FR4004_20130426_omb

Supporting Statement for the
Written Security Program for State Member Banks
(FR 4004; OMB No. 7100-0112)
Summary
The Board of Governors of the Federal Reserve System, under delegated authority from
the Office of Management and Budget (OMB), proposes to extend for three years, without
revision, the Written Security Program for State Member Banks (FR 4004; OMB No. 71000112). This mandatory information collection is a recordkeeping requirement contained in the
Board’s Regulation H Section 208.61. Each state member bank must develop and implement a
written security program and maintain it in the bank’s records. There is no formal reporting
form and the information is not submitted to the Federal Reserve. The annual burden for the
FR 4004 is estimated to be 22 hours (i.e., on average 0.5 hours per bank) for 44 state member
banks, the number of state member bank applications approved during the 2011 calendar year.
Background and Justification
The Congress adopted the Bank Protection Act of 1968 (12 U.S.C. § 1882) to promulgate
rules establishing minimum standards for banks as to the installation, maintenance, and operation
of security devices and procedures to discourage robberies, burglaries, and larcenies and to assist
in the identification and apprehension of persons who commit such acts.
In response to the passage of the Bank Protection Act (Act), each of the federal financial
institution supervisory agencies established minimum standards for security devices and
procedures. The requirements established by the Board of Governors of the Federal Reserve
System in 1969 for state member banks were contained in Regulation P. In the regulation, the
Federal Reserve required the board of directors of each state member bank to designate a
security officer to assume the responsibility for the development and administration of a written
security program within 180 days of opening for business. The original Act also contained
provisions that required financial institutions to submit periodic reports to their primary federal
supervisory agency with respect to the installation, maintenance, and operation of security
devices and the development of security procedures.
The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA)
included provisions that amended the Act. The provisions eliminated the requirement that each
bank submit periodic reports to its regulator, but retained the requirement that each bank develop
and implement a written security program. The Federal Reserve amended Regulation P in 1991
to reflect this change.1
Effective October 1, 1998, Regulation P, Minimum Security Devices and Procedures for
Federal Reserve Banks and State Member Banks, was rescinded and its provisions were
incorporated into Regulation H (12 CFR §208.61).2 The Federal Reserve’s action to incorporate
1

Two other reporting and recordkeeping requirements (FR 4003 and FR 4005; OMB No. 7100-0112) were
discontinued following the Regulation P amendments.
2
Federal Register notice published July 13, 1998, (63 FR 37665).

Regulation P into Regulation H was designed to simplify compliance by consolidating regulatory
requirements that apply to state member banks into one regulation.
The Federal Reserve has determined that Regulation H, section 208.61 continues to
require the board of directors of each state member bank to designate a security officer to assume
the responsibility for the development and administration of a written security program within
180 days of opening for business.
Description of Information Collection
Each state member bank must keep a written security program in its records. This
program should include a requirement to install security devices and should establish procedures
that satisfy minimum standards in the regulation, with the security officer determining the need
for additional security devices and procedures based on the location of the banking office.
Time Schedule for Information Collection
Because the written security program is a recordkeeping requirement, copies of the
program are not collected by the Federal Reserve System and are not published. Bank examiners
verify compliance with this recordkeeping requirement during examinations of state member
banks.
Legal Status
The Board’s Legal Division has determined that section 3 of the Bank Protection Act
(12 U.S.C. § 1882(a)) authorizes the Board to require the recordkeeping of this information.
Section 208.61 of the Board’s Regulation H (12 C.F.R. § 208.61) implements section 3 of the
Bank Protection Act and sets forth bank security procedures for state member banks. Because
written security programs are maintained at state member banks, no issue of confidentiality
under the Freedom of Information Act normally arises. However, copies of such documents
included in examination work papers would, in such form, be confidential pursuant to exemption
8 of the Freedom of Information Act (5 U.S.C. § 552(b)(8)). In addition, the records may also be
exempt from disclosure under exemption 4 of the Freedom of Information Act (5 U.S.C. §
552(b)(4)).
Consultation Outside the Agency
On February 11, 2013, the Federal Reserve published a notice in the Federal Register
(78 FR 9691) requesting public comment for 60 days on the extension, without revision, of the
FR 4004. The comment period for this notice expired on April 12, 2013. The Federal Reserve
did not receive any comments on the extension. On April 26, 2013, the Federal Reserve
published a final notice in the Federal Register (78 FR 24745) for the FR 4004.
Estimate of Respondent Burden
The annual recordkeeping burden for the FR 4004 is estimated to be 22 hours, as

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presented in the following table. The number of respondents is based on the number of state
member bank applications approved during 2011. These recordkeeping requirements represent
less than 1 percent of the total Federal Reserve System paperwork burden.

FR 4004

Number of
respondents3

Annual
frequency

Estimated
average hours
per response

Estimated
annual burden
hours

44

1

0.5

22

The total cost to the public is estimated to be $987.4
Sensitive Questions
This collection of information contains no questions of a sensitive nature, as defined by
OMB guidelines.
Estimate of Cost to the Federal Reserve System
Annual costs to the Federal Reserve System associated with this recordkeeping
requirement are minimal because there are no reporting forms and the information is not
submitted to the Federal Reserve.

3

Of these respondents, 18 are small entities as defined by the Small Business Administration (i.e., entities with less
than $175 million in total assets) www.sba.gov/content/table-small-business-size-standards.
4
Total cost to the public was estimated using the following formula: Percent of staff time, multiplied by annual
burden hours, multiplied by hourly rate (30% Office & Administrative Support @ $17, 45% Financial Managers @
$52, 15% Legal Counsel @ $55, and 10% Chief Executives @ $81. Hourly rate estimates for each occupational
group are the median hourly wages (rounded up) using data from the Bureau of Labor and Statistics (BLS),
Occupational Employment and Wages 2011, www.bls.gov/news.release/ocwage.nr0.htm. Occupations are defined
using the BLS Occupational Classification System, www.bls.gov/soc/.

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