Annual Capital and Asset Report for Foreign Banking Organizations

(April 24, 2014 DRAFT)

INSTRUCTIONS FOR PREPARATION OF

The Capital and Asset Report
for Foreign Banking Organizations

General Instructions

FT

FR Y-7Q

The Capital and Asset Report for Foreign Banking
Organizations (FR Y-7Q) requires financial information
from foreign banking organizations (FBOs).

Who must report

The FR Y-7Q must be filed by each top-tier FBO. The
report consists of two parts.

• Reported quarterly for each lower-tier FBO (where
applicable) operating a branch or an agency, or
owning an Edge or Agreement corporation, or a
commercial lending company subsidiary in the
United States, if it or any FBO in its tiered structure
has FHC status.

Generally, the top-tier reporter of the FR Y-7Q is the
same as the top-tier reporter for the annual FR Y-7 report.
With certain tiered FBOs, however, the initial determination of the top-tier reporter for FR Y-7Q reporting
purposes may require consultation with Federal Reserve
staff. This determination will be based primarily on
whether the top-tier reporter provides capital ratio information to its home country authorities. For example, a
top-tier entity that is an insurance company and does not
provide capital ratio information to home country authorities will likely not have to provide capital ratio information on the FR Y-7Q; in this case, the next-highest tier
that provides capital and asset information to home
country authorities would likely be deemed the top-tier
entity for capital and asset reporting on the FR Y-7Q. For
any items being translated from foreign currency denominations, the foreign currency translation rate should be
the rate effective on the as-of date of the report.

RA

1) Part 1 - Capital and Asset Information for the Top-tier
FBO.

Edge or Agreement Corporation, or a commercial
lending company subsidiary in the United States.

D

• Reported quarterly by each top-tier FBO if the FBO
or any FBO in its tiered structure has effectively
elected to be a financial holding company (FHC).
Also, reported quarterly by each top-tier FBO that
has total consolidated assets of $50 billion or more
as of the report date, regardless of FHC status. Once
an FBO without FHC status has total consolidated
assets of $50 billion or more and begins to report
quarterly, the FBO must continue to report Part 1
quarterly unless and until the FBO has reported
total consolidated assets of less than $50 billion for
each of all four quarters in a full calendar year.
Thereafter, an FBO without FHC status may revert
to annual reporting, in accordance with the instructions for annual reporting below. If at any time,
after reverting to annual reporting, an FBO without
FHC status has total consolidated assets of $50
billion or more, the FBO must return to quarterly
reporting of Part 1 immediately.
• Reported annually by each top-tier FBO if (1) the
FBO or any FBO in its tiered structure has not
effectively elected to be an FHC and (2) the FBO
has total consolidated assets of less than $50 billion
as of the report date.

2) Part 2 - Capital and Asset Information for Lower-tier
FBOs Operating a Branch or an Agency, or owning an
FR Y-7Q
General Instructions

March 2014

All financial data should be reported in U.S. dollars, as
indicated on the reporting form.

Page 1

Page

The page 1 of the report must include the legal name of
the FBO filing the FR Y-7Q and the mailing address. The
name, telephone number and e-mail address of a contact
at the FBO to whom questions about the report(s) may be
directed must be indicated.
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General Instructions

Legal Name of Foreign Banking
Organization

Submission of Reports
Submission Date

FT

The legal name must be the same name that is specified
on the Report of Changes in Organizational Structure
(FR Y-10).

day on the submission date (i.e., 5:00 P.M. at each of the
Federal Reserve Banks). The filing of this report will be
considered timely, regardless of when the reports are
received by the appropriate Federal Reserve Bank, if
these reports are mailed and postmarked no later than the
third calendar day preceding the submission deadline. In
addition, the hand delivery of the completed original
reports on or before the submission deadline to the
location to which the reports would otherwise be mailed
is an acceptable alternative to mailing such reports. If the
submission deadline falls on a weekend or holiday, the
report must be received by 5:00 P.M. on the first business
day after the weekend or holiday. Any report received
after 5:00 P.M. on the first business day after the weekend
or holiday deadline will be considered late unless it has
been postmarked three calendar days prior to the original
weekend or holiday submission deadline (original deadline), or the institution has a record of sending the report
by overnight service one day prior to the original deadline.

8

RA

The report date for FBOs that must report annually is
December 31. The preferred reporting period is for the
12-month calendar year ending December 31. However,
FBOs are permitted to report based on their most recent
12-month fiscal year, if their fiscal year differs from the
12-month calendar year ending December 31. Report the
‘‘as-of’’ date in Part 1 item 7. For example, if a reporter’s
fiscal year ends on October 31, 2002, then item 7 of the
FR Y-7Q filed for December 31, 2002 would read 10 31
2002.

D

The reporting dates for FBOs that must report quarterly
are March 31, June 30, September 30, and December 31.
The preferred reporting periods correspond with the
12-month calendar year ending December 31 (i.e., for the
three months ending March 31, six months ending
June 30, nine months ending September 30, and twelve
months ending December 31). However, an FBO is
permitted to report at different periods if its fiscal year
differs from the 12-month calender year ending December 31. Report the ‘‘as-of’’ dates in Part 1, item 7, and
Part 2, item 6 (if applicable). However, these reports must
be submitted on the quarter end dates, similar to the
manner described above for year-end dates.

Where to Submit Reports
This report must be received by the appropriate Federal
Reserve Bank no more than 90 calendar days after the
report date. The earlier submission would aid the Federal
Reserve in reviewing and processing the report and is
encouraged. Cases in which home country practices do
not allow for reporting within 90 days might justify an
extension, but only after consultation with Federal Reserve
staff. If this deadline cannot be met, the FBO must advise
the appropriate Federal Reserve Bank as soon as possible, and normally not later than 30 calendar days before
the deadline, and request an extension, stating the reason
for the request and the date on which the information will
be filed. The reports are due by the end of the reporting

Confidentiality
The completed version of this report generally is available to the public upon request on an individual basis 120
days after the quarterly or annual as-of-dates. However, a
reporting FBO may request confidential treatment if it is
of the opinion that disclosure of specific commercial or
financial information in the report would likely result in
substantial harm to its competitive position, or that
disclosure of the submitted information would result in
unwarranted invasion of personal privacy. A request for
confidential treatment beyond the initial 120 days must
be submitted in writing concurrently with the submission
of the report. The request must discuss in writing the
justification for which confidentiality is requested and
must demonstrate the specific nature of the harm that
would result from public release of the information.
Merely stating that competitive harm would result or that
information is personal is not sufficient.
WHEN
CONFIDENTIAL
TREATMENT
IS
REQUESTED, PAGE 1 SHOULD BE LABELED
‘‘CONFIDENTIAL.’’ THIS INFORMATION SHOULD
BE SPECIFICALLY IDENTIFIED AS BEING CONFIDENTIAL.
The Federal Reserve may subsequently release information for which confidential treatment is requested if the
Board of Governors determines that the disclosure of

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General Instructions

December

FR Y-7Q
March 2014

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General Instructions

such information is in the public interest. If the Federal
Reserve deems it necessary to release confidential data,
the respondent will be notified before it is released.

Signatures

Amended Reports

Enter a ‘‘1’’ for ‘‘yes’’ if home country supervisor of the
FBO has adopted and utilizes risk-based standards consistent with the Basel Capital Accord. Enter a ‘‘0’’ for
‘‘no’’ if the FBO is not required to apply standards
consistent with the Basel Capital Accord. If ‘‘yes’’,
provide capital and asset information using the procedures consistent with the risk-based framework required
by the home country supervisor. If ‘‘no’’, provide the
organization’s best approximation of the capital and asset
information.

FT

The Capital and Asset Report for Foreign Banking
Organizations must be signed as indicated on page 1 by a
duly authorized officer of the FBO. By signing page 1 of
this report, the authorized officer acknowledges that any
knowing and willful misrepresentation or omission of a
material fact on this report constitutes fraud in the
inducement and may subject the officer to legal sanctions
provided by 18 USC 1001 and 1007.

Line Item 1 Is the foreign banking organization
required by its home country supervisor to calculate
its capital ratios using a risk-adjusted framework
consistent with the Basel Capital Accord?

Line Item 2

Monitoring of Regulatory Reports

D

Federal Reserve Banks will monitor the filing of all
regulatory reports to ensure that they are filed in a timely
manner and are accurate and not misleading. Reporting
deadlines are detailed in Submission Date section of
these general instructions. Additional information on the
monitoring procedures are available from the Federal
Reserve Banks.

PART 1—Capital and Asset Information
for the Top-tier Foreign Banking
Organization
The capital and asset information provided in Part 1
should be reported by the top-tier FBO. See the ‘‘Who
must report’’ section to determine the frequency of
reporting for Part 1. The Federal Reserve may require a
FR Y-7Q reporter to submit supporting calculations and
definitions of its components of capital if deemed necessary.
FR Y-7Q
General Instructions

March 2014

Tier 1 capital.

Report the amount of Tier 1 capital, on a consolidated
basis, as reported by the institution to its home country
supervisor under the Basel Capital Accord if the answer
to Part 1, item 1 is ‘‘yes’’. If the answer to Part 1, item 1 is
‘‘no’’, then report by using the closest possible approximation.

RA

The Federal Reserve may require the filing of an amended
Capital and Asset Report for Foreign Banking Organizations if reports as previously submitted contain significant errors. In addition, an FBO should file an amended
report when internal or external auditors make audit
adjustments that result in a restatement of financial
statements affecting reports previously submitted to the
Federal Reserve. In the event that the required data is
not available, respondents should contact the appropriate
Federal Reserve Bank for information on submitting
revisions.

Line Item 3

Total risk-based capital.

Report the amount of total risk-based capital, on a
consolidated basis, as reported by the institution to its
home country supervisor under the Basel Capital Accord
if the answer to Part 1, item 1 is ‘‘yes’’. If the answer to
Part 1, item 1 is ‘‘no’’, then report by using the closest
possible approximation.
Line Item 4

Risk-weighted assets.

Report the amount of risk-weighted assets, on a consolidated basis, as reported by the institution to its home
country supervisor under the Basel Capital Accord if the
answer to Part 1, item 1 is ‘‘yes’’. If the answer to Part 1,
item 1 is ‘‘no’’, then report by using the closest possible
approximation.
Line Item 5 Total consolidated assets at the end of
the reporting period.
Report the total assets, on a consolidated basis, at the end
of the reporting period.
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General Instructions
8
Line Item 6 Total combined assets of U.S.
operations, net of intercompany balances and
transactions between U.S. domiciled affiliates,
branches, and agencies.

FT

Report the total combined assets of the top-tier FBO’s
U.S. domiciled affiliates,1 branches, and agencies. In
situations where a U.S. domiciled affiliate is a parent of
one or more subsidiaries, including subsidiaries of subsidiaries, the FBO should consolidate assets of the affiliate and its subsidiaries at the top-tier U.S. domiciled
affiliate, in accordance with U.S. GAAP, and then the
total consolidated assets (or total assets, as applicable) of
each top-tier U.S. domiciled affiliate, branch, and agency
should be combined. Total combined assets reported by
top-tier FBOs should exclude intercompany balances and
intercompany transactions between the FBO’s U.S. domiciled affiliates, branches, or agencies to the extent such
items are not already eliminated in consolidation. However, total combined assets reported by top-tier FBOs
should include net intercompany balances and intercompany transactions between a non-U.S. domiciled affiliate
and a U.S. domiciled affiliate, branch, or agency of the
FBO.

example, if a reporter’s fiscal year ends on October 31,
then item 7 of the FR Y-7Q filed for December 31, 2002
would read 10 31 2002. For quarterly reporters a similar
process would be followed, e.g., for a report filed on
March 31, 2003 the reporter would provide data as-of
January 31, 2003, item 7 would be 01 31 2003.

PART 2—Capital and Asset Information
for Lower-tier FBOs Operating a Branch,
or an Agency, or Owning an Edge or
Agreement Corporation, or a Commercial
Lending Company Subsidiary in the
United States

RA

Part 2 is to be completed only if the top-tier or lower-tier
FBO has FHC status. Part 2 pertains only to the capital
and asset information of lower-tier FBOs (information on
top-tier reporters is reported on Part 1, not on Part 2).
This information is to be collected only if the lower-tier
FBO operates a branch or an agency, or owns an Edge or
Agreement corporation, or a commercial lending company subsidiary in the United States. A separate version
of Part 2 should be submitted for each of the top-tier
reporter’s lower-tier FBOs that meet these reporting
requirements (e.g., if the top-tier reporter has two
lower-tier FBOs meeting the reporting requirements for
Part 2, a separate schedule of the Part 2 information for
each of the two lower-tier reporters must be provided).

For purposes of this report, a U.S. domiciled affiliate is
defined as a subsidiary, an associated company, or an
entity treated as an associated company (e.g., a corporate
joint venture) as set forth in the instructions for the
Insert instructions
for new
Consolidated
Financial Statements
for item:
Holding Companies (FR
Y-9C).
Additionally,
the
determination
Line Item 7 Total U.S. non-branch of
whether
an affiliate of an FBO shall be consolidated shall
assets
be made in accordance with the FR Y-9C. Investments by
a top-tier FBO in unconsolidated U.S. domiciled affiliates
shall be accounted for under the equity method.

D

8

Line Item 7 Enter the as-of date for the financial
data provided above.
Report in item 7 the as-of date for the financial data
reported in items 2–6. Report the month, day, and year in
the boxes provided, using leading zeroes, if necessary.
For example, if the as-of date is December 31, 2002, the
entry would be 12 31 2002. If a reporter’s fiscal year does
not follow the reporting pattern as defined above under
‘‘Submission date’’, then the as-of date for the most
recent data available should be reported in item 7. For
1. Total combined assets of the top-tier FBO’s U.S. domiciled affiliates
should exclude the assets of section 2(h)(2) companies as defined in
section 2(h)2 of the Bank Holding Company Act (12 U.S.C. 1841(h)(2)).

The capital and asset information provided in Part 2
must be reported on a quarterly basis for any lower-tier
FBO meeting the reporting requirements defined above.
Items should be reported on a consolidated basis for each
lower-tier FBO. Part 2 does not pertain to capital and
asset information of U.S. operations. The Federal Reserve
may require a lower-tier FBO to submit supporting
calculations and definitions of its components of capital
if deemed necessary.

Legal title of lower-tier FBO that operates a branch
or an agency, or owns an Edge or Agreement
corporation or a commercial lending company
subsidiary in the United States
Enter the full name of the lower-tier FBO for which
capital and asset information is being provided.

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General Instructions

December

FR Y-7Q
March 2014

(April 24, 2014 DRAFT)

DRAFT
FR Y-7Q REPORT FORM INSTRUCTIONS INSERT

INSERT 1
Line Item 7-- Total U.S. Non-Branch Assets
Instructions
Report the total U.S. non-branch and agency assets of the top-tier FBO’s U.S. domiciled affiliates. Total
U.S. non-branch and agency assets are the sum of the total combined assets of a top-tier FBO’s top-tier
U.S. domiciled affiliates excluding the assets of its U.S branches and agencies. Total combined assets of
the top-tier FBO’s U.S. domiciled affiliates should also exclude the assets of section 2(h)(2)companies as
defined in section 2(h)2 of the Bank Holding Company Act (12 U.S.C. 1841(h)(2)) and debt previously
contracted (DPC) branch subsidiaries.
In situations where a top-tier U.S. domiciled affiliates is a parent of one or more subsidiaries, the top-tier
FBO should consolidate the assets of the affiliate and its subsidiaries, in accordance with U.S. Generally
Accepted Accounting Principles (GAAP), and the total consolidated assets (or total assets, as applicable)
of each top-tier U.S. domiciled affiliate should be combined. Where a top-tier U.S. domiciled subsidiary
is not consolidated with the FBO for GAAP purposes, that entity shall be accounted for under the equity
method and the sum of the amount of the investments should be included in the sum of the total combined
assets of top-tier U.S. domiciled affiliates. The sum of the total combined assets of top-tier U.S.
domiciled affiliates reported by a top-tier FBO should exclude intercompany balances and intercompany
transactions between the FBO’s U.S. domiciled affiliates to the extent such items are not already
eliminated in consolidation. However, the sum of the total combined assets of top-tier U.S. domiciled
affiliates reported by a top-tier FBO should include asset exposures to U.S. branches, or agencies of the
FBO and to non U.S. domiciled affiliates. In cases where the non U.S. domiciled affiliate is already
consolidated with a top tier U.S. domiciled affiliate these exposures are excluded.
For purposes of this item, U.S. domiciled affiliate is defined as a subsidiary, an associated company, or
an entity treated as an associated company (e.g., a corporate joint venture) as set forth in the instructions
for the Consolidated Financial Statements for Holding Companies (FR Y-9C)

(April 24, 2014 DRAFT)

General Instructions

Country of lower-tier FBO that operates a branch
or an agency, or owns an Edge or Agreement
corporation or a commercial lending company
subsidiary in the United States
Enter the country in which this lower-tier FBO is incorporated or has its principal location.

Line Item 4

Risk-weighted assets.

Report the amount of risk-weighted assets, on a consolidated basis, as reported by the lower-tier FBO to its home
country supervisor under the Basel Capital Accord if the
answer to Part 2, item 1 is ‘‘yes’’. If the answer to Part 2,
item 1 is ‘‘no’’, then report by using the closest possible
approximation.

FT

Line Item 1 Is the reporting lower-tier FBO
required by its home country supervisor to calculate
its capital ratios using a risk-adjusted framework
consistent with the Basel Capital Accord?

Accord if the answer to Part 2, item 1 is ‘‘yes’’. If the
answer to Part 2, item 1 is ‘‘no’’, then report by using the
closest possible approximation.

Line Item 5 Total consolidated assets at the end of
the reporting period.
Report the total assets of the lower-tier FBO, on a
consolidated basis, at the end of the reporting period.
Line Item 6 Enter the as-of date for the financial
data provided above.

RA

Enter a ‘‘1’’ for ‘‘yes’’ if the home country supervisor of
the lower-tier FBO has adopted and utilizes risk-based
standards consistent with the Basel Capital Accord. Enter
a ‘‘0’’ for ‘‘no’’ if the lower-tier FBO is not required to
apply standards consistent with the Basel Capital Accord.
If ‘‘yes’’, provide capital and asset information using the
procedures consistent with the risk-based framework
required by the home country supervisor. If ‘‘no’’, provide the lower-tier FBO’s best approximation of the
capital and asset information.
Line Item 2

Tier 1 capital.

Report the amount of Tier 1 capital, on a consolidated
basis, as reported by the lower-tier FBO to its home
country supervisor under the Basel Capital Accord if
the answer to Part 2, item 1 is ‘‘yes’’. If the answer to
Part 2, item 1 is ‘‘no’’, then report by using the closest
possible approximation.
Line Item 3

Total risk-based capital.

D

Report the amount of total risk-based capital, on a
consolidated basis, as reported by the lower-tier FBO to
its home country supervisor under the Basel Capital

FR Y-7Q
General Instructions

March 2014

Report in item 6 the as-of date for the financial data
reported in items 2–5. Report the month, day, and year in
the boxes provided, using leading zeroes, if necessary.
For example, if the as-of date is December 31, 2002, the
entry would be 12 31 2002. If a lower-tier FBO’s fiscal
year does not follow the reporting pattern as defined
above under ‘‘Submission date’’, then the as-of date for
the most recent data available should be reported in
item 6. For example, if a lower-tier FBO’s fiscal year
ends on October 31, then item 6 of the FR Y-7Q filed
for December 31, 2002 would be 10 31 2002. For
quarterly reporters a similar process would be followed,
e.g., for a report filed on March 31, 2003 the reporter
would provide data as-of January 31, 2003, item 6 would
be 01 31 2003.

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