
April 1 (two) 60 30 - 89 Days
May 1 (three) 91 90 Days or More
June 1 (four) 121 90 Days or More
In the March TFR, you would report this loan the 30 - 89 Days category. In the June TFR, you would report this loan in either the 90 Days or More or Nonaccrual category.
Partial Payments for Amortizing Closed-end Loans:
When borrowers make partial payments, they get credit for the amount of payment they make, so the loan will generally not be reported as past due until two or more months of partial payments have been made.
For example:
If the payment due were $100 and the borrower, due to a temporary condition, only paid $25 a month, the loan would be $75 past due at the end of the first month, $150 past due the second month, and $225 past due the third month.
If the loan were due on January 1, the loan would be $75 past due on February 1 (and February 28), $150 past due on March 1 (and March 31), and $225 on April 1 (and April 30). On the March 31 TFR, the loan would be more than 30 days delinquent and would be reported as 30-89 days past due on Schedule PD.
Likewise, if the borrower paid $50 a month, the loan would be $50 past due on February 1 (and February 28), $100 past due on March 1 (and March 31), and $150 on April 1 (and April 30). Again, on the March 31 TFR, the loan would be 30 days delinquent and reported as 30-89 days past due.
However, if the borrower paid $51 a month, the loan would be $49 past due on February 1 (and February 28), $98 past due on March 1 (and March 31), and $147 on April 1 (and April 30). Therefore, on the March 31 TFR, the loan would be less than 30 days delinquent and would not be reported as past due.
Restructured loans:
You need not maintain a loan in nonaccrual status where you have formally restructured the loan so that you are reasonably assured of repayment and of performance according to the modified terms, provided the restructured loan is well secured and collection under the revised terms is probable. To determine probability of collection, consider the borrower’s sustained historical repayment performance for a reasonable period, which may take into account performance prior to restructuring. A sustained period of repayment performance generally would equal a minimum of six months and would involve payments of cash or cash equivalents.
Do not include:
1. Loans on which interest is being accrued for record-keeping purposes but not for reporting purposes.
2. Accrued interest and advance payments of borrowers’ taxes and insurance unless they have been capitalized to the loan balance.
3. Deductions for allowances for loan and lease losses (ALLL) or the assumed liability of wraparound loans applicable to such loans.
NONACCRUAL
Report loans on which you no longer accrue interest.
Interest does not accrue on:
1. An asset that you maintain on a cash basis due to the borrower’s deteriorating financial position.
2. An asset for which you do not expect to receive full payment of interest or principal.
3. An asset with principal or interest in default unless the value of the property securing the loan exceeds the receivable balance, including principal, interest, and escrows, and collection is probable.
MORTGAGE LOANS:
PD115, 215, AND 315:CONSTRUCTION
Report loans included on SC230 through SC240, Construction Loans.
Permanent, Secured by:
1-4 Dwelling Units:
PD121, PD221, and PD321: Revolving, Open-End Loans
Report past due and nonaccrual revolving, open-end mortgages on 1-4 dwelling units reported on SC251.
All Other:
PD123, PD223, and PD323: Secured by First Liens
Report past due and nonaccrual mortgages with a first lien on 1-4 dwelling units reported on SC254.
PD124, PD224, and PD324: Secured by Junior Liens
Report past due and nonaccrual mortgages with a junior lien on 1-4 dwelling units reported on SC255.
PD125, 225, and 325: Multifamily (5 or More) Dwelling Units
Report loans included on SC256, Permanent Mortgages on: Multifamily (5 or More) Dwelling Units.
PD135, 235, and 335: Nonresidential Property (Except Land)
Report loans included on SC260, Permanent Mortgages on: Nonresidential Property (Except Land).
PD138, 238, and 338: Land
Report loans included on SC265, Permanent Mortgages on: Land.
NONMORTGAGE LOANS AND LEASES: PD140, 240, AND 340: COMMERCIAL
Report loans and leases included on SC300 through SC306, Nonmortgage Loans: Commercial Loans.
CONSUMER LOANS:
PD161, 261, and 361: Loans on Deposits
Report loans included on SC310, Consumer Loans: Loans on Deposits.
PD163, 263, and 363: Home Improvement Loans
Report loans included on SC316, Consumer Loans: Home Improvement Loans.
PD165, 265, and 365: Education Loans
Report loans included on SC320, Consumer Loans: Education Loans.
PD167, 267, and 367: Auto Loans
Report loans included on SC323, Consumer Loans: Auto Loans.
PD169, 269, and 369: Mobile Home Loans
Report loans included on SC326, Consumer Loans: Mobile Home Loans.
PD171, 271, and 371: Credit Cards
Report past due and nonaccrual consumer credit cards reported on SC328
PD180, 280, and 380: Other
Report past due and nonaccrual consumer loans reported on SC330.
PD10, 20, AND 30: TOTAL
The EFS software automatically computes these totals as the sum of PD115 through PD180 on PD10, the sum of PD215 through PD280 on PD20, and the sum of PD315 through PD380 on PD30.
MEMORANDA:
PD190, 290, AND 390: TROUBLED DEBT RESTRUCTURED INCLUDED ABOVE
Report troubled debt restructurings that you included above in Schedule PD. Refer to the instructions for VA942 for a discussion of troubled debt restructured. These lines plus the amount reported on VA942 will equal the total troubled debt restructured included in your balance sheet as of the quarter end.
PD192, 292, AND 392: LOANS AND LEASES REPORTED IN PD115 – PD380 THAT ARE HELD FOR SALE
Report loans and leases held for sale that are included above in Schedule PD.
PD195, 295, AND 395: LOANS AND LEASES REPORTED IN PD115 – PD380 THAT ARE WHOLLY OR PARTIALLY GUARANTEED BY THE U.S. GOVERNMENT, AGENCY, OR SPONSORED ENTITY
Report the recorded investment included above in Schedule PD of past due or nonaccrual loans that are wholly or partially recoverable from the U.S. Government, its agencies, and its government sponsored entities.
PD196, 296, AND 396: GUARANTEED PORTION OF OTHER LOANS AND LEASES INCLUDED IN PD195-PD395 (EXCLUDE REBOOKED “GNMA LOANS”)
Report the guaranteed portion of loans (excluding rebooked “GNMA loans”) reported in PD195 through PD395 above.
PD197, 297, AND 397 REBOOKED “GNMA LOANS” REPURCHASED OR ELIGIBLE FOR REPURCHASE INCLUDED IN PD195 – PD395
Report the amount of “GNMA loans” repurchased or eligible for repurchase that are reported in PD195 through PD395 above.
SCHEDULE LD — CONSOLIDATED LOAN DATA
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
You should report on this schedule only information about your loans and those of your consolidated subsidiaries. Do not include information of your holding company, affiliates, or unconsolidated subsidiaries.
HIGH LOAN-TO-VALUE LOANS SECURED BY 1-4 FAMILY RESIDENTIAL PROPERTIES, WITHOUT PMI OR GOVERNMENT GUARANTEE
Report data on 1-4 family real estate loans that meet both of the following conditions:
• The loan-to-value equals or exceeds 90 percent.
• There is no private mortgage insurance (PMI) or government guarantee, such as FHA or VA.
For reporting 1-4 family, high loan-to-value loans on this schedule, include small business loans secured by single-family residences classified as commercial loans on Schedule SC, as well as loans reported as mortgages. The only 1-4 family real estate loans that you can exclude are those that the borrower has otherwise substantially secured and where you take the mortgage as an abundance of caution (for example secured auto loans), and where you have not made the terms more favorable than they would have been in the absence of the real estate lien. Report all loans at recorded investment less specific valuation allowances. See the instructions for mortgage loans in Schedule SC for a definition of recorded investment. Note that the amount you report as the loan value may differ from the amount used in the calculation of LTV as explained below.
You may exclude from this schedule loans that you intend to sell within 90 days from origination, without recourse, to a financially responsible third party. However, you must include any uninsured, high LTV loans originated for sale that are more than 90 days old.
Include both permanent and construction loans secured by 1-4 family dwellings. Include conventional construction loans that have been approved for PMI that will be effective when the loan converts to a permanent loan, but where the construction loan is not yet covered by PMI.
In determining the LTV ratio, you must combine all loans secured by the same property regardless of whether you classify the loan as a mortgage or consumer loan in Schedule SC. If you hold a junior lien, you must include all liens senior to your lien in the LTV calculation, even if you do not hold all the senior liens.
In calculating LTV, use the recorded investment of the loan as the numerator. Do not deduct specific valuation allowances. If you have not yet disbursed the entire loan and you are legally bound to fund an undisbursed commitment, for the numerator use the recorded investment plus the undisbursed commitment, including letters of credit.
Use the borrower’s purchase price of the real estate or appraised value at origination, whichever is less, for the denominator in the LTV calculation. Subsequent to origination if the real estate market has changed significantly and the value of the real estate has increased, you may use a current market valuation. You must support this valuation by a current appraisal or evaluation performed in accordance with 12 CFR 564. However, if the value of the real estate has decreased, you may use the appraised value at origination; we do not require that you use a lower current appraisal unless you have refinanced the loan or disbursed additional funds. When the borrower has paid down his loan below 90% LTV, you no longer have to report the loan in Schedule LD.
If you make an adjustable rate mortgage loan where the loan contract permits negative amortization when interest rates rise, such that the loan could exceed 90 percent LTV, you do not need to report the loan as a high LTV loan until the balance of the loan reaches 90 percent of the value of the property. See definitions in 12 CFR § 560.101.
Example 1: You make a loan with a principal balance of $90,000 on the purchase of a house, with deferred fees net of origination costs of $2,000. At origination the appraised value is $100,000. There is no PMI on this loan. The recorded investment at origination is $88,000 ($90,000 less $2,000). Therefore, at origination the LTV equals 88 percent and the loan is not reported as a high LTV loan in Schedule LD.
Example 2: You purchase a loan with a principal balance of $88,000 at a premium of $3,000. The originator appraised the property at $100,000. Your recorded investment is $91,000 ($88,000 plus $3,000), and thus the LTV is 91 percent. There is no PMI on this loan. You must include your recorded investment in this loan in the 90 up to 100 LTV category.
Example 3: You make a legally binding commitment of $9 million on a construction loan on a project of single-family homes, with a projected value at completion of $10 million. Therefore, the LTV equals 90 percent. There is no PMI on this loan. At the reporting date, you have disbursed $3 million on this loan; this is the recorded investment. You must report the $3 million in the 90 up to 100 LTV category.
Example 4: You make an adjustable rate mortgage loan with a principal balance of $85 thousand on the purchase of a house for $100 thousand. There is no PMI on this loan. The loan document guarantees that the monthly payment will not exceed $750. The LTV at origination is 85 percent, and you, therefore, do not report the loan as a high LTV loan. Interest rates rise to the point that, if you fully amortized the loan, the loan payment would exceed $750. Each month you add the amount of the loan amortization in excess of $750 to the recorded investment of the loan. In time, the recorded investment of the loan reaches 90 percent. At that time, you must include the recorded investment of the loan in the 90 up to 100 LTV category.
BALANCES AT QUARTER-END:
Report the recorded investment less specific valuation allowances of all mortgages secured by 1-4 family residential properties where the loan-to-value falls in the range indicated and that are not covered by PMI or government guarantee.
If you hold junior and senior liens on the same property and the senior lien is covered by PMI but the junior lien is a home equity loan that is not covered by PMI or government guarantee, report the recorded investment of only the home equity loan. However, for purposes of calculating LTV, you include the recorded investments of the first mortgage and the home equity loan and the undisbursed commitment of the home equity loan as the numerator. If the first mortgage has an LTV less than 80% and therefore has no PMI, you must combine it with junior liens on the same property on LD110 and LD120.
LD110: 90 up to 100 LTV
LD120: 100 or Greater LTV
PAST DUE AND NONACCRUAL BALANCES:
Report the recorded investment less specific valuation allowances of all past due and nonaccrual mortgages secured by 1-4 family residential properties, where the loan-to-value falls in the range indicated and that are not covered by PMI or government guarantee. You should use the same definitions of past due and nonaccrual that we provide in Schedule PD. If you have made multiple loans on the same property, report only the loans that are past due.
Past Due and Still Accruing:
30 - 89 Days
LD210: 90 up to 100 LTV
LD220: 100 and Greater LTV
90 Days or More
LD230: 90 up to 100 LTV
LD240: 100 and Greater LTV
Nonaccrual
LD250: 90 up to 100 LTV
LD260: 100 and Greater LTV
CHARGE-OFFS AND RECOVERIES:
Net Charge-offs (including Specific Valuation Allowance Provisions & Transfers from General to Specific Allowances):
We define net charge-offs as charge-offs from general valuation allowances, as reported on VA155, less recoveries, as reported on VA135, plus specific valuation allowance provisions, as reported on VA118, and transfers from general allowances, as reported VA128. This is also referred to as adjusted net charge-offs. You also report adjusted net charge-offs on Schedule VA in the column beginning with VA39. Include adjusted net charge-offs of all balances reportable on LD110 and LD 120. Include all charge-offs, recoveries and specific valuation allowance activity on high loan-to-value 1-4 family mortgages even if the acquisition and the charge-off took place in the same quarter. Report charge-offs and recoveries if the loan was reported on Schedule LD either in the prior or current quarter.
LD310: 90 up to 100 LTV
LD320: 100 and Greater LTV
PURCHASES
Report the cost of all high loan-to-value loans secured by 1-4 family residential properties purchased during the quarter from other entities. You should also report these purchases in Schedule CF.
LD410: 90 up to 100 LTV
LD420: 100 and Greater LTV
ORIGINATIONS
Report the amount disbursed for all high loan-to-value loans secured by 1-4 family residential properties during the quarter. Note that you report all amounts net of loans-in-process (LIP), and report additional disbursements in the quarter in which you make them. Use the definition of disbursements found in the instructions as Schedule CF for the definition of originations in this schedule.
LD430: 90 up to 100 LTV
LD440: 100 and Greater LTV
SALES
Report all high loan-to-value loans secured by 1-4 family residential properties sold to other entities or otherwise disposed of during the quarter. You should also report these sales in Schedule CF.
LD450: 90 up to 100 LTV
LD460: 100 and Greater LTV
SUPPLEMENTAL LOAN DATA FOR ALL LOANS
LD510: 1-4 DWELLING UNITS CONSTRUCTION-TO-PERMANENT LOANS
Report the outstanding balance of all construction-to-permanent loans secured by 1-4 dwelling units, and construction loans to the ultimate owner-occupant, that are reported in SC230, Construction loans on 1-4 Dwelling Units. Do not include loans to builders who plan to sell or rent after completion.
LD520: OWNER-OCCUPIED MULTIFAMILY PERMANENT LOANS
Report the outstanding balance of all owner-occupied multifamily permanent loans secured by 5 or more dwelling units that are reported in SC256, Multifamily (5 or More) Dwelling Units.
The determination as to whether a multifamily property is considered “owner-occupied” should be made upon acquisition (origination or purchase) of the loan. However, for purposes of determining whether existing multifamily real estate loans should be reported as “owner-occupied”, the institution may consider the source of repayment either when the loan was acquired or based on the most recent available information. Once the institution determines whether a loan should be reported as “owner-occupied” or not, this determination need not be reviewed thereafter.
Loans secured by owner-occupied multifamily properties are those multifamily property loans for which the primary source of repayment is the cash flow from the ongoing operations and activities conducted by the party, or an affiliate of the party, who owns the property. Thus, for loans secured by owner-occupied multifamily properties, the primary source of repayment is not derived from third party, nonaffiliated, rental income associated with the property (i.e., any such rental income is less than 50 percent of the source of repayment) or the proceeds of the sale, refinancing, or permanent financing of the property.
LD530: OWNER-OCCUPIED NONRESIDENTIAL PROPERTY (EXCEPT LAND) PERMANENT LOANS
Report the outstanding balance of all owner-occupied nonresidential property (except land) permanent loans that are reported in SC260, Permanent Loans - Nonresidential Property (Except Land).
The determination as to whether a nonresidential property is considered “owner-occupied” should be made upon acquisition (origination or purchase) of the loan. However, for purposes of determining whether existing nonresidential real estate loans should be reported as “owner-occupied”, the institution may consider the source of repayment either when the loan was acquired or based on the most recent available information. Once the institution determines whether a loan should be reported as “owneroccupied” or not, this determination need not be reviewed thereafter.
Loans secured by owner-occupied nonresidential properties are those nonresidential property loans for which the primary source of repayment is the cash flow from the ongoing operations and activities conducted by the party, or an affiliate of the party, who owns the property. Thus, for loans secured by owner-occupied nonresidential properties, the primary source of repayment is not derived from third party, nonaffiliated, rental income associated with the property (i.e., any such rental income is less than 50 percent of the source of repayment) or the proceeds of the sale, refinancing, or permanent financing of the property. Include loans secured by hospitals, golf courses, recreational facilities, and car washes unless the property is owned by an investor who leases the property to the operator who, in turn, is not related to or affiliated with the investor. Also include loans secured by churches unless the property is owned by an investor who leases the property to the congregation.
LD610: 1-4 DWELLING UNITS OPTION ARM LOANS
Report the outstanding balance of all option ARM loans secured by 1-4 dwelling units that are reported in SC251, Revolving, Open-End Loans on 1-4 Dwelling Units, SC254, First Liens, Closed-End on 1-4 Dwelling Units, and SC255, Junior Liens, Closed-End on 1-4 Dwelling Units.
Option ARMs loans generally represent adjustable rate mortgages where the borrower may have the option to opt for a minimum payment or an interest only payment.
LD620: 1-4 DWELLING UNITS ARM LOANS WITH NEGATIVE AMORTIZATION
Report the outstanding balance of all ARM loans with negative amortization secured by 1-4
dwelling units that are reported in SC251, Revolving, Open-End Loans on 1-4 Dwelling Units, SC254,
First Liens, Closed-End on 1-4 Dwelling Units, and SC255, Junior Liens, Closed-End on 1-4 Dwelling
Units.
LD650: TOTAL CAPITALIZED NEGATIVE AMORTIZATION
Report the total capitalized negative amortization included in the outstanding balances reported in LD620, 1-4 Dwelling Units ARM Loans with Negative Amortization.
SCHEDULE CC — CONSOLIDATED COMMITMENTS AND CONTINGENCIES
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
COMMITMENTS OUTSTANDING
Report all commitments outstanding that will close in your name. In the case of securities held by an agent, report commitments made on your behalf.
In reporting commitments to originate loans on CC280 through CC310, do not include the portion of refinancings, including wrap-around loans, that will not involve your disbursing cash. Report only the amount you will disburse. Do not report the gross commitment amount.
Report commitments to purchase or sell loans or securities on CC320 through CC375 on a gross basis. Do not net commitments to sell against commitments to purchase, even if the commitments are for the same or similar investments and even if no cash will be disbursed or received. For example, report a commitment to swap mortgages for mortgage pool securities as a commitment to sell mortgages and purchase mortgage pool securities, even though no cash will be involved in the transaction. Do not include resale agreements accounted for as financings.
UNDISBURSED BALANCE OF LOANS CLOSED (LOANS-IN-PROCESS EXCLUDING LINES OF CREDIT)
Report loan distributions on loans closed, but not disbursed.
Include:
1. All undisbursed amounts relating to construction loans reported on SC230, SC235, and SC240.
2. Loans disbursed according to a specified schedule or upon completion of specified terms.
3. Loans awaiting completion of certain contractual terms prior to disbursal.
4. Loans where you have executed the documents but have not yet disbursed loan proceeds.
Do not include:
1. The undisbursed portion of open-ended lines of credit, including home equity loans.
2. Borrower’s advances or deposits that are reported on SC710, Deposits, or SC783, Escrows.
CC105: Mortgage Construction Loans
Report undisbursed amounts (loans-in-process) on mortgage construction loans of the types reported on SC230 through SC240.
CC115: Other Mortgage Loans
Report the undisbursed balance of closed-end permanent mortgage loans of the types reported on SC254 through SC265.
CC125: Nonmortgage Loans
Report the undisbursed balance of closed-end nonmortgage loans of the types reported on SC300 through SC330.
TO ORIGINATE MORTGAGES SECURED BY
Report outstanding commitments made to builders, owners, or purchasers of real estate to originate mortgage loans that will close in your name, classified by the type of property securing the loan.
CC280: 1-4 Dwelling Units
Report outstanding commitments to originate mortgage loans secured by 1-4 dwelling units. Include the full amount committed for revolving lines of credit not yet closed that will be secured by 1-4 dwelling units. Once the revolving line of credit has closed, report the unused line on CC412.
CC290: Multifamily (5 or More) Dwelling Units
Report outstanding commitments to originate mortgage loans secured by multifamily (5 or more) dwelling units. Include unused lines of credit committed for revolving lines of credit secured by permanent mortgages on multifamily (5 or more) dwelling units.
CC300: All Other Real Estate
Report outstanding commitments to originate mortgage loans on nonresidential property and land. Include unused lines of credit committed for revolving lines of credit secured by permanent mortgages on nonresidential property.
CC310: TO ORIGINATE NONMORTGAGE LOANS
Report outstanding commitments to originate nonmortgage loans that will close in your name.
CC320: TO PURCHASE LOANS
Report outstanding commitments to purchase whole mortgage and nonmortgage loans and participating interests.
CC330: TO SELL LOANS
Report outstanding commitments to sell whole mortgage and nonmortgage loans and participating interests.
TO PURCHASE OR SELL MORTGAGE-BACKED SECURITIES AND INVESTMENT SECURITIES
Report all commitments to purchase mortgage-backed securities and investment securities whether or not they are accounted for under SFAS Statement No. 133 (e.g., when-issued, regular-way trades, or normal purchases and sales) on the appropriate line: CC335, CC355, CC365, or CC375. Report commitments to purchase and sell when-issued securities that are accounted for as derivatives under SFAS Statement No. 133 on a gross basis (except you may net purchases and sales of the identical security with the same party). For example, report a GSE To-Be-Announced (TBA) mortgage-backed security where there is expectation of physical delivery upon issuance of the security (regular-way trade) on CC335. Similarly, report a GSE TBA where there is no expectation of delivery, and therefore, accounted for under SFAS Statement No. 133 as a forward contract, also on CC335.
CC335: TO PURCHASE MORTGAGE-BACKED SECURITIES
Report outstanding commitments to purchase mortgage-backed securities of the types included on SC210 through SC222.
CC355: TO SELL MORTGAGE-BACKED SECURITIES
Report outstanding commitments to sell mortgage-backed securities of the types included on SC210 through SC222.
CC365: TO PURCHASE INVESTMENT SECURITIES
Report outstanding commitments to purchase investment securities of the types reported on SC130 through SC185.
CC375: TO SELL INVESTMENT SECURITIES
Report outstanding commitments to sell investment securities of the types reported on SC130 through SC185.
LINES AND LETTERS OF CREDIT:
UNUSED LINES OF CREDIT:
Report all unused lines of credit that you issue in connection with credit cards or open-end loans. Unused lines of credit are defined as the difference between the amount authorized by contract and the actual amount outstanding at quarter-end.
Do not include loans-in-process on constructions loans; report construction LIP on CC105.
CC412: Revolving Open-End Loans On 1-4 Dwelling Units
Report unused lines of credit on mortgage loans on 1-4 dwelling units for revolving, open-end loans (home equity lines of credit) reported on SC251.
CC420: Commercial Lines
Report unused lines of credit on nonmortgage commercial loans reported on SC300, SC303, and SC306.
Open-End Consumer Lines:
CC423: Credit Cards
Report unused lines of credit on consumer credit cards reported on SC328.
CC425: Other
Report unused lines of credit on consumer loans reported on SC330, including credit extended to individuals under prearranged overdraft plans.
LETTERS OF CREDIT
Report the undrawn portion of outstanding letters of credit at the end of the quarter. Do not report any other type of commitment. Report most other types of commitments on CC280 through CC375.
There are two classifications of letters of credit:
1. A commercial letter of credit is one where the issuer expects to pay drafts or other demands for payment.
2. A standby letter of credit is one where the issuer stands ready to pay in the unexpected event
that the customer defaults or fails to perform on the underlying contract with the third party. Do not include unused lines of credit.
CC430: Commercial
Report the undrawn portion of commercial letters of credit.
CC435: Standby, Not Included on CC465 or CC468
Report the undrawn portion of all standby letters of credit not included on CC465 or CC468. Include both collateralized and uncollateralized standby letters of credit.
RECOURSE OBLIGATIONS AND DIRECT CREDIT SUBSTITUTES
If you have recourse obligations, residual interests, credit-enhancing interest-only strips, subordinated securities, or direct credit substitutes, you should use the lines below to report these interests and the amount of assets that they enhance.
You may find it helpful to review the definitions in 12 CFR 567.1. While that section does not include a specific definition for subordinated securities, in context you should consider subordinated securities as a type of direct credit substitute.
You also use these lines to report exposures arising through a nonsecurity financial instrument under FASB Statement No. 140.
CC455: TOTAL PRINCIPAL AMOUNT OF ALL ASSETS COVERED BY RECOURSE OBLIGATIONS OR DIRECT CREDIT SUBSTITUTES
Report the outstanding principal balance of assets you enhance, fully or partially, by recourse obligations, credit-enhancing interest-only strips, residual interests, subordinated securities, or direct credit substitutes.
Include:
1. The full amount of assets enhanced by your recourse obligations, requiring you to absorb credit
2. losses on assets held by a third party.
Example: If you sell $1000 in loans, and agree to absorb the first 10% of losses, you report
$1000 on this line, and $100 on line CC468.
3. The full amount of assets enhanced by your residual interests.
4. Example: If you create and securitize a $1000 pool of loans and you sell $900 and retain a “first loss” residual interest of $100, you report $1,000 on this line and $100 on line CC468.
5. The full amount of assets enhanced by your subordinated securities: Example: If you buy a subordinated security in a senior/subordinated structure, the total structure
6. is $1,000, and your subordinated security is $200, you report $1,000 on this line and $200 on line CC465.
7. The full amount of assets enhanced by your letters of credit, or other direct credit substitutes,
8. both collateralized and uncollateralized, to cover credit obligations of another party.
Example: If you provide a simple line of credit of $100 to another party, you report $100 on this
line, and $100 on line CC465.
Example: If you provide a line of credit of $100 to another party that is available to enhance the
other party’s “first loss” or otherwise subordinate obligation on a $1,000 loan pool, you report
$1000 on this line and $100 on line CC465.
2. Assets covered by recourse obligations even if the obligation is limited to 120 days or less.
Do not Include:
Positions subordinate to your own. Example: If you have retained a $100 mezzanine “second loss” security in a $1000 pool of assets that you have securitized or purchased and you have sold the $100 first loss security (subordinate to your security) and the $800 security (senior to your security), you report $900 on this line and $100 on line CC468.
CC465: AMOUNT OF DIRECT CREDIT SUBSTITUTES ON ASSETS IN CC455
Include the amount of direct credit substitutes, including purchased credit-enhancing interest-only strips, purchased subordinated securities, and other similar exposures that you have purchased from another party.
Report the face amount of the exposure, residual, or security that you have purchased from another party, or the face amount of a letter of credit that you supply to another party. Refer to the examples in item 4, CC455 above.
CC468: AMOUNT OF RECOURSE OBLIGATIONS ON ASSETS IN CC455
Include the amount of recourse obligations, residuals, credit-enhancing interest-only strips, and subordinated securities that arise from your own securitization activities.
Report the face amount of the exposure, residual, or security that arises from your own securitization activities. Include letters of credit issued on behalf of affiliates or on behalf of any securitization trust that you have created. Refer to the examples under CC455 above.
CC480: OTHER CONTINGENT LIABILITIES
Report all contingent liabilities that you do not report elsewhere in this schedule or in Schedule SC.
CC490: CONTINGENT ASSETS
Report all contingent assets not reported elsewhere in this schedule or Schedule SC.
SCHEDULE CF — CONSOLIDATED CASH FLOW INFORMATION
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
You should report on this schedule only the activity of you and your consolidated subsidiaries. Do not include activity of your holding company, affiliates, or unconsolidated subsidiaries. Do not report as new activity the following: bulk sales and purchases of loans and deposits, branch purchases and sales, and assets and deposits acquired through a merger. In the case of a merger of depository institutions, you should report activity for all institutions involved in the merger for the entire quarter. If you have been acquired by a holding company where you used pushdown accounting, you should report your activity for the entire quarter regardless of the date of acquisition.
MORTGAGE-BACKED SECURITIES
Report purchases and sales of securities included on SC210 through SC222, including those that you purchased and sold during the same quarter.
PASS-THROUGH:
CF143: Purchases
Report the purchase price of mortgage-backed securities reported on SC210 and SC215 that you purchased during the quarter.
CF145: Sales
Report the carrying value of mortgage pool securities reported on SC210 and SC215 that you sold during the quarter.
CF148: Other Balance Changes
Report other balance changes of mortgage pool securities reported on SC210 and SC215. Include cash repayments of principal, adjustments pursuant to FASB Statements 115 and 133, and amortization of discounts and premiums. Report as negative amounts decreases in the security balance, and as positive amounts, increases in the security balance.
OTHER MORTGAGE-BACKED SECURITIES:
CF153: Purchases
Report the purchase price of mortgage-backed securities reported on SC217 through SC222 that you purchased during the quarter.
CF155: Sales
Report the carrying value of mortgage-backed securities reported on SC217 through SC222 that you sold during the quarter.
CF158: Other Balance Changes
Report other balance changes of mortgage-backed securities reported on SC217 through SC222. Include cash repayments of principal, adjustments pursuant to FASB Statements No. 115 and No. 133, and amortization of discounts and premiums. Report as negative amounts decreases in the security balance, and as positive amounts, increases in the security balance.
MORTGAGE LOANS
MORTGAGE LOANS DISBURSED:
Report the amount disbursed for mortgage loans during the quarter. Note that you report all amounts net of loans-in-process, LIP. Report additional disbursements in the quarter in which you make them.
Include:
1. All loans closed in your name. Report all loans closed, even if a third party funds the loans or you immediately transfer the loans to a third party. Include loans whether or not you, an affiliate, or another entity performs the actual closing. Do not report subsequent transfers to you from the closing entity as purchases. This is because you already reported the loans as your originations.
1. Increases in loan balances of existing loans such as the following:
1. Disbursement of LIP.
2. Disbursement of a previously closed but undisbursed mortgage.
3. Negative amortizations.
4. Additional disbursements of home equity loans.
5. The amount disbursed for refinanced loans.
2. Combination construction-permanent loans both when the construction loan closes and when the loan converts to permanent financing, even if you disburse no new funds.
3. All loans meeting the above definitions, even if you immediately securitize or sell the loans. Also report these loans on CF310 through CF330.
Do not include:
1. Loans closed in the name of an affiliated unconsolidated entity. If you subsequently acquire mortgages closed in the name of an affiliated unconsolidated entity, you should report the acquisition as a purchase on CF280 through CF300.
2. The undisbursed portion of construction and open-end home equity loans. Report as
contingencies on Schedule CC.
3. Mortgages closed by brokers under warehouse lines of credit where you closed the loans, but disbursed no money. Report only as you disburse funds as described in item 2 under Include above.
Construction Loans On:
CF190: 1-4 Dwelling Units
Report the amount of construction loans disbursed during the quarter of the type on SC230, Construction Loans on 1-4 Dwelling Units.
Do not include:
Construction loans secured by condominium projects. Report on CF200.
CF200: Multifamily (5 or More) Dwelling Units
Report the amount of construction loans disbursed during the quarter of the type on SC235, Construction Loans on 5 or More Dwelling Units.
Include:
Construction loans secured by apartment buildings including condominium and timeshare projects.
CF210: Nonresidential
Report the amount of construction loans disbursed during the quarter of the type on SC240, Construction Loans on Nonresidential Property.
Permanent Loans On:
When a single loan provides permanent financing for more than one type of property, you should report the entire loan in the data field describing the type of property representing the largest use of loan proceeds.
CF225: 1-4 Dwelling Units
Report the amount of mortgage loans disbursed during the quarter of the type reported on SC251, SC254, and SC255. Include the amounts disbursed for open-end home equity loans, revolving, open-end loans secured by 1-4 dwelling units and extended under lines of credit.
CF226: Home Equity and Junior Liens
Report the amount of mortgage loans disbursed during the quarter included under CF225 that are of the type reported on SC251 and SC255.
CF245: Multifamily (5 or More) Dwelling Units
Report the amount of mortgage loans disbursed during the quarter of the type reported on SC256, permanent mortgages on multifamily residential property.
CF260: Nonresidential (Except Land)
Report the amount of mortgage loans disbursed during the quarter of the type on SC260, Permanent Mortgages on Nonresidential Property (Except Land).
CF270: Land
Report the amount of mortgage loans disbursed during the quarter of the type on SC265, Permanent Mortgages on Land.
Include:
1. Developed building lots.
2. Land in the acquisition or development stage such as loans for making improvements required to convert to developed building lots.
3. Unimproved land.
Do not include:
1. Land used for farming. Report on CF260.
2. Combination land and construction loans. Report on CF190 through CF210.
LOANS AND PARTICIPATIONS PURCHASED, SECURED BY:
Include:
The purchase price of mortgage loans and participations purchased from other entities after adjusting for discounts, premiums, and LIP.
Do not include:
1. Transfers from an unconsolidated affiliate where you closed the loans in your name. Report as mortgage loans disbursed when originated.
2. Acquisitions of mortgage-backed securities. Report on CF143 and CF153.
CF280: 1-4 Dwelling Units
Report loans and participations purchased during the quarter of the types on SC230, Construction Loans on: 1-4 Dwelling Units, and SC251 through SC255, Permanent Mortgages on 1-4 Dwelling Units.
CF281: 1-4 Dwelling Units Purchased From Entities Other Than Federally-Insured Depository Institutions or Their Subsidiaries
Report loans and participations included in CF280 that were purchased from entities other than federally-insured depository institutions or their subsidiaries during the quarter that are included under CF280 and of the types on SC230, Construction Loans on: 1-4 Dwelling Units, and SC251 through SC255, Permanent Mortgages on 1-4 Dwelling Units.
CF282: Home Equity and Junior Liens
Report loans and participations included in CF280 that are of the type reported on SC251 and SC255.
CF290: Multifamily (5 or More) Dwelling Units
Report loans and participations purchased during the quarter of the types on SC235, Construction Loans on 5 or More Dwelling Units, and SC256, Permanent Mortgages on 5 or More Dwelling Units.
CF300: Nonresidential
Report loans and participations purchased during the quarter of the types on SC240, Construction Loans on Nonresidential Property, SC260, Permanent Mortgages on Nonresidential Property (Except Land), and SC265, Permanent Mortgages on Land.
LOANS AND PARTICIPATIONS SOLD, SECURED BY:
Include:
1. The carrying value of mortgage loans and participations sold to other entities or otherwise disposed of.
2. Securitized loans, both those sold and those you retain in your security portfolio. If you retain a portion of a loan securitization, report that portion as an acquisition on CF143 or CF153.
CF310: 1-4 Dwelling Units
Report loans and participations sold during the quarter of the types on SC230, Construction Loans on 1-4 Dwelling Units, and SC251 through SC255, Permanent Mortgages on 1-4 Dwelling Units.
CF311: Home Equity and Junior Liens
Report loans and participations included under CF310 that are of the type reported on SC251 and SC255.
CF320: Multifamily (5 or More) Dwelling Units
Report loans and participations sold during the quarter of the types on SC235, Construction Loans on 5 or More Dwelling Units, and SC256, Permanent Mortgages on 5 or More Dwelling Units.
CF330: Nonresidential
Report loans and participations sold during the quarter of the types on SC240, Construction Loans on Nonresidential Property; SC260, Permanent Mortgages on Nonresidential Property (Except Land); and SC265, Permanent Mortgages on Land.
CF361: MEMO: REFINANCING LOANS
Report the gross amount of refinanced or restructured mortgage loans during the quarter.
Include:
1. Both refinanced loans that you reported on CF190 through CF270 where the reporting institution held the original mortgage and refinanced loans where another institution held the original mortgage.
2. Any loan where the terms of the loan (principal, rate, or maturity) are modified, including TDRs.
3. The full amount of the new refinanced loan even though you report only the new amount disbursed on CF190 through C270.
4. All loans refinanced this quarter, even if you disbursed no new funds; these loans will not be reported on CF190 through CF270.
NONMORTGAGE LOANS:
Report the amount disbursed for commercial and consumer nonmortgage loans and financing leases. Include both loans originated by you and loans you purchased.
Include:
1. Disbursements made during the quarter on lines of credit.
2. Disbursements of LIP.
3. Disbursements made on loans even if the loans paid off or you sold them during the same quarter
– line-of-credit transactions and loans originated for sale.
Refer to the general instructions at the beginning of this schedule for reporting when there is a merger or bulk acquisition.
COMMERCIAL:
CF390: Closed or Purchased
Report disbursements of loans and financing leases that you originated or purchased during the quarter of the types on SC300 through SC306, Commercial Loans.
CF395: Sales
Report the carrying value of nonmortgage commercial loans you sold or otherwise disposed of during the quarter. Include commercial loans that you securitized, including both those securities sold and those retained in your portfolio.
CONSUMER:
CF400: Closed or Purchased
Report disbursements of loans and financing leases that you originated or purchased during the quarter of the types on SC310 through SC330, Consumer Loans.
CF405: Sales
Report the carrying value of nonmortgage consumer loans sold or otherwise disposed of during the quarter. Include consumer loans that have been securitized, including both those securities sold and those retained in your portfolio.
DEPOSITS
CF430: INTEREST CREDITED TO DEPOSITS
Report amount of interest and dividends credited during the quarter to accounts on SC710, Deposits.
In the case of a merger, include the following:
Merger with a savings association regulated by the OTS:
Report your combined interest credited and any from a savings association that you merged with for the full quarter, regardless of whether you used the purchase or pooling method of accounting. This should reflect the entire quarter’s interest credited regardless of the merger date.
Merger with depository institution not previously regulated by the OTS:
Do not report the interest credited by the acquired non-OTS depository institution before the merger date. After the merger date, report your interest credited combined with the merged institution.
Do not include:
1. Interest paid out in cash.
2. Accrued interest reported on SC763, Accrued Interest Payable – Deposits.
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SCHEDULE DI —CONSOLIDATED DEPOSIT INFORMATION
Throughout these instructions, you and your refers to the savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
DEPOSIT DATA:
TOTAL BROKER-ORIGINATED DEPOSITS:
DI100: Fully Insured
Report brokered deposits included on SC710, Deposits, and SC712, Escrows, and received from brokers, dealers, or agents, for the account of others where the individual account balance is equal to or less than the account insurance limit.
DI110: Other
Report brokered deposits included on SC710, Deposits, and SC712, Escrows, received from brokers, dealers, or agents, for the account of others where the individual account exceeds the account insurance limit. Report the full amount of the deposit, both insured and uninsured portions.
Based on the FDIC definition of deposits in Section 3(l), each institution must complete lines DI120 through DI185, DI210, DI510, DI520, and DI530 on an unconsolidated single FDIC certificate number basis. Each separately chartered depository institution that is insured by the FDIC has a unique FDIC certificate number. When an insured institution owns another depository institution as a subsidiary, each institution should report only its own deposit liabilities in this section (i.e., the parent institution should not combine the subsidiary institution’s deposit liabilities with its own in this section). Each of the above referenced lines should also include accrued interest that is reported on SC763 and exclude unposted debits and unposted credits.
The sum of DI120, DI130, DI170, and DI175 must equal the institution’s assessable deposits, i.e. line DI510, less DI520.
DEPOSITS (EXCLUDING RETIREMENT ACCOUNTS) WITH BALANCES:
DI120: $100,000 or Less
Report deposits (excluding retirement accounts) included on SC710, Deposits, and SC712, Escrows, and SC763, Accrued Interest Payable-Deposits, with current balances of $100,000 or less. Include broker-originated deposits (excluding retirement accounts) where the current balances of the investors’ participating shares are $100,000 or less.
DI130: Greater than $100,000
Report deposits (excluding retirement accounts) included on SC710, Deposits, and SC712, Escrows, and SC763, Accrued Interest Payable-Deposits, with current balances greater than $100,000. Include broker-originated deposits (excluding retirement accounts) where the current balances of the investors’ participating shares exceed $100,000.
NUMBER OF DEPOSIT ACCOUNTS (EXCLUDING RETIREMENT ACCOUNTS) WITH BALANCES:
DI150: $100,000 or Less
Report the actual number of accounts (excluding retirement accounts) that have outstanding balances including accrued interest of $100,000 or less. Do not report the outstanding balances. Report each investor participation in a broker-originated deposit (excluding retirement accounts) as a separate account. Report the actual number; do not round to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you hold and that you report on SC710, Deposits, and SC712, Escrows.
DI160: Greater than $100,000
Report the actual number of accounts (excluding retirement accounts) that have outstanding balances including accrued interest greater than $100,000. Do not report the outstanding balances. Report each investor participation in a broker-originated deposit as a separate account. Report the actual number; do not round to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you hold and that you report on SC710, Deposits, and SC712, Escrows.
RETIREMENT DEPOSITS WITH BALANCES:
DI170: $250,000 or Less
Report retirement deposits included on SC710, Deposits, and SC712, Escrows, and SC763, Accrued Interest Payable-Deposits, with current balances of $250,000 or less. Include broker-originated deposits where the current balances of the investors’ participating shares are $250,000 or less.
DI175: Greater than $250,000
Report retirement deposits included on SC710, Deposits, and SC712, Escrows, and SC763, Accrued Interest Payable-Deposits, with current balances greater than $250,000. Include broker-originated deposits where the current balances of the investors’ participating shares exceed $250,000.
NUMBER OF RETIREMENT DEPOSIT ACCOUNTS WITH BALANCES:
DI180: $250,000 or Less
Report the actual number of retirement accounts that have outstanding balances including accrued interest of $250,000 or less. Do not report the outstanding balances. Report each investor participation in a broker-originated retirement deposit as a separate account. Report the actual number; do not round to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you hold and that you report on SC710, Deposits, and SC712, Escrows.
DI185: Greater than $250,000
Report the actual number of retirement accounts that have outstanding balances including accrued interest greater than $250,000. Do not report the outstanding balances. Report each investor participation in a broker-originated retirement deposit as a separate account. Report the actual number; do not round to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you hold and that you report on SC710, Deposits, and SC712, Escrows.
DI200: IRA/KEOGH ACCOUNTS
Report IRA and Keogh accounts included in SC710, Deposits, and SC712, Escrows.
Include other retirement accounts such as SEP accounts.
Do not include:
1. 401(k) accounts.
2. Accounts that, under applicable tax laws, are predominantly for uses other than retirement.
DI210: UNINSURED DEPOSITS
Institutions with less than $1 billion in total assets are not required to complete this item. Institutions with $1 billion or more in total assets are required to report these data on a unconsolidated single FDIC certificate number basis. To determine whether to complete this item, use your institution's total assets from line SC60 as of the June 30 TFR prior to or current with the current reporting cycle. Once an institution passes the $1 billion total assets threshold, it must continue to report its estimated uninsured deposits regardless of subsequent changes in its total assets. Report the uninsured portion of all deposits and escrows in excess of insured limits pursuant to Section 141 of the FDIC Improvement Act, FDICIA.
You may not be able to precisely determine the amount of uninsured deposits due to the lack of information about interests by other parties in certain deposit accounts. However, you should diligently seek the best estimate of your uninsured deposits. You should derive the estimate from your existing information systems or personal knowledge of your depositor base.
The estimated amount of uninsured deposits reported in this item should be based on the institution’s deposits included in Schedule DI, line DI510, “Total deposit liabilities before exclusions (gross) as defined in Section 3(1) of the Federal Deposit Insurance Act and FDIC regulations,” less line DI520, “Total allowable exclusions (including foreign deposits)”. In addition to the uninsured portion of deposits in “domestic offices” reported in Schedule SC, line SC71, the estimate of uninsured deposits should take into account all other items included in Schedule DI, line DI510 less line DI520, including, but not limited to:
• Interest accrued and unpaid on deposits in domestic offices;
• Deposits in insured branches in Puerto Rico and U.S. territories and possessions (including interest accrued and unpaid on these deposits);
• Deposits on consolidated subsidiaries in domestic offices and in insured branches in Puerto Rico and U.S. territories and possessions (including interest accrued and unpaid on these deposits); and
• Deposit liabilities that have been reduced by assets netted against these liabilities in accordance with generally accepted accounting principles.
DI220: PREFERRED DEPOSITS
Report all deposits and escrows from states and political subdivisions in the U.S. included in SC710, Deposits, secured or collateralized as required under state law, pursuant to Section 141 of FDICIA.
Do not include:
1. Deposits of the U.S. Government secured or collateralized as required under federal law.
2. Deposits of trust funds secured or collateralized as required under state law unless the
beneficiary is a state or political subdivision in the U.S. State law may require you to pledge securities or other readily marketable assets to cover the uninsured portion of the deposits of a state or political subdivision. If you pledge securities with a value that exceeds the amount of the uninsured portion of the state or political subdivision’s deposits, report only the uninsured amount and none of the insured portion of the deposits as a preferred deposit.
For example, you hold a political subdivision’s $350,000 in deposits. Under state law, you must pledge securities to cover only the uninsured portion of such deposits, or $250,000. Although you have pledged securities with a value of $300,000 to secure these deposits, consider only $250,000 of the political subdivision’s $350,000 in deposits – the uninsured amount – as preferred deposits.
In other states, you must participate in a state public deposits program to receive deposits from the state or from political subdivisions within the state in amounts exceeding federal deposit insurance. Under state law, you calculate annually the value of the securities you must pledge to the state, but this represents only a percentage of the uninsured portion of your public deposits. State law may require you to participate in the state program that may ultimately require you to share in any loss to public depositors incurred in the failure of another participating institution.
As long as the value of the securities pledged to the state exceeds the calculated requirement, you protect all of your uninsured public deposits from loss under the operation of the state program if you fail. Therefore, consider all of the uninsured public deposits preferred deposits.
For example, you are participating in a state public deposits program with $1,000,000 in public deposits under the program and $700,000 of this amount is uninsured; you pledge securities with an actual value of $800,000. You should report the $700,000 in uninsured public deposits as preferred deposits.
COMPONENTS OF DEPOSITS AND ESCROWS:
The sum of DI310, DI320, DI330, and DI340 must equal SC710 plus SC712.
DI310: Transaction Accounts (Including Demand Deposits)
Report the balance of all transaction accounts included in SC710, Deposits, and SC712, Escrows.
Transaction accounts are those deposit and escrow accounts from which the depositor is permitted to make:
• Transfers or withdrawals by negotiable or transferable instruments.
• Payment orders of withdrawal, telephone transfers, or other similar devices for purpose of making payments or transfers to third persons or others.
• Third party payments at an automated teller machine (ATM), a remote service unit (RSU), or other electronic device, including by debit card.
Transaction accounts include demand deposits, NOW (negotiable order of withdrawal) accounts, ATS (automatic transfer service) accounts, and telephone and preauthorized transfer accounts. These accounts may be interest-bearing or non-interest-bearing.
Exclude money market deposit accounts (MMDAs) and other savings deposits as defined below in DI320 and DI330, even though such deposits permit some third-party transfers. However, report as a transaction account an account that otherwise meets the definition of a savings deposit but that authorizes or permits the depositor to exceed the transfer limitations specified for that account.
DI310 plus DI320 plus DI330 plus DI340 must equal SC710 plus SC712.
DI320: Money Market Deposit Accounts
Report the balance of money market deposit accounts (MMDAs) as defined in 12 CFR §561.28 or applicable state law.
MMDAs generally have the following requirements:
• The savings association reserves the right to require at least seven days’ notice prior to
withdrawal or transfer of funds in the account.
• The depositor may make no more than six transfers per calendar month or statement cycle, provided that no more than three of the six transfers may be by check, draft, debit card, or similar order.
Refer to 12 CFR §561.28 for more detailed requirements of MMDAs.
DI330: Passbook Accounts (Including Nondemand Escrows)
Report the balance of nontransactional savings accounts that are not MMDAs or time deposits.
DI340: Time Deposits
Report the balance of time deposits. Time deposits are nontransactional savings deposits payable at a specified future date with earnings at a specified rate of interest. The interest specified may adjust periodically according to a predetermined formula or index or may be fixed for the term of the deposit. The specified maturity date must be not less than seven days after the date of the deposit. Time deposits may be an open savings deposit or may be evidenced by a negotiable or nonnegotiable instrument or receipt commonly known as a certificate of deposit (CD). Open time deposits include club accounts, such as Christmas club and vacation club accounts, are made under written contracts that provide that no withdrawal may be made until the customer makes a certain number of periodic deposits or a certain period of time has elapsed.
Time deposits issued to deposit brokers in the form of large ($100,000 or more) certificates of deposit that have been participated out by the broker in shares of less than $100,000 should also be reported as deposits of $100,000 or less.
Data reported in lines DI350 and DI360 are used by the Federal Reserve to ensure accurate construction of the monetary aggregates for monetary policy purposes.
DI350: Time Deposits of $100,000 or Greater (Excluding Brokered
Time Deposits Participated Out by the Broker in Shares of
Less Than $100,000 and Brokered Certificates of Deposit
Issued In $1,000 Amounts Under a Master Certificate of
Deposit)
Report the balance of time deposits of $100,000 or greater. Do not include brokered time deposits participated out by the broker in shares of less than $100,000 and brokered certificates of deposit issued in $1,000 amounts under a master certificate of deposit.
DI360: IRA/Keogh Accounts of $100,000 or Greater Included in Time Deposits
Report the balance of IRA / Keogh accounts of $100,000 or greater included in time deposits.
DI610: NON-INTEREST-BEARING DEMAND DEPOSITS
Report all demand deposits reported on SC710, Deposits, and SC712, Escrows. FDIC Regulations 12 CFR § 329.1, 329.101, and 329.102 define the demand deposits to report on this line.
A demand deposit is a non-interest-bearing deposit with the following characteristics:
1. Is payable immediately on demand.
2. Is issued with an original maturity or required notice period of less than seven days.
3. Where the depository institution does not reserve the right to require at least seven days’ written notice of an intended withdrawal.
Demand deposits include:
1. Matured time deposits that do not have automatic renewal provisions, unless the deposit
agreement provides for the transfer of funds at maturity to another type of account.
2. Escrow accounts reported on SC712 that meet the definition of demand deposits.
3. Outstanding checks drawn against zero-balance accounts reported on SC710, including those at Federal Home Loan Banks.
Demand deposits do not include:
1. Money market deposit accounts, MMDAs.
2. NOW accounts not meeting the three criteria listed above for demand deposits.
3. Deposits held either in branches outside of the territories and possessions of the U.S. or by an Edge or Agreement Subsidiary or by an International Banking Facility (IBF).
4. Amounts not included in SC710 or SC712, such as outstanding checks drawn against Federal Home Loan Banks.
DEPOSIT DATA FOR DEPOSIT INSURANCE PREMIUM ASSESSMENTS
GENERAL INSTRUCTIONS
Each institution must complete lines DI510, DI520, and DI530 on an unconsolidated single FDIC certificate number basis. Each separately chartered depository institution that is insured by the FDIC has a unique FDIC certificate number. When an insured institution owns another depository institution as a subsidiary, each institution should report only its own deposit liabilities in this section (i.e., the parent institution should not combine the subsidiary institution’s deposit liabilities with its own in this section).
In addition, an institution that meets one of the criteria discussed below must complete lines DI540, DI550, and DI560 on an unconsolidated single FDIC certificate number basis each quarter.
Effective March 31, 2008, an institution that (a) reported $1 billion or more in total assets as of the March 31, 2007, report date (regardless of its asset size in subsequent quarters) or (b) became insured by the FDIC on or after April 1, 2007, but before January 1, 2008, must report both quarter-end balances and daily averages for the quarter in this section of Schedule DI. In addition, an institution that meets one of the following criteria must report both quarter-end deposit totals and daily averages in Schedule DI:
1. If an institution reports $1 billion or more in total assets in two consecutive Thrift Financial Reports subsequent to its March 31, 2007, report, the institution must begin reporting both quarter-end balances and daily averages for the quarter beginning on the later of the March 31, 2008, report date or the report date six months after the second consecutive quarter in which it reports total assets of $1 billion or more. For example, if an institution reports $1 billion or more in total assets in its reports for June 30 and September 30, 2007, it would have to begin reporting daily averages in its report for March 31, 2008. If the institution reports $1 billion or more in total assets in its reports for December 31, 2008, and March 31, 2009, it would have to begin reporting daily averages in its report for September 30, 2009.
2. If an institution becomes newly insured by the FDIC on or after January 1, 2008, the institution must report daily averages in Schedule DI beginning in the first quarterly Thrift Financial Report that it files. The daily averages reported in the first report the institution files after becoming FDIC-insured would include the dollar amounts for the days since the institution began operations and zero for the days prior to the date the institution began operations, effectively pro-rating the first quarter’s assessment base.
Any institution that reports less than $1 billion in total assets in its March 31, 2007, report may continue to report only quarter-end total deposits and allowable exclusions until it meets the two-consecutive-quarter asset size test for reporting daily averages. Alternatively, the institution may opt permanently at any time to begin reporting daily averages for purposes of determining its assessment base. After an institution begins to report daily averages for its total deposits and allowable exclusions, either voluntarily or because it is required to do so, the institution is not permitted to switch back to reporting only quarter-end balances.
The amounts to be reported as daily averages are the sum of the gross amounts of total deposits (domestic and foreign) and allowable exclusions for each calendar day during the quarter divided by the number of calendar days in the quarter (except as noted above for an institution that becomes insured on or after January 1, 2008, in the first report it files after becoming insured). For days that an office of the reporting institution (or any of its subsidiaries or branches) is closed (e.g., Saturdays, Sundays, or holidays), the amounts outstanding from the previous business day would be used. An office is considered closed if there are no transactions posted to the general ledger as of that date.
DI510: TOTAL DEPOSIT LIABILITIES BEFORE EXCLUSIONS
(GROSS) AS DEFINED IN SECTION 3(L) OF THE FEDERAL
DEPOSIT INSURANCE ACT AND FDIC REGULATIONS
Report on an unconsolidated single FDIC certificate number basis the gross total deposit liabilities as of the calendar quarter-end report date that meet the statutory definition of deposits in Section 3(l) of the Federal Deposit Insurance Act before deducting exclusions from total deposits that are allowed in the determination of the assessment base upon which deposit insurance assessments (and FICO premiums) are calculated. Since the FDIC’s amendments to its assessment regulations in 2006 did not substantially change the definition of deposits for assessment purposes, an institution’s gross total deposit liabilities are the combination of all deposits reported in line SC710 (excluding unposted credits net of unposted debits), all escrows reported in line SC712, and accrued interest payable on deposits reported in line SC763.
An institution’s documentation to support the amounts reported for purposes of determining its assessment base has always been, and continues to be, subject to verification. This documentation includes the actual system control summaries in the institution’s systems that provide the detail sufficient to track, control, and handle inquiries from depositors about their specific individual accounts. These systems can be automated or manual. If the system control summaries have been reduced by accounts that are overdrawn, these overdrawn accounts are extensions of credit that must be treated and reported as "loans" rather than being treated as negative deposit balances.
Unposted debits and unposted credits should not be included in an institution’s system control summaries. However, if they are included in the gross total deposit liabilities reported in this line, they may be excluded in line DI520 below.
DI520: TOTAL ALLOWABLE EXCLUSIONS (INCLUDING FOREIGN DEPOSITS)
Report, on an unconsolidated single FDIC certificate number basis, the total amount of allowable exclusions from deposits as of the calendar quarter-end report date if the institution maintains such records as will readily permit verification of the correctness of its reporting of exclusions. Any accrued and unpaid interest on the allowable exclusions listed below should also be reported in this item as an allowable exclusion.
The allowable exclusions include:
1. Foreign Deposits: As defined in Section 3(l)(5) of the Federal Deposit Insurance Act, foreign deposits include
(A)
any obligation of a depository institution which is carried on the books and records of an office of such bank or savings association located outside of any State, unless --
(i)
such obligation would be a deposit if it were carried on the books and records of the depository institution, and would be payable at, an office located in any State; and
(ii)
the contract evidencing the obligation provides by express terms, and not by implication, for payment at an office of the depository institution located in any State; and
(B)
any international banking facility deposit, including an international banking facility time deposit, as such term is from time to time defined by the Board of Governors of the Federal Reserve System in regulation D or any successor regulation issued by the Board of Governors of the Federal Reserve System.
NOTE: Foreign deposits are deposit obligations under the FDIC certificate number of the reporting institution only. Deposit obligations of a subsidiary depository institution chartered in a foreign country should not be included in amounts reported in Schedule DI under the domestic institution’s FDIC certificate number.
1. Reciprocal balances: Any demand deposit due from or cash item in the process of collection due from any depository institution (not including a foreign bank or foreign office of another U.S. depository institution) up to the total amount of deposit balances due to and cash items in the process of collection due such depository institution.
2. Drafts drawn on other depository institutions: Any outstanding drafts (including advices and authorization to charge the depository institution’s balance in another bank) drawn in the regular course of business by the reporting depository institution. These types of drafts only apply to unposted debits and unposted credits which have not been extracted from SC710 (due to the institution’s system control Summaries).
3. Pass-through reserve balances: Reserve balances passed through to the Federal Reserve by the reporting institution that are also reflected as deposit liabilities of the reporting institution. This exclusion is not applicable to an institution that does not act as a correspondent bank in any pass-through reserve balance relationship. A state nonmember bank generally cannot act as a pass-through correspondent unless it maintains an account for its own reserve balances directly with the Federal Reserve.
4. Depository institution investment contracts: Liabilities arising from depository institution investment contracts that are not treated as insured deposits under section 11(a)(5) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(5)). A Depository Institution Investment Contract is a separately negotiated depository agreement between an employee benefit plan and an insured depository institution that guarantees a specified rate for all deposits made over a prescribed period and expressly permits benefit-responsive withdrawals or transfers.
5. Accumulated deposits: Deposits accumulated for the payment of personal loans that are assigned or pledged to assure payment of the loans at maturity. Deposits that simply serve as collateral for loans are not an allowable exclusion.
DI530: TOTAL FOREIGN DEPOSITS (INCLUDED IN TOTAL ALLOWABLE EXCLUSIONS)
Report on an unconsolidated single FDIC certificate number basis the total amount of foreign deposits (including International Banking Facility deposits) as of the calendar quarter-end report date included in line DI520.
DI540: TOTAL DAILY AVERAGE OF DEPOSIT LIABILITIES BEFORE
EXCLUSIONS (GROSS) AS DEFINED IN SECTION 3(L) OF THE
FEDERAL DEPOSIT INSURANCE ACT AND FDIC
REGULATIONS
Report on an unconsolidated single FDIC certificate number basis the total daily average for the quarter of gross total deposit liabilities that meet the statutory definition of deposits in Section 3(l) of the Federal Deposit Insurance Act before deducting exclusions from total deposits that are allowed in the determination of the assessment base upon which deposit insurance assessments (and FICO premiums) are calculated. For further information on deposit amounts to be calculated, see the instructions for line DI510. For information on calculating the total daily average for the quarter, see the General Instructions for reporting Deposit Data for Deposit Insurance Assessment Purposes above.
DI550: TOTAL DAILY AVERAGE OF ALLOWABLE EXCLUSIONS (INCLUDING FOREIGN DEPOSITS)
Report on an unconsolidated single FDIC certificate number basis the total daily average for the quarter of the total amount of allowable exclusions from deposits (as defined in line DI520) if the institution maintains such records as will readily permit verification of the correctness of its reporting of exclusions.
DI560: TOTAL DAILY AVERAGE OF FOREIGN DEPOSITS
Report on an unconsolidated single FDIC certificate number basis the total daily average for the quarter of the total amount of foreign deposits (including International Banking Facility deposits) included in line DI550.
DEPOSIT DATA FOR THRIFTS PARTICIPATING IN THE TRANSACTION ACCOUNT GUARANTEE PROGRAM COMPONENT OF THE FDIC'S TEMPORARY LIQUIDITY GUARANTEE PROGRAM
The following items are to be reported by insured institutions that are participating in (i.e., have not opted out of) the Transaction Account Guarantee Program component of the FDIC's Temporary Liquidity Guarantee Program (TLGP). Thrifts would report noninterest-bearing transaction accounts (as defined in the FDIC’s Temporary Liquidity Guarantee Program regulations) of more than $250,000. (Do not include custodial or escrow accounts on which "pass-through" coverage applies).
DI570: AMOUNT OF NONINTEREST-BEARING TRANSACTION ACCOUNTS OF MORE THAN $250,000 (INCLUDING BALANCES SWEPT FROM NONINTEREST-BEARING TRANSACTION ACCOUNTS TO NONINTEREST-BEARING SAVINGS ACCOUNTS
DI575: NUMBER OF NONINTEREST-BEARING TRANSACTION ACCOUNTS OF MORE THAN $250,000
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SCHEDULE SI —SUPPLEMENTAL INFORMATION
Throughout these instructions, you and your refers to the savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
MISCELLANEOUS:
SI370: NUMBER OF FULL-TIME EQUIVALENT EMPLOYEES
Report the actual number of full-time equivalent employees employed by you and your consolidated subsidiaries. Report the actual whole number; do not round to thousands.
SI375: FINANCIAL ASSETS HELD FOR TRADING PURPOSES
Financial assets held for trading purposes are defined as securities and other financial assets that are bought and held for the purpose of short term resale or with the intent of benefiting from actual or expected price movements, and carried at fair value with the change in fair value reflected in current earnings. Trading generally reflects active and frequent buying and selling to generate profits in the short-term.
Report financial assets held for trading purposes on this line and also on SI376. Financial assets held for trading purposes reported on this line should include any trading securities accounted for under FASB Statement No. 115 where it is management’s intent to actively buy and sell such securities to generate profits in the short term.
SI376: FINANCIAL ASSETS CARRIED AT FAIR VALUE THROUGH EARNINGS
Report the balance of financial assets carried at fair value where the changes in fair value are reflected in current earnings under FASB Statement No. 115 (for trading securities), No. 133 (for derivatives), No. 155 (for hybrid instruments), and No. 159 (for all other financial assets where the fair value option is elected). Such assets are reported on various lines on Schedule SC and, therefore, the total of all assets reported at fair value is included on SC60. For example, derivative assets are included in SC689.
Include financial assets held for trading purposes on this line. Such assets are also reported on SI375.
Available-for-sale securities are financial assets carried at fair value. However for available-for-sale securities, the changes in fair value are not reflected in current earnings, but rather in other comprehensive income net of any deferred tax impact. Accordingly, do not include the balance of available-for-sale securities on this line. Rather, report such amount on SI385.
Under a “fair value option,” servicing assets may be carried at fair value with the changes in fair value reflected in current earnings. However, servicing assets are not financial assets. Accordingly, do not include the balance of any servicing assets on this line.
SI377: FINANCIAL LIABILITIES CARRIED AT FAIR VALUE THROUGH EARNINGS
Report the balance of financial liabilities carried at fair value where the changes in fair value are reflected in current earnings under FASB Statement No. 133 (for derivatives), No. 155 (for hybrid instruments), and No. 159 (for all other financial liabilities where the fair value option is elected). Such liabilities are reported on various lines on Schedule SC, and therefore the total of all net liabilities reported at fair value is included on SC70. For example, derivative liabilities are included in SC796.
SI385: AVAILABLE-FOR-SALE SECURITIES
Report all investments in debt securities including mortgage securities not classified as held-to-maturity or as trading, and all investments in equity securities that have readily determinable fair values that are accounted for pursuant to FASB Statement No. 115 and are not classified as trading. Do not include equity securities whose sale is restricted by governmental or contractual requirement – for example, FHLB stock. Include amounts reported on SC665, Interest-Only Strip Receivables and Certain Other Instruments, that are not classified as trading pursuant to FASB Statement No. 115.
Report available-for-sale securities at fair value. Exclude unrealized gains and losses from current earnings and report, net of taxes, as a separate component of equity on SC860, Unrealized Gains (Losses) on Available-for-Sale Securities, until realized. In addition, report certain nonsecurity financial instruments, CNFIs, classified as available-for-sale pursuant to FASB Statement No. 115.
Transfer securities from the available-for-sale category to held-to-maturity at fair value as of the date of transfer.
SI387: ASSETS HELD FOR SALE
Report all assets held for sale except securities and repossessed assets. Report assets held for sale at the lower of cost or market, LOCOM. Recognize unrealized losses in current earnings on SO465, Net Income (Loss) from LOCOM Adjustments Made to Assets Held for Sale.
Transfer assets from the ”for sale” category to an investment account at the lower-of-cost-or-market as of the date of transfer.
Include:
1. Loans and participations originated or purchased by you with the intent to sell.
2. Assets originally held for investment but now held for sale.
3. Assets held for sale, including real estate and branch offices, whether or not there is an outstanding commitment to sell.
Do not include:
1. Securities, report on SI385.
2. Repossessed assets.
SI390: LOANS SERVICED FOR OTHERS
Report the principal balance of mortgage and nonmortgage whole loans and participating interests in loans serviced by you, but owned by others.
Include:
1. Loans and securities that you sold to others but for which you perform the servicing.
2. Loans serviced by you for others, where the loans have been securitized, whether or not you own the securities and whether or not you have reported any servicing assets.
3. Loans serviced by you for others, where you have transferred the loans to others, but have not reported the transaction as a sale.
4. Loans and securities serviced by you under a contract to a third party who owns the servicing rights.
Do not include:
1. Loans and securities where you own the servicing rights and where the servicing has been subcontracted to a third party.
2. Loans and securities serviced for you by a consolidated subsidiary or a subsidiary depository institution.
RESIDUAL INTERESTS
Residual interests are defined in 12 CFR Part 567.1 as any balance sheet asset that represents an interest, including a beneficial interest, created by a transfer of financial assets that qualifies as a sale under GAAP and that exposes the institution to a credit risk that exceeds a pro rata share of the institution’s claim on the transferred assets. The transfer of assets may be through securitization or otherwise; the credit risk may be directly or indirectly associated with the transferred assets; and the exposure to credit risk may be through either subordination provisions or other credit enhancement techniques.
This definition of residual interests is for regulatory reporting purposes, and, therefore, is not the same as purchased or retained beneficial interests in securitized financial assets, as that term is used in authoritative accounting literature.
Examples of residual interests include, but are not limited to, credit-enhancing interest-only strips defined below, spread accounts, cash collateral accounts, and retained subordinated interests.
You report all residual interests somewhere on Schedule SC, typically on SC182, SC185, SC217 through 222,SC665, or SC689. The total of lines SI402 and SI404 should equal all residual interests, as defined above, that you have included on Schedule SC.
In addition, you should report the appropriate amounts in Schedule CC, on CC455 and CC465 or CC468, related to direct credit substitutes and recourse obligations. Also, as residual interests are subject to specialized regulatory capital treatment pursuant to 12 CFR Parts 567.6 and 567.12, you should report the appropriate amounts in Schedule CCR, on CCR133, CCR270, CCR375, and CCR605.
SI402: RESIDUAL INTERESTS IN THE FORM OF INTEREST-ONLY STRIPS
Report residual interests as defined above in the form of credit-enhancing interest-only strips.
Credit-enhancing interest-only strips are defined in 12 CFR Part 567.1 as any on-balance-sheet asset that, in form or in substance, represents the contractual right to receive some or all of the interest due on transferred assets, and that through subordination provisions or other credit enhancement techniques exposes the institution to credit risks that exceed its pro rata claim on the transferred assets.
Report both retained and purchased credit-enhancing interest-only strips. However, do not include interest-only strips issued by government-sponsored entities or other interest-only strips that do not function in a credit enhancing or otherwise subordinate capacity.
SI404: OTHER RESIDUAL INTERESTS
Report any other residual interests and on-balance-sheet recourse assets that you have not reported on SI402. Include purchased subordinated interests, purchased subordinated securities, and any other type of residual or recourse position that you have purchased from others. Do not include interest-only strips issued by the government or government sponsored enterprises, unless they meet the definition of residual interest in 12 CFR 567.1.
QUALIFIED THRIFT LENDER TEST
SI581, SI582, AND SI583: ACTUAL THRIFT INVESTMENT PERCENTAGE AT MONTH-END
To be a Qualified Thrift Lender, QTL, you must either meet the Home Owners’ Loan Act, HOLA, QTL test or the Internal Revenue Service tax code Domestic Building and Loan Association, DBLA, test.
If you use the HOLA QTL test, report the ATIP from the OTS QTL worksheets, OTS Form 1427, for the three months. If you use the IRS DBLA test, leave lines SI581, 582, and 583 blank, and complete SI585 and SI586.
IRS DOMESTIC BUILDING AND LOAN TEST:
Complete these lines only if you do not use the Home Owners’ Loan Act (HOLA) Qualified Thrift Lender (QTL) test, but instead use the IRS Domestic Building and Loan Association (DBLA) test (IRS regulation 26 CFR § 301.7701-13A) to determine if you are a Qualified Thrift Lender. Refer to Appendix A of the OTS Examination Handbook, Section 270.
SI585: PERCENT OF ASSETS TEST
SI586: DO YOU MEET THE DBLA BUSINESS OPERATIONS TEST?
SI588: AGGREGATE INVESTMENT IN SERVICE CORPORATIONS
Report your aggregate investment in the capital stock, loans and obligations, and other securities of all service corporations, determined in a manner consistent with 12 CFR Part 559.
Loans and obligations include all loans and other debt instruments, and all guarantees or take-out commitments of such loans or debt instruments.
For purposes of this reporting only, the measurement of the investment in capital stock should be based on the cost method, and not the equity method. Under the cost method, your investment in capital stock will include amounts paid to acquire the stock, but will not include accumulated undistributed earnings and losses of the service corporations. As a result, your aggregate investment reported on this line will likely differ from the related amount obtained from your accounting records and from the amount reported on SC540.
EXTENSIONS OF CREDIT BY THE REPORTING ASSOCIATION (AND ITS CONTROLLED SUBSIDIARIES) TO ITS EXECUTIVE OFFICERS, PRINCIPAL SHAREHOLDERS, DIRECTORS, AND THEIR RELATED INTERESTS AS OF THE REPORT DATE
Federal Reserve Regulation O defines the terms used in this item.
An extension of credit is a making or renewal of any loan, a granting of a line of credit, or an extension of credit in any manner whatsoever. Extensions of credit include, among others, loans, prearranged overdrafts, cash items, standby letters of credit, and securities purchased under agreements to resell. For lines of credit, the amount reported as an extension of credit is normally the total amount of the line of credit extended to the insider, not just the current balance of the funds that have been advanced to the insider under the line of credit. See 12 CFR § 215.3, Regulation O.
An executive officer of the reporting savings association is person who participates or has authority to participate, other than as a director, in major policy-making functions of the reporting savings association, an executive officer of the savings association’s holding company, and, unless excluded by the savings association’s board of directors or bylaws, any other subsidiary of that holding company. See 12 CFR § 215.2(e), Regulation O.
A director of the reporting savings association is person who is a director of the savings association, whether or not receiving compensation, a director of the holding company of which the savings association is a subsidiary, and, unless excluded by the savings association’s board of directors or bylaws, a director of any other subsidiary of that holding company. See 12 CFR § 215.2(d), Regulation
O.
A principal shareholder of the reporting savings association is an individual or a company other than an insured depository institution that directly or indirectly, or acting through or in concert with one or more persons, owns controls, or has the power to vote more than 10% of any class of voting stock of the reporting savings association. Regulation O considers shares owned or controlled by a member of an individual’s immediate family to be held by the individual. A principal shareholder includes a principal shareholder of a holding company of which the reporting savings association is a subsidiary and a principal shareholder of any other subsidiary of that holding company. See 12 CFR § 215.11(a)(1), Regulation O.
A related interest is either:
1. A company, other than an insured depository institution or a foreign bank that is controlled by an executive officer, director, or principal shareholder.
2. A political or campaign committee that is controlled by or the funds or services of which will benefit an executive officer, director, or principal shareholder. See 12 CFR § 215.11(a)(2), Regulation O.
SI590: AGGREGATE AMOUNT OF ALL EXTENSIONS OF CREDIT
Report the aggregate amount outstanding as of the report date of all extensions of credit by you and your controlled subsidiaries to all of your executive officers, principal shareholders, directors, and their related interests.
Include each extension of credit in the aggregate amount only one time, regardless of the number of borrowers.
SI595: NUMBER OF EXECUTIVE OFFICERS, PRINCIPAL
SHAREHOLDERS, AND DIRECTORS TO WHOM THE AMOUNT
OF ALL EXTENSIONS OF CREDIT (INCLUDING EXTENSIONS
OF CREDIT TO RELATED INTERESTS) EQUALS OR EXCEEDS
THE LESSER OF $500,000 OR FIVE PERCENT OF
UNIMPAIRED CAPITAL AND UNIMPAIRED SURPLUS (CCR30
+ CCR35 + CCR530 + CCR105)
Report the number of your executive officers, principal shareholders, and directors to whom the amount of all extensions of credit outstanding by you and your controlled subsidiaries as of the report date equals or exceeds the lesser of $500,000 or five percent of unimpaired capital and unimpaired surplus. That is, five percent x (CCR30 + CCR35 + CCR530 + CCR105). Report the actual number; do not round to thousands.
For purposes of this item, the amount of all extensions of credit by you and your controlled subsidiaries to an executive officer, principal shareholder, or director includes all extensions of credit by you to the related interests of the executive officer, principal shareholder, or director. A single extension of credit to more than one borrower must be included in full for all extensions of credit for each executive officer, principal shareholder, and director included in the credit. That is, one loan may be included more than once in the calculation of the $500 thousand or 5% of unimpaired capital and unimpaired surplus limit, because it will be included for each executive officer, principal shareholder, and director listed on the loan.
SUMMARY OF CHANGES IN SAVINGS ASSOCIATION EQUITY CAPITAL
SI600: SAVINGS ASSOCIATION EQUITY CAPITAL, BEGINNING BALANCE
The EFS software automatically generates this amount from your prior quarter’s SC80.
Special instructions for mergers and reorganizations:
• Purchase Mergers – Report SI680 for the previous quarter for the surviving savings association only.
• Change of Control involving pushdown accounting including receiverships – Report SI680 for the previous quarter. Adjustments should be reported on SI660.
SI610: NET INCOME (LOSS) ATTRIBUTABLE TO SAVINGS ASSOCIATION (SO91)
The EFS software automatically generates this amount from SO91.
DIVIDENDS DECLARED:
SI620: Preferred Stock
Report the dollar amount of cash dividends declared during the period on preferred stock. These dividends are not charged to interest expense, but directly reduce retained earnings.
Include:
Dividends declared on preferred stock reported on SC812 and SC814.
SI630: Common Stock
Report the dollar amount of cash dividends declared during the period for common stock reported on SC820. These dividends are not charged to interest expense, but directly reduce retained earnings. Include cash dividends made to holding companies as well as to individual shareholders.
Do not include:
1. Stock dividends.
2. Stock splits.
3. Property dividends. Report on SI670.
SI640: STOCK ISSUED
Report the amount of cumulative and noncumulative perpetual preferred stock and common stock issued during the quarter.
Include:
1. Perpetual preferred stock, including discounts and premiums, issued by you during the quarter that qualifies as equity under GAAP.
2. The par value and paid-in-capital received in connection with the stock issue.
Do not include:
1. The conversion of preferred stock into common stock.
2. Gains on treasury stock sold. Report on SI670.
3. Capital contributed not connected with a stock issue. Report on SI670.
When applying push-down accounting, report the amount paid in a change of control for your stock. Report the previously recorded par value and capital in excess of par value on SI650.
SI650: STOCK RETIRED
Report the amount paid for common and perpetual preferred stock retired during the quarter. Report the amount as a positive number.
When applying push-down accounting, report the previously recorded par value and capital paid in excess of par value of the stock acquired by the new owners. The amount paid for this stock is reported on SI640.
SI655: CAPITAL CONTRIBUTIONS (WHERE NO STOCK IS ISSUED)
Report increases during the quarter in SC830, Common Stock: Paid in Excess of Par, that came from stockholders but that did not result from the issuing of stock.
Include the fair value of employee stock options granted as compensation.
Also include as a negative amount property distributions to stockholders. Record the transfer of dividends other than cash at the fair value of the asset on the declaration date of the dividend. Recognize a gain or loss on the transferred asset in the same manner as if you disposed of the property in an outright sale at or near the declaration date.
SI660: NEW BASIS ACCOUNTING ADJUSTMENTS
Include:
1. Adjustments made during the period in applying push-down accounting in the change-of-control.
2. Adjustments made in accounting for a savings association taken into receivership during the period.
SI662: OTHER COMPREHENSIVE INCOME
The EFS software automatically generates this amount as the change during the quarter in SC86, Accumulated Other Comprehensive Income: Total.
Other comprehensive income includes the change in:
1. Accumulated unrealized fair value gains and losses on available-for-sale securities, net of taxes.
2. Accumulated fair value gains and losses on cash flow hedges, net of taxes.
3. Any minimum pension liability adjustment recognized in accordance with FASB Statement No. 87, Employers’ Accounting for Pensions, net of taxes and FAS Statement No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans.
4. Cumulative foreign currency translation adjustments and qualifying foreign currency transaction
gains and losses, net of taxes. .
SI668: PRIOR PERIOD ADJUSTMENTS
Prior period adjustments for purposes of the TFR include:
1. Changes to a beginning balance of equity capital pursuant to transition requirements under newly adopted FASB Statements such as SFAS No. 154 and SFAS No. 159.
2. Corrections to an income statement for a quarter from a prior calendar year where the TFR for that quarter can no longer be amended.
3. Cumulative effects of an accounting change under FAS159 and FIN48.
Also refer to item number 6 in the General Instructions for the TFR.
Do not include:
1. Audit adjustments and prior period adjustments within the current calendar year. Correct these through an amended report within 140 days of the report date or report them currently in Schedule SO.
2. Corrections of accruals. Report these in the current period in the same data field in Schedule SO that they would have been reported had the accruals been made when incurred.
SI671: OTHER ADJUSTMENTS
Report other adjustments to equity capital that cannot be included elsewhere in SI610 through SI668.
Include:
1. Issuance costs of common stock offerings.
2. The change in SC891, Other Components of Equity Capital.
Do not include:
1. Property distributions to stockholders; report as a negative amount on SI655.
2. Prior period adjustments to prior calendar years; report on SI668.
3. Additional contributions of paid-in capital; report on SI655.
4. Adjustments within the current calendar year. Correct these through an amended report within 135 days of the report date, or report them currently in Schedule SO.
5. Corrections of accruals. Report these in the current period in the same data field in Schedule SO that they would have been reported had the accruals been made when incurred.
SI680: TOTAL SAVINGS ASSOCIATION EQUITY CAPITAL, ENDING BALANCE (SC80)
The EFS software automatically calculates this as the sum of SI600, SI610, SI640, SI655, SI660, SI662, SI668, and SI671 less SI620, SI630, and SI650. SI680 must equal SC80, Total Savings Association Equity Capital, on the current TFR.
TRANSACTIONS WITH AFFILIATES:
The following two line items parallel 12 CFR 563.41, Transactions with Affiliates. Section 563.41(c)(3) requires each association to maintain records that reflect all transactions between a savings association and its affiliates.
Section 563.41 implements the affiliate transactions regulation found in Sections 23A and 23B of the Federal Reserve Act, as codified in 12 CFR Part 223 (Regulation W). Sections 23A and 23B of the Federal Reserve Act are made applicable to savings associations by Section 11(a)(1) of the Home Owners’ Loan Act. You should include transactions subject to the quantitative limits of Section 23A in SI750. Include all other covered affiliate transactions in SI760, including transactions subject only to Section 23B.
Affiliate and covered transaction are defined in Regulation W, as modified as appropriate for savings associations in Section 563.41. Generally, an affiliate is defined as:
1. Your parent company.
2. Any company controlled by your parent company that is not a subsidiary of yours (except a bank or thrift subsidiary of yours).
3. Any company that you or another affiliate sponsors or advises.
4. Any company which shares a majority of the same directors with you or your parent company.
Information in this section is not made public on an individual institution basis, but is available in the OTS aggregates.
SI750: ACTIVITY DURING THE QUARTER OF COVERED
TRANSACTIONS WITH AFFILIATES SUBJECT TO
QUANTITATIVE LIMITS
Report all covered affiliate transactions subject to quantitative limits. Generally, these include:
• All purchases of assets by you from affiliates. This includes all commitments outstanding at the end of the quarter to purchase assets entered into with affiliates that will close in your name. Report such commitments on a gross basis. Do not net commitments to sell against commitments to purchase, even if the commitments are for the same or similar items and even if you will disburse or receive no cash.
• All extensions of credit to affiliates. This includes, but is not limited to, loans and receivables whether or not supported by a loan document or contract; purchasing a note or other obligation of an affiliate, as well as loan guarantees or letters of credit on behalf of an affiliate. Acceptance of a security issued by an affiliate as collateral for an extension of credit to any third party.
Include all transactions that occurred during the quarter, regardless of whether you have paid affiliates during the quarter or owe the amount as of the end of the quarter.
SI760: ACTIVITY DURING THE QUARTER OF OTHER COVERED
TRANSACTIONS WITH AFFILIATES NOT SUBJECT TO
QUANTITATIVE LIMITS
Report all other affiliate transactions that are not included in SI750. Generally, these include:
• The sale of securities or other assets from you to an affiliate, including assets subject to a repurchase agreement.
• Your payment of funds to, or furnishing of services to, an affiliate, including such tasks as
collection of debt payments, data processing, maintenance, office supplies or payroll.
• Any transaction in which an affiliate receives an agency or broker’s fee from you for its services on behalf of you or a third party.
Include all transactions that occurred during the quarter, regardless of whether you have paid affiliates during the quarter or owe the amount as of the end of the quarter.
MUTUAL FUND AND ANNUITY SALES:
SI805: DO YOU SELL PRIVATE-LABEL OR THIRD-PARTY MUTUAL FUNDS AND ANNUITIES?
Respond Yes if you, your subsidiaries, affiliates, or an unaffiliated entity sells private label or third party mutual funds or annuities:
1. On your premises;
2. From which you receive income at the time of the sale or over the duration of the account (for example, annual fees, trailer fees, or redemption fees); or
3. Through your trust department in transactions that are not executed in a fiduciary capacity (for
example, trustee, executor, administrator, or conservator). Mutual fund is the common name for an open-end investment company whose shares are sold to the investing public.
An annuity is an investment product, typically underwritten by an insurance company, that pays either a fixed or variable payment stream over a specified period of time.
Both proprietary and private label mutual funds and annuities are established for the purpose of marketing primarily to your customers or customers of your affiliates. A proprietary product is a product for which the reporting institution or its subsidiary or other affiliate acts as investment adviser and may perform additional support services. In a private label product, an unaffiliated entity acts as the investment adviser. The identity of the investment adviser is normally disclosed in the prospectus for a mutual fund or annuity. Mutual funds and annuities that are not proprietary or private label products are considered third party products. For example, third party mutual funds and annuities include products that are widely marketed by numerous parties to the investing public and have investment advisers that are not affiliated with the reporting institution.
SI815: TOTAL ASSETS YOU MANAGE OF PROPRIETARY MUTUAL FUNDS AND ANNUITIES
Report the amount of assets held by mutual funds and annuities as of the report date for which you or your subsidiaries act as investment adviser.
SI860: FEE INCOME FROM THE SALE AND SERVICING OF MUTUAL FUNDS AND ANNUITIES
Report the amount of income that you earned during the quarter from the sale and servicing of mutual funds and annuities.
In general, this income is included in the amount reported on SO420, Other Fees and Charges. Report the income included in this item gross rather than net of expenses incurred by you or your consolidated subsidiary.
Include:
1. Income earned in connection with mutual funds and annuities that are sold on your premises or sold by you, through a subsidiary, or by affiliated or unaffiliated entities from which you receive income. This income may be in the form of fees or sales commissions at the time of the sale or fees, including a share of another entity’s fees, that are earned over the duration of the account – for example, annual fees, Rule 12b-1 fees or trailer fees, and redemption fees. Report commissions as income when earned on an accrual basis at the time of the sale. However, you may report income when payment is received if the results would not differ materially from those obtained using an accrual basis.
2. Income from leasing arrangements with affiliated and unaffiliated entities who lease space in your offices for use in selling mutual funds and annuities. Income from leasing arrangements should be reported on an accrual basis, when earned, but may be reported as income when payment is received if the results would not differ materially from those obtained using an accrual basis.
3. Fees for providing investment advisory services for mutual funds and annuities that are sold on your premises or sold, through a subsidiary, or by affiliated or unaffiliated entities from which you receive income.
4. Fees for providing securities custody, transfer agent, and other operational and ancillary services to mutual funds and annuities that are sold on bank premises or sold by you, through a subsidiary, or by affiliated or unaffiliated entities from which you receive income.
Do Not Include:
1. Fees earned for services provided to mutual funds that are not sold by you, through a subsidiary, or by affiliated or unaffiliated entities with whom the savings association has sales relationships.
2. Do not include mutual fund and annuity fee income reported in Schedule FS.
AVERAGE BALANCE SHEET DATA (BASED ON MONTH-END DATA)
Report average balance sheet data for the quarter. At a minimum, compute these data based on balances at month-end. However, you may compute these data based on other than month-end balances, such as daily or weekly balances. All balances should be as reported in Schedule SC. For example, the balance of loans should reflect premiums, discounts, deferred loan fees, allowances for credit losses, etc. Each month's average should be computed using the prior month's ending balance plus the current month's ending balance divided by two. For example, the balance at December 31 is considered to be the beginning balance at January 1. The average for the three months in the quarter should then be summed and divided by three.
In the case of a business combination accounted for using the purchase method of accounting or acquisition by a holding company where you used pushdown accounting, you should include amounts for the acquired entity from the date of its acquisition through the end of the quarter.
Example of Averaging:
Balances
Month Beginning Ending Average
December N/A 1,500 N/A
January 1,500 1,575 1,538
February 1,575 1,550 1,563
March 1,550 1,695 1,623
Sum 4,724
Quarter Average Balance = $4,724 / 3 = $ 1,575
If you consummated a merger on February 20, the calculation would be as follows:
December January February pre-merger February post-merger
Beginning N/A 1,500 1,575 3,200
Ending 1,500 1,575 1,550 3,280
Average N/A 1,538 1,563 3,240
x x
Adjustment 19 days = 29,698 9 days = 29,160
Adjusted Average N/A 1,538

(29,698+ 29,160)/28
2,102
March
3,280
3,965
3,623

3,623
Sum

7,263
Quarter Average Balance = $7,263 / 3 = $2,421
SI870: TOTAL ASSETS
Report your average assets for the quarter based on the calculation explained above using total assets reported on SC60.
SI875: DEPOSITS AND INVESTMENTS EXCLUDING NON-INTERESTEARNING ITEMS
Report your average deposits and investments for the quarter based on the calculation explained above using interest-earning deposits and investments reported on SC112 through SC185. Do not include mortgage loans and mortgage-backed securities included in SI880.
If you invest in adjustable rate products on which the interest rate has been reduced to zero as a result of market conditions, you should continue to report such investments in these averages.
SI880: MORTGAGE LOANS AND MORTGAGE-BACKED SECURITIES
Report your average mortgage loans and mortgage-backed securities for the quarter based on the calculation explained above using mortgage loans and mortgage-backed securities reported on SC210 through SC222 and SC230 through SC265.
SI885: NONMORTGAGE LOANS
Report your average nonmortgage loans for the quarter based on the calculation explained above using nonmortgage loans reported on SC300 through SC330.
SI890: DEPOSITS AND ESCROWS
Report your average interest-earning deposits and escrows for the quarter based on the calculation explained above using interest-earning deposits included in SC710 and SC712. If you offer deposit products on which you periodically adjust the interest rate, and the interest rate has been reduced to zero as a result of market conditions, you should continue to report such deposits as interest-bearing accounts in these averages.
SI895: TOTAL BORROWINGS
Report your average interest-bearing borrowings for the quarter based on the calculation explained above using interest-bearing borrowings reported on SC720 through SC760.
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SCHEDULE SQ — CONSOLIDATED SUPPLEMENTAL QUESTIONS
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision. However, in this schedule, you should answer all questions except SQ310 based on your data alone, and not on your consolidated subsidiaries’ data. SQ310 applies to both you and your consolidated subsidiaries.
Indicate whether an activity occurred during the period by placing an X in either the Yes or No column of each question. No question that can be answered with a yes or no should be left blank. Check Yes if there is any doubt as to whether an activity occurred during the quarter.
SQ270: Your fiscal year-end (MM)
Enter the month of your current fiscal year-end for audited financial statement purposes. In some cases this may not correspond to the tax year-end.
SQ280: Code representing nature of work to be performed by independent public accountants for the current fiscal year
Enter the code for the statement below that best describes the level of audit or other attestation work – such as review, compilation, or agreed-upon procedures – that an independent public accountant will have performed by the end of your current fiscal year. The current fiscal year is the 12-month period that includes the quarter that you are reporting.
07 You do not plan to have an audit or other attestation work by an independent public accountant. 08 You do not plan to have an audit. However, you do plan to have other attestation work performed and reported on by an independent public accountant. 09 You plan to have an audit of, and receive a report on, only the holding company’s consolidated financial statements by an independent public accountant.
Use this code where plans are for an audit and report on:
a.Only your holding company’s consolidated financial statements.
b.Not your separate financial statements.
1. Your holding company’s consolidated financial statements include, by consolidation, your financial statements. Use code 10 for an audit and report on, your separate financial statements.
10 You plan to have an audit of, and receive a report on, your financial statements by an
independent public accountant.
1. Use this code where plans are for an audit and report on:
a.
Only your separate financial statements, or
b.
Both your separate financial statements and your holding company’s consolidated financial statements.
2. Use code 09 for an audit of, and report on, only the holding company’s consolidated financial statements.
SQ300: Did you change your independent public accountant during the quarter?
Check yes if you did one or both of the following:
• Gave notice to your prior independent public accountant terminating his engagement.
• Engaged a successor accountant.
SQ310: Did you and your consolidated subsidiaries have any outstanding futures or options positions at quarter end?
SQ320: Do you have a Subchapter S election in effect for federal income tax purpose for the current year?
SQ410: Have you been consolidated with your parent in another TFR? If so, enter the OTS docket number of your parent savings association.
SQ420: Have you been consolidated with your parent in a Commercial Bank Call Report? If so, enter the FDIC certificate number of your parent commercial bank.
SQ530: If you have a web page on the Internet, indicate your main Internet home page address (for transactional or nontransactional web sites).
Report your main Internet home page address, even if you do not have a transactional web site. This field has a maximum of 78 characters.
SQ540: Do you provide transactional Internet banking to your customers, as defined in 12 CFR 555.300(b)?
Respond Yes if you have a transactional Internet banking web site. Transactional Internet banking web sites are defined in 12 CFR 555.300(b).
SCHEDULE SB — CONSOLIDATED SMALL BUSINESS LOANS
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete this schedule annually using data as of June 30.
SB010: DO YOU HAVE ANY SMALL BUSINESS LOANS TO REPORT IN THIS SCHEDULE?
Respond No if you have no loans meeting the definitions of small business loans as defined in this schedule for agricultural and nonagricultural purposes. Respond Yes if you have loans to report in Schedule SB. If you respond No, you should not complete any other lines in this schedule.
You should respond No and leave the remaining of Schedule SB blank if the following are true: (1) you and your consolidated subsidiaries have no loans reported on SC260, 300, 303, and 306; (2) your business loans and those of your consolidated subsidiaries only have original amounts, as defined below, exceeding $1 million; (3) your farm loans only have original amounts exceeding $500 thousand.
LOANS TO SMALL BUSINESSES AND SMALL FARMS:
Complete the following data annually on June 30 for yourself and your consolidated subsidiaries to comply with Section 122 of the FDIC Improvement Act.
When you report the number and amount of business loans currently outstanding with original amounts of $1 million or less and farm loans with original amounts of $500 thousand or less, use the following guidelines:
1. For loans drawn down under lines of credit or loan commitments, the original amount of the loan is the amount existing when the line of credit or loan commitment was most recently approved, extended, or renewed prior to the report date. However, if the amount currently outstanding as of the report date exceeds this size, the original amount is the amount currently outstanding.
2. For loan participations and syndications, the original amount of the loan participation or
syndication is the entire amount of the credit originated by the lead lender.
3. For all other loans, the original amount is the total amount of the loan at origination or the
amount currently outstanding as of the report date, whichever is larger. The amount outstanding is the amount reported on Schedule SC as of the report date and should be reported net of loans in process, specific valuation allowances, and yield adjustments to the extent possible.
Report the actual number of loans. Do not round to the nearest thousand.
Do not include loans to subsidiaries eliminated in consolidation.
Except as noted below for corporate or business credit card programs, when you determine original amounts and report the number and amount currently outstanding for a category of loans in this schedule, you should compute the amounts as follows: combine multiple loans to one borrower and report them on an aggregate basis rather than as separate individual loans, to the extent that you do not incur undue cost to obtain such aggregate individual borrower data. If the burden of such aggregation would be excessive, you may report multiple loans to one borrower as separate individual loans.
If you offer corporate or business credit card programs where credit cards are issued to one or more of a company’s employees for business-related use, you should treat each company’s entire credit card program as a single extension of credit. You should total the credit limits for all of the individual credit cards issued to the company’s employees, and treat this total as the original amount of the corporate or business credit card program established for this company. The company’s program should be reported as one loan and the amount currently outstanding would be the sum of the credit card balances as of the June 30 report date on each of the individual credit cards issued to the company’s employees. However, when aggregated data for each individual company in a corporate or business credit card program are not readily determinable from your credit card records, you should develop reasonable estimates of the number of corporate or business credit card programs that exist as of the report date, the original amounts of these programs, and the amounts currently outstanding of these programs and should then report information about these programs on the basis of your reasonable estimates. In no case should individual credit cards issued to a company’s employees under a corporate or business credit card program be reported as separate individual loans to small businesses.
SB100: Do you have any loans secured primarily by farms reported
on SC260 or any loans to finance agricultural production or
other loans to farmers reported on SC300, 303, or 306?
Answer Yes to this question only if the agricultural and farm loans had original amounts, as defined above, of $500 thousand or less.
If yes, complete lines 300 through 650; do not complete 110 through 210. If no, complete the following item, 110.
SB110: Are all or substantially all of your commercial loans (Schedule
SC lines 260, 300, 303, and 306) loans with original amounts
of $100,000 or less?
Indicate yes and complete only the following lines, 200 and 210, if:
1. The average amount outstanding of your commercial, nonfarm loans that you reported on
Schedule SC lines 260, 300, 303, and 306 is $100 thousand or less and
2. Based on your loans and other relevant information, your lending officer believes that all or substantially all of your commercial loans have original amounts, as defined above, of $100 thousand or less.
Otherwise, indicate no and complete lines 300 through 450.
SB200: Number of loans reported on line SC260
Report the actual number – do not round to thousands – of loans reported on SC260, Permanent Mortgages on Nonresidential Property. Complete this line only if line 100 is no and 110 is yes – that is, all of the loans reported on SC260, 300, 303, and 306 are nonfarm loans and substantially all of the original amounts of the loans are $100 thousand or less.
SB210: Number of loans reported on SC300, 303, and 306
Report the actual number – do not round to thousands – of loans reported on SC300, 303, and 306, Nonmortgage Commercial Loans. Complete this line only if line 100 is no and 110 is yes; that is, all of the loans reported on SC260, 300, 303, and 306 are nonfarm loans and substantially all of the original amounts of the loans are $100 thousand or less.
NUMBER AND AMOUNT OUTSTANDING OF PERMANENT MORTGAGE LOANS SECURED BY NONFARM, NONRESIDENTIAL PROPERTIES REPORTED ON SC260:
Number of Loans with Original Amounts of: SB300: $100,000 or less SB320: Greater than $100,000 thru $250,000 SB340: Greater than $250,000 thru $1 million Outstanding Balance with Original Amounts of: SB310: $100,000 or less SB330: Greater than $100,000 thru $250,000 SB350: Greater than $250,000 thru $1 million
NUMBER AND AMOUNT OUTSTANDING OF NONMORTGAGE, NONAGRICULTURAL COMMERCIAL LOANS REPORTED ON SC300, 303, AND 306:
Number of Loans with Original Amounts of: SB400: $100,000 or less SB420: Greater than $100,000 thru $250,000 SB440: Greater than $250,000 thru $1 million Outstanding Balance with Original Amounts of: SB410: $100,000 or less SB430: Greater than $100,000 thru $250,000 SB450: Greater than $250,000 thru $1 million
NUMBER AND AMOUNT OUTSTANDING OF LOANS SECURED PRIMARILY BY FARMS REPORTED ON SC260: Number of Loans with Original Amounts of: SB500: $100,000 or less SB520: Greater than $100,000 thru $250,000 SB540: Greater than $250,000 thru $500,000 Outstanding Balance with Original Amounts of: SB510: $100,000 or less SB530: Greater than $100,000 thru $250,000 SB550: Greater than $250,000 thru $500,000
NUMBER AND AMOUNT OUTSTANDING OF NONMORTGAGE, COMMERCIAL LOANS TO FINANCE AGRICULTURAL PRODUCTION AND OTHER NONMORTGAGE COMMERCIAL LOANS TO FARMERS REPORTED ON SC300, 303, AND 306:
Number of Loans with Original Amounts of: SB600: $100,000 or less SB620: Greater than $100,000 thru $250,000 SB640: Greater than $250,000 thru $500,000 Outstanding Balance with Original Amounts of: SB610: $100,000 or less SB630: Greater than $100,000 thru $250,000 SB650: Greater than $250,000 thru $500,000
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SCHEDULE FS — FIDUCIARY AND RELATED SERVICES
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete Schedule FS on a consolidated basis, including the fiduciary or related services of any significant, majority-owned operating subsidiaries or service corporations.
The information reported on FS310 through FS35, on fiduciary and related services income and FS710 through FS72 on fiduciary settlements, surcharges and other losses will not be made available to the public on an individual association basis. All other information on this schedule will be made available to the public.
The income and expense data reported on FS310 through FS35 and the fiduciary settlements, surcharges, and other losses reported on FS710 through FS72 must be reported for the calendar year-to-date.
FS110: DOES YOUR INSTITUTION HAVE FIDUCIARY POWERS?
Check Yes if OTS, a state, or another banking authority has granted you trust powers to administer accounts in a fiduciary capacity. You should check Yes if your significant, majority-owned subsidiaries have been granted trust powers by OTS, a state, or another banking authority. If you check No, you should not complete the remainder of this schedule. Fiduciary capacity generally includes acting as a trustee, executor, administrator, registrar of stocks and bonds, transfer agent, assignee, receiver, guardian or conservator of the estate of a minor or incompetent, investment adviser (if you receive a fee for your investment advice), any capacity in which you possess investment discretion on behalf of another, or any other similar capacity.
FS120: DOES YOUR INSTITUTION EXERCISE THE FIDUCIARY POWERS IT HAS BEEN GRANTED?
Check Yes if you exercise your fiduciary powers. Exercising fiduciary powers means that you serve in a fiduciary capacity as described in the instructions for FS110.
FS130: DOES YOUR INSTITUTION HAVE ANY FIDUCIARY OR
RELATED ACTIVITY (IN THE FORM OF ASSETS OR
ACCOUNTS) TO REPORT IN THIS SCHEDULE?
Check Yes if you have assets, accounts, or income from fiduciary or related services. You should check No if you have trust powers and only use those powers to provide services in connection with land trusts or if you act as a document custodian for mortgage-backed securities, such as those offered by Fannie Mae (FNMA), Freddie Mac (FHLMC), or Ginnie Mae (GNMA). If you have trust powers and provide land trust or document custodian services, along with other fiduciary or related services reportable on this schedule, you should not include your land trust or document custodian activities on this schedule. If you check No, do not complete the remainder of this schedule.
Reportable related services are those services that do not require trust powers but are related to fiduciary services. Specifically, this includes custodial services for assets held by you in a fiduciary capacity. You should report on this schedule fiduciary related services that are offered through your trust department, fiduciary business unit, or other distinct department or business unit that is devoted to the provision of fiduciary or related services. You should not include custodial services provided to retail bank accounts. Retail bank accounts may include brokerage accounts, escrow accounts that benefit third parties, safety deposit boxes, and other similar arrangements.
FILING REQUIREMENTS
If your answer to FS130 is Yes, complete the applicable items of Schedule FS as follows:
If your total fiduciary assets (items FS20 and FS21) are greater than $250 million or for the preceding calendar year your gross fiduciary and related services income was greater than 10 percent of revenue (net interest income plus noninterest income), you must complete:
1. Items FS210 through FS30 each quarter;
2. Items FS391 through FS35 annually with the December report; and
3. Memorandum items FS410 through FS72 annually with the December report. If your total fiduciary assets (items FS20 and FS21) are greater than $100 million but less than or equal to
$250 million and for the preceding calendar year your gross fiduciary and related services income was not greater than 10 percent of revenue (net interest income plus noninterest income), you must complete:
1. Items FS210 through FS291 each quarter; and
2. FS310 through FS35 and all memorandum items, FS410 through FS72, annually with the
December report. If your total fiduciary assets (items FS20 and FS21) are $100 million or less or for the preceding calendar year your gross fiduciary and related services income was not greater than 10 percent of revenue (net interest income plus noninterest income), you must complete:
1. Items FS210 through FS291 each quarter; and
2. Memorandum items FS410 through FS65 annually with the December report.
FIDUCIARY AND RELATED ASSETS
Report fiduciary and related assets using market value as of the report date. While market value quotations are readily available for marketable securities, many financial and physical assets held in fiduciary accounts are not widely traded or easily valued. If the methodology for determining market values is not set or governed by applicable law (including state or federal law governing the fiduciary relationship, the terms of an instrument governing the fiduciary relationship, or any court order pertaining to the relationship), you may use any reasonable method to establish values for purposes of reporting on this schedule. Reasonable methods may include appraisals, book value, or reliable estimates. Valuation methods should be consistent from reporting period to reporting period. This “reasonable method” approach to reporting market values applies both to financial assets that are not marketable and to physical assets. Physical assets held in fiduciary accounts may include equipment, art, collectibles, and household goods.
If two institutions are named cofiduciary in the governing instrument, both institutions should report the account. In addition, where one institution provides fiduciary or related services to another institution’s accounts (for example: Bank A provides custody services to the trust accounts of Bank B; or Bank A provides investment management services to the trust accounts of Bank B) both institutions should report the accounts, according to the services provided.
Exclude unfunded trusts, anticipated testamentary executor appointments, and any other arrangements that represent potential future fiduciary accounts.
Report asset values net of any outstanding liabilities. For example, report: (1) an employee benefit account with participant loans net of the outstanding loan balances; (2) an account with a real estate asset and corresponding mortgage loan net of the mortgage liability; (3) gross fiduciary assets net of any associated overdrafts; and (4) gross assets net of the fair value of derivative instruments, as defined in FASB Statement No. 133, even if the fair value is negative.
Reflect securities borrowing/lending transactions as sales or as secured borrowings according to GAAP, as principally prescribed in FASB Statement No. 140. A transferee (borrower) of securities generally is required to provide collateral to the transferor (lender) of securities. When such transactions do not qualify as sales, securities lenders and borrowers should account for the transactions as secured borrowings in which cash (or securities that the holder is permitted by contract or custom to sell or repledge) received as collateral by the securities lender is considered the amount borrowed and the securities loaned are considered pledged against the amount borrowed. For purposes of this schedule, securities held in fiduciary accounts that are loaned in securities lending transactions and are accounted for as secured borrowings should be reported as an asset of the respective fiduciary account that loaned the securities, but the collateral received should not be reported as an asset of the fiduciary account.
In the Fiduciary and Related Assets section (FS210 through FS291), you should include for each account in whatever line item is pertinent, the market value of common trust fund units, collective investment fund (CIF) units, and shares of proprietary mutual funds held by the account. Proprietary mutual funds are those funds where the savings association, its affiliates, or its subsidiaries act as investment adviser to the fund. You should not report a common trust fund or a collective investment fund operated by you as a separate account in FS262. You should report each proprietary mutual fund as a separate account in FS262 and include its assets in FS260. When reporting a proprietary mutual fund in FS260, subtract from the value of the mutual fund as a whole, those shares held by fiduciary or custodial accounts that are already reported in the fiduciary and related section on FS210 through FS291. This will prevent duplicate reporting.
MANAGED ASSETS
Report the total market value of assets held in managed fiduciary accounts. An account should be categorized as managed if you have investment discretion or offer investment advice for a fee. Investment discretion is defined as the sole or shared authority to determine what securities or other assets to purchase or sell on behalf of the fiduciary account, even if that authority is not exercised. If you have delegated your investment authority to another institution, then you both have investment discretion for reporting purposes. You should report an account as either managed or nonmanaged based on your predominant responsibility.
NONMANAGED ASSETS
Report the total market value of assets held in nonmanaged fiduciary accounts. An account should be categorized as nonmanaged if you do not have investment discretion but otherwise provide services in a fiduciary capacity as that term is defined for FS110. Accounts should be categorized as nonmanaged where you are a fiduciary and provide a menu of investment options but the ultimate selection authority remains with the account holder or an external manager. For example, if you provide a choice of sweep vehicles or an array of mutual funds, you are not necessarily exercising investment discretion. Another example of a fiduciary nonmanaged account is where you serve as trustee for a 401(k) employee benefit plan and the plan participants make their own investment selections. This section also includes IRA accounts where you are a trustee (not a custodian) and the account holders direct their own investments.
NUMBER OF MANAGED ACCOUNTS
Report the total number of managed fiduciary accounts.
NUMBER OF NONMANAGED ACCOUNTS
Report the total number of nonmanaged fiduciary accounts.
FS210 Through 213: Personal Trust and Agency Accounts
Report the market value and number of accounts for all testamentary trusts, revocable and irrevocable living trusts, and any other personal trusts and estates. Include accounts in which you serve as trustee, executor, administrator, guardian, or conservator. Do not include individual investment management agency accounts that should be included in FS260 and FS262. Also, do not include Keogh Act plans, Individual Retirement Accounts (IRAs), and other pension or profit sharing plans for self-employed individuals that should be included in FS240 through FS243. Include accounts that only receive custody or safekeeping services in FS280 and FS281.
Retirement-related Trust and Agency Accounts:
FS220 Through FS223: Employee Benefit - Defined Contribution
Report the market value and number of accounts for all employee benefit, defined contribution accounts for which you serve as trustee or in another fiduciary capacity. Include 401(k) plans, 403(b) plans, profit-sharing plans, money purchase plans, target benefit plans, stock bonus plans, employee stock ownership plans, and thrift-savings plans. The number of accounts reported should reflect the total number of plans administered rather than the number of plan participants. Report employee benefit accounts for which you are a custodian in FS280 and FS281.
FS230 Through FS233: Employee Benefit - Defined Benefit
Report the market value and number of accounts for all employee benefit, defined benefit plans for which you serve as trustee or in another fiduciary capacity. The number of accounts reported should reflect the total number of plans administered rather than the number of plan participants. Report employee benefit accounts for which you are a custodian in FS280 and FS281.
FS240 Through FS243: Other Retirement Accounts
Report the market value and number of accounts for all other retirement related accounts in which you serve as trustee or in another fiduciary capacity. Include self-directed Individual Retirement Accounts (Education IRAs and Roth IRAs) for which you are a trustee. Report employee benefit accounts for which you are a custodian in FS280 and FS281.
FS250 Through FS253: Corporate Trust and Agency Accounts
Report the market value and number of all your corporate trust accounts. Report assets for which you have the responsibility to manage or administer in accordance with the corporate trust agreement. Include assets of unpresented bonds or coupons relating to issues that have been called or matured. Do not include the entire market value of the associated securities or the outstanding principal of associated debt issues. Include accounts where you are the trustee for corporate securities, tax-exempt and other municipal securities, and other debt securities including unit investment trusts. Also, include accounts for which you are the dividend or interest paying agent or any other type of corporate trustee or agent.
FS260 and FS262: Investment Management Agency Accounts
Report the market value and number of accounts for all investment management accounts that are administered by you. Investment management accounts are those for which you have investment discretion or provide investment advice for a fee although title to the assets remains with the client. Include accounts for which you serve as a sub-advisor. For each account include the market value of common trust fund units, collective investment fund (CIF) units, and shares of proprietary mutual funds (those funds where you, your subsidiaries, or your affiliates act as investment adviser to the fund) held by the account. Do not include common trust funds or collective investment funds operated by you as a separate account in FS262. When reporting a proprietary mutual fund in FS260 you must subtract from the value of the mutual fund as a whole, those shares held by fiduciary or custodial accounts that are already reported in this or other sections of Schedule FS. This will avoid duplicate reporting. Each mutual fund should be reported as a separate account in FS262. The different investment classes of a single mutual fund should be combined and reported as a single account.
FS270 Through FS273: Other Fiduciary Accounts
Report the market value and number of accounts for all other fiduciary accounts not reported in FS210 through FS262. Report custody and safekeeping accounts in FS280 and FS281.
FS20 THROUGH FS23: TOTAL FIDUCIARY ACCOUNTS
The EFS software will compute these lines as the sums of their respective columns, from FS210, FS211, FS212, and FS213 through FS270, FS271, FS272, and FS273.
FS280 and FS281: Custody and Safekeeping Accounts
Report the market value and the number of accounts for all individual and institutional custody and safekeeping accounts administered by you. Safekeeping and custody accounts are a type of account for which you perform custody or safekeeping services. In these accounts, you do not act in a fiduciary capacity, such as trustee, and you do not provide investment management or investment advice for a fee or have investment discretion. Safekeeping and custodial services may include holding assets, processing income and redemptions, recordkeeping, or customer reporting. For employee benefit custody or safekeeping accounts, the number of accounts you report should reflect the total number of plans administered rather than the number of plan participants. Include accounts in which you serve as a sub-custodian for another institution. For example, where you contract with another institution for custody services, both of you should report the accounts. Do not include accounts for which you provide document custodial services for Ginnie Mae, Fannie Mae, or other mortgage-backed securities. Also, do not include accounts for which you provide services to land trusts.
Include custody and safekeeping accounts that are administered by your trust department or other identifiable business unit area that focuses on offering custodial services to individual or institutional fiduciary clients. Do not include those custodial and safekeeping activities that are related to retail bank services such as safety deposit box assets or any other similar retail arrangement.
FS290 and FS291: Assets Included Above, Excluded for Purposes of the OTS Assessment Complexity Component
OTS imposes semiannual assessments on savings associations based on three components: the thrift’s size, its condition, and the complexity of its portfolio. For savings associations that have trust powers, a complexity component is assessed for those associations that administer over $1 billion in trust assets. This complexity component, broken into three different categories, is calculated by utilizing different line items of this schedule. There are situations where OTS requires savings associations to report certain assets on a line item in Schedule FS that will not be included for assessment purposes. Therefore, the purpose of FS290 and FS291 is to exclude certain assets for OTS assessment purposes.
Report on FS290 those assets of proprietary mutual funds that are reported as a separate account in FS260 and FS262. Do not include in FS290 those shares of the proprietary mutual fund held by fiduciary or custodial accounts that are reported in other sections of Schedule FS. At this time, FS291 should remain blank.
FIDUCIARY AND RELATED SERVICES INCOME (CALENDAR YEAR-TO-DATE)
Report fiduciary and related services income and expense for the calendar year-to-date. The following income categories correspond to the asset categories described in FS210 through FS281. Report income and expense on an accrual basis. You may report both income and expense on a cash basis only if the results would not materially differ from those obtained using an accrual basis. The information reported on FS310 through FS35 will not be made available to the public on an individual association basis.
FS310: PERSONAL TRUST AND AGENCY ACCOUNTS
Report gross income generated from the services provided to personal trust and agency accounts reported on FS212 and FS213.
RETIREMENT RELATED TRUST AND AGENCY ACCOUNTS:
FS320: Employee Benefit – Defined Contribution
Report gross income generated from the services provided to defined contribution, employee benefit trust and agency accounts reported on FS222 and FS223.
FS330: Employee Benefit – Defined Benefit
Report gross income generated from the services provided to defined benefit, employee benefit trust and agency accounts reported on FS232 and FS233.
FS340: Other Retirement Accounts
Report gross income generated from the services provided to other retirement accounts reported on FS242 and FS243.
FS350: CORPORATE TRUST AND AGENCY ACCOUNTS
Report gross income generated from the services provided to corporate trust and agency accounts reported on FS252 and FS253.
FS360: INVESTMENT MANAGEMENT AGENCY ACCOUNTS
Report gross income generated from the services provided to investment management accounts reported on FS262.
FS370: OTHER FIDUCIARY ACCOUNTS
Report gross income generated from services provided to other fiduciary accounts reported on FS272 and FS273.
FS380: CUSTODY AND SAFEKEEPING ACCOUNTS
Report gross income generated from services provided to custody and safekeeping accounts reported on FS281.
FS390: OTHER FIDUCIARY AND RELATED SERVICES INCOME
Report all other gross fiduciary and related services income that cannot properly be reported on FS310 through FS380. Include income received from others, including affiliates, for fiduciary and related services provided by you. Also, include net income generated from securities lending activities, after deduction of broker rebates and income paid to lending accounts. Do not include allocations of income to the trust department from other areas of your savings association, such as credits for fiduciary cash held as a deposit on your commercial side.
FS30: TOTAL GROSS FIDUCIARY AND RELATED SERVICES INCOME
The EFS software will compute this line as the sum of FS310 through FS390.
FS391: LESS: EXPENSES
Report total direct and indirect expenses attributable to the fiduciary and related services reported in this schedule.
Direct expenses are immediately identifiable as costs directly chargeable to, for and under the control of the fiduciary and related services function. These expenses include: salaries, bonuses, hourly wages, overtime pay and incentive pay associated with officers and employees; expenses associated with employee benefits, such as contributions to employee benefit plans, health and life insurance costs, social security and unemployment taxes, relocation expenses and other fringe benefits; expenses associated with occupancy, such as maintenance, service and repairs, telephones and utilities, insurance coverage, real estate or property taxes, depreciation/amortization, lease/rental payments for premises and equipment, and any leasehold improvements charged directly to expense; fees paid directly for external or internal audits of the fiduciary and related services; trust examination fees, employee training, fees directly paid for outside legal counsel and/or consultants; and, expenses paid directly for advertising and business development activities.
Indirect expenses are those expenses charged to the fiduciary and related services activity from other departments of the institution. The expenses are generally reflected in the your retail accounting system and include any allocation for the proportionate share of corporate expenses that you do not directly charge to a particular department or function. If your internal accounting system is unable to provide the information, you may use a reasonable alternate method to estimate indirect costs. Indirect expenses include: the proportionate share of data processing expenses, building rent or depreciation, utilities, real estate taxes, and insurance, internal and external audits of trust activities, inhouse and/or outside legal expenses, non-trust employee incentives, business development activities, charitable contributions, and corporate overhead, such as allocated expenses for corporate planning and/or financial staff, board of director/committee fees, training, temporary personnel and professionals, travel, entertainment, stationary and postage, and automobile expenses. You must keep your reporting methods for indirect expenses consistent from period to period.
Do not include settlements, surcharges, and other losses in FS391.
FS392 LESS: NET LOSSES FROM FIDUCIARY AND RELATED SERVICES
Report net losses resulting from fiduciary and related services. Net losses are gross losses less recoveries. Gross losses may result from settlements, surcharges, errors from trade processing, miscalculation of fees or taxes, pricing discrepancies and other losses that are realized in the reporting period attributable to the fiduciary and related services. Recoveries should include those that are attributable to prior and current period losses. FS392 must equal the sum of gross managed and nonmanaged account losses minus recoveries (FS 70 + FS 71 - FS 72) reported in the Memoranda section of the FS Schedule.
FS393 PLUS: INTRACOMPANY INCOME CREDITS FOR FIDUCIARY AND RELATED SERVICES
If applicable, report credits from other areas of your association for activities reportable in this schedule. Include any intracompany income credit made available to the fiduciary area for fiduciary account holdings of own-bank deposits. Also, include credits for other intracompany services and transactions.
FS35 NET FIDUCIARY AND RELATED SERVICES INCOME
The EFS software will compute this line as the sum of FS30 less FS391 and FS392 plus FS393.
MEMORANDA
MANAGED ASSETS HELD IN PERSONAL TRUST AND AGENCY ACCOUNTS:
Report on FS410 through FS460 the market value of managed assets held in personal trust and agency accounts, in accordance with how the account is invested. FS40 must equal FS210. Include on the appropriate line the value of the units of common trust funds, collective investment funds, and shares of proprietary mutual funds held by each account.
Report securities held in fiduciary accounts that are loaned in securities lending transactions, accounted for as secured borrowings, as an asset of the fiduciary account that loaned the securities. Do not report the collateral received as an asset of this fiduciary account.
FS410: Non-interest-bearing Deposits
Report all non-interest-bearing deposits, including deposits of both principal and income cash.
FS415: Interest-bearing Deposits
Report interest-bearing savings and time deposits. Include NOW accounts, MMDA accounts, BICs that are insured by the FDIC, and certificates of deposit. Report interest-bearing deposits of both principal and income cash.
FS420: U.S. Treasury and U.S. Government Agency Obligations
Report all securities issued by and loans to the U.S. Government and agencies and sponsored enterprises of the U.S. Include certificates or other obligations that represent pass-through participations in pools of real estate loans when the participation instruments: (1) are issued by FHA-approved mortgagees and guaranteed by Ginnie Mae, or (2) are issued, insured, or guaranteed by a U.S. Government agency or sponsored enterprise, such as Freddie Mac. Also include CMOs and REMICs issued by Fannie Mae and Freddie Mac.
FS425: State, County and Municipal Obligations
Report all short and long-term obligations of state and local governments and political subdivisions of the United States. Include obligations of U.S. territories and their political subdivisions and all Federal income tax exempt obligations of authorities such as local housing and industrial development authorities that derive their tax-exempt status from relationships with state or local governments. Tax-exempt money market mutual funds should be reported with money market mutual funds on FS430.
FS430: Money Market Mutual Funds
Report all holdings of open-end registered investment companies – mutual funds – that attempt to maintain net asset values at $1.00 per share. Include both taxable and tax-exempt money market mutual funds. Do not include any common or collective investment fund holdings.
FS435: Other Short-Term Obligations
Report all short-term obligations. Short-term obligations are defined as obligations with original maturities of less than 1 year, or 13 months in the case of the time portion of master notes. In addition to short-term notes, this would include such money market instruments as master note arrangements, commercial paper, bankers’ acceptances, securities repurchase agreements, and other short-term liquidity investments. Do not include any state, county or municipal obligations.
FS440: Other Notes and Bonds
Report all other bonds, notes other than personal notes, and debentures.
Include:
1. Corporate debt, insurance annuity contracts, GICs and BICs that are not insured by the FDIC, and obligations of foreign governments.
2. Certificates or other obligations, however named, representing pass-through participation in pools of real estate loans when the participation instruments are issued by financial institutions and guaranteed in whole or in part by private guarantors.
3. CMOs and REMICs that are not issued by Fannie Mae or Freddie Mac, even if the collateral consists of Ginnie Mae or Fannie Mae pass-throughs or Freddie Mac PCs.
Do not include:
1. Short-term obligations that should be reported on FS435.
2. Personal notes.
FS445: Common and Preferred Stocks
Report all holdings of domestic and foreign common and preferred equities, including warrants and options.
Include:
1. Holdings of all mutual funds (open-end and closed-end) except money market funds that are reported in FS430.
2. Unit investment trusts, regardless of the securities they are invested in, such as stocks, corporate bonds, and municipal bonds.
3. Ownership interests in private equity investments, limited liability companies, and any other pooled investment vehicle, except those that are primarily invested in real estate that should be included in FS455.
FS450: Real Estate Mortgages
Report real estate mortgages, real estate contracts, land trust certificates, and ground rents. These assets may be reported at unpaid balance if that figure is a fair approximation of market value.
FS455: Real Estate
Report real estate and other similar assets.
Include:
1. Mineral interests.
2. Royalty interests.
3. Leaseholds.
4. Land and buildings associated with farm management accounts.
5. Investments in limited partnerships that are solely or primarily invested in real estate.
FS460: Miscellaneous Assets
Report personal notes, tangible personal property, and other miscellaneous assets that cannot be properly reported on FS410 through FS455. Include crops, equipment, and livestock associated with farm management accounts.
FS40: TOTAL MANAGED ASSETS HELD IN PERSONAL TRUST AND AGENCY ACCOUNTS.
The EFS software will compute this line as the sum of FS410 through FS460. FS40 must equal FS210.
CORPORATE TRUST AND AGENCY ACCOUNTS:
FS510 and FS515: Corporate and Municipal Trusteeships
Report in FS510 the total number of corporate and municipal issues, as well as other debt issues such as unit investment trusts, for which you serve as trustee. If more than one institution is trustee for an issue, both institutions should report the issue. Consider securities with different CUSIP numbers as separate issues; however, consider serial bond issues as a single issue. When you serve as trustee of a bond issue and you also perform agency functions for the issue such as transfer agent or paying agent, you should report the issue only in FS510, as the trustee appointment is considered the primary function. Do not include issues that have been called in their entirety or have matured even if funds are being held for unpresented bonds or coupons.
Report on FS515 the total par value of outstanding debt securities for the issues reported on FS510. For zero-coupon bonds, report the final maturity amount. Do not include assets, such as cash, deposits, and investments, that are being held for corporate trust purposes; report these on FS250 and FS251.
FS520: Transfer Agent, Registrar, Paying Agent, and Other Corporate Agency
Report the total number of issues for which you act in a corporate agency capacity. Include the total number of equity, debt, and mutual fund issues for which you act as transfer agent, registrar, or paying agent. Separate classes of a mutual fund should be consolidated and reflected as a single issue. Include the total number of stock or bond issues for which you disburse dividend or interest payments. Do not include any issues reported on FS510.
COLLECTIVE INVESTMENT FUNDS AND COMMON TRUST FUNDS:
Report the number and market value of assets held in Collective Investment Funds (CIFs) and Common Trust Funds operated by you. If you manage a common or collective fund that is used more than one institution, you should report the entire common or collective fund in this section. Do not include proprietary mutual funds in this section. Each common or collective investment fund should be categorized in the one item that best fits the fund type.
FS610 and FS615: Domestic Equity
Report funds investing primarily in U.S. equities.
Include:
1. Funds seeking growth, income, or both growth and income.
2. U.S. index funds and those concentrating on small, mid, or large cap domestic stocks.
Do not include funds specializing in a particular sector, such as technology, health care, financial institutions, or real estate. Sector funds should be reported on FS670 and FS675.
FS620 and FS625: International/Global Equity
Report funds investing exclusively in equities of issuers located outside the U.S. and those funds representing a combination of U.S. and foreign issuers. Include funds that specialize in a particular country, region, or emerging market.
FS630 and FS635: Stock/Bond Blend
Report funds investing in a combination of equity and bond investments. Include funds with a fixed allocation along with those having the flexibility to shift assets between stocks, bonds, and cash.
FS640 and FS645: Taxable Bond
Report funds investing in taxable debt securities.
Include funds that specialize in:
1. U.S. Treasury and U.S. Government agency debt.
2. Investment grade corporate bonds.
3. High-yield debt securities.
4. Mortgage-related securities.
5. Global, international, and emerging market debt funds.
Do not include funds that invest in:
1. Municipal bonds; report these on FS650 and FS655.
2. Funds that qualify as short-term investments that should be reported on FS660 and FS665.
FS650 and FS655: Municipal Bond
Report funds investing in debt securities issued by states and political subdivisions in the U.S. Such securities may be taxable or tax-exempt. Include funds that invest in municipal debt issues from a single state. Do not include funds that qualify as short-term investments that should be reported on FS660 and FS665.
FS660 and FS665: Short Term Investments/Money Market
Report funds that invest in short-term, money market instruments with an average portfolio maturity that is limited to 90 days with individual securities limited to maturities of 13 months or less. Money market instruments may include U.S. Treasury bills, commercial paper, bankers’ acceptances, and repurchase agreements. Include taxable and nontaxable funds.
FS670 and FS675: Specialty/Other
Report funds that specialize in equity securities of particular sectors, such as technology, health care, financial, or real estate. Also report funds that do not fit into any of the above categories.
FS60 AND FS65: TOTAL COLLECTIVE INVESTMENT FUNDS
The EFS software will compute these lines as the sum of FS610 through FS670 and the sum of FS615 through FS675.
FIDUCIARY SETTLEMENTS, SURCHARGES, AND OTHER LOSSES (CALENDAR YEAR-TO-DATE)
Report for the calendar year-to-date all aggregate gross settlements, surcharges, and other losses arising from errors, misfeasance, or malfeasance on managed accounts on FS710, FS720, FS730, and FS740 and on nonmanaged accounts, including custody and safekeeping accounts on FS711, FS721, FS731, and FS741. Gross losses should reflect losses recognized on an accrual basis before recoveries or insurance payments. Do not include fiduciary related contingent losses, including those for pending or threatened litigation.
Report recoveries on FS712, FS722, FS732, and FS742. Recoveries may be for current or prior years’ losses and should be reported when payment is actually realized, not upon the filing of an insurance claim.
The information reported on FS710 through FS72 on fiduciary settlements, surcharges, and other losses will not be made available to the public on an individual association basis.
FS710 through FS712: Personal Trust and Agency Accounts
Report gross losses and recoveries for managed and nonmanaged personal trust and agency accounts.
FS720 through FS722: Retirement Related Trust and Agency Accounts
Report gross losses and recoveries for managed and nonmanaged retirement related trust or agency accounts. Include gross losses and recoveries for all defined contribution, defined benefit, and other retirement accounts.
FS730 through FS732: Investment Management Agency Accounts
Report gross losses and recoveries for investment management agency accounts.
FS740 through FS742: Other Fiduciary Accounts and Related Services
Report gross losses and recoveries for all other fiduciary accounts and related services that are not included in FS710 through FS732. Include losses and recoveries from corporate trust and agency accounts, other fiduciary accounts, custody and safekeeping accounts, and other fiduciary related service accounts.
FS70 THROUGH FS72: TOTAL FIDUCIARY SETTLEMENTS, SURCHARGES, AND OTHER LOSSES
The EFS software will compute these lines as the sum of FS710 through FS740, FS711 through FS741, and FS712 through FS742. The sum of FS70 and FS71 minus FS72 must equal FS392.
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SCHEDULE HC — THRIFT HOLDING COMPANY
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
Complete this schedule if you are owned by a thrift holding company, except if your holding company is a registered Bank Holding Company supervised by the Federal Reserve. If your holding company owns more than one thrift institution, we will advise you which institution should file this report. We will also advise you which holding company(ies) to report if you are owned by more than one. You should continue to report for each holding company designated until advised otherwise.
Unless otherwise instructed, report all dollar amounts in accordance with GAAP for each designated holding company filing Schedule HC. (See the note below for insurance companies preparing financial statements under statutory accounting principles.) Where it is appropriate under GAAP to consolidate one or more of the holding company’s subsidiaries (which may or may not include your thrift), the amounts in the “Consolidated” column should reflect consolidation of those subsidiaries. The amounts in the “Parent Only” column must reflect the holding company’s investment in subsidiaries and the operations of those subsidiaries, under the equity method of accounting. Subsidiary operations, as a component of the investment account, would include dividends, earnings, and other activity updated on a quarterly basis. In the infrequent circumstance where it is not appropriate under GAAP to consolidate any of the holding company’s subsidiaries – such as a designated holding company filing Schedule HC that is a noncontrolling shareholder of the thrift and controls no other subsidiaries – the amounts in the “Consolidated” column should be left blank.
If the holding company has a quarter end other than a calendar quarter end, you may use data from the fiscal quarter ending within the reporting calendar quarter. For example, if the holding company’s fiscal year end is October, its fiscal quarter ends are January, April, July, and October. You should use its fiscal quarter ending January 31 for the March 31 TFR, April 30 for June 30, July 31 for September 30, and October 31 for December 31.
If your holding company is an insurance company, and does not prepare financial statements for external use in conformity with GAAP, you may file data from financial statements prepared in conformity with statutory accounting principles in the “Parent Only” column. If periodic consolidated financial statements are prepared under GAAP – such as for annual reports to policyholders – data from these statements should be used in filing Schedule HC in the appropriate “Consolidated” and “Parent Only” columns.
You must file Schedule HC no later than the 45th day following the end of the calendar quarter. We do not make public Schedule HC data for individual holding companies. We do make public aggregate data for Schedule HC.
HC100: HOLDING COMPANY NUMBER
Report the OTS docket number of the holding company for which you are reporting. All holding company docket numbers begin with an H.
HC110: FISCAL YEAR END
Enter the month of your current fiscal year-end for audited financial statement purposes. In some cases this may not correspond to the tax year-end.
HC125: STOCK EXCHANGE TICKER SYMBOL
List the symbol if the stock of the holding company is traded on a public exchange.
HC130: SEC FILE NUMBER
If the holding company must file periodic securities disclosure documents with the SEC pursuant to the Securities Exchange Act of 1934, report the SEC file number. Examples of disclosure documents are Form 10-K and Form 10-Q.
If the reporting holding company does not file periodic securities disclosure documents with the SEC but its parent or top tier holding company does file, you should report the SEC file number of that parent or top tier holding company.
HC140: WEBSITE ADDRESS
If one exists, report the Internet address of the reporting holding company or of the appropriate entity within the corporate structure where publicly available financial information is available.
PARENT ONLY
The parent holding company is an entity within the corporate structure. Parent-only reporting reflects the activities of the holding company. The parent activities are often limited to ownership of subsidiaries, financing activities and administrative activities. The parent records investments in subsidiaries as an investment or under the equity method as prescribed by GAAP. On a parent only basis, intragroup transactions are not eliminated.
HC210: TOTAL ASSETS
Report total assets on a parent only basis. Report details for components included in Total Assets on HC310 through HC370.
HC220: TOTAL LIABILITIES
Report total liabilities on a parent only basis. Report details for components included in Total Liabilities on HC410 through HC460.
HC240: TOTAL EQUITY
Report total equity on a parent only basis. Include the holding company’s portion of current subsidiary earnings (including the thrift) and other comprehensive income in equity of the parent. Generally, parent only Total Equity should be equal to Total Consolidated Equity (HC630). If HC240 and HC630 are not equal, explain the difference in a user note.
HC250 NET INCOME FOR THE QUARTER
Report net income for the quarter. Include the parent holding company’s proportionate share of any thrift institution subsidiary’s income for that quarter. Income should not be left blank.
INCLUDED IN TOTAL ASSETS:
RECEIVABLE FROM SUBSIDIARIES:
HC310: Thrift
Report the holding company’s receivable from thrift subsidiaries, which is sometimes referred to as “advances to” or “due from.” Include certain ESOP borrowings reflected on the thrift’s books that are reported as receivables on a parent only basis.
HC320: Other Subsidiaries
Report the holding company’s receivable from subsidiaries other than thrift subsidiaries, which is sometimes referred to as “advances to” or “due from”.
INVESTMENT IN SUBSIDIARIES:
HC330: Thrift
Report the holding company’s direct investment in thrift subsidiaries in a manner that reflects the equity method of accounting. If you are wholly owned, this line should equal your equity (SC80).
Report zero if this holding company is not the direct owner of the thrift.
HC340: Other Subsidiaries
Report the holding company’s investment in subsidiaries other than thrift subsidiaries in a manner that reflects the equity method of accounting. If this holding company is not the direct owner of the thrift, report the holding company’s investment in the mid-tier holding company.
INTANGIBLE ASSETS
HC350: MORTGAGE SERVICING ASSETS
Report the carrying amount of mortgage servicing assets.
HC360: NONMORTGAGE SERVICING ASSETS AND OTHER
Report the balance of the parent’s nonmortgage servicing assets and other intangible assets.
Include on this line the following intangible assets taken from examples provided in FASB Statement No.
141:
1. Goodwill.
2. Customer relationships and customer lists, including core deposit premiums.
3. Employment agreements.
4. Noncompete agreements.
5. Lease agreements.
6. Computer software costs.
HC370: DEFERRED POLICY ACQUISITION COSTS
Report deferred policy acquisition costs (DPAC) incurred by insurance companies. DPAC includes variable acquisition costs such as commissions and underwriting and policy issuance expenses related to both new and renewal insurance policies and annuities.
INCLUDED IN TOTAL LIABILITIES (EXCLUDING DEPOSITS):
Borrowings, as the term is used here, means short-term or long-term debt, negotiated with specified terms, usually including interest rates and repayment dates. Borrowings exclude deposits and transactional liabilities, such as accounts payable, income taxes payable, and accrued liabilities.
PAYABLE TO SUBSIDIARIES:
Thrift Subsidiaries:
HC410: Transactional
Report the holding company’s payable to thrift subsidiaries, which is sometimes referred to as “advances from” or “due to”. Do not include amounts reported on HC420.
HC420: Debt
Report the amount of borrowings the holding company owes to the reporting thrift. Do not include amounts reported on HC410.
Other Subsidiaries:
HC430: Transactional
Report the holding company’s payable to subsidiaries other than thrift subsidiaries, which is sometimes referred to as “advances from” or “due to”. Do not include amounts reported on HC440.
HC440: Debt
Report the balance of the holding company's borrowings from its subsidiaries other than thrift subsidiaries. Do not include amounts reported on HC430 and HC445.
HC445: TRUST PREFERRED INSTRUMENTS
Trust preferred securities are typically issued to third party investors by a wholly owned trust of the holding company. The holding company typically borrows from the trust substantially all the net proceeds from issuance of the trust preferred securities. For parent only reporting, report the balance of the holding company's borrowings from the trust that issued the trust preferred securities.
Where the holding company's financial statements do not reflect consolidation of the financial statements of the trust that issued the trust preferred securities, the amounts in HC445 and HC 670 should be equal. If the trust is consolidated, report on HC 670 the balance of the trust preferred instruments.
HC450: OTHER DEBT MATURING IN 12 MONTHS OR LESS
Report all borrowings excluding deposits, payable to subsidiaries, and trust preferred securities that you would classify as current liabilities if the holding company were to present a classified balance sheet. Include such borrowings that, within the next 12 months, either (1) contractually mature; (2) are callable at the option of the lender; or (3) otherwise become due and payable.
Callable, as the term is used here, refers to an option by the lender to require repayment of the borrowing before its contractual maturity.
A classified balance sheet is one that includes subtotals for current assets and current liabilities. Most thrift holding companies do not present a classified balance sheet. However, for purposes of HC450/HC680 and HC460/HC690, classify all borrowings as either current or noncurrent. The parameters of current liabilities are detailed in Accounting Research Bulletin No. 43, Restatement and Revision of Accounting Research Bulletins, Chapter 3A, as revised by SFAS No. 78, Classification of Obligations That Are Callable by the Creditor.
Example: A holding company’s borrowings, on a consolidated basis, include a FHLBank advance where the contractual maturity date is beyond the next 12 months. However, beginning on a date within the next 12 months, the FHLBank may exercise its option to require immediate repayment of the advance. You should include that advance in line HC450/HC680.
HC460: OTHER DEBT MATURING IN MORE THAN 12 MONTHS
Report all borrowings (other than payables to subsidiaries and trust preferred securities) except:
1. Debt maturing in 12 months or less reported on HC450/HC680.
2. Deposit and escrow liabilities held by you or any other subsidiary depository institution.
REFLECTED IN NET INCOME FOR THE QUARTER:
DIVIDENDS
As stated in the General Instructions to Schedule HC, the amounts in the “Parent Only” column should reflect the holding company’s investment in subsidiaries, and the operations of those subsidiaries, under the equity method of accounting. Consistent with those instructions, the holding company’s net income on a “Parent Only” basis, as reported on HC250, should reflect the holding company’s equity in net income or loss of its subsidiaries. Typically, such income or loss is presented as two separate components:
1. Dividends from subsidiaries – that is, the distributed component, and
2. Equity in undistributed income or loss of subsidiaries.
Accordingly, report on HC525 and HC535 the dividends-from-subsidiaries component of the holding company’s equity in income or loss of its directly owned subsidiaries. For example, assume that the holding company’s equity in the net income of its thrift subsidiary is $10
million; and that dividends declared by, and received from, the subsidiary are $3 million. The holding company’s net income on a parent only basis reported on HC250, “Net Income for the Quarter”, would include the $10 million. The holding company would report the $3 million on HC525. Note that the holding company’s $7 million ($10 million - $3 million) undistributed income component of its equity in income of the thrift subsidiary would not be reported separately on Schedule HC.
HC525: From Thrift Subsidiaries
Report dividends from thrift subsidiaries in which you have direct ownership. Such dividends should be recognized by the holding company under the equity method of accounting.
HC535: From Other Subsidiaries
Report dividends from non-thrift subsidiaries recognized by the holding company under the equity method of accounting.
INTEREST EXPENSE
HC545: TRUST PREFERRED INSTRUMENTS
Report interest expense from borrowings from the trust that issues the trust preferred instruments.
HC555: ALL OTHER DEBT
Report interest expense, excluding interest expense on trust-preferred instruments and on deposit and escrow liabilities held by a subsidiary depository institution.
HC565: NET CASH FLOW FROM OPERATIONS FOR THE QUARTER
Report the net increase or decrease in cash and cash equivalents from operating activities for the quarter, as it would appear in a statement of cash flows prepared in accordance with FASB No. 95. Do not include any change in cash and cash equivalents from investing and financing activities.
CONSOLIDATED
Prepare the consolidated amounts on Schedule HC in accordance with GAAP unless specifically stated otherwise. All data is reported as of the end of the quarter, or in the case of income, expense, and other activity data, for the period of one calendar quarter. Report subsidiaries that are not GAAP-consolidated subsidiaries using the equity method of accounting.
HC600: Total Assets
Report total consolidated assets. Report details for components included in Total Assets on HC650 through HC660.
HC610: Total Liabilities
Report total consolidated liabilities. Report details for components included in Total Liabilities on HC670 through HC690.
HC620: NONCONTROLLING INTERESTS IN CONSOLIDATED SUBSIDIARIES
Include:
1. Common and perpetual preferred stock issued by the holding company’s consolidated
subsidiaries to third parties constituting a noncontrolling interest.
For any net income or loss attributable to a noncontrolling interest in a consolidated subsidiary, see the instructions for HC640, Net Income (Loss) Attributable to Holding Company.
Do not include:
1. Mandatorily redeemable preferred stock that should be classified as a liability. Report on HC610, Liabilities.
2. Redeemable and perpetual preferred stock that was issued by consolidated subsidiaries and is owned by the holding company or its other subsidiaries as an investment asset. When making consolidating entries, eliminate the preferred stock of the consolidated subsidiary.
HC630: TOTAL EQUITY
Report total equity on a consolidated basis. Include perpetual preferred stock, common stock, accumulated other comprehensive income, retained earnings, other components of equity capital, and noncontrolling interests in consolidated subsidiaries. Generally, Total Equity on this line should be equal to Total Equity on HC240 plus Noncontrolling Interests in Consolidated Subsidiaries on HC620. If this is not the case, explain the difference in a user note.
HC635: NET INCOME (LOSS) ATTRIBUTABLE TO HOLDING COMPANY AND NONCONTROLLING INTERESTS
Report net income or loss on a consolidated basis, including the net income or loss attributable to noncontrolling interests in consolidated subsidiaries.
HC640: NET INCOME (LOSS) ATTRIBUTABLE TO HOLDING COMPANY
Report net income or loss on a consolidated basis attributable to the holding company only; that is, without regard to the net income or loss attributable to noncontrolling interests in consolidated subsidiaries.
HC650: Mortgage Servicing Assets
Report servicing assets on mortgage loans only.
HC655: Nonmortgage Servicing Assets and Other
Report servicing assets of loans other than mortgages, such as automobile and credit card loans.
HC660: Deferred Policy Acquisition Costs
Report deferred policy acquisition costs (DPAC) incurred by insurance companies. DPAC includes variable acquisition costs such as commissions and underwriting and policy issuance expenses related to both new and renewal insurance policies and annuities.
HC670: Trust Preferred Instruments
Where the holding company's financial statements reflect consolidation of the financial statements of the trust that issued the trust preferred securities, report the balance of the trust preferred securities - not the balance of the holding company's borrowings from the trust. Where the trust's financial statements are consolidated with those of the holding company, the holding company's borrowings from the trust are eliminated in consolidation. Refer to HC445 for additional information on reporting of Trust Preferred Instruments. Where the holding company’s financial statements do not reflect consolidation of the financial statements, report the balance of the holding company borrowings from the trust.
HC680: Other Debt Maturing in 12 Months or Less
Report other debt (on a consolidated basis) that will mature in less than 12 months. If a direct thrift ownership by the parent exists, then this line should include the proportionate ownership of FHLB advances, repurchase agreements, and most of the items that would meet the definition of borrowings as reported on SC72 at the thrift level. Inter-company accounts should be eliminated through consolidation. See HC450 for further explanation.
HC690: OTHER DEBT MATURING IN MORE THAN 12 MONTHS
Report other debt (on a consolidated basis), that will mature in more than 12 months. If a direct thrift ownership by the parent exists, then this line should include the proportionate ownership of FHLB advances, repurchase agreements, and most of the items that would meet the definition of borrowings as reported on SC72 at the thrift level. Inter-company accounts should be eliminated through consolidation. See HC460 for further explanation.
INTEREST EXPENSE:
HC710: Trust Preferred Instruments
Where the holding company's financial statements do not reflect consolidation of the financial statements of the trust that issued the trust preferred instruments, report interest expense on the trust preferred instruments (this means that HC445 and HC670 will be equal). If the trust is consolidated, report on HC710 the dividends paid on the trust preferred instruments – not the interest expense on the holding company’s borrowings from the trust. Report Interest Expense on Trust Preferred Instruments. When the financial statements are consolidated with those of the holding company, the interest expense on the holding company's borrowings from the is eliminated in consolidation.
Where the holding company's financial statements reflect consolidation of the financial statements entity that issued the trust preferred securities, report on HC710 the dividends paid on the trust preferred securities - not the interest expense on the holding company's borrowings from the trust.
HC720: All Other Debt
Report Interest Expense on All Other Debt.
CASH FLOW:
HC730: Net Cash Flow from Operations for the Quarter
Report the net increase or decrease in cash and cash equivalents from operating activities for the quarter, as it would appear in a statement of cash flows prepared in accordance with FASB No. 95. Do not include any change in cash and cash equivalents from investing and financing activities.
SUPPLEMENTAL QUESTIONS
Answer Supplemental Questions (HC810 through HC880) for each designated holding company and its subsidiaries for activities that occurred during the quarter. HC810 through HC875 require either a Yes or No answer. HC876 through HC880 may be left blank if not applicable.
For purposes of the Supplemental Questions only (HC810 through HC880):
A subsidiary means any company which is owned or controlled directly or indirectly by a person, and includes any service corporation owned in whole or in part by a savings association, or a subsidiary of such service corporation. As the term is used here, a “subsidiary” may be a company whose assets and liabilities are not consolidated with those of the holding company.
A significant subsidiary is a subsidiary that meets any of the following criteria:
• Accounts for five percent or more of the consolidated assets of the company
• Accounts for five percent or more of the consolidated gross revenue of the company
• Engages in transactions with the thrift.
HC810: Have any significant subsidiaries of the holding company been formed, sold, or dissolved during the quarter?
Check Yes only if this activity occurred during this quarter. Do not include any organizational structure changes that occurred during a prior period. A significant subsidiary accounts for five percent or more of the consolidated assets of the structure or five percent or more of the consolidated gross revenue of the structure, or engages in covered transactions with the thrift as described in §563.41. If you are an insurance company, do not include a response for activity in Separate Accounts.
Is the holding company or any of its subsidiaries:
Check Yes for each that may apply to any organization within the holding company structure, including the holding company itself. More than one may be checked if appropriate. Answer No if not applicable.
HC815: A broker or dealer registered under the Securities Exchange Act of 1934?
HC820: An investment adviser regulated by the Securities Exchange Commission or any State?
HC825: An investment company registered under the Investment Company Act of 1940?
HC830: An insurance company subject to supervision by a State insurance regulator?
HC835: Subject to regulation by the Commodity Futures Trading Commission?
HC840: Regulated by a foreign financial services regulator?
HC845: Has the holding company appointed any new senior executive officers or directors during the quarter?
Check Yes if there has been a change during the quarter.
HC850: Has the holding company or any of its subsidiaries entered into a new pledge, or changed the terms and conditions of any existing pledge, of capital stock of any subsidiary savings association that secures short-term or long-term debt or other borrowings of the holding company?
Check Yes if there has been a change during the quarter.
HC855: Has the holding company or any of its subsidiaries implemented changes to any class of securities that would negatively impact investors?
Check Yes if there has been a change during the quarter. Examples of a change that could negatively impact investors could include, but is not limited to: default, collateral substitution, changes in repayment dates, interest dates, voting rights, or conversion options.
HC860: Has there been any default in the payment of principal, interest, a sinking or purchase fund installment, or any other default of the holding company or any of its subsidiaries during the quarter?
Check Yes if there has been a default during the quarter.
HC865: Has there been a change in the holding company’s independent auditors during the quarter?
Check Yes if there has been a change during the quarter.
HC870: Has there been a change in the holding company’s fiscal year-end during the quarter?
Check Yes if there has been a change during the quarter.
HC875: Does the holding company or any of its GAAP consolidated subsidiaries (other than the reporting thrift) control other U. S. depository institutions?
Check Yes if the holding company controls a U. S. depository institution (federal or state chartered) and it is included in its consolidated financial statements.
HC876 Through HC880: If located in the U.S. or its territories, provide the FDIC certificate number:
If the answer to HC875 is Yes, list the five digit FDIC certificate number for each institution. If the answer to HC875 is No, the lines should be left blank.
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SCHEDULE CSS — SUBORDINATE ORGANIZATION SCHEDULE
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete this schedule annually using data as of December 31.
Report data for those subordinate organizations that you own directly or indirectly that meet one or more of the following criteria:
• The gross revenue of the consolidated subordinate organization is 5% or more of the gross revenue of the consolidated thrift (gross revenue is defined as the total of Interest Income and Noninterest Income); or
• The total assets of the consolidated subordinate organization are 5% or more of the consolidated thrift assets; or
• The consolidated subordinate organization is regulated by a state insurance department, the Securities and Exchange Commission, or the Commodity Futures Trading Commission; or
• The Regional Director deems there is a supervisory reason for requiring the reporting of a subordinate organization.
You may, but are not required to, include subordinate organizations that do not meet the above criteria. Include subsidiary depository institutions. Do not include ownership interest in entities designated as pass-through investments as described in 12 CFR § 560.32.
CSS010: ENTITY TAX ID #
Report the taxpayer identification number, EIN, of the entity.
CSS020: ENTITY NAME
Report the legal name of the entity and all active “doing business as” (DBA) names used for the entity. The TFR filing software has been modified with an entry feature to report CBA names. Do not preface the DBA name with “d/b/a” or other introductions.
CSS025: STREET ADDRESS
Report the street address of the entity’s headquarters, if located within the United States or its possessions. If the entity’s headquarters is located in a foreign country, report the street address and city
– abbreviate if necessary.
CSS030: CITY
Report the city where the entity has its headquarters, if located within the U.S. or its possessions. The city must correspond to the street address reported on CSS025. If the entity’s headquarters is located within a foreign country, report only the name of that country.
CSS040: STATE
Report the abbreviation for the state in which the headquarters of the entity is located. The state must correspond to the city reported on CSS030. Report 99 if located in a foreign country.
CSS045: ZIP CODE
Report the zip code for the entity’s headquarters. The zip code must correspond to the address reported on CSS025 through CSS040. Report 99999 if the headquarters is located within a foreign country that does not have a five-digit zip code.
CSS050: OTS DOCKET NUMBER OR TAX ID # OF IMMEDIATE PARENT
For first-tier subordinate organizations or a depository institution that you own directly or indirectly, report the docket number of the parent savings association. For lower-tier entities, as defined in 12 CFR § 559.2, report the taxpayer identification number, EIN, of the immediate parent of the entity within your organizational structure. For lower-tier entities, the taxpayer ID number entered here will also appear as a taxpayer ID number on CSS010.
If two or more entities in your tier structure own a subordinate organization, report the taxpayer ID number of the parent with the largest percent ownership. If two or more parents in your tier structure have the same percent ownership, choose one and report the taxpayer ID number for the parent chosen.
CSS060: NAME OF IMMEDIATE PARENT
Report the legal name of the immediate parent reported on CSS050.
CSS070: % OWNERSHIP BY IMMEDIATE PARENT
Report the percent ownership by the immediate parent reported in CSS050 and CSS060. Report the number as a whole-number percentage – report 2/3’s as 67 not as 0.67 or 66.7.
CSS080: TYPE OF ENTITY
Report the code for the type of entity described below.
Code 11 Operating Subsidiary, Including entities formerly defined as finance subsidiaries
Operating subsidiary as defined in 12 CFR § 559.2 as any entity that satisfies all of the requirements for an operating subsidiary under 12 CFR § 559.3 and that is designated as an operating subsidiary by the parent savings association. A federal savings association must own, directly or indirectly, more than 50 percent of the voting shares of an operating subsidiary, and no other person or entity may exercise effective operating control. An operating subsidiary may only engage in activities permissible for a federal savings association.
Do not include entities that meet the criteria for a lower-tier operating subsidiary. Report these entities as Code 12.
Code 12 Lower-tier Operating Subsidiary
An operating subsidiary as defined under Code 11 that you own indirectly.
Code 13 Service Corporation
A service corporation is any entity that satisfies all of the requirements for service corporations in 12
U.S.C. § 1464(c)(4)(B) of the Home Owners’ Loan Act and 12 CFR § 559.3 and that is designated as a service corporation by the investing savings association.
Code 14 Lower-tier Entity Qualifying as a Subsidiary
As defined in 12 CFR § 559.2, a lower-tier entity includes any company in which an operating subsidiary or a service corporation has a direct or indirect ownership interest. A lower-tier entity qualifies as a subsidiary if you directly or indirectly control the entity. Control is defined in 12 CFR § 574.
Do not include entities that do not meet the criteria for subsidiary. Report such entities as Code 15, Lower-tier Entity Not Qualifying as a Subsidiary.
Code 15 Lower-tier Entity not Qualifying as a Subsidiary
A lower-tier entity, defined in 12 CFR § 559.2, does not qualify as a subsidiary if you do not control it directly or indirectly. Control is defined in 12 CFR § 574.
CSS100 THROUGH CSS103: TYPE OF BUSINESS
Report the code that describes the type of activity(ies) in which the entity engages up to a maximum of four. If the entity engages in more than one activity, report the functionally regulated activities first. List other activities in descending order, beginning with the entity that generates the largest revenue.
Code 01 – 29 Not Used
Securities Brokerage and Investment Advisory Operations
Code 30 Registered Broker or Dealer (Functionally Regulated)
Subordinate organizations that are registered securities brokers and dealers with the Securities and Exchange Commission (SEC) to effect securities transactions or buy and sell securities. Note: Do not use this code to report a subordinate organization that has an arrangement, contractual or otherwise, with a registered securities broker/dealer. See Code 34.
Code 31 Registered Investment Advisor (Functionally Regulated)
Subordinate organizations that are registered as investment advisors with the SEC or a state. Do not use this code if the thrift itself is registered as an investment advisor. Note: Do not use this code to report arrangements, contractual or otherwise, that the thrift or the subordinate organization may have with an affiliated or unaffiliated investment adviser to sell nondeposit investment products to your retail customers.
Code 32 Registered Investment Company (Functionally Regulated)
Subordinate organizations that are registered as investment companies with the SEC under the Investment Company Act of 1940. Registered investment companies are primarily referred to as mutual funds.
Code 33 Commodities Firms/Brokers (Functionally Regulated)
Subordinate organizations that engage in commodities transactions and are regulated by the Commodities Futures Trading Commission (CFTC).
Code 34 Third Party Nondeposit Investment Product Sales or Referral Program
Subordinate organizations that contract with a affiliated or unaffiliated investment adviser, broker-dealer, or other entity to market and sell nondeposit investment products or investment advisory or related services to retail customers. Do not use this code if the subordinate organization has trust powers issued by OTS or another entity.
Note: Do not include subordinate organizations that are broker-dealers, mutual funds, or registered investment advisers (see Codes 30-32) or insurance sales operations (see Codes 35-37).
Insurance Operations
Code 35 Insurance Agency (Functionally Regulated)
Subordinate organizations that are insurance agencies licensed and regulated by individual states.
Note: Do not use this code to report organizations that do either of the following:
1. Offer insurance products or services indirectly through an arrangement with an insurance
company. See Code 37.
2. Underwrite insurance. See Code 36.
Code 36 Insurance Underwriting (Functionally Regulated)
Subordinate organizations that engage directly, not through a third party, in the business of insurance underwriting, including reinsurance.
Note: Do not include organizations that only engage in insurance agency operations – see Code 35 – or third party insurance sales arrangements. See Code 37.
Code 37 Third Party Insurance Sales or Referral Programs or Other Non-functionally Regulated Insurance Operations
Subordinate organizations that contract with an affiliated or unaffiliated investment adviser, broker-dealer, or an entity to market or sell insurance products and related services to retail customers. Do not use this code if the subordinate organization has trust powers issued by OTS or another entity.
Other Business Operations
Code 38 Subsidiary Depository Institution
Subordinate organizations that are also a depository institution - such as a federal savings association, state savings association, state savings bank, national bank, state chartered trust company that has FDIC insurance, or credit card bank.
Code 39 Lending
Subordinate organizations that engage in mortgage lending, commercial lending, consumer lending or mortgage banking activities. Include finance or capital leasing activities.
Code 40 General Leasing
Subordinate organizations that engage in general leasing activities. With general, operating, leases, the lessor is often responsible for the maintenance of the property.
Note: Include finance or capital leasing activities in lending, Code 39.
Code 41 Trust and Other Fiduciary-related Services
Subordinate organization that has been granted trust powers by OTS, OCC, or by a state and that engages in trust and asset management activities. Do not use this code if the thrift has been granted trust powers by OTS and engages in trust and asset management activities.
Note: If subordinate organization (not the thrift) is registered with the SEC or with a state as an investment advisor, report code 31.
Code 42 Unused
This code is no longer a valid type-of-business code.
Code 43 Real Estate Development and Related Activities (Except Community Development-Related Investments)
Subordinate organizations that: (1) develop land or other real estate for sale or lease or property management or (2) acquire improved real estate or manufactured homes to be held for rental or resale, remodeling, renovating, or demolishing and rebuilding for sale or rental, or to be used for offices and related facilities of a stockholder of the subordinate organization.
Note: Do not include community development-related real estate investments and development activity. See Code 55.
Code 44 Management of Real Estate Owned and Other Repossessed Assets
Subordinate organizations that perform asset management and disposition services for real estate owned (REO) or other repossessed assets.
REO includes:
1. Real estate in judgment.
2. Real estate acquired through foreclosure.
3. In-substance foreclosures.
4. Real estate acquired through deed in lieu of foreclosure.
5. Real property exchanged for foreclosed real estate.
Code 45 Appraisal, Inspection Services
Subordinate organizations offering appraisal or inspection services.
Code 46 Real Estate Investment Trust
Subordinate organizations organized as a real estate investment trust (REIT).
Code 47 Agency Operations
Subordinate organizations that conduct activities in a custodial capacity, not as principal. An example would be real estate brokerage activities.
Note: Do not use this code if the subordinate organization is a broker-dealer, a registered investment adviser, or a mutual fund. Do not use this code if the thrift or subordinate organization has trust powers.
Code 48 Electronic Banking
Subordinate organizations that engage in e-commerce business, such as Internet access, on-line lending, web site bill payment or funds transfer, web site maintenance, account aggregation, finder services, online brokerage or maintenance of financial portals.
Code 49 Digital Certificate Authority
Subordinate organizations that engage in digital certificate authority services.
Code 50 Data Processing Service Provider
Subordinate organizations that provide data processing, data mining, or data warehousing services.
Code 51 Application (Software) Development
Subordinate organizations that engage in software development activities, such as new technologies or modeling techniques.
Code 52 Issuing Notes, Bonds, Debentures or Other Securities
Subordinate organizations that issue – directly or through a third party intermediary – notes, bonds, debentures, or other instruments/securities. Do not include organizations that only issue preferred securities. See Code 53.
Code 53 Issuing Preferred Securities
Subordinate organizations that issue preferred securities, such as trust-preferred or REIT-preferred securities.
Community Development-related Operations
Code 54 Investments in a Small Business Investment Company
Subordinate organizations that invest in Small Business Investment Companies or New Market Venture Capital Companies licensed by the Small Business Administration.
Code 55 Investments in Community Development Related Real Estate
Subordinate organizations that invest in community development related real estate as authorized under HOLA 5(c)(3)(A), such as investments in low-income housing tax credit projects.
Code 56 Charitable Foundation
Subordinate organizations that establish a nonprofit organization recognized by the Internal Revenue Service as organized for charitable purposes.
Note: Do not utilize this code if the thrift or subordinate organization provides services to charitable foundations and receives a fee or when it has trust powers.
Code 57 Investments in Entities Authorized by Statute to Promote Community Development
Subordinate organizations that make investments in entities authorized by statute to promote community, inner city, and community development purposes, such as investments in Community Development Financial Institutions.
Code 58 Other Community Development Investments
Subordinate organizations that make investments in either of the following:
1. Governmentally insured, guaranteed, subsidized or otherwise sponsored programs for housing, small farms, or businesses that are local in character.
2. Entities that meet the community development needs of, and primarily benefit, low-and moderate- income communities.
Other
Code 99 Other
Any activity not listed above.
CSS110: IDENTIFICATION NUMBER OF SUBSIDIARY DEPOSITORY INSTITUTION
If Code 38 is entered on CSS100 through CSS103, report the subsidiary depository institution’s OTS docket number. If there is no OTS docket number, report the FDIC certificate number.
CSS115: OTHER BUSINESS TYPE
If Code 99 is entered on CSS100 through CSS103, describe the type of activity in which the entity engages. This narrative is limited to twenty spaces.
CSS120: TOTAL ASSETS
Report the total assets of the entity as of the reporting date. Do not consolidate lower-tier entities. If total assets round to less than one thousand, enter a 1 in CSS120 and a corresponding entry in CSS130 or CSS140.
CSS130: TOTAL LIABILITIES
Report the total liabilities of the entity as of the reporting date. Do not consolidate lower-tier entities.
CSS140: TOTAL CAPITAL
Report the capital of the entity as of the reporting date. Do not consolidate lower-tier entities.
CSS150: NET INCOME (LOSS) FOR THE CALENDAR YEAR
Report the net income or loss of the entity on a stand-alone, unconsolidated, basis for the year ending December 31.
CSS160: GROSS COMMITMENTS AND CONTINGENT LIABILITIES
Report the outstanding gross commitments and contingent liabilities, including all transactions with affiliates.
Include:
1. Gross commitments to originate, sell or purchase loans and securities.
2. Gross commitments to purchase or sell real estate.
3. Loans-in-Process, loans closed, but not yet disbursed.
4. Unused lines of credit.
5. Total contingent liabilities.
Examples of contingent liabilities include:
1. Guarantees of indebtedness to others.
2. Standby letters of credit.
3. Loans sold with recourse.
4. Litigation claims or assessments.
CSS200: TRANSACTIONAL INTERNET BANKING WEB SITE, AS DEFINED IN 12 CFR 555.300(B)
If you have a transactional Internet banking web site, report that web site address. Transactional Internet banking web sites are defined in 12 CFR 555.300(b).
CSS210: IS THIS ENTITY A GAAP-CONSOLIDATED SUBSIDIARY OF THE PARENT SAVINGS ASSOCIATION?
Respond Yes if this entity is a GAAP-consolidated subsidiary of the parent savings association and is consolidated with the parent savings association in Schedule SC.
SCHEDULE CCR — CONSOLIDATED CAPITAL REQUIREMENT
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
OTS-regulated savings associations must comply with two overlapping sets of regulatory capital standards listed below:
12 CFR § 567, Capital (FIRREA)
1. Tangible capital: The minimum ratio, as a percent of tangible assets, is 1.5 percent.
2. Core or leverage capital: The minimum ratio, as a percent of adjusted total assets, is 3 percent for savings associations assigned a composite CAMELS rating of ”1”, and 4 percent for all other savings associations.
3. Risk-based capital: The minimum ratio, as a percent of risk-weighted assets, is 8 percent.
12 CFR § 565, Prompt Corrective Action (FDICIA)
1. Tangible equity: Savings associations with tangible equity equal to or less than 2 percent of tangible assets are critically undercapitalized.
1. Tier 1 or leverage capital: Savings associations are adequately capitalized or well capitalized if
2. the minimum ratios, as a percent of adjusted total assets, are 4 percent or 5 percent, respectively. Note: § 567 contains an exception to these standards.
2. Tier 1 risk-based capital: Savings associations are adequately capitalized or well capitalized if the minimum ratios, as a percent of risk-weighted assets, are 4 percent or 6 percent, respectively.
3. Total risk-based capital: Savings associations are adequately capitalized or well capitalized if the minimum ratios, as a percent of risk-weighted assets, are 8 percent or 10 percent, respectively.
Note: The following paragraph refers to numbers 1 through 7 above.
Schedule CCR - Consolidated Capital Requirement uses the following conventions:
◦ Tangible capital (FIRREA) [See 1 above.]
◦ Schedule CCR does not include this measure because the minimum ratio is no longer considered a meaningful limitation for most savings associations.
• Tangible equity (FDICIA) [See 4 above.]
CCR840 reports the calculated tangible equity ratio.
◦ Core or leverage capital (FIRREA) [See 2 above.] and Tier 1 or leverage capital (FDICIA) [See 5
◦ above.]
Schedule CCR treats these two measurements as one and refers to them as Tier 1 (core) capital.
CCR810 reports the actual ratio. An adequately capitalized savings association must have a
minimum Tier 1(core) capital ratio of 4 percent. CCR20 reports the calculated amount.
• Tier 1 risk-based capital (FDCIA) [See 6 above.]
CR830 reports the calculated ratio.
• Risk-based capital (FIRREA) [See 3 above.] and total risk-based capital (FDICIA) [See 7 above.] Schedule CCR treats these two measurements as one and refers to them as total risk-based
capital. CCR820 reports the calculated ratio. An adequately capitalized savings association must have a minimum total risk-based capital ratio of 8 percent. CCR39 reports the calculated amount.
Generally, report all data on a consolidated basis with all subsidiaries that you would consolidate under GAAP, except as noted in these instructions.
Subsidiary: The term subsidiary means any corporation, partnership, business trust, joint venture, association, or similar organization where you, directly or indirectly, hold an ownership interest and consolidate the assets with yours for purposes of reporting under GAAP. Generally these are majority-owned subsidiaries.
This definition does not include ownership interests taken in satisfaction of debts previously contracted, provided you have not held the interest for more than five years, or a longer period if approved by OTS.
Generally, treat investments in entities not constituting subsidiaries under this definition as equity investments for capital purposes.
The following shows the regulatory capital treatment of debt and equity investments in subsidiaries and other subordinated organizations:
• Consolidate includable subsidiaries in accordance with GAAP.
• Deduct debt and equity investments in nonincludable subsidiaries in full (100 percent) from assets and capital. All previously applicable transition provisions have expired.
• Deduct nonincludable equity investments in subordinate organizations constituting subsidiaries in
full (100 percent) in computing total capital for the total risk-based capital standard. Nonincludable subsidiaries: Generally include subsidiaries engaged as principal in activities not permissible for a national bank. The instructions for CCR105 define nonincludable subsidiaries.
Note: Do not consolidate subsidiaries with investments fully covered by the FDIC. Include all FDIC-covered assets in the zero percent risk-weight category, and report them on CCR409, Notes and Obligations of FDIC, Including Covered Assets.
These instructions deal with investments in mutual funds and certain asset pools based on the characteristics of the assets in the fund. Where the mutual fund holds various assets that have different risk weights under the capital requirement, risk weight the entire ownership interest in the mutual fund based on the category of the asset with the highest capital requirement – highest risk weight or subject to deduction. On a case-by-case basis, OTS may allow you to assign the portfolio proportionately to the various risk-weight categories based on the proportion of the risk-weight categories represented in the mutual fund. See 12 CFR § 567.6(a)(1)(vi)(C).
Lower-tier subsidiary: Subsidiaries where you do not directly hold an ownership interest. Rather, your service corporation or operating subsidiary directly or indirectly holds the ownership interest.
TIER 1 (CORE) CAPITAL REQUIREMENT
CALCULATION OF CORE (TIER 1) CAPITAL
CCR100: Total Equity Capital (SC84)
The EFS software generates this line from SC84, Total Equity Capital.
Explanatory Note:
Schedule CCR adjusts Equity Capital, CCR100 in calculating Tier 1 (core) capital according to the OTS capital rule. For example, the OTS capital rule does not include cumulative perpetual preferred stock in Tier 1 (core) capital. Furthermore, the OTS capital rule requires you to deduct debt and equity investments in nonincludable subsidiaries and certain other assets from total assets and equity capital in computing Tier 1 (core) capital. In addition, OTS’s capital rule reverses the adjustment to GAAP equity for unrealized gains and losses on available-for-sale (AFS) debt securities included in SC860 in computing Tier 1 (core) capital. However, you report marketable equity securities at the lower of cost or market for Tier 1 (core) capital purposes.
Deduct:
CCR105: Investments in, Advances to, and Noncontrolling Interests in Nonincludable Subsidiaries
Reduce Tier 1 (core) capital by your investment in, advances to, guaranteed obligations of, and noncontrolling interests in certain nonincludable subsidiaries. The general instructions to Schedule CCR define subsidiary.
In consolidation, you eliminate the investment and intercompany loan accounts of subsidiaries, and you establish the noncontrolling interests in subsidiaries on Schedule SC. Therefore, you must obtain the amount of the investment and advances from your books before consolidation (as well as the noncontrolling interests after consolidation). Calculate the investment using the equity method as prescribed by GAAP plus any loans, advances, guaranteed obligations, or other extensions of credit, whether secured or unsecured. Use negative investments to offset loans, guaranteed obligations, or advances to the same subsidiary, but do not reduce this line below zero. If you have a nonincludable subsidiary and the result on this line rounds to zero or is a negative amount, report a one to indicate that you have reported your nonincludable subsidiary.
Note: Report investments in subsidiaries and equity investments where the FDIC fully covers the investments on CCR409, zero percent risk weight: FDIC Covered Assets. This rule applies to your investment regardless of the business activity of such entity.
Nonincludable Subsidiaries
Section 5(f) of HOLA [12 USC 1464(t)(5)(A)] defines nonincludable subsidiaries as subsidiaries of a savings association that engage in activities impermissible for a national bank with the following exceptions:
1. Subsidiaries only engaged in impermissible activities as an agent for its customers where the subsidiary has no risk of loss.
2. Subsidiaries engaged solely in mortgage banking activities.
3. Insured depository institutions acquired as subsidiaries before May 1, 1989.
4. Subsidiaries of federal savings associations that existed on August 8, 1989, and were chartered before October 15, 1982, as a savings bank or cooperative bank under state law.
5. Subsidiaries of federal savings associations that existed on August 8, 1989, that acquired their principal assets from a savings association chartered before October 15, 1982, as a savings bank or cooperative bank under state law.
Generally, a subsidiary of a savings association is nonincludable if any of its unconsolidated assets are impermissible for a national bank. If any lower-tier subsidiary engages in impermissible activities or invests in an entity that engages in impermissible activities, but the first-tier subsidiary owned by the parent savings association does not directly engage in impermissible activities, the first-tier subsidiary is an includable subsidiary. Deduct only subsidiary’s investment in the nonincludable lower-tier subsidiary in computing the capital of the upper-tier subsidiary on an unconsolidated basis and in computing your consolidated capital. Deduct from total capital, equity investments of subsidiaries in lower-tier subordinate organizations that are not considered subsidiaries, if those equity investments are not permissible for national banks.
Fully deduct all nonincludable subsidiaries from capital.
You should report investments in and advances to nonincludable subsidiaries net of all general valuation allowances, specific valuation allowances, and charge-offs, as they have already reduced equity capital.
CCR115: Goodwill and Certain Other Intangible Assets
For some savings associations, this line may equal SC660. However, you may manually override this amount in certain cases. For purposes of regulatory capital only, you may elect to:
• Reduce the amount Goodwill by any associated deferred tax liability.
• Reduce Core Deposit Intangible Assets (CDIs) and Certain Other Intangible Assets acquired in a nontaxable business combination by any associated deferred tax liabilities.
• You do not reduce the amount of Purchase Credit Card Relationships (PCCRs) by any
associated deferred tax liability. Report this as a positive amount. The EFS software will deduct this line from equity capital in calculating Tier 1 (core) capital.
Include:
1. Goodwill.
2. Core deposit intangible assets (CDIs).
3. Purchased credit card relationships (PCCRs).
Do not include:
1. Servicing assets.
2. Certain nonsecurity financial instruments accounted for under FASB Statement No. 125.
3. Net deferred tax assets.
4. Computer software (purchased and internally-developed).
5. Intangible pension assets.
CCR133: Disallowed Servicing Assets, Disallowed Deferred Tax Assets, Disallowed Residual Interests, and Other Disallowed Assets
Report this as a positive amount. The EFS software will deduct this line from equity capital in calculating Tier 1 (core) capital.
Disallowed Servicing Assets
You may include servicing assets reported on SC642 and SC644 in regulatory capital, subject to both of the following limitations:
1. For mortgage and nonmortgage servicing assets, and PCCRs, combined — include in capital the lesser of:
a.
100 percent of Tier 1 (core) capital.
b.
90 percent of fair value.
c.
100 percent of reported amount.
2. For nonmortgage servicing assets and PCCRs, as a separate sub-limit — include in capital the lesser of the following:
a.
25 percent of Tier 1 (core) capital.
b.
90 percent of fair value.
c.
100 percent of reported amount.
Accordingly, on CCR133, include the amount of servicing assets reported on SC642 and SC644 (that are not in a nonincludable subsidiary) and PCCRs included on SC660 that exceed the above limitations.
For purposes of the 25 percent and 100 percent of Tier 1 (core) capital limitations above, base the deduction on a Tier 1 (core) capital subtotal before the deduction. In addition, in computing the deduction for the 25 percent and 100 percent limitations, you may reduce the amount of servicing assets by any corresponding deferred tax liability.
Disallowed Deferred Tax Assets
If regulatory capital includes disallowed deferred tax assets, include the amount of the disallowed deferred tax assets on this line. To the extent that realizing deferred tax assets depends on your future taxable income (exclusive of reversing temporary differences and carryforwards), or your tax planning strategies, such deferred tax assets are limited for regulatory capital purposes to the lesser of the following:
1. The amount that you can realize within one year.
2. 10 percent of Tier 1 (core) capital. Accordingly, disallowed deferred tax assets is that amount includable in assets under GAAP, but not includable in regulatory capital pursuant to OTS policy. The deferred tax asset subject to the limitation is
the net deferred tax asset or liability included on Schedule SC, adjusted for the deferred tax asset or liability added to or subtracted from total assets related to the following:
1. Accumulated gains and losses on certain AFS securities and cash flow hedges on CCR280.
2. Goodwill and other intangible assets on CCR265 and CCR285.
3. Servicing assets on CCR270. Note: You can generally realize deferred tax assets without limitation from the following sources:
1. Taxes paid in prior carry-back years.
2. Future reversals of existing taxable temporary differences.
For purposes of the 10 percent of Tier 1 (core) capital limitation above, base the deduction on a Tier 1 (Core) capital subtotal before the deduction.
Disallowed Residual Interests
Include on this line that portion of credit-enhancing interest-only strips (as defined) reported on SI402 that must be deducted in computing Tier 1 capital, pursuant to 12 CFR Part 567. With certain exceptions provided for in the regulation, you must deduct from equity capital the amount of any credit-enhancing interest-only strips that exceeds 25% of Tier 1 capital before the deduction. In computing the deduction, you may reduce the amount by any corresponding deferred tax liability.
CCR134: Other
Report other items required to be deducted from Tier 1 Capital not included in CCR105 through CCR133.
Include the accumulated net increase in retained earnings (equity capital) resulting from certain net gains reported on SO485; specifically, those gains, net of losses, on liabilities carried at fair value, net of income taxes, that are attributable to changes in the savings association’s own creditworthiness.
Add:
CCR180: Accumulated Losses (Gains) on Certain Available-For-Sale
Securities and Cash Flow Hedges, Net of Taxes Report on this line:
1. Accumulated Unrealized Gains and Losses on Certain Available-for-Sale Securities
Equity capital on SC80 includes a separate component for accumulated, unrealized gains and losses, net of income taxes, on AFS securities. See SC860, Unrealized Gains (Losses) on Available-for-sale Securities. However, you cannot include most of that separate component of equity capital in regulatory capital, as specified below.
For regulatory capital purposes on Schedule CCR, but not for reporting purposes on Schedule SC:
• Report aggregate AFS debt securities at amortized cost, not at fair value.
• Report aggregate AFS equity securities at the lower of cost or fair value, not at fair value.
Report on CCR180 the amount on SC860, Unrealized Gains (Losses) on Available-for-Sale Securities, adjusted for losses on certain equity securities, as follows:
• SC860, Unrealized Gains (Losses) on Available-for-Sale Securities
• Plus: As a positive number, any portion of the amount on SC860 that represents unrealized losses on equity securities (but not debt securities), net of gains and net of income taxes.
2. Accumulated Gains and Losses Related to Qualifying Cash Flow Hedges
Equity capital on SC80 includes a separate component for accumulated gains and losses on qualifying cash flow hedges. See SC865, Gains (Losses) on Cash Flow Hedges. However, you cannot include that separate component of equity capital in regulatory capital.
Report the result on CCR180 as follows:
• When the amount on this line represents gains, net of losses, report a negative number
reducing capital.
• When the amount on this line represents losses, net of gains, report a positive number
increasing capital. Report the corresponding adjustment to assets on CCR280. See the instructions for CCR280 for additional information.
CCR185: Intangible Assets
Report PCCRs included on SC660.
CCR195: Other
Report other items permitted to be added to Tier 1 Capital that are not included in CCR180 through CCR190.
Include the accumulated net decrease in retained earnings (equity capital) resulting from certain net losses reported on SO485; specifically, those losses, net of gains, on liabilities carried at fair value, net of income taxes, that are attributable to changes in the savings association’s own creditworthiness.
CCR20: Tier 1 (Core) Capital
The EFS software will compute this line as follows: CCR100 less CCR105, CCR115, CCR133, and CCR134, plus CCR180, CCR185, and CCR195.
CALCULATION OF ADJUSTED TOTAL ASSETS
CCR205: Total Assets
Report total assets of the consolidated entity as reported on SC60, Total Assets. The EFS software will compute this line from SC60, Total Assets.
Deduct:
CCR260: Assets of "Nonincludable" Subsidiaries
Report the entire amount of the assets of nonincludable subsidiaries included in Schedule SC. For consolidated subsidiaries, this amount should equal total assets of the subsidiary less any assets eliminated in consolidation. For subsidiaries accounted for under the equity method, this amount should equal your investment account plus all advances to the subsidiary.
Report this as a positive amount. The EFS software will deduct this line from total assets in calculating Tier 1 (core) capital.
CCR265: Goodwill and Certain Other Intangible Assets
Generally, this line will equal SC660, Goodwill and Other Intangible Assets, with the exception of certain intangible assets such as intangible pension assets and computer software. Accordingly, the EFS software will automatically generate this line from SC660. However, if you have an intangible asset that is not required to be deducted from Tier 1 capital, such as intangible pension assets or capitalized computer software costs, you may change the generated amount.
• Goodwill
If you elect to reduce the amount of Goodwill by any associated deferred tax liability on CCR 115, then you must also reduce the amount of Goodwill on CCR 265 by the same amount.
• Certain Other Intangible Assets
Similarly, if you elect to reduce the amount of Certain Other Intangible Assets arising from nontaxable transactions by any associated deferred tax liability on CCR 115, then you must also reduce the amount of Certain Other Intangible Assets on CCR 265 by the same amount.
Report this as a positive amount. The EFS software will deduct this line from total assets in calculating Tier 1 (core) capital.
CCR270: Disallowed Servicing Assets, Disallowed Deferred Tax Assets, Disallowed Residual Interests, and Other Disallowed Assets
For most savings associations this line will equal CCR133. Accordingly, the EFS software will automatically generate this line from CCR133. However, this amount may change in certain cases. For example, deferred tax liabilities are deductible from servicing assets on CCR133, but are not deductible from servicing assets on CCR270. In which case you may override the generated amount.
Report this as a positive amount. The EFS software will deduct this line from total assets in calculating Tier 1 (core) capital.
CCR275: Other
Report other items required to be deducted from Adjusted Total Assets not included in CCR260 through CCR270.
Add:
CCR280: Accumulated Losses (Gains) on Certain Available-For-Sale
Securities and Cash Flow Hedges Report on this line:
1. Accumulated Unrealized Gains and Losses on Certain Available-for-Sale (AFS) Securities
Report amounts included in total assets for accumulated unrealized gains and losses on certain AFS securities, including any related component of income tax assets. Calculate the amount included on this line for unrealized gains and losses on certain AFS securities as follows:
• The amount included in SC60, Total Assets, that corresponds to the separate component of equity capital on SC860.
• Add to this amount: As a positive number, any amount included in SC60 that represents net unrealized losses on equity securities. That is, you include all unrealized gains and losses on available-for-sale securities included in assets except for those losses on equity securities.
2. Derivative Instruments Reported as Assets Related to Qualifying Cash Flow Hedges
Report amounts included in total assets for derivative instruments related to qualifying cash flow hedges, including any related component of income tax assets. Do not include derivative instruments reported as liabilities.
Report the result on CCR280 as follows:
• When the amount on this line represents a net amount that increased assets reported on Schedule SC, report a negative number that will deduct this amount from total assets for regulatory capital purposes.
• When the amount on this line represents a net amount that decreased assets reported on Schedule SC, report a positive number that will add this amount back to total assets for regulatory capital purposes.
Report the corresponding adjustment to equity capital on CCR180. See the instructions for CCR180 for additional information.
CCR285: Intangible Assets
For most savings associations, this line will equal CCR185; therefore, the EFS software will generate the amount from CCR185.
CCR290: Other
Report other items permitted to be added to Adjusted Total assets that are not included in CCR280 or CCR285.
CCR25: Adjusted Total Assets
The EFS software will compute this line as follows: CCR205 less CCR260, CCR265, CCR270, and CCR275 plus CCR280, CCR285 and CCR290.
CCR27: Tier 1 (Core) Capital Requirement
This represents the Tier 1 capital necessary for adequate capitalization pursuant to 12 CFR § 565.
The EFS software will compute this line as CCR25, Adjusted Total Assets, multiplied by four percent. If we have assigned you a composite CAMELS rating of one, you should override the calculated amount and report CCR25 multiplied by three percent.
If you have an individual minimum capital requirement (IMCR) set by OTS that requires the maintenance of a capital level in excess of the minimum requirement, you should override the calculated amount and report your IMCR.
This amount should never be less than three percent of CCR25.Total Risk-Based Capital Requirement:
CCR30: TIER 1 (CORE) CAPITAL
The EFS software will bring forward Tier 1 (core) capital from CCR20.
TIER 2 (SUPPLEMENTARY) CAPITAL
Under the OTS risk-based capital regulations, there are two types of capital: Tier 1 (core) capital and Tier 2 (supplementary) capital. Tier 2 (supplementary) capital includes certain specified instruments with characteristics of capital that do not qualify as Tier 1 (core) capital. You may include Tier 2 (supplementary) capital in your total risk-based capital, up to a maximum of 100 percent of your Tier 1 (core) capital.
Tier 2 (supplementary) capital consists of the following:
1. Permanent instruments not qualifying as Tier 1 (core) capital. Report on CCR310, Qualifying Subordinated Debt and Redeemable Preferred Stock; CCR340, Other Equity Instruments; and CCR355, Other.
2. Maturing instruments. After adjustments for the limitations described below, report on CCR310, Qualifying Subordinated Debt and Redeemable Preferred Stock; CCR340, Other Equity Instruments; and CCR355, Other.
3. Allowances for Loan and Lease Losses. Report on CCR350, Allowances for Loan and Lease Losses.
4. Up to 45 percent of your pretax unrealized gains, net of unrealized losses, on AFS equity
securities. Report on CCR302.
5. Noncontrolling interests in includable subsidiaries consolidated under GAAP that are not eligible for inclusion in Tier 1 (core) Capital on CCR190, provided the noncontrolling interest meets the other requirements for Tier 2 (supplementary) capital and neither you nor any of your subsidiaries or other subordinate organizations that you own, directly or indirectly, hold the noncontrolling interest. Report such noncontrolling interest on CCR340, Other Equity Instruments.
Maturing Capital Instruments Issued on or Before November 7, 1989
Maturing capital instruments approved or grandfathered by the FHLBB before December 5, 1984, continue grandfathered status under the prior and current OTS capital regulation. You may include them in full in Tier 2 (supplementary) capital until the last year before maturity.
With our prior approval, you may include maturing capital instruments issued on or before November 7, 1989, in Tier 2 (supplementary) capital, following the procedures below that are applicable to instruments issued after that date.
Maturing Capital Instruments Issued After November 7, 1989
You may elect to include maturing capital instruments issued after November 7, 1989, by choosing one of the following options. Once you elect either option, you must continue to apply that option for all subsequent issuances of maturing capital instruments as long as there is a balance outstanding of such issuances. Once such issuances have all been repaid, you may elect the other option for future issuances.
Option 1 Tier 2 (supplementary) capital is equal to the outstanding capital instrument multiplied by the applicable percentage from the following amortization schedule:
Years to Maturity Percentage Counted as Tier 2 (Supplementary) Capital
Greater than 5 100%
Greater than 4, but less than or equal to 5 80%
Greater than 3, but less than or equal to 4 60%
Greater than 2, but less than or equal to 3 40%
Greater than 1, but less than or equal to 2 20%
Less than or equal to 1 0%
Option 2 Tier 2 (supplementary) capital will include only the aggregate amount of maturing capital instruments that mature in any one year during the seven years immediately before an instrument’s maturity that does not exceed 20 percent of your capital. Capital is Tier 1 (core) capital plus, without limitation, items included in Tier 2 (supplementary) capital. There is no percentage of assets limitation for general loan and lease valuation allowances. There are no limitations on maturing capital instruments based on maturity dates. There is no limitation on Tier 2 (supplementary) based on the amount of Tier 1 (core) capital.
CCR302: Unrealized Gains on Available-for-Sale Equity Securities
You may include in Tier 2 (supplementary) capital up to 45 percent of the amount of any pretax unrealized gains. This is net of any unrealized losses, on AFS equity securities included in SC140, Equity Securities Subject to FASB Statement No. 115. If losses exceed gains, do not report an amount on this line. When you report unrealized gains, net of unrealized losses, here and include them in supplementary capital, you must include the entire (100 percent) unrealized gains, net of unrealized losses, in assets to risk weight. In other words, you must risk weight the fair value, not the historical cost of these AFS equity securities.
Do not include unrealized gains on AFS debt securities or on equity securities in a trading portfolio.
CCR310: Qualifying Subordinated Debt and Redeemable Preferred Stock
Include:
1. Perpetual subordinated debentures and mandatory convertible securities.
2. Maturing subordinated debentures, mandatory convertible securities, and redeemable preferred stock calculated according to the above instructions.
CCR340: Other Equity Instruments
Report equity instruments you issued that we permit as supplemental capital but not as Tier 1 (core) capital and that you deducted on CCR134.
Include:
1. Cumulative preferred stock reported on SC812.
2. Preferred stock reported on SC812 or SC814 where the dividend adjusts based on current market conditions or indexes and the issuer’s current credit rating;
3. Any other equity instruments reported on CCR134 except preferred stock that is, in effect, collateralized by assets of the reporting savings association; and
4. Noncontrolling interest reported on SC800, Noncontrolling Interest, in excess of the amount included in Tier 1 (core) capital on CCR190.
CCR350: Allowances for Loan and Lease Losses
Report ALLL established by you and your consolidated includable subsidiaries as defined in the instructions for CCR105. You cannot grandfather ALLL for nonincludable subsidiaries for this calculation. Note that Tier 2 (supplementary) capital limits the inclusion of ALLL reported on CCR 350 to 1.25 percent of risk-weighted assets. Apply the percentage limitation to Subtotal Risk-Weighted Assets on CCR75.
For regulatory capital purposes, the ALLL potentially reportable on CCR350 consists of:
1. First − allowances established to cover probable, but not specifically identifiable, credit losses
associated with on-balance-sheet loans and leases, reported as ALLL on mortgage loans (SC283)
and on nonmortgage loans (SC357).
2. Second, if the capital limit mentioned above permits − liabilities for credit losses associated with off-balance-sheet credit exposures (such as commitments, letters of credit, and guarantees) included in Other Liabilities and Deferred Income (SC796), with the following exception: Any portion of this liability related to transfers of loans or other assets reported as sales with recourse is separate and distinct from the ALLL, and therefore is not includable in CCR350.
Include purchased ALLL where the balance and nature of the purchased ALLL is consistent with OTS policy in the Examination Handbook, Sections 260 and 261.
Do not include:
1. ALLL of unconsolidated subordinate organizations.
2. ALLL of nonincludable subsidiaries.
3. Recourse liability accounts that arise from recourse obligations for any transfers of loans or other assets that are reported as sales. Such accounts are separate and distinct from the ALLL.
CCR355: Other
Report other items permitted in Tier 2 Capital that you do not include in CCR302 through CCR350.
CCR33: Tier 2 (Supplementary) Capital
The EFS software computes this line as the sum of CCR302, CCR310, CCR340, CCR350 and CCR355.
CCR35: ALLOWABLE TIER 2 (SUPPLEMENTARY) CAPITAL
The EFS software computes this line as follows.
If Tier 1 (core) capital is a positive amount, the software reports the lesser of the following:
1. Tier 2 (supplementary) Capital reported on CCR33.
2. Tier 1 (core) Capital reported on CCR30.
3. If you have negative Tier 1 (core) capital, the software reports zero on CCR35.
The amount of Tier 2 (supplementary) capital included in total capital cannot exceed the amount of Tier 1 capital.
CCR370: Equity Investments and Other Assets Required to be Deducted
Report the assets that 12 CFR § 567.5(c) requires to be deducted from total capital unless deducted elsewhere.
Include:
1. Investments in other depository institutions (reciprocal holdings) that other depository institutions may count in their regulatory capital such as capital stock, qualifying subordinated debt, etc.
1. The entire amount of all the following items:
1. Your nonincludable debt and equity investments including debt and equity investments in subordinate organizations not constituting subsidiaries under 12 CFR § 567.1 (investments in entities not consolidated under GAAP) that engage as principal in activities impermissible for national banks and not otherwise includable under § 5(t) of HOLA.
2. Investments in real property except real property primarily used or intended to be used by you, your subsidiaries, subordinate organizations, or affiliates as offices.
3. Real property acquired in satisfaction of a debt, where you intend to hold the property for real estate investment purposes or do not expect to dispose of it within five years.
The term equity securities means any:
1. Stock.
2. Certificate of interest of participation in any profit sharing agreement.
3. Collateral trust certificate or subscription.
4. Preorganization certificate or subscription.
5. Investment Contract.
6. Voting trust certificate.
7. Securities immediately convertible into equity securities at the option of the holder without payment of substantial additional consideration such as convertible subordinated debt.
8. Securities carrying any warrant or right to subscribe to or purchase an equity security.
9. Investments, loans, advances, and guarantees issued on behalf of unconsolidated subordinate organizations.
10. Investments in real property not classified as fixed assets or repossessed property.
Do not include:
1. Interests in real property that are primarily used by you, your subsidiaries, subordinate organizations, or affiliates as offices or related facilities to conduct business. Report on CCR506, 100 percent Risk weight: All Other Assets.
2. Interests in real property that you acquire in satisfaction of a debt previously contracted in good faith or acquired in sales under judgments or decrees (REO). Report on CCR506, 100 percent Risk weight: All Other Assets.
3. FHLBank Stock.
1. Equity investments permissible for both savings associations and national banks. Risk weight them at 100 percent on CCR506. These include:
1. Freddie Mac Stock.
2. Fannie Mae Stock.
1. Equity investments in subordinate organizations not constituting subsidiaries under 12 CFR §
2. 567.1 – investments in subordinate organizations not consolidated under GAAP, that engage solely in activities as agent for customers or engage as principal in activities permissible for national banks or otherwise includable under § 5(t) of the HOLA.
3. Real estate loans that are equity investments under GAAP and are permissible investments for national banks.
4. Mutual funds and pass-through investments, defined in 12 CFR § 560.32 that invest in any of the above categories of permissible equity investments.
4. Investments in subsidiaries and/or equity investments that FSLIC or any successor agency fully covers. Report the entire amount of such investment on CCR409, 0% Risk weight: Notes and Obligations of FDIC, Including Covered Assets. There is no requirement for you to deduct such investments from capital.
Computation of CCR370 When General Valuation Allowances have been established:
Calculate the amount of equity investments reported on CCR370 net of charge-offs and general valuation allowances. For example, if you established a $10 specific valuation allowance against a $100 equity investment, you only deduct $90 from total capital and enter $90 on CCR370.
In computing CCR370, you should reduce the amount you calculated using the above instructions by the amount of general valuation allowances established against equity investments and required deductions in real property investments. To receive this credit, you must establish the general valuation allowance at the savings association level as a contra-asset to the equity investments and investments in real property. You must have and maintain adequate records to enable examiners to verify your claim that you established the general valuation allowances against these specific assets.
For example, if you have a $100 equity investment, net of charge-offs and specific valuation allowances, against which you established no general valuation allowance after July 1, 1994, you should enter the full asset amount, $100, on CCR370. If you established a $10 general valuation allowance against that same asset, you should deduct the $10 general valuation allowance from the $100 investment, resulting in deduction of $90.
Do not include general valuation allowances established on other assets in the credit computation outlined above.
CCR375: Deduction for Low-Level Recourse and Residual Interests
If you elect the “direct deduction” approach for low-level recourse and residual interests, report on this line the amount of 1) low-level recourse and 2) residual interests reported on SI402 and SI404. However, you should reduce the amount of residual interests reported here by any amount reported on CCR133. In addition, you may reduce the amount of low-level recourse and residual interests reported here by the amount of any corresponding deferred tax liability.
Include:
1. The amount of recourse liability you retain when it is less than the capital requirement for credit-risk exposure and therefore not converted to an on-balance-sheet equivalent. For example, in the sale of most assets with one percent recourse, the amount of liability retained usually is less than the capital requirements, and therefore you would report one percent of the assets sold on CCR375 or CCR605. See the instructions for the 100 percent credit conversion factor in the Conversion of Off-balance-sheet Items to On-balance-sheet Equivalents section above.
2. The amount of on-balance-sheet financial instruments pursuant to FASB Statement No. 140 representing subordinated credit risk interests, including interests in spread accounts and asset pools. However, your low-level recourse requirement may exceed the amount of this instrument if you are subject to credit losses exceeding the amount of the instrument.
CCR39: TOTAL RISK-BASED CAPITAL
The EFS software will compute this line as the total of CCR30 plus CCR35 minus CCR370, and CCR375.
RISK-WEIGHT CATEGORIES
General Instructions
To calculate the total risk-based capital standard you must classify your assets in one of four risk-weight categories described below. Do not risk weight the assets that you have deducted from Tier 1 (core) capital – for example, nonincludable subsidiaries, nonqualifying intangibles, and disallowed assets.
Consolidate the assets of includable, GAAP-consolidated subsidiaries in determining the appropriate risk-weight categories. However, exclude the assets of nonincludable subsidiaries and nonincludable equity investments when computing risk-weighted assets.
Tier 2 (supplementary) capital includes ALLL but does not include other general valuation allowances. Consequently, to calculate the amount to be risk weighted, you may deduct allocated general valuation allowances from assets other than loans and leases but you may not deduct ALLL from loans and leases. In other words, you should risk weight loans at their recorded investment less only their specific valuation allowances, and risk weight all other assets at their recorded investment less their specific valuation allowances and allocated general valuation allowances.
You should risk weight assets after you make regulatory capital adjustments to those assets. For example, if we required you to deduct gains or add back losses on AFS securities in Tier 1 (core) capital, you should risk weight those securities at historical cost, not at fair value. The same is true for adjustments for disallowed servicing assets, disallowed net deferred tax assets, and other adjustments to Tier 1(core) capital. If you exclude assets, portions of assets, or adjustments to assets from Tier 1 (core) capital, you should exclude them from risk-weighted assets. Additionally, where you have included up to 45 percent of the pretax unrealized gains, net of unrealized losses, on AFS equity securities in Tier 2 capital (CCR302), you should include 100 percent of those unrealized gains in risk-weighted assets. In other words, you should risk weight the fair value, not the historical cost, of these AFS equity securities.
In determining the appropriate risk-weight category for secured loans, you must look at the type of collateral. In determining the appropriate risk-weight category for investments in mutual funds, you must look to the characteristics of the assets in the fund. Where the portfolio of a mutual fund consists of various assets that require different treatment under the capital requirement, you have two alternatives:
1. You may deal with the entire ownership interest in the mutual fund based on the asset with the highest capital requirement in the portfolio, or exclude the mutual fund from assets and thus deduct it from calculations of total capital, as appropriate.
2. You may assign different risk-weight categories to the mutual fund on a pro-rata basis, according
to the investment limits for different categories in the fund’s prospectus. Regardless of the risk-weighting method used, the total risk weight of a mutual fund must be no less than 20 percent.
Accrued interest receivable that is not delinquent is part of the recorded investment in that loan or investment and should be risk-weighted with the underlying asset. Generally, delinquent accrued interest receivable is risk weighted at 100%
Multiply the sum of each risk-weight category by the appropriate risk-weight percentage for that category. For instance, you would multiply the sum of the zero percent risk-weight category by zero percent. After adding each risk-weight category and multiplying by its appropriate risk weight, add the product of each risk-weight category. This results in the on-balance-sheet portion of the total risk-based capital standard.
Include off-balance-sheet items in the total risk-based capital standard after converting them into on-balance-sheet equivalents. Convert off-balance-sheet items by taking the dollar amount of the off-balance-sheet item or the grossed up amount of off-balance-sheet recourse obligations under 12 CFR § 567.1, as appropriate. Multiply that amount by the appropriate credit conversion factor from the table that follows the discussion of risk-weight categories. Additionally, you should risk weight interest-rate and exchange-rate contracts by calculating a credit equivalent amount. See explanation following the discussion of off-balance-sheet items.
Report in the appropriate category all on-balance-sheet assets together with all on-balance-sheet equivalents (off-balance-sheet items after converting them according to the discussion above). From the sum of on-balance-sheet and off-balance-sheet risk-weighted assets, deduct ALLL that exceeds the amount you may include as capital on CCR350.
Note: Report all loans and investments that are more than 90 days past due on CCR506, 100 percent Risk weight. Report all of these loans on CCR506 regardless of the type of investment or collateral, except for FDIC covered assets. Report FDIC covered assets on CCR409, 0% Risk weight: Notes and Obligations of FDIC Including Covered Assets.
0% Risk weight
CCR400: Cash
Report all cash-on-hand, including the amount of domestic and foreign currency owned and held or in transit in all your offices. Convert any foreign currency into U.S. dollar equivalents as of the date of the report.
Do not include:
1. Cash deposited in another financial institution, whether interest-bearing or non-interest-bearing. Report on CCR445.
2. Cash equivalents such as travelers’ checks. Report on CCR445.
CCR405: Securities Backed by Full Faith and Credit of U.S. Government
Report securities, not loans, on this line. Report the amount of securities issued by and other direct claims on the following:
1. The U.S. Government or its agencies to the extent such securities or claims are unconditionally backed by the full faith and credit of the U.S. Government.
2. The central government of an Organization of Economic Cooperation and Development (OECD) country.
Include:
1. Most Ginnie Mae securities. (Note that an interest only strip or Ginnie Mae security that exhibits similar interest rate risk would not be eligible for 0% risk weight. Report as 100% risk weight on CCR 505.)
2. U.S. Treasury securities.
3. SBA pools or certificates, or portions thereof, that have an unconditional guarantee by the full faith and credit of the U.S. Government.
Do not include:
1. Notes and obligations of the FDIC. Report on CCR409.
2. Assets collateralized by U.S. Government securities. Report on CCR450, 20% Risk weight: Other.
3. Mortgage-backed securities (MBS) where you have recourse for the underlying loans. The capital requirement on such obligations should follow the standard treatment of recourse obligations.
4. Delinquent mortgage loans previously securitized with Ginnie Mae, where either (a) you have an unconditional repurchase option, or (b) you have repurchased the loans under such an option. Report on CCR450, 20% Risk weight: Other.
CCR409: Notes and Obligations of FDIC, Including Covered Assets
Report notes and obligations of the FDIC that have the unconditional backing by the full faith and credit of the U.S. Government. Include the portion of assets fully covered against capital loss and/or yield maintenance agreements by the FDIC. Place that portion of assets without FDIC coverage (for example, those included in a deductible) in a risk-weight category according to the characteristics of the asset. If you cannot assign a deductible under a coverage agreement to a specific type of asset, then you should place the deductible in the 100 percent risk-weight category.
Include investments in subsidiaries and equity investments with full FDIC coverage, regardless of the percentage of ownership or business activity of the entity in which you have invested.
CCR415: Other
Report all zero percent risk-weight assets not included above as defined in 12 CFR § 567.6(a)(1)(i).
Include:
1. Deposit reserves at, claims on, and balances due from Federal Reserve Banks, excluding interest rate contracts. Report interest rate contracts on CCR450, 20% Risk weight: Other.
2. The book value of paid-in Federal Reserve Bank stock.
3. That portion of assets not included elsewhere in the zero percent risk-weight category directly and unconditionally guaranteed by the U.S. Government or its agencies, or the central government of an OECD country.
CCR420: Total
The EFS software will compute this line as the sum of CCR400 through CCR415.
CCR40: 0% Risk-Weight Total
The EFS software will automatically compute this line as zero percent times CCR455, the risk-weighted product of all zero percent risk-weighted assets.
20% Risk weight
CCR430: Mortgage and Asset-Backed Securities Eligible for 20% Risk Weight
Report mortgage-related securities and other asset-backed securities that meet the criteria for 20% risk weight. Note that if you have a subordinate class of an otherwise 20% risk weight, high-quality MBS, you must gross up and risk weight your security plus the balance of all classes senior to it. However, if you are able to utilize the ratings based approach (12 CFR 567.6), it is not necessary to gross up the more senior positions. See also CC455, CC465, and CC468.
Include:
1. Most Fannie Mae and Freddie Mac mortgage-related securities. (Note: Report Fannie and Freddie principal-only stripped securities (POs) and interest-only stripped securities (IOs) that are not credit enhancing on CCR 506.)
2. Asset-backed securities with an AAA or AA rating that meet the criteria of the ratings based approach - 12 CFR § 567.6.
Do not include:
1. Stripped MBS. Report IO and PO strips that are not credit enhancing of otherwise high quality MBS on CCR506, 100% risk weight.
2. Ginnie Mae mortgage pool securities. Refer to instructions for CCR405.
3. MBSs where you have recourse for the underlying loans. The capital requirement on such obligations should follow the treatment of recourse obligations.
CCR435: Claims on FHLBs
Report all investments in, claims on, and balances due from Federal Home Loan Banks.
Include:
1. Book value of Federal Home Loan Bank stock.
2. Demand, savings, and time deposits with a FHLBank.
3. Securities, bonds, and notes issued by the Federal Home Loan Bank System
4. The credit equivalent amount of interest rate contracts, interest-rate swaps and caps, where the counterparty is a Federal Home Loan Bank.
CCR440: General Obligations of State and Local Governments
Report the amount of securities and other general obligations issued by state and local governments.
CCR445: Claims on Domestic Depository Institutions
Include the following obligations of domestic depository institutions:
1. Demand deposits and other transaction accounts.
2. Savings deposits.
3. Time certificates.
4. Travelers’ checks and other cash equivalents.
5. Cash items in the process of collection.
6. Federal funds sold.
7. Loans and overdrafts.
8. Debt securities.
9. The credit equivalent amount of interest and exchange rate contracts (interest-rate swaps and caps) where the counterparty is a domestic depository institution.
Do not include:
1. Investments in other depository institutions where those institutions may count the investments in their regulatory capital, such as capital stock, qualifying subordinated debt, etc. Report on CCR370, Assets Required to be Deducted.
2. Interest rate contracts with a FHLBank or a Federal Reserve Bank. Report on CCR435 and CCR450, respectively.
CCR450: Other
Report all twenty percent risk-weight assets, not included above, as defined in 12 CFR § 567.6(a)(1)(ii).
Include:
1. Assets conditionally guaranteed by the U.S. Government, such as VA and FHA insured mortgage loans, the guaranteed portion of SBA, FhmA, and AID loans, and FICO and REFCO bonds, etc.
2. Delinquent mortgage loans previously securitized with Ginnie Mae, where either (a) you have an unconditional repurchase option, or (b) you have repurchased the loans under such an option.
3. Loans and other assets fully collateralized by deposits.
4. The credit equivalent amount of interest rate contracts (interest-rate swaps and caps) where the counterparty is a Federal Reserve Bank.
5. Assets collateralized by U.S. Government securities other than mortgage related securities on CCR430.
6. Securities issued by, or other direct claims on, U. S. Government-sponsored agencies, including notes issued by Fannie Mae and Freddie Mac. Do not include equity securities or MBSs.
CCR455: Total
The EFS software will compute this line as the sum of CCR430 through CCR450.
CCR45: 20% Risk-Weight Total
The EFS software will compute this line as twenty percent times CCR455, the risk-weighted product of all 20 percent risk-weighted assets.
50% Risk weight
CCR460: Qualifying Single-family Residential Mortgage Loans
Report the carrying value, outstanding balance less all specific valuation allowances, of all qualifying single-family residential mortgage loans secured by a first lien when you have no other extensions of credit secured by a second lien on the same property to the same consumer, if such loans meet all of the following criteria:
1. You have prudently underwritten the loan.
2. The loan is performing and not more than 90 days past due.
3. The current LTV ratio is 90% or less, calculated using the value at origination, including loans individually insured by private mortgage insurance or other appropriate credit enhancement that brings the effective LTV down to 90% or less.
Notes:
1. See 12 CFR 567.1 for the definition of Qualifying Mortgage Loan.
2. A loan with an LTV higher than 90%, without PMI or other readily marketable collateral enhancement, would not typically qualify for the 50% risk weight. The Real Estate Lending Guidelines urge savings associations as well as other types of banking organizations, to require PMI or other appropriate credit enhancement if a mortgage exceeds 90% LTV. See 12 CFR 560.101, and the footnote in the section on supervisory loan-to-value limits. These guidelines constitute a supervisory presumption of safety and soundness. To overcome that presumption for a loan that exceeds 90% LTV, a bank or thrift must demonstrate to the examiners' satisfaction that the loan is both prudently underwritten, and that it qualifies for the 50% risk weight in spite of the absence of private mortgage insurance or other appropriate credit enhancement.
Also, report the combined carrying value of all mortgage and consumer loans secured by liens on the same one- to four-family residential property, with no intervening liens. For example, you hold extensions of credit secured by first lien and second lien positions. Include in 50 percent risk weighting, if the loan meets all the following criteria:
1. You have prudently underwritten each loan.
2. Each loan is performing and not more than 90 days past due.
1. One of the following is true:
1. The combined loan-to-value ratio (CLTV) does not exceed 90 percent at origination.
2. The combined extension of credit is insured to at least a 90 percent LTV ratio by private mortgage insurance, or there is other appropriate credit enhancement to bring the effective LTV down to 90 percent or less.
3. The current LTV ratio is 90% or less, calculated using the value at origination, including loans individually insured by private mortgage insurance or other appropriate credit enhancement that brings the effective LTV down to 90% or less.
When you hold the first lien and junior liens on a 1-to-4-family residential property and no other party holds an intervening lien, view the loans as a single extension of credit secured by a first lien on the underlying property. Use this treatment to determine the LTV ratio, as well as for risk weighting. Assign the combined loan amount to either the 50 percent or 100 percent risk category, depending on whether the credit satisfies the criteria for 50 percent risk weighting. In determining the LTV ratio, you need not include loans classified in Schedule SC as commercial loans made to businesses and secured by residential property when you calculate the CLTV ratio for that property. If such loans are not included in the CLTV ratio for that property, you should risk weight such commercial loans at 100 percent.
If there is an intervening lien, do not combine the loans because another entity holds the second lien (the intervening lien). For example, you hold a first mortgage and third lien as a home equity line. In this case, you risk weight the carrying value of the loan secured by the first lien at 50 percent if the LTV is less than 90 percent and it otherwise meets the 50 percent risk-weight criteria. You risk weight the carrying value of the loan secured by the third lien at 100 percent, regardless of the CLTV.
In addition, include the following types of loans in the definition of single-family mortgage loans. These loans must meet the criteria above to be risk weighted at 50 percent:
1. Loans on interests in cooperative buildings.
2. Loans to individuals to fund the construction of their own home that meet the definition of a qualifying mortgage loan in 12 CFR § 567.1. You may include any accrued interest receivable in the loan balance.
3. Mortgage loans on mixed-use properties that are primarily single-family residential properties.
Do not include:
1. The combined carrying value of mortgage and consumer loans secured by first or second liens on the same property when the CLTV ratio exceeds 90 percent. Report the combined carrying value of these loans on CCR506, 100% Risk weight: All Other Assets.
2. The combined carrying value of mortgage and consumer loans secured by first and second liens on the same property if any of the extensions of credit are nonperforming (nonaccrual) or more than 90 days past due. Report on CCR506, 100% Risk weight: All Other Assets.
3. A loan to a consumer collateralized by a junior lien when another lender holds an intervening lien. For example, you hold the second lien and another lender holds the first lien, or you hold the first lien and the third lien, but do not hold the second lien (intervening lien). Report the junior lien on CCR506, 100% Risk weight: All Other Assets.
4. Foreclosed real estate. Report on CCR506, 100% Risk weight: All Other Assets.
5. Loans to individuals to construct their own home that are not qualifying mortgage loans as defined in 12 CFR § 567.1. Report on CCR506, 100% Risk weight: All Other Assets.
6. The portion of loans guaranteed by FHA that may be risk weighted at 20 percent. Report on CCR450.
7. Loans to commercial entities collateralized by mortgages of third-party borrowers (warehouse loans), or small business loans collateralized by a lien on a residential property. Report on CCR506, 100% Risk weight: All Other Assets.
CCR465: Qualifying Multifamily Residential Mortgage Loans
Qualifying Multifamily Mortgage Loans (12 CFR § 567.1) Under Current Rule
Report the carrying value plus accrued interest receivable, of permanent, first mortgages secured by first liens on multifamily residential properties consisting of five or more dwelling units that meet all the following criteria:
1. Amortization of principal and interest occurs over a period of not more than 30 years.
2. Original minimum maturity for repayment of principal on the loan is not less than seven years.
3. At the time you placed the loan in the 50 percent risk-weight category, the owner had made all principal and interest payments on the loan for the preceding year on a timely basis according to the loan terms (not 30 days or more past due).
4. The loan is performing and not 90 days or more past due.
5. You made the loan according to prudent underwriting standards.
6. The current outstanding loan balance does not exceed 80 percent (75 percent for variable rate loans) of the value of the property securing the loan. “Value of the property” (when you originate a loan to purchase a multifamily property) means the lower of either the purchase price or the amount of the initial appraisal, or if appropriate, the initial evaluation. Where a purchaser is not purchasing a multifamily property, but taking a new loan on his currently owned property, determine the value of the property by the most current appraisal, or if appropriate, the most current evaluation.
7. For the property’s most recent fiscal year, the ratio of annual net operating income generated by the property, before payment of any debt service on the loan, to annual debt service on the loan is not less than 120 percent, (115 percent for variable-rate loans). In the case of cooperative or other not-for-profit housing projects, the property generates sufficient cash flows to provide you
comparable protection. The debt service coverage ratio should be based on a fully indexed payment that will amortize the loan over its contractual term. It has long been industry practice to offer multifamily property loans with relatively short terms compared to the amortizing payment schedule. For example, the loan may have a 10-year term and a payment based on a 30-year amortization schedule with a balloon payment at the end of the term. In such cases, the DSCR should be based on the fully amortizing, fully indexed payment over the scheduled amortization period, but no longer than 30 years.
In cases where a borrower refinances a loan on an existing property, the borrower must comply with the above criteria.
12 CFR § 567.1 defines residential property as houses, condominiums, cooperative units, and manufactured homes. This definition does not include hospitals and nursing homes. Manufactured homes are those subject to HUD regulations under Title VI of the U.S. Code.
Include mortgage loans on mixed-use properties that are primarily multifamily residential properties if they satisfy the criteria for qualifying multifamily mortgage loans.
Grandfathered Qualifying Multifamily Mortgage Loans
Qualifying multifamily mortgage loans include multifamily mortgage loans that on March 18, 1994, met the criteria of qualifying multifamily mortgage loans under our capital rule on March 17, 1994, and continue to meet those criteria, namely:
1. An existing property consisting of 5 to 36 dwelling units secures the mortgage.
2. The initial LTV ratio is not more than 80 percent.
3. For the past full year, the property’s average annual occupancy rate is 80 percent or more of total units.
CCR470: Mortgage and Asset-Backed Securities Eligible for 50% Risk Weight
Mortgage-Backed Securities:
Report MBS, other than high quality MBS reported on CCR430, secured by qualifying single-family residential mortgage loans eligible to be reported on CCR460 or qualifying multifamily residential mortgage loans eligible to be reported on CCR465. Include POs secured by qualifying single-family or multifamily residential mortgage loans unless you can report them on CCR430.
If qualifying multifamily residential mortgage loans back the securities, you must receive timely payments of principal and interest according to the terms of the security. Generally, consider payments timely if they are not 30 days or more past due.
Note that if you have a subordinate class of an otherwise 50% risk-weight, high-quality MBS, you must gross up and risk weight your security plus the balance of all classes senior to it. However, if you are able to utilize the ratings based approach (12 CFR 567.6), it is not necessary to gross up the more senior positions. See also CC455, CC465, and CC468.
Asset-Backed Securities:
Also include asset-backed securities eligible for 50% risk weight under the ratings-based approach (“A” rated that meet all the criteria of the ratings based approach).
Do not include:
Interest Only Strips. Report credit-enhancing interest-only strips as residuals. Refer to the definitions in 12 CFR 567.1 and to the capital treatment in 12 CFR 567.6(b). See instructions for lines CCR133, CCR270, CCR375, CCR605, and SI402. Report IO and PO strips that are not credit enhancing of otherwise high quality MBS on CCR506, 100% risk weight.
CCR475: State and Local Revenue Bonds
Report securities issued by state and local governments where the revenues from a stated project such as a toll road repay the security.
CCR480: Other
Report all fifty-percent risk-weight assets not included above as defined in 12 CFR § 567.6(a)(1)(iii).
Include:
1. The credit equivalent amount of interest and exchange rate contracts (interest-rate swaps and caps) where the counterparty is an entity other than a domestic depository institution, a FHLBank, or a Federal Reserve Bank.
2. Revenue bonds issued by any public-sector entity in an OECD country that are payable solely from the revenues generated from the project financed through the issuance of the obligations.
1. Qualifying residential construction loans, also called residential bridge loans, meeting the criteria of 12 CFR § 567.1. Such loans must satisfy the following criteria:
1. You must make the loan according to sound lending principles to a builder with at least 15 percent equity in the project (or higher, depending upon the risk of the project) who will construct a one- to four-family residence that, when sold, will be owner-occupied.
1. You must obtain sufficient documentation from a permanent lender (that may be the construction lender) demonstrating all the following:
2. i. The homebuyer intends to purchase the residence.
3. ii. The homebuyer has the ability to obtain a permanent qualifying mortgage loan sufficient to purchase the residence.
4. iii. The homebuyer has made a substantial earnest money deposit.
5. The construction loan must meet all the following requirements:
6. i. Not exceed 80 percent of the sales price of the residence.
7. ii. Be secured by a first lien on the lot, residence under construction, and other improvements.
8. iii. Be performing and not more than 90 days past due.
2. The home purchaser(s) must intend that the home will be owner-occupied and must not be a business entity or any entity that is purchasing the home(s) for speculative purposes.
3. You must retain sufficient undisbursed loan funds throughout the construction period to ensure project completion. The builder must incur a significant percentage of direct costs; for example, the actual costs of land, labor, and material, before he draws on the loan.
CCR485: Total
The EFS software will compute this line as the sum of CCR460 through CCR480.
CCR50: 50% Risk-Weight Total
The EFS software will compute this line as 50 percent times CCR485, the risk-weighted product of all 50 percent risk-weight assets.
100% Risk weight
CCR501: Securities Risk Weighted at 100% (or More) Under Ratings-Based Approach
Include on this line:
1. Asset-backed securities or exposures eligible for 100% risk weight under the ratings-based approach. Example: “BBB” rated.
2. Also include asset-backed securities or exposures that receive a 200% risk weight under the ratings-based approach. Example: “BB” rated. For these 200% risk weight items, you must first multiply the balance by 2 (two).
Note: Only a limited set of asset-backed securities and other exposures arising from securitization activities qualify for this risk weighting, and these must meet all of the requirements of the ratings-based approach. Refer to 12 CFR 567.6(b)(3).
CCR506: All Other Assets
Report all other assets except those included above or in any other risk-weight category.
Include:
1. Consumer loans.
2. Commercial loans.
3. All assets that are nonperforming or more than 90 days past due, except FDIC covered assets. Report FDIC covered assets on CCR409, 0% Risk weight.
4. All repossessed assets including repossessed real estate (REO), other repossessed assets, and equity investments that have the same characteristics as REO, for example stock from an REO workout firm that has been approved for inclusion in the 100% risk-weight category.
5. First and junior mortgages on one- to four-family dwelling unit properties that do not qualify for inclusion on CCR460 (50% Risk weight: Qualifying Single family Residential Mortgage Loans).
6. Multifamily mortgage loans that do not meet the qualifying criteria for inclusion on CCR465, 50% Risk weight: Qualifying Multifamily Residential Mortgage Loans.
7. Residential construction loans, except those to individuals to build their own homes that you report on CCR460, and except qualifying residential construction loans (bridge loans) as defined in CCR480.
8. Nonresidential construction loans as defined in the instructions for SC260, Nonresidential Property.
9. Obligations issued by a state or political subdivision for the benefit of a private party or enterprise where that party or enterprise, rather than the issuing state or political subdivision, is responsible to pay principal and interest on the obligation (industrial development bonds).
10. Private-issue debt securities, including commercial paper, except those that you report in the 20 percent or 50 percent risk-weight categories.
11. Investments in fixed assets and premises.
12. Qualifying intangible assets reported on CCR185.
13. Servicing assets, less the amount included on CCR133.
14. The gross amount of wrap-around loans where you are liable on the first mortgage or must assume the first mortgage to perfect your position. Report the wrap-around loan net of the first mortgage if you have no liability on the first mortgage loan or obligation to assume it.
1. Equity investments that are permissible for both savings associations and national banks and including the following:
1. Fannie Mae Stock.
2. Freddie Mac Stock.
3. Equity investments in unconsolidated subordinate organizations (those that do not qualify as subsidiaries under 12 CFR § 567.1) that engage solely in activities as agent for customers or engage as principal in activities permissible for national banks or otherwise are includable under § 5(t) of the HOLA.
4. Real estate loans that are equity investments under GAAP and are includable under the Office of the Comptroller of the Currency’s (OCC’s) capital rule.
5. Mutual funds and pass-through investments, defined in 12 CFR § 560.32, that invest in any of the above categories of permissible equity investments.
15. Loans to commercial entities collateralized by mortgages of third party borrowers (warehouse loans).
16. Interest-only (IO) and principal only (PO) stripped securities that are not credit enhancing. This category includes most IOs and POs issued by Fannie Mae and Freddie Mac.
17. Any other remaining assets that you do not deduct from capital on CCR133 or CCR375, or that you do not “super risk-weight” using CCR605 and CCR62.
CCR510: Total
The EFS software will compute this line as the sum of CCR501 and CCR506.
CCR55: 100% Risk-Weight Total
The EFS software will compute this line as 100 percent times CCR510, the risk-weighted product of all 100 percent risk-weight assets.
CONVERSION OF OFF-BALANCE-SHEET ITEMS TO ON-BALANCESHEET EQUIVALENTS
Include off-balance-sheet items in the total risk-based capital standard after converting them into on-balance-sheet equivalents. Convert off-balance-sheet items to on-balance-sheet equivalents by taking the dollar amount of the off-balance-sheet item and multiplying it by the appropriate credit conversion factor from the table below.
SC689, Other Assets, and SC796, Other Liabilities and Deferred Income, include the fair value of derivative instruments accounted for under FASB Statement No. 133. We treat on-balance-sheet derivative instruments used for risk management purposes, rather than for trading, as off-balance-sheet items for risk-based capital purposes. Accordingly, you should risk weight only the converted on-balancesheet equivalent amounts, not the amounts reported on SC689 and SC796.
Place the on-balance-sheet equivalents (converted off-balance-sheet items) in the appropriate risk-weight category just as any other on-balance-sheet assets. For example, place an off-balance-sheet letter of credit in the same risk-weight category as the loan would be upon execution of the letter of credit.
Loans in Process (Undisbursed Loan Balances)
You may convert all LIP that meets the following criteria at a zero percent conversion factor. In other words, you do not risk weight it.
1. LIP that contractually must be fully disbursed or expire in one year or less under the original terms of the contract.
1. LIP that you may disburse over a period of time exceeding one year and that meets both of the following criteria:
1. You may unconditionally cancel the agreement.
2. You make a separate credit decision before each draw.
Convert all LIP that does not meet the criteria in #1 or #2 above at a 50 percent conversion factor and place in the risk-weight category appropriate for the related loan, except as follows:
1. When the borrower pays interest on the full amount of the loan, including both the disbursed and undisbursed portions, you must convert the LIP to an on-balance-sheet equivalent at a 100 percent credit conversion factor.
2. When the LIP is a direct credit substitute, you must convert it to an on-balance-sheet equivalent at a 100 percent credit conversion factor.
Table of Conversion Factors for Off-Balance-Sheet Items
This calculation translates the face amount of an off-balance-sheet exposure into an on-balance-sheet credit equivalent amount.
Zero Percent Credit Conversion Factor (not risk weighted)
Include:
1. Unused commitments with an original maturity of one year or less.
1. Unused commitments with an original maturity of greater than one year:
1. That you may unconditionally cancel at any time, and
2. You have the contractual right to make, and you do make, either:
2. i. A separate credit decision based upon the borrower’s current financial condition before each draw, or,
3. ii. An annual, or more frequent credit review, based upon the borrower’s current financial condition to determine whether or not to continue the lending arrangement.
2. Unused portions of retail credit card lines of credit that you may unconditionally cancel to the extent allowed by applicable law.
1. Unused portion of home equity lines of credit:
1. That you may unconditionally cancel at any time to the extent allowed by federal law, and
2. You have the contractual right to make, and you do make, either:
2. i. A separate credit decision based upon the borrower’s current financial condition before each draw, or,
3. ii. An annual, or more frequent credit review, based upon the borrower’s current financial condition to determine whether to continue the lending arrangement.
3. A commitment to make a permanent loan, where either the balance sheet or off-balance-sheet includes the construction loan. If the commitment to make the permanent loan exceeds the construction loan, treat the excess as a separate commitment and convert it to an on-balancesheet equivalent.
Twenty Percent Credit Conversion Factor
Trade-related contingencies are short term, self-liquidating instruments used to finance the movement of goods and collateralized by the underlying shipment. For example, a commercial letter of credit.
Fifty Percent Credit Conversion Factor
Include:
1. Transaction-related contingencies, including performance bonds and performance-based standby letters of credit.
2. Unused commitments with an original maturity greater than one year, including home equity lines of credit that are not in the zero percent credit conversion factor category because they are not unconditionally cancelable.
1. Revolving underwriting facilities, note issuance facilities, and similar arrangements where the customer can issue short-term debt in its own name, but where you have a legally binding commitment to either:
1. Purchase the obligations the customer is unable to sell by a certain date.
2. Advance funds to its customer if the customer is unable to sell the obligations.
Example:
You have a $1 million off-balance-sheet letter of credit guaranteeing the completion of a road in a residential construction project. Letters of credit that guarantee performance have a conversion factor of 50 percent. You convert the $1 million off-balance-sheet item into a $500,000 on-balance-sheet equivalent ($1 million times 50 percent), and place this in the 100 percent risk-weight category on CCR506, which is the same risk-weight category as on-balance-sheet residential construction loans.
One Hundred Percent Credit Conversion Factor
Include:
1. Financial guarantee-type standby letters of credit. Convert the face amount to a credit-equivalent amount.
1. Assets sold with recourse:
1. If you sell a $100 loan with ten percent recourse, you must convert the full $100 – the grossed up amount – at 100 percent, except where the amount of recourse liability that you retain is less than the capital requirement for credit-risk exposure. In that situation, the low-level recourse provision limits your capital charge to a dollar-for-dollar requirement against the amount of credit-risk exposure retained. For example, in the sale of most assets with one percent recourse, the amount of liability retained is less than the capital requirement. Therefore, one percent of the assets sold would be the capital requirement. Report this low-level recourse amount on CCR375 or CCR605. No off-balance-sheet conversion is necessary.
2. Loans serviced for others where you or your subsidiaries are liable for credit losses on the loans serviced. In general, do not consider servicing of VA loans in GNMA pools as recourse servicing; however, we reserve the right on a case-by-case basis to treat such servicing as recourse. Note: You should not risk weight the on-balance-sheet asset. You should convert the full outstanding balance of the loans serviced at 100 percent.
3. Treat the subordinated portions of senior/subordinated securities, both retained and purchased subordinated pieces, identically to assets sold with partial, first-loss recourse under 2(a) above. You generally should not risk weight the on-balance-sheetsubordinated security. You should convert the full amount of both the senior and subordinate portions of the mortgage pool security at 100 percent.
4. You may elect to apply the 100 percent credit conversion factor to only the retained recourse amount related to transfers of small business loans and leases of personal property, according to § 208 of the Riegle Community Development and Regulatory Improvement Act of 1994. Qualifying savings associations may apply the treatment under
§ 208, as implemented, to transfers on or after March 22, 1995. See § 208 of the Riegle Act and 12 CFR § 567.6(a)(2)(i)(C).
1. Forward agreements and other contingent obligations with a specified draw down are legally binding agreements to purchase assets at a specified future date. You should convert the principal amount of the assets you will purchase on the date you enter into the agreement.
2. Securities of customers where you lend such securities to others as agent and you indemnify the customer against loss.
Example:
You have a $1 million off-balance-sheet, legally binding commitment to purchase and the institution has the intent to take delivery of (e.g., a regular-way trade, which is not accounted for as a derivative under SFAS Statement No. 133) FannieMae or FreddieMac MBS. Forward agreements to purchase assets at a specified date have a conversion factor of 100 percent. You convert the $1 million off-balance-sheet item into a $1 million on-balance-sheet equivalent, and you place it in the 20 percent risk-weight category on CCR450.
Interest-rate and Exchange-rate Contracts, and Certain Derivative Contracts
Credit Equivalent Amount
This calculation translates interest-rate and exchange-rate contracts into an on-balance-sheet credit equivalent amount. The credit equivalent amount of interest-rate and exchange-rate contracts is the sum of: (1) current credit exposure, and (2) potential credit exposure.
The credit equivalent amount, consisting of the current exposure plus the potential credit exposure, is assigned to the appropriate risk-weight category and reported on one of the following lines:
20% Risk weight
CCR435 Claims on FHLBs CCR445 Claims on Domestic Depository Institutions CCR450 Other (where the counter party is a Federal Reserve Bank)
50% Risk weight
CCR480 Other – where the counter party is other than a domestic depository institution, a FHLBank, or a Federal Reserve Bank
1. Current Credit Exposure
Current credit exposure is the replacement cost of the contract, measured in U.S. dollars, regardless of the currency specified in the contract.
Replacement cost is the loss that you would incur if a counterparty defaults. You measure replacement cost as the net cost of replacing the contract at the current market value. If default would result in a theoretical profit, the replacement value is zero. The replacement cost calculation incorporates changes in both interest rates and counterparty credit quality.
2. Potential Credit Exposure
Potential credit exposure means the estimated potential increase in credit exposure over the remaining life of the contract. You calculate it as follows:
Interest-rate Contracts
Multiply the notional principal amount of the contract by either:
1. Zero percent, if the contract has a remaining maturity of one year or less.
2. One-half of one percent if the contract has a remaining maturity greater than one year.
Exchange-rate Contracts
Multiply the notional principal amount of the contract by either:
1. One percent if the contract has a remaining maturity of one year or less.
2. Five percent if the contract has a remaining maturity greater than one year.
Interest Rate Contract Example:
You have a $10 million notional amount interest rate swap agreement. You report the positive fair value of this derivative instrument of $80 thousand as an asset under FASB Statement No. 133, and include it in line SC689, Other Assets. However, you do not include this $80 thousand on-balance-sheet amount in assets to risk weight. Instead, you include in assets to risk weight the credit equivalent amount of this interest rate exchange agreement, which you have calculated to be $130 thousand. You computed the $130 thousand by adding the current credit exposure of $80 thousand (equal to the replacement cost of the contract) to the potential credit exposure of $50 thousand (equal to the $10 million notional amount times 0.5%, for this contract with a remaining maturity of 2 years). You include the $130 thousand in assets to risk weight, in the 20 percent risk-weight category on CCR435, because the counterparty is a Federal Home Loan Bank.
Foreign Exchange Rate Example:
Your thrift has a foreign currency exchange rate contract where the thrift will deliver €1 million (Euros) and receive $1.8 million (US Dollars) in 90 days. The exchange rate was 0.90 (US Dollars/Euros) and it is now 0.95. No matter which side of the contract your thrift has taken, it should always be measured in dollars for capital purposes. The market loss of $100,000 is reported on SC796. As there is a market loss, the current credit portion is $0. The potential credit portion is $18,000 because the term is less than one year. You would report $18 on CCR480 as the counterparty is a broker (non-bank).
Do not include in risk-based assets:
(1)
A foreign exchange rate contract with an original maturity of 14 calendar days or less; and
(2)
Any interest rate or foreign exchange rate contract that is traded on an exchange requiring the daily payment of any variations in the market value of the contract.
See 12 CFR 567.6 for more information.
Netting of Current Replacement Value under Qualifying Bilateral Netting Agreements
You may net the current replacement values of multiple rate contracts with a single counterparty under a qualifying bilateral netting agreement in accordance with the OTS’ bilateral netting rule according to 12 CFR § 567.6(a)(2)(v)(B). A bilateral netting agreement is a master contract under which two parties agree to net the amounts they owe each other under rate contracts covered by the agreement to reduce their credit exposure. You may only net contracts for capital purposes under this rule if all of the following are true:
1. The rate contracts are between the same two parties.
2. You net only interest rate contracts and foreign exchange rate contracts for capital purposes.
3. The bilateral netting contract covering the rate contracts results in a single netted amount being payable or receivable in case of the default, insolvency, bankruptcy, or similar circumstance of either party.
4. If you are party to the bilateral netting agreement, you have legal opinions concluding that the courts and other legal authorities of relevant jurisdictions would uphold the contract.
CCR605: Amount of Low-Level Recourse and Residual Interests Before Risk weighting
If you elect the “super risk weighting” approach for low-level recourse and residual interests, report on this line the amount of 1) low-level recourse and 2) residual interests reported on SI402 and SI404. However, you should reduce the amount of residual interests reported here by any amount reported on CCR133.
Include:
1. The amount of recourse liability (low-level recourse amount) that you retain when it is less than the capital requirement for credit-risk exposure. Therefore, you do not convert it to an on-balance-sheet equivalent. In the sale of most assets with one percent recourse, the amount of liability retained usually is less than the capital requirement. You would report one percent of the assets sold on CCR375 or CCR605. See the instructions for the 100 percent credit conversion factor in the Conversion of Off-balance-sheet Items to On-balance-sheet Equivalents section.
2. The amount of on-balance-sheet financial instruments reported pursuant to FASB Statement No. 125 representing subordinated credit risk interests, including interests in spread accounts and asset pools. However, your low-level recourse requirement may exceed the amount of this instrument if you are subject to credit losses exceeding the amount of the instrument.
Do not Include:
Credit-enhancing interest-only strips reported on SI402 that exceed 25% of your Tier 1 Capital. You must deduct the amount that exceeds 25% of Tier 1 capital on CCR 133.
CCR62: RISK-WEIGHTED ASSETS FOR LOW-LEVEL RECOURSE AND RESIDUAL INTERESTS (CCR605 X 12.5)
This notional risk-weighted amount is your low-level recourse and residual interests amount on CCR605 multiplied by 12.5. Note: This computation results in a risk-weighted asset amount that when multiplied by 8 percent results in your low-level recourse amount. By converting your low-level recourse and residual interests amount into risk-weighted assets, this method increases your total risk-based capital requirement instead of reducing your total risk-based capital like the deduction method.
The EFS software will compute this line as CCR605 multiplied by 12.5, the reciprocal of the 8 percent risk-based capital requirement.
CCR64: ASSETS TO RISK WEIGHT
The EFS software will automatically compute this line as the sum of CCR420, CCR455, CCR485, CCR510, and CCR605.
Total assets subject to risk weighting are as follows:
1. Adjusted Total Assets, CCR25.
2. ALLL, CCR350 plus CCR530.
3. Assets you are required to deduct, reported on CCR370.
4. Off-balance-sheet items you are required to convert to assets to risk weight.
5. Unrealized gains on AFS equity securities reported on CCR302.
6. Less any on-balance-sheet assets reported on CCR375.
CCR75: Subtotal Risk-Weighted Assets
The EFS software will compute this line as the sum of CCR40, CCR45, CCR50, CCR55, and CCR62.
CCR530: Excess Allowances for Loan and Lease Losses (ALLL)
Report an amount on CCR530 only when the ALLL reported on CCR350 is less than the ALLL reported on SC283 and SC357. This could occur when the total ALLL reported on Schedule SC exceeds the regulatory capital limit of 1.25 percent of risk-weighted assets. Report on CCR530 the ALLL reported on SC283 and SC357 that is not included on CCR350. Excess ALLL may not include amounts for liabilities for credit losses on off-balance-sheet credit exposures.
CCR78: TOTAL RISK-WEIGHTED ASSETS
The EFS software will compute this line as CCR75 minus CCR530.
CCR80: Total Risk-Based Capital Requirement
The EFS software will compute this line as CCR78, Total Risk-Weighted Assets multiplied by eight percent. This represents the Total Risk-based Capital necessary to be deemed adequately capitalized pursuant to 12 CFR Part 565.
If you have an individual minimum capital requirement (IMCR) set by OTS that requires the maintenance of a capital level in excess of the minimum requirement, you should override the calculated amount and report your IMCR.
This amount should never be less than eight percent of CCR78.
CAPITAL AND PROMPT CORRECTIVE ACTION RATIOS
The EFS software will compute the following ratios. These ratios provide you and the data user with instantaneous calculation of important capital ratios.
CCR810: Tier 1 (Core) Capital Ratio
The EFS software will compute this ratio as Tier 1 (core) capital divided by adjusted total assets (CCR20/CCR25), expressed as a percentage.
CCR820: Total Risk-Based Capital Ratio
The EFS software will compute this ratio as total risk-based capital divided by risk-weighted assets (CCR39/CCR78), expressed as a percentage.
CCR830: Tier 1 Risk-Based Capital Ratio
The EFS software will compute this ratio as Tier 1 (core) capital, less the deduction for low-level recourse and residual interests, divided by risk-weighted assets ((CCR20-CCR375)/CCR78), expressed as a percentage.
CCR840: Tangible Equity Capital
If you do not report purchased credit card relationships (PCCRS) or servicing assets on nonmortgage loans or if you do not have non-qualifying PCCRs or non-qualifying servicing assets on nonmortgage loans, the EFS software will compute this ratio as Tier 1 (core) capital plus cumulative perpetual preferred stock less PCCRS and servicing assets on nonmortgage loans divided by tangible assets less PCCRS and servicing assets on nonmortgage loans ([CCR20-CCR185+SC812-SC644]/[CCR25-CCR285SC644]), expressed as a percentage.
If you have non-qualifying PCCRs or non-qualifying servicing assets on nonmortgage loans, as determined under CCR133, you should manually override the software calculation for CCR840. You should take into consideration adjustments made on CCR 133 so that PCCRs and servicing assets on nonmortgage loans in Tier 1 (core) capital are fully deducted for purposes of the tangible equity ratio.
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SCHEDULE CMR — CONSOLIDATED MATURITY AND RATE
Throughout these instructions, you and your refers to the reporting savings association and its consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
INTRODUCTION
Schedule CMR provides information about the interest rate, repricing, and maturity characteristics of all financial instruments that you hold. We use the information on Schedule CMR as input to the OTS Net Portfolio Value Model (OTS Model). The OTS Model measures your exposure to interest rate risk by estimating how a change in interest rates affects the market value of your assets, liabilities, and off-balance-sheet (OBS) contracts. OTS sends the output reports of the OTS Model to you after the information you submit on Schedule CMR has passed the data edits.
To estimate the market value of a financial instrument, it is necessary to project its future cash flows. To project the future cash flows of a financial instrument, you need the following information:
1. The outstanding balance of the instrument or, in the case of an OBS contract, the notional principal amount of the position.
2. The contract interest rate of the instrument and, if the instrument is adjustable-rate, details concerning how and when the coupon will adjust in the future.
3. The instrument’s amortization schedule and maturity. Because it is not possible to collect this information on Schedule CMR for individual financial instruments, we group together information on instruments that display similar characteristics. For example, you report the total outstanding balance of all your 30-year, conventional, fixed-rate mortgages with coupons
between 7.00 percent and 7.99 percent on CMR002. On CMR007 and CMR012, you report the average maturity and the average coupon of those balances.
Collecting information about financial instruments stratified by coupon range is an important feature of Schedule CMR. When you prepare software to handle preparation of this report, please note that if there are major changes in interest rates, OTS may modify the coupon ranges.
REPORTING OF INFORMATION
Use the same consolidation instructions that apply to the other schedules of the Thrift Financial Report.
Generally, dollar amounts reported on Schedule CMR are outstanding balances. We define outstanding balance as the principal balance, net of LIP and before any yield adjustments or deductions for valuation allowances. In most cases, outstanding balance is face value less charge-offs. We note exceptions to reporting outstanding balances where appropriate. For purposes of reporting in Schedule CMR, exclude nonperforming loans, which we define as nonaccrual loans or loans that are at least 90 days past due but still accruing interest. Report construction LIP in the Off-Balance-Sheet Positions section of Schedule CMR and report nonperforming loans on CMR501 and CMR511 in the Assets section.
You may estimate items requested on Schedule CMR if the necessary information is not available. For example, you may not have ready access to all required information for your holdings of mortgage loans and mortgage securities serviced by others.
FORMAT OF SCHEDULE CMR
We have divided Schedule CMR into six sections. The first three sections collect information on assets, liabilities, and financial derivatives and OBS positions, respectively. You must fill out these three sections of the report. The other three sections, Supplemental Reporting for Assets and Liabilities, Supplemental Reporting of Market Value Estimates and Supplemental Reporting for Financial Derivatives and Off-balance-sheet Positions, are required for most savings associations. We have noted exceptions to the required reporting in the instructions for these sections. We provide these three sections so that you can report additional information that results in more accurate interest rate risk exposure estimates.
Supplemental Reporting for Assets and Liabilities
This section gives you the ability of reporting more detailed information on certain assets and liabilities than you report in the assets and liabilities sections of Schedule CMR. Use of this data by the OTS Model results in more accurate interest rate risk exposure estimates. Supplemental reporting is available for the following areas:
1. Certain types of loans.
2. Investments in mortgage-related mutual funds.
3. Investments in other investment securities.
4. Variable-rate, fixed-maturity (VRFM) liabilities. See the instructions for Supplemental Reporting for Assets and Liabilities for more information.
Supplemental Reporting of Market Value Estimates
In this section, you estimate the market value of several types of complex financial instruments for seven different interest rate scenarios. If the OTS Model valued these instruments, we would need a significant amount of additional data. The valuation estimates you provide will supplement or replace OTS estimates for those instruments. The instruments are:
1. OBS contracts.
2. Mortgage-derivative securities.
3. Liabilities with embedded options. For example, callable debt.
4. Mortgage-derivative securities you issue.
5. Complex securities, such as structured securities.
Some savings associations are required to report market value estimates of these instruments. See detailed instructions in the section Supplemental Reporting of Market Value Estimates.
Supplemental Reporting for Financial Derivatives and Off-Balance-Sheet Positions
This section permits you to report any additional OBS positions you hold beyond the 16 that the Off-Balance-Sheet section of Schedule CMR can accommodate. See the section Financial Derivatives and Off-Balance-Sheet Positions and the section Supplemental Reporting for Derivatives and Off-Balance-Sheet Positions for more information.
CALCULATING WEIGHTED AVERAGES
Certain items that you report on Schedule CMR require that you calculate weighted averages. We describe how to calculate the weighted-average coupon (WAC) and other measures below.
Weighted-Average Coupon (WAC)
The WAC is the average coupon of a group of assets, liabilities, or OBS contracts. You weight the coupon of each individual instrument in the group by its outstanding dollar balance, as a proportion of the total dollar balances of the group. Unless otherwise stated in the reporting instructions for a specific instrument, use the following general guidelines:
1. Express the interest rates for all assets as annual simple interest rates (coupon rates for
securities and contract rates for loans).
2. Express the interest rates for all liabilities as annual percentage yields (APYs).
3. For mortgage loans that others service, report the contract rate of the loan. Do not subtract the servicing fee.
4. Express all WACs as a percent, to two decimal places. For instance, 10.54.
The following example illustrates how to calculate the WAC of a portfolio of 30-year, single-family fixed-rate mortgages. The coupons are between 9.00 percent and 9.99 percent.
Example: You have three mortgages with outstanding balances totaling $350,000. The mortgages have outstanding balances and coupons of $100,000 and 9.75 percent, $110,000 and 9.5 percent, and $140,000 and 9.0 percent. Calculate the WAC for this portfolio as follows:
WAC = $100,000 (9.75%) + $110,000 (9.5%) + $140,000 (9.0%)
$350,000
= 9.37%
Details of the computation of the WAC may vary for certain instruments. For further guidance, see the relevant sections of the instructions.
Weighted-Average Pass-Through Rate
The pass-through rate is the net interest rate passed through to the holder of a mortgage pass-through security. This is the rate after deducting servicing, management, and guarantee fees from the gross coupon of the mortgages underlying the security. The weighted-average pass-through rate is the average coupon of a group of mortgage pass-through securities. Weight the coupon of each security in the group by its outstanding dollar balance, as a proportion of the total dollar balances of the group. Express the interest rates for all assets as annual simple interest rates. Express all weighted-average pass-through rates as a percent, to two decimal places, for instance, 10.54.
The following example illustrates how to calculate the weighted-average pass-through rate of a portfolio of 30-year, single-family, fixed-rate mortgage securities. The coupons are between 9.00 percent and 9.99 percent.
Example: You have three mortgage pass-through securities with outstanding balances totaling $350,000. The securities have outstanding balances and pass-through rates of $100,000 and 9.5 percent, $110,000 and 9.5 percent, and $140,000 and 9.0 percent. Calculate the weighted-average pass-through rate for this portfolio as follows:
Weighted-Average Pass-Through Rate = $100,000 (9.5%) + $110,000 (9.5%) + $140,000 (9.0%) $350,000
= 9.30%
Weighted-Average Remaining Maturity (WARM)
The WARM is the average remaining maturity, in months, for a group of assets or liabilities. You weight the maturity of each individual asset or liability by taking its outstanding dollar balance, as a proportion of the total dollar balances of the group. Round values to the nearest month. Perform rounding after you complete the calculation. The following example illustrates how to calculate the WARM for fixed-rate consumer loans.
Example: You have three fixed-rate consumer loans with total outstanding balances of $40,000. Two are auto loans with respective outstanding balances and remaining maturities of $10,000 and 48 months, and $1,000 and 12 months. The third is a mobile home loan with an outstanding balance of $29,000 and a remaining term of 120 months. Calculate the WARM for your fixed-rate consumer loans as follows:
WARM = $10,000 (48) + $1,000 (12) + $29,000 (120)
$40,000
= 99.3 months
= 99 months (rounded to the nearest month)
For balloon mortgages, use the number of months until payment of the balloon. The following example illustrates how to calculate the WARM for balloon mortgages.
Example: You have two balloon mortgages, each with an outstanding balance of $100. The first mortgage amortizes over 240 months, but the entire remaining principal is due as a balloon in 60 months. The second mortgage amortizes over 360 months, but has a balloon payment in 84 months. The WARM for your balloon mortgages would be 72 months. [72 = ($100/$200) x 60 + ($100/$200) x 84].
An exception to this treatment exists for single-family adjustable-rate mortgages (ARMs) reported on CMR096 through CMR120, Balloon Mortgages and Mortgage-Backed Securities (MBS). See that section for details.
Loans that have matured but still have a principal balance outstanding should be included in calculating the WARM if they are less than 90 days past due. Assign such loans a remaining maturity of one month. Do not include such loans if more than 90 days past due.
For loans made under open-end lines of credit, calculate maturity as if the borrower will repay the existing loan balance by making the minimum payments required by the repayment schedule.
For demand loans, either adjustable- or fixed-rate, that pay interest only and have no definite maturity, use one month when calculating the WARM.
Weighted-Average Margin
The margin of an adjustable-rate loan or deposit is the amount added to the index rate to derive the fully indexed coupon rate. If you have adjustable-rate loans or deposits where you determine the coupon by multiplying an index by some factor, you should calculate an additive margin each quarter. Do this by subtracting the value of the index from the fully indexed coupon rate. Report all weighted-average margins in basis points. When you calculate weighted-average margins for mortgage securities and asset-backed securities, use the net margin for securities. Do not include servicing and guarantee fees. For loans serviced by others, use the gross margin. Do not subtract the servicing fee. For details on specific types of loans, see the relevant section of the instructions.
The following example illustrates how to calculate the weighted-average margin of ARM loans and securities.
Example: You have a portfolio containing an adjustable-rate, single-family, first mortgage loan and a mortgage security backed by adjustable-rate, single-family, first mortgage loans. Both use the one-year Treasury rate as an index. The loan and the security each have an outstanding balance of $100,000. The loan has a gross margin of 225 basis points. The loans backing the security have a gross margin of 225 basis points. You receive a pass-through rate of the one-year Treasury plus 175. The guarantee and servicing fees amount to 50 basis points. Use the security’s net margin of 175 basis points to calculate the weighted-average margin.
Weighted-Average Margin = $100,000 (225) + $100,000 (175) $200,000 = 200 basis points
RELATIONSHIP OF ITEMS ON SCHEDULES CMR AND SC
Information you report on Schedule CMR relates to the information you report on Schedule SC as follows:
Assets
The EFS software computes CMR550 as the sum of the following items:
CMR125
CMR185
CMR261
CMR262
CMR281
CMR282
CMR291
CMR292
CMR311
CMR312
CMR325
CMR326
CMR335
CMR336
CMR377
CMR378
CMR490
CMR501
CMR502
CMR503
CMR508
CMR511
CMR512
CMR517
CMR520
CMR525
CMR530
CMR535
CMR538
CMR541
CMR543
CMR544

Less the sum of the followin
g items:

CMR504
CMR507
CMR513
CMR516
CMR539
CMR540

CMR550 plus the balance for Complex Securities reported as code 121 on the section for Supplemental Reporting of Market Value Estimates should equal SC60, Total Assets. For all editing and output data uses, our data systems will add the balance for complex securities reported as code 121 in the section for Supplemental Reporting of Market Value Estimates to CMR550.
SC11, Cash, Deposits, and Investment Securities, less SC182, Securities Backed by Nonmortgage Loans, equals the sum of the following items:
CMR490 CMR538
Plus Complex Securities reported as code 121 on the section for Supplemental Reporting of Market Value Estimates
Less the sum of the following items:
CMR539 CMR540
SC22, Mortgage-Backed Securities, plus SC26, Mortgage Loans, equals the sum of the following items:
CMR125 CMR185 CMR261 CMR262 CMR281 CMR282 CMR291 CMR292 CMR311 CMR312 CMR501 CMR502 CMR503 CMR508 CMR578 CMR377 CMR378
– Less the sum of the following items: –
CMR504 CMR507 CMR580 SC31, Nonmortgage Loans, plus SC182, Securities Backed by Nonmortgage Loans, equals the sum of the following items:
CMR325 CMR326 CMR335 CMR336 CMR511 CMR512 CMR517 CMR580
– Less the sum of the following items:
CMR513 CMR516 CMR578
SC40, Repossessed Assets, equals CMR525
SC45, Real Estate Held for Investment, equals CMR520
SC55, Office Premises and Equipment, equals CMR535
SC59, Other Assets, plus SC510, FHLB Stock, equals the sum of the following items:
CMR541 CMR543 CMR544
Liabilities and Equity Capital
The sum of SC710, Deposits, SC72, Borrowings, and SC715, Unamortized Yield Adjustments on Deposits, equals the sum of the following line items:
CMR645 CMR715 CMR762 CMR765 CMR768 CMR771 CMR782 CMR784 CMR785
Plus:
(1) Variable-rate, fixed-maturity liabilities reported as codes 200, 220, and 299 in the section Supplemental Reporting for Assets and Liabilities and (2) Structured borrowings reported as codes 280 through 290 in the section Supplemental Reporting of Market Value Estimates.
Less the following item: CMR755
The sum of SC75, Other Liabilities, and SC712, Escrows, equals the sum of the following items:
CMR775 CMR777 CMR779 CMR786 CMR787
SC800, Redeemable Preferred Stock and Noncontrolling Interest in Consolidated Subsidiaries, equals
the sum of CMR755 and CMR793.
SC80, Total Equity Capital, equals CMR796.
ASSETS
TERMS USED IN THE ASSETS SECTION
Dwelling Unit: A dwelling unit is a unified combination of rooms, whether existing or under construction, designed for residence by one family. This classification does not change because of incidental use for business purposes.
Single Family Mortgages: Single-family mortgages include all permanent loans and combination construction-permanent loans where the permanent financing interest rate has already been set. They may be secured by any of the following types of properties:
1. One-family dwellings in detached or semi-detached structures.
2. Individual permanently financed units in a condominium, cooperative, or timesharing arrangement where the owner of each unit has an undivided proportional interest in the underlying real estate and common elements of the structure.
3. Structures consisting of two- to four-dwelling units. Multifamily Mortgages: Multifamily mortgages include all permanent loans and combination construction-permanent loans where the permanent financing interest rate has already been set. They
are secured by residential property containing five or more dwelling units and include the following types of properties:
1. Mortgages on fraternity or sorority houses offering sleeping accommodations.
2. Living accommodations for students or staff of a college or hospital.
3. Retirement homes with sleeping and eating accommodations that are not condominiums or
cooperatives. In these cases, the number of bedrooms determines the number of dwelling units.
Nonresidential Mortgages: Nonresidential mortgages include all permanent loans and combination construction-permanent loans where the permanent financing interest rate has already been set. They are secured by properties not covered by the definition of single-family dwelling units, multifamily dwelling units, or land loans. This category includes the following types of properties regardless of the incidental use of the property as a dwelling unit:
1. Mobile home parks.
2. Hospitals.
3. Nursing homes.
4. Churches.
5. Stores.
6. Other commercial property.
7. Properties used for farming. Construction and Land Loans: Construction and land loans include land loans and the funded portion
of construction loans as a single balance. This category includes most loans classified as construction or land loans in Schedule SC including the following types of properties:
1. Loans to acquire and develop land.
2. Loans for developed building lots.
3. Loans for unimproved land.
4. Construction loans secured by single-family, multifamily, or nonresidential properties.
5. Loans to developers secured by land where the developer is constructing any of these properties. Construction and land loans do not include combination construction-permanent mortgages on any type
of property where the permanent financial interest rate has already been set; include such loans with permanent mortgages in the relevant category.
Nonperforming Loans: Nonperforming loans are nonaccrual loans and loans that are still accruing interest and are at least 90 days past due, or an equivalent number of cycles – see the instructions for Schedule PD.
Teaser ARMs: Teaser ARMs are adjustable rate mortgages originated at introductory rates below the fully indexed rate, teaser rates, and that remain at their introductory rates – that is, they have not reset.
Balloon Mortgages: Fixed-rate balloon mortgages are fixed-rate mortgages with a remaining maturity at least ten years shorter than the remaining time to full amortization. For example, a fixed-rate mortgage that matures in four years and that would require 14 years to amortize fully is a balloon mortgage.
Call Loans: Call loans are extensions of credit where the lender may require repayment of outstanding principal on one or more contractually specified call dates, irrespective of any contractual maturity date. Lenders often refinance, or roll over, such loans under new terms, upon mutual agreement of lender and borrower.
Pass-through securities: Pass-through securities are securities that convey ownership of a fractional part of each asset in a pool of assets backing the security. The issuer collects principal and interest payments generated by the underlying pool of assets and passes the payments through to each security owner based on their share of ownership.
Pay-through securities: Pay-through securities represent secured debt of the issuer. They give an investor a security interest in, but not ownership of, the underlying assets. You should consider any asset-backed security that does not meet the definition of pass-through securities above, to be a pay-through security.
FIXED-RATE, SINGLE-FAMILY, FIRST MORTGAGE LOANS AND MORTGAGE-BACKED SECURITIES
Report requested information about performing, fixed-rate, first mortgage, single-family loans, participations in such loans, and pass-through securities backed by such loans.
Include:
1. Fixed-rate fully amortizing mortgages.
2. Fixed-rate balloon payment mortgages.
3. Mortgages with a single rate adjustment. For instance, those that would qualify for the FNMA Two-Step Mortgage program.
4. Mortgages with interest rates that adjust less often than every five years.
5. Mortgages with coupons that were adjustable in the past, but where the coupon will remain fixed for the remaining maturity.
6. Mortgages with rates that change over time by prespecified steps. For instance, a 2/1 buydown with rates scheduled to be seven percent in year one, eight percent in year two, and 9 percent thereafter.
7. Some call mortgages, as described below.
8. Combination construction-permanent mortgages for single-family dwellings where the permanent financing interest rate has already been set.
Do not include:
1. Nonperforming mortgages. Report on CMR501.
2. Mortgage warehouse loans, loans collateralized by mortgage loans rather than liens directly on real estate. Report as commercial loans on CMR326.
3. Mortgages you service for others. Report in the section dealing with mortgage servicing rights, CMR401 through CMR450.
4. Second mortgages, secured home improvement loans, or home equity loans, regardless of whether you also hold the first lien or whether there is a first lien. Report as second mortgages on CMR312.
We collect all information described below according to coupon range and type of loan or security.
Coupon Range: Divide mortgages into the following coupon categories:
1. Less than 5 percent.
2. 5 to 5.99 percent.
3. 6 to 6.99 percent.
4. 7 to 7.99 percent.
5. 8 percent and greater. Report each mortgage loan and participation in the coupon range that corresponds to its contract rate.
For loans serviced by others, be careful to report according to the contract rate of the loans. Do not subtract the servicing fee.
Report each mortgage security in the coupon range that corresponds to the pass-through rate of the security. For example, you should report a FNMA security with a pass-through rate of 6.5 percent and where the collateral has a WAC of 7.25 percent in the 6 to 6.99 percent coupon column.
Within each coupon range, divide mortgages into the following broad groups:
1. Thirty-year mortgage loans.
2. Securities backed by 30-year conventional mortgages.
3. Securities backed by 30-year FHA or VA mortgages.
4. Fifteen-year mortgages and mortgage securities.
5. Balloon mortgages and mortgage securities.
Information requested for the five groups differs somewhat; however, the following general information applies, unless the instructions state differently.
1. Wherever there is a request for a balance use the following guidelines:
a.
Report the outstanding principal balance, not the carrying value, of mortgage loans.
b.
Report the pro rata share of the outstanding principal balance of participations in mortgages.
c.
Report the outstanding principal balance of mortgage securities.
1. Wherever we request a WARM, refer to the calculation of the WARM in the general instructions to Schedule CMR.
2. Wherever we request a weighted average WAC, refer to the calculation of the WAC in the general instructions to Schedule CMR.
3. Wherever we request a weighted-average pass-through rate, refer to the calculation of the
weighted-average pass-through rate in the general instructions to Schedule CMR. A detailed description of the information to report for each group follows.
Thirty-year Mortgages and MBS
CMR001 Through CMR020: Mortgage Loans
Include all fully amortizing mortgage loans and participations in fully amortizing mortgage loans with an original maturity of at least 25 years. Include combination construction-permanent mortgages that have fixed rates for the entire term of the loan. Do not report mortgage loans with a biweekly payment feature.
Report outstanding balances, by coupon range, on CMR001 through CMR005. For each balance, report the WARM and the WAC on the corresponding column of CMR006 through CMR010 and CMR011 through CMR015, respectively. Of the loan balances on CMR001 through CMR005, report the amount of each that is FHA or VA guaranteed on CMR016 through CMR020, as appropriate.
CMR026 Through CMR040: Securities Backed by Conventional Mortgages
Include FHLMC, FNMA, and privately issued mortgage securities backed by fully amortizing mortgage loans with original maturity of at least 25 years. Do not report mortgage loans with a biweekly payment feature.
Report the outstanding balances of securities on CMR026 through CMR030 according to the coupon rates of the securities. For each balance, report the WARM on CMR031 through CMR035, and report the weighted-average pass-through rate corresponding to each balance on CMR036 through CMR040.
CMR046 Through CMR060: Securities Backed by FHA or VA Mortgages
Include all GNMA and other mortgage securities backed by fully amortizing FHA and VA mortgage loans with an original maturity of at least 25 years. Do not report mortgage loans with a biweekly payment feature.
On CMR046 through CMR050 report, by coupon range, outstanding balances of these mortgage securities. For each balance entered CMR046 through CMR050, report the WARM on CMR051 through CMR055 and the weighted-average pass-through rate on CMR056 through CMR060.
CMR066 Through CMR090: Fifteen-year Mortgages and MBS
Include all fully amortizing mortgage loans with an original maturity of less than 25 years. Include participations in such loans, and mortgage securities backed by such loans. Include biweekly payment mortgages having an original maturity of 25 years or more. Include combination construction-permanent mortgages that have fixed rates for the entire term of the loan.
On CMR066 through CMR070 report, by coupon range, the outstanding principal balances of such mortgage loans and participations. On CMR071 through CMR075, report the WAC of each balance reported on CMR066 through CMR070. Report the outstanding principal balance of mortgage securities backed by loans of this type, by coupon range, on CMR076 through CMR080.
Place security balances into the coupon range corresponding to the pass-through rate of the security. Report the weighted-average pass-through rate of the securities on CMR081 through CMR085. Report on CMR086 through CMR090, by coupon range, the WARM of the loans and securities reported in each coupon range.
CMR096 through CMR120: Balloon Mortgages and MBS
Report requested information about the following types of single-family first mortgage loans. Include participations in such loans and securities backed by such loans.
Include:
1. Balloon payment mortgages. Fixed-rate balloon mortgages are fixed-rate mortgages with a remaining maturity at least ten years shorter than the remaining time to full amortization. For example, a fixed-rate mortgage that matures in four years and that would require 14 years to amortize fully is a balloon mortgage.
2. Mortgages scheduled for a single rate adjustment, such as those that would qualify for the FNMA Two-Step mortgage program.
3. ARMs whose coupons reset less frequently than every five years.
4. Some call loans, which we describe in the examples below. Call loans are those where you have the option, on a particular date, to require repayment of the loan, or may roll it over into a loan with potentially different terms. In particular, the interest rate of a call loan is subject to change on the call date.
On CMR096 through CMR100 report, by coupon range, the outstanding principal balances of the above listed types of mortgage loans and participations. On CMR101 through CMR105, report the WAC of each balance on CMR096 through CMR100. Report the outstanding principal balance of mortgage securities backed by loans of this type, by coupon range, on CMR106 through CMR110.
Place security balances into the coupon range corresponding to the pass-through rate on CMR101 through CMR105. Report the WAC of each balance on CMR096 through CMR100. Report the outstanding principal balance of mortgage securities backed by loans of this type, by coupon range, on CMR106 through CMR110. Place security balances into the coupon range corresponding to the pass-through rate of the security. Report the weighted-average pass-through rate of the securities on CMR111 through CMR115. Report on CMR116 through CMR120, by coupon range, the WARM of the loans and securities reported in each coupon range. Calculate the remaining maturity based on the number of months remaining until the one of the following dates:
1. Date the balloon payment is due – for balloon mortgages.
2. Next scheduled payment reset date for mortgages with a single rate adjustment and mortgages with interest rates that adjust less often than every 5 years.
3. Next call date for call mortgages.
If the terms of the mortgage change:
If the terms change following a scheduled rate reset or because you roll over the loan on its balloon due date or call date, you should reclassify the mortgage as follows:
1. If the interest rate will remain fixed for the remaining term of the mortgage, report it as a single-family, 30-year, fixed-rate mortgage (CMR001 through CMR060) or a single-family, 15-year, fixed-rate mortgage (CMR066 through CMR090). The term depends on the time between the date of final principal repayment and the date the original mortgage was originated. If that period is at least 25 years, report the mortgage with the 30-year fixed-rate mortgages; if less, report it with the 15-year fixed-rate mortgages.
1. Report the mortgage as an ARM on CMR141 through CMR245, as appropriate, if it falls into either of the following categories:
1. The interest rate resets at least every 5 five years during the remaining maturity of the mortgage.
2. If the mortgage is subject to a series of calls no more than five years apart.
2. Otherwise, continue to report the loan as a balloon mortgage.
Examples:
1. A seven-year balloon mortgage amortizes according to a 30-year schedule.
a.
During the seven years before the balloon payment date, you should report the mortgage as a balloon mortgage. Its remaining maturity is equal to the number of months until the balloon payment is due.
b.
If, after seven years, you roll the mortgage over into a fully amortizing, fixed-rate mortgage with 23 years remaining until maturity, you would report it as a 30-year fixed-rate mortgage (CMR001 through CMR060). The time between origination and final maturity of the mortgage in this example is 30 years [seven 7 years + 23 years]. This exceeds the 25-year criterion for reporting in the 30-year fixed-rate category.
2. Assume instead of 30 years, the balloon mortgage in Example 1 had been amortizing according to a 20-year schedule. Then, after seven years, you rolled the mortgage over into a fully amortizing fixed-rate loan with 13 years remaining maturity.
a. After you rolled the loan over, you would report the loan as a 15-year fixed-rate mortgage. This is because its 20-year total maturity is less than the 25-year cutoff for inclusion in the 30year mortgage category.
3. A 30-year, two-step mortgage has a single interest rate reset after five years.
a.
During the first five years of its life, you would report the mortgage as a balloon mortgage, with its remaining maturity equal to the number of months until the rate reset date.
b.
Following the rate reset, you would report the mortgage as a 30-year fixed-rate mortgage. The remaining maturity would be equal to the number of months until the maturity date.
4. A 30-year fixed-rate mortgage that you may call after six years. The note does not stipulate any further calls or rate resets.
a.
Report the mortgage as a balloon for the first six 6 years of its life. Its remaining maturity is equal to the number of months until the call date.
b.
If you roll the mortgage over after six years, reporting would depend on the provisions written into the new or amended note.
5. A 30-year mortgage has a fixed rate of interest for six years, but the contract stipulates that the rate will adjust annually thereafter.
a.
For the first year of its life, report the mortgage as a balloon mortgage. Its remaining maturity is equal to the number of months until the rate reset date.
b.
After the first year, report it in the single family, ARM section, CMR141 through CMR245. This is because, in the future, its interest rate will be subject to reset at least every five years, as required for reporting in that section. The remaining maturity of the mortgage is equal to the number of months until the final maturity date.
6. A 30-year fixed-rate mortgage that you may call after six years and is subject to annual calls thereafter.
a. The reporting would be the same as in Example 5. We treat scheduled resets and calls the same.
7. A 30-year mortgage is subject to rate resets, or calls, every five years.
a. Report it as an ARM, because the interest rate may potentially reset at least every five years as required for reporting in the ARMs section.
CMR125: Total Fixed-Rate, Single-Family, First Mortgage Loans and Mortgage-Backed Securities
The EFS software computes this line as the sum of: CMR001 through CMR005, CMR026 through CMR030, CMR046 through CMR050, CMR066 through CMR070, CMR076 through CMR080, CMR096 through CMR100, and CMR106 through CMR110.
ADJUSTABLE-RATE, SINGLE-FAMILY, FIRST MORTGAGE LOANS AND MORTGAGE-BACKED SECURITIES
Report requested information about performing adjustable-rate, single-family, first mortgage loans – ARMs, participations in such loans, and pass-through securities backed by such loans.
Include:
1. Adjustable-rate fully amortizing mortgages.
2. Adjustable-rate balloon payment mortgages.
3. Fixed-rate mortgages subject to call at contractually set intervals of at most every five years.
4. ARMs that you own, but do not service.
5. Combination construction-permanent mortgages for single-family dwellings with interest rates
meeting any of the above criteria, even if construction is not complete. Do not include the following types of mortgages. Report instead with fixed-rate mortgages on CMR001 through CMR125:
1. Mortgages with a single rate adjustment. For instance, those that would qualify for the FNMA Two-Step Mortgage program.
2. Mortgages with interest rates that adjust less often than every five years.
3. Mortgages with coupons that were adjustable in the past, but that do not have any further rate adjustments scheduled during their remaining term.
4. Mortgages with rates that change over time by prespecified steps. For example, a 2/1 Buydown
with rates scheduled to be 7 percent in year one, 8 percent in year two, and 9 percent thereafter. Also, do not include:
1. Nonperforming mortgages. Report on CMR501.
2. Mortgage warehouse loans (loans collateralized by mortgage loans rather than liens directly on real estate). Report as commercial loans on CMR325.
3. Mortgages you service for others. Report in the section dealing with mortgage servicing rights, CMR401 through CMR450.
4. Second mortgages, even when you hold both the first and second liens. Report as second
mortgages on CMR311. Group mortgages according to type of index – current market or lagging market – and frequency of coupon reset, as described below. Report ARMs originated at introductory rates below the fully indexed rate, teaser rates, and that remain at their introductory rates – have not yet reset – separately on CMR141 through CMR150, and are not reported with other ARMs on CMR156 through CMR215. Do not distinguish between convertible and nonconvertible ARMs.
Current Market Index ARMs
ARMs with indices that adjust quickly to changes in market interest rates are current market index ARMs. Examples of current market indices include the following:
1. Rates on Treasury securities.
2. Prime rate.
3. London Interbank Offered Rate (LIBOR).
4. FHLB advance rate.
5. FHLMC sixty-day rate.
Indices that adjust to changes in market interest rates less quickly are lagging market indices. We group ARMs using such indices separately. See Lagging Market Index ARMs below.
Divide current market index ARMs into three groups based on the frequency that their coupons reset. Group ARM securities according to the frequency that their underlying loans reset, not on the coupon reset frequency of the security. Report current market index ARMs with coupons that reset as follows:
1. Every six months or less — report in the Current Market Index column 6 Mo. or Less.
2. Less frequently than semiannually, but at least every two years —– report in the Current Market Index column 7 Mo. to 2 Yrs.
3. Less often than every two years, but at least every five years — report in the 2+ Yrs. to 5 Yrs.
column. Report ARMs with a reset frequency greater than five years with Fixed-Rate Balloon Mortgages. See instructions above.
Group ARMs that have irregular adjustment periods according to the remaining time until the loan will begin accruing at a new rate. For example, you would report an ARM with a rate that will reset for the first time after 36 months and then annually thereafter in the 2+ Yrs. to 5 Yrs. column during the first 12 months of its life, and in the 7 Mo. to 2 Yrs. column thereafter.
Lagging Market Index ARMs
ARMs with indices that adjust to changes in market interest rates less quickly than current market indices are lagging market index ARMs. Examples of lagging indices include the following:
1. Cost of funds (COF) indices. For instance, FHLB 11th District COF Index, Federal COF Index.
2. National Average Contract Rate for the Purchase of Previously Occupied Homes.
3. Indices that are more than three months old. For instance, a rate adjustment based on the one-year Constant Maturity Treasury (CMT) yield six months before the adjustment date.
4. Indices based on portfolio rates, rather than current offered rates.
5. Rolling averages of indices using an index within the average that is more than three months old. Divide information about lagging index ARMs into two groups based on the frequency that their accrual rates reset. Group ARM securities based on the frequency that their underlying loans reset not the
coupon-reset frequency of the security. Report lagging market index ARMs with accrual rates that reset as follows:
1. Monthly or less — report in the Lagging Market Index column – 1 Month.
2. Less often than monthly, but at least every five years — report in the Lagging Market Index column – 2 Mo. to 5 Yrs.
3. Lagging index ARMs that reset less often than every five years — report with Fixed-Rate Balloon Mortgages. See instructions above. Report fixed-rate call mortgages that qualify for reporting as ARMs in the Lagging Market Index column that best approximates the number of months between call dates.
ARMs Not Indexed To Treasury, LIBOR, or COF
The OTS Model assumes you determine the coupons of ARMs by adding the reported margin to a Treasury rate index for current market index ARMs or a COF index for lagging index ARMs. This treatment may result in inaccurate interest rate exposure estimates for ARMs that do not have coupons tied to a Treasury, LIBOR, or COF index. That means they do not have coupons tied to the interest rates represented by codes 303 through 412, 811, 812, or 820 in Appendix A. Examples of ARMs not tied to those indices include the following:
1. ARMs indexed to the prime rate or the National Average Contract Rate.
2. ARMs with no contractual index where you have discretion to set rates at each reset interval.
If you have ARMs whose coupons use something other than a Treasury, LIBOR, or COF index, you should use the following reporting treatment:
After categorizing all ARM balances into the appropriate columns as described in the previous two sections, calculate what percent of each column’s total balance consists of ARMs indexed to Treasury or LIBOR for current marked indices or a COF index for lagging market indices. Include both teaser and nonteaser ARMS. After categorizing all ARM balances into the appropriate columns as described in the previous two sections, calculate what percent of each column’s total balance, both teaser and non-teaser, consists of ARMs indexed to Treasury or LIBOR for current marked indices or a COF index for lagging market indices.
If the ARM balances, both teaser and nonteaser, tied to a Treasury, LIBOR, or COF index are less than fifty percent of the total balance in a given column, report an entry of 9999 in the margin cell for that column – CMR161 through CMR165.
If the ARM balances, both teaser and nonteaser, tied to a Treasury, LIBOR, or COF index are fifty percent or more of the total balance, calculate the margin for that column based on only the margins of the nonteaser ARM balances that use a Treasury, LIBOR, or COF index.
Base all other ARM characteristics reported in the column – for instance, WAC, WARM, time until next payment reset, rate caps and floors – on all ARM balances in the column.
Teaser ARMs
Teaser ARMs are adjustable-rate mortgages that you originated with a temporary, introductory interest rate (teaser rate). Report an ARM as a Teaser ARM if it meets the following criteria:
1. The loan originated with an accrual rate that was below the fully indexed rate.
2. The loan had an introductory rate scheduled to reset 12 months or less after the first scheduled payment.
3. The ARM’s first reset date has not yet passed.
Mortgages with interest rates fixed for a specified number of years and that subsequently adjust annually (such as 3/1 or 5/1 ARMs) will rarely meet the above criteria for Teaser ARMs.
CMR141 through CMR145: Balances Currently Subject to Introductory Rates
Report the outstanding balance of teaser ARM loans, participations, and securities currently subject to teaser rates by type of index and reset frequency on CMR141 through CMR145.
CMR146 through CMR150: Weighted-Average Coupon (WAC)
Report the WAC for each index and reset frequency category, in percentage points, on CMR146 through CMR150. Calculate the WAC as described in the general instructions to Schedule CMR, using coupon rates for mortgage loans and pass-through rates for mortgage securities. For loans serviced by others, use the contract rate of the loans. Do not subtract the servicing fee.
Example: You have $100,000 in ARM loans currently paying 8 percent interest and $200,000 of ARM securities with a pass-through rate of 7.40 percent. You would report a WAC of 7.60 percent for the combined $300,000 balance.
WAC = $100,000 (8.00%) + $200,000 (7.40%)
$300,000
= 7.60%
Note that for one-month Cost of Funds Index (COFI) ARMs you should calculate the WAC using the interest rate that the current payment uses, not the accrual rate.
Nonteaser ARMs
Report the following items by type of index and reset frequency for ARMs that are not subject to an introductory teaser rate:
CMR156 Through CMR160: Balances of All Nonteaser ARMs
Report the outstanding balance of loans, participations, and securities in each index and reset frequency category on CMR156 through CMR160.
CMR161 through CMR165: Weighted-Average Margin
Report the weighted-average margin of each ARM category, in basis points, on CMR161 through CMR165. Calculate the weighted-average margin as described in the general instructions to Schedule CMR.
In calculating the weighted-average margin, use the contractual margin, not the difference between the current coupon and the index. The contractual margin is the amount added to the index to calculate the fully indexed rate. The fully indexed rate may differ from the contractual margin when rate caps or floors are binding. For ARM securities, use the net margin. Net margin is the gross margin of the underlying loans less servicing and guarantee fees. For loans serviced by others, use the gross margin in the calculation; do not subtract the servicing fee. For mortgages that have a fixed interest rate for a specified number of years and that subsequently adjust annually (such as 3/1 or 5/1 ARMs), report the margin that the mortgage will use when the annual adjustments begin.
If ARMs tied to a Treasury, LIBOR, or COF index are less than 50 percent of the balances in a given column of the ARMs section, report an entry of 9999 in the margin cell.
CMR166 through CMR170: Weighted-Average Coupon (WAC)
Report the WAC for each category, in percentage points, on CMR166 through CMR170. Calculate the WAC as described in the general instructions to Schedule. Use coupon rates for mortgage loans and pass-through rates for mortgage securities. For loans serviced by others, use the contract rate of the loans. Do not subtract the servicing fee.
Example: Suppose you have $100,000 of ARM loans currently paying 8 percent interest and $200,000 of ARM securities with a pass-through rate of 7.40 percent. You would report a WAC of 7.60 percent for the combined $300,000 balance.
WAC = $100,000 (8.00%) + $200,000 (7.40%)
$300,000
= 7.60%
Note: For one-month COFI ARMs, calculate the WAC using the interest rate that the current payment uses, not the accrual rate.
CMR171 through CMR175: Weighted-Average Remaining Maturity (WARM)
Report the WARM for each category on CMR171 through CMR175. Calculate the WARM as described in the general instructions to Schedule CMR. For adjustable-rate balloon mortgages use the number of months until the balloon payment is due. For combination construction-permanent mortgages use the number of months until the permanent mortgage matures.
CMR176 through CMR180: Weighted-Average Time until Next Payment Reset
Report the weighted-average number of months until the next payment reset for each category, in months, on CMR176 through CMR180. The date of the next payment reset of an ARM is the date that the new payment is due to you. Do not use the date the loan begins to accrue at the new interest rate. Calculate this item in the same manner as the WARM described in the general instructions to Schedule. Use the number of months until next payment reset for each loan or mortgage security instead of the remaining maturity.
Example: You have two ARMs indexed to the one-year Constant Maturity Treasury (CMT) yield. One has a balance of $50,000 and two months until next payment reset. The other has a balance of $150,000 with ten months until next payment reset. You would report eight months as the weighted-average time until next payment reset on CMR177, in the 1-Year Reset column.
Weighted-Average Time Until Next Payment Reset = $50,000 (2 mo.) + $150,000 (10 mo.) $200,000
= 8 months
For ARMs with accrual rates and payments that reset at different frequencies (for example, one-month COFI ARMs), be careful to use the months to next payment reset, not months to the next reset of the accrual rate.
CMR185: Total Adjustable-Rate, Single-Family, First Mortgage Loans and Mortgage-Backed Securities
Report on CMR185, the outstanding balance of all ARM loans, participations, and securities reported on CMR141 through CMR145 and CMR156 through CMR160.
Memo Items for all ARMS (Reported at CMR185):
ARM Balances by Distance to Lifetime Cap
CMR186 through CMR215 collects information about the proximity of ARM coupons to their lifetime interest rate caps. Group all ARM loans, participations, and securities reported on CMR185 by the distance between the current coupon of each and its lifetime cap, as described below. For securities, use the distance between the pass-through rate and its lifetime cap – the net lifetime cap. For one-month COFI ARMs, calculate the distance between the cap and the interest rate that the current payment uses, not the accrual rate.
CMR186 through CMR190: Balances with Coupon within 200 Basis Points of Lifetime Cap
Report the outstanding balances of ARM loans, participations, and securities where the current coupon is 200 basis points or less below the lifetime cap.
CMR191 through CMR195: Weighted-Average Distance from Lifetime Cap
Report, in basis points, the weighted-average distance between the coupons and lifetime caps of the balances reported on CMR186 through CMR190. Calculate this item in the same manner as described for the WAC in the general instructions to Schedule CMR. However, instead of the coupon rate of each loan or security, use the number of basis points between the loan’s, or security’s, current coupon and lifetime cap. For one-month COFI ARMs, calculate the distance between the cap and the interest rate that the current payment uses, not the accrual rate.
CMR196 through CMR200: Balances with Coupon 201 - 400 Basis Points from Lifetime Cap
Report the outstanding balances of ARM loans, participations, and securities where the current coupon is at least 201 basis points, but no more than 400 basis points below the lifetime cap.
CMR201 through CMR205: Weighted-Average Distance from Lifetime Cap
Report, in basis points, the weighted-average distance between the coupons and lifetime caps of the balances reported on CMR196 through CMR200. Calculate this item in the same manner as described for CMR191 thr