RegBB_20150430_omb

Supporting Statement for the
Reporting, Recordkeeping, and Disclosure Requirements
Associated with Regulation BB (Community Reinvestment Act)
(Reg BB; OMB No. 7100-0197)
Summary
The Board of Governors of the Federal Reserve System (the Board), under delegated
authority from the Office of Management and Budget (OMB), proposes to extend for three years,
without revision, the mandatory Reporting, Recordkeeping, and Disclosure Requirements
Associated with Regulation BB (Community Reinvestment Act) (Reg BB; OMB No. 71000197). The Board is required under the Paperwork Reduction Act (PRA) to renew every three
years the information collections mandated by the regulation for institutions supervised by the
Board. The PRA classifies reporting, recordkeeping, or disclosure requirements of a regulation,
including Regulation BB, as an information collection.1
The Board accounts for the paperwork burden associated with Regulation BB only for
institutions subject to Community Reinvestment Act (CRA) that the Board supervises.2 The total
estimated annual burden for the 851 entities supervised by the Board, as of March 31, 2014, is
50,279 hours.
Background and Justification
CRA was enacted in 1977 and is implemented by Regulation BB.3 The CRA directs the
federal banking agencies4 to evaluate financial institutions’ records of helping to meet the credit
needs of their entire communities, including low- and moderate-income areas consistent with the
safe and sound operation of the institutions. The CRA is implemented through regulations
issued by the federal banking agencies.5
In 1995, the federal banking agencies issued substantially identical regulations under
CRA to reduce unnecessary compliance burden, promote consistency in CRA assessments, and
encourage improved performance.6 As a result, the current recordkeeping, reporting, and
disclosure requirements under Regulation BB depend in part on a bank’s size, and are discussed
more fully below in the description of information collection.

1

44 U.S.C. § 3501 et seq.
Other federal agencies account for the paperwork burden imposed under CRA on entities for which they have
supervision authority. Other federal agencies with supervision authority are the Office of the Comptroller of the
Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC).
3
12 U.S.C. § 2901 et seq.
4
In addition to the Board, the federal banking agencies currently responsible for CRA rules are the OCC and the
FDIC.
5
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 transferred from the Office of Thrift
Supervision (OTS) all authorities (including rulemaking) relating to savings associations to the OCC and all
authorities (including rulemaking) relating to savings and loan holding companies (SLHCs) to the Board on July 21,
2011.
6
60 FR 22156 (May 4, 1995).
2

Under Regulation BB, large banks are defined as those with assets of $1.202 billion or
more for the past two consecutive year-ends; all other banks are considered small or
intermediate.7 The banking agencies amend the definition of a small bank and an intermediate
small bank in their CRA regulations each year when the asset thresholds are adjusted for
inflation pursuant to Regulation BB, most recently in December 2013.8
Other than the information collections pursuant to the CRA, the Board has no information
collection that supplies data regarding the community reinvestment activities of state member
banks (SMBs).
Description of Information Collection
The reporting, recordkeeping, and disclosure requirements associated with
Regulation BB are listed in Attachment 1 and also summarized below. A SMB that qualifies for
evaluation under the small bank performance standards but elects evaluation under the lending,
investment, and service tests will collect, maintain, and report the data required for large banks.
Assessment area delineation (Sections 228.41 and 228.42(g))
Each SMB must delineate one or more assessment areas within which the Board
evaluates the bank’s record of helping to meet the credit needs of its community. Large banks
must also report the list of assessment areas to the Board by March 1 each year. The assessment
area(s) consists generally of one or more Metropolitan Statistical Areas (MSA) or one or more
contiguous political subdivisions, such as counties, cities, or towns. The assessment area(s)
includes the tracts in which the bank has its main office, branches, and deposit-taking automated
teller machines (ATMs), as well as the surrounding tracts in which the bank has originated or
purchased a substantial portion of its loans. There are rules designed to prevent redlining
(arbitrary exclusion of lower-income or minority neighborhoods) in the drawing of assessment
areas.
Public file (Section 228.43)
All SMBs are required to maintain and make available to the public a file containing
comments received from the public for the current year and each of the prior two calendar years,
and any response to the comments from the bank. The file also must contain a copy of the public
section of the SMB’s most recent CRA performance evaluation prepared by the Board, a list of
the bank’s open branches with addresses and geographies, a list of branches opened or closed
during the current year and each of the prior two calendar years, a list of the services generally
offered by the bank, and a map of each assessment area. The bank may include in the file any
other information it chooses.
7

Beginning January 1, 2014, banks and savings associations that, as of December 31 of either of the prior two
calendar years, had assets of less than $1.202 billion are small banks or small savings associations. Small banks or
small savings associations with assets of at least $300 million as of December 31 of both of the prior two calendar
years, and less than $1.202 billion as of December 31 of either of the prior two calendar years, are intermediate
small banks or intermediate small savings associations.
8
78 FR 79283 (December 30, 2013).

2

Large banks must also include in the public file the CRA Disclosure Statement (Section
228.42(h)) prepared by the Board for each of the prior two calendar years and, if applicable,
information about consumer loan data. SMBs required to report data under the Home Mortgage
Disclosure Act (HMDA) must include in the public file a copy of the HMDA Disclosure
Statement prepared by the Federal Financial Institutions Examination Council (FFIEC) for each
of the prior two calendar years. In addition, SMBs that elect to have mortgage lending of an
affiliate of any of those years considered in its CRA evaluation must include in the public file the
affiliate’s HMDA disclosure statement for those years.
A small bank or intermediate small bank must include in the public file the bank’s loanto-deposit ratio for each quarter of the prior calendar year and, if it elects to be evaluated under
the lending, service, and investment tests, the information required under the disclosure rules
applicable to large banks.
A SMB that has, in accordance with section 228.27, submitted and been approved by the
Board for assessment under a strategic plan (see Strategic Plan, below) must include a copy of
the plan in the public file. A SMB that received a rating worse than “Satisfactory” during its
most recent examination, must include in the public file a description of its efforts to improve its
performance.
Public notice by banks (Section 228.44)
A SMB must provide in the public lobby of its main office and in each branch a
prescribed notice informing consumers of their rights to certain information about the SMB’s
operations and CRA performance as evaluated by the Board.
Required Collection, Maintenance or Reporting of Loan Information for Large Banks
Loan information to be collected and maintained (Section 228.42(a))
A large bank is required to collect and maintain in machine-readable form until the
completion of its next CRA examination the following data for each small business or small farm
loan originated or purchased:





a unique number or alpha-numeric symbol used to identify the relevant loan file;
the loan amount at origination;
the loan location; and
an indicator whether the loan was made to a business or farm with gross annual revenues
of $1 million or less.
Loan information to be reported (Section 228.42(b))

Small business and small farm loan data. A large bank is required to report annually by
March 1 to the Board in machine-readable form the following data for the preceding calendar
year. For each geographical location in which the SMB originated or purchased a small business
or small farm loan, the SMB must report the aggregate number and amount of loans:

3






of $100,000 or less at origination;
of more than $100,000 at origination but less than or equal to $250,000 at origination;
of more than $250,000 at origination; and
made to businesses and farms with gross annual revenues of $1 million or less (using the
revenues that the bank considered in making its credit decision).

Community development loan data. A large bank is also required to report annually by
March 1 to the Board in machine-readable form the aggregate number and aggregate amount of
community development loans originated or purchased in the preceding calendar year.
Home mortgage loan data. Reporting of mortgage loan data is governed by HMDA,
which is implemented by Regulation C. However, a large bank that is subject to reporting under
Regulation C (12 CFR Part 203), is also required under Regulation BB to report annually by
March 1 to the Board in machine-readable form the property location for each home mortgage
loan application, origination, or purchase outside the MSAs in which the SMB has a home or
branch office (or outside any MSA). The paperwork burden for providing property location
information for loans inside an MSA is associated with the HMDA Loan/Application Register
(FR HMDA-LAR; OMB No. 7100-0247).
Optional Data Collection and Maintenance
Consumer loan data (Section 228.42(c))
A SMB has the option to collect and maintain, in machine-readable form, data for
consumer loans originated or purchased by the bank for consideration under the lending test. A
SMB may maintain data for one or more of the following categories of consumer loans: motor
vehicle, credit card, home-equity, other secured, and other unsecured. If the SMB maintains data
for loans in a certain category, it must maintain data for all loans originated or purchased within
that category. The SMB must maintain data separately for each category and must include for
each loan:





a unique number or alpha-numeric symbol used to identify the relevant loan file;
the loan amount at origination or purchase;
the loan location; and
the gross annual income of the borrower that the SMB considered in making its credit
decision.

At its option, a SMB may also provide other information concerning its lending
performance, including additional loan-distribution data.
Affiliate lending data (Section 228.42(d))
A SMB that elects to have the Board consider loans by an affiliate, for purposes of the
lending or community development test or an approved strategic plan, must collect, maintain,
and report for those loans the data that the SMB would have collected, maintained, and reported
had the loans been originated or purchased by the SMB. For home mortgage loans, the bank

4

must also be prepared to identify the home mortgage loans reported by the affiliate under HMDA
and Regulation C.
Data on lending by a consortium or a third party (Section 228.42(e))
A SMB may elect to have the Board consider community development loans made by a
consortium or third party, for purposes of the lending or community development tests or an
approved strategic plan. If so, the SMB must report for those loans the data that the bank would
have reported had the loans been originated or purchased by the SMB itself.
Strategic plan (Section 228.27)
A SMB may elect to be assessed under a strategic plan if the SMB has submitted the plan
to the Board, the Board has approved the plan, the plan is in effect, and the SMB has been
operating under an approved plan for at least one year. The Board’s approval of this plan does
not affect the SMB’s obligation, if any, to comply with the data collecting and reporting
requirements under 12 CFR 228.42.9 The plan may have a term of no more than five years;
multi-year plans must include annual interim measurable goals. Before submitting a plan to the
Board, a SMB must seek suggestions from members of the public in its assessment area(s),
formally solicit public comment for at least thirty days, and during the period of formal public
comment make copies of the plan available for public review at its offices at no cost, and by mail
for a reasonable cost.
A strategic plan must include measurable goals for helping meet the credit needs of each
assessment area covered by the plan, addressing the lending, investment and service tests. A
plan must specify goals that constitute satisfactory performance and also may specify goals that
constitute outstanding performance. If an institution fails to meet its own goals for satisfactory
performance, a SMB may elect in its plan to be evaluated under the alternate test(s) specified in
the regulation.
Request for designation as a wholesale or limited purpose bank (Section 228.25(b))
The Board evaluates the performance of a wholesale or limited purpose bank under the
community development test specified in the regulation. A SMB wishing to be designated as a
wholesale or limited purpose bank must file a request, in writing, with the Board, at least three
months prior to the proposed effective date of the designation.
Time Schedule for Information Collection and Publication
The recordkeeping, reporting, and disclosure requirements required by Regulation BB are
mandatory and depend on bank size and other factors. SMBs that are required to collect
assessment area information, small business and small farm data, community development data,
and home mortgage loan data must collect and report the data to the Board in machine-readable
form annually by March 1 for the prior calendar year.

9

12 C.F.R. § 228.27(b).

5

The Board uses the data to examine and assess SMBs’ CRA records; to prepare the
public sections of CRA performance evaluations; and to help evaluate applications for
acquisitions and other transactions. The Board prepares annually for each SMB a public
disclosure statement that contains, on a state-by-state basis, information on small farm, small
business, and community development loans.
Together with the other agencies, the Board prepares annually for each MSA (including
an MSA that crosses a state boundary) and for each non-MSA portion of each state, an aggregate
disclosure statement of small business and small farm lending by all institutions subject to
reporting requirements under each agency’s CRA regulation. These disclosure statements
indicate, for each geography, the number and amount of all small business and small farm loans
originated or purchased by reporting institutions, except that the Board may adjust the form of
the disclosure if necessary to protect the privacy of a borrower or the competitive position of an
institution. The Board makes the aggregate disclosure statements and the individual SMB
statements available to the public at central data repositories and publishes a list of the
repositories at which statements are available. The FFIEC also makes both statements available
on the FFIEC CRA website www.ffiec.gov/cra. The statements are usually available at the
SMBs, central data repositories, and on the FFIEC website in late July after the March 1
reporting date.
Any SMB electing to submit a strategic plan to the Federal Reserve must do so at least
three months prior to the proposed effective date of the plan. The Board will act upon the plan
within 60 days. If the Board fails to act within this 60 days, the plan shall be deemed approved
unless the Board extends the review period for good cause. As indicated above, a SMB may not
be evaluated under a strategic plan unless it has been operating under an approved plan for at
least one year.
Legal Status
The Board’s Legal Division has determined that the reporting, recordkeeping, and
disclosure requirements associated with Regulation BB are authorized by section 806 of the
CRA, which permits the Board to issue regulations to carry out the purpose of CRA (12 U.S.C.
§ 2905), Section 11 of the Federal Reserve Act (FRA), which permits the Board to require such
statements as reports of SMBs as it deems necessary (12 U.S.C. § 248(a)(1)), and section 9 of the
FRA, which permits the Board to examine SMBs (12 U.S.C. § 325). The obligation to comply
with the reporting, recordkeeping, and disclosure requirements of Regulation BB is generally
mandatory and varies depending on whether the bank is a large bank. Other parts of the
collection, specifically the request for designation as a wholesale or limited purpose bank, the
strategic plan, and the reporting and recordkeeping requirements associated with data regarding
consumer loans and lending performance, affiliate lending data, data on lending by a consortium
or a third party, are required to obtain a benefit. The data that are reported to the Federal
Reserve are not considered confidential.

6

Consultation Outside the Agency
On January 28, 2015, the Federal Reserve published a notice in the Federal Register
(80 FR 4571) requesting public comment for 60 days on the extension, without revision, of this
information collection. The comment period for this notice expired on March 30, 2015. The
Federal Reserve did not receive any comments. On April 21, 2015, the Federal Reserve
published a final notice in the Federal Register (80 FR 22186).
Estimates of Respondent Burden
The burden estimates for non-optional reporting requirements related to loan data, other
than community development loan data, include time estimates for geocoding easy- and hard-tofind loan geographies. The number of respondents for the non-optional reporting requirements
(loan data and assessment area delineation) and optional reporting requirements (third-party and
affiliate lending) are based on the number of CRA data respondents regulated by the Board using
2013 data reported March 1, 2014. Optional reporting requirements for requests for strategic
plan approvals and designations as a wholesale or limited purpose bank are based on previous
experience.10 Optional recordkeeping burden estimates for consumer loan data and other loan
data are estimated based on a review of CRA performance evaluations.
The burden for the public file disclosure requirements includes estimates for both the
large and small bank requirements. The public file requirement also includes an estimate of the
time required for small banks, including intermediate small banks, to delineate an assessment
area.
The total annual burden for SMBs associated with complying with CRA is estimated to
be 50,279 hours for the 851 institutions supervised by the Board. These reporting,
recordkeeping, and disclosure requirements represent less than 1 percent of the total Federal
Reserve System annual paperwork burden.

10

On average, requests for (1) strategic plan approvals and (2) designations as a wholesale or limited purpose bank
have averaged less than one a year, although three strategic plans were approved in 2014.

7

Number of
respondents

Reg BB

Estimated
Annual
average hours
frequency
per response

Estimated
annual burden
hours

Recordkeeping Requirement
(Section 228.42(a))
Small business and
small farm loan register

77

1

219

16,863

Optional Recordkeeping
Requirements
(Section 228.42(c))
Consumer loan data
Other loan data

13
11

1
1

326
25

4,238
275

82

1

2

164

77
82
71

1
1
1

8
13
253

616
1,066
17,963

9

1

17

153

4

1

38

152

1

1

275

275

1

1

4

4

851

1

10

8,510

Reporting Requirements
Assessment area delineation
(Sections 228.41 and 228.42(g))
Loan data:
(Section 228.42(b))
- Small business and small farm
- Community development
- HMDA out of MSA
Optional Reporting
Requirements
Data on lending by
a consortium or third party
(Section 228.42(e))
Affiliate lending data
(Section 228.42(d))
Request for Strategic plan
approval
(Section 228.27)
Request for designation as a
wholesale or limited purpose
bank
(Section 228.25(b))
Disclosure Requirement
(Section 228.43 and 228.44)
Public file
Total

50,279

8

The total cost to the public is estimated to be $2,601,938.11
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
The Board processes data for the Federal Reserve, OCC, and FDIC. The banking
agencies’ 2014 annual cost was budgeted to be $1,184,933.

11

Total cost to the public was estimated using the following formula: percent of staff time, multiplied by annual
burden hours, multiplied by hourly rates (30% Office & Administrative Support at $17, 45% Financial Managers at
$63, 15% Lawyers at $64, and 10% Chief Executives at $87). Hourly rates for each occupational group are the
(rounded) mean hourly wages from the Bureau of Labor and Statistics (BLS), Occupational Employment and Wages
2014, published March 25, 2015, www.bls.gov/news.release/ocwage.nr0.htm. Occupations are defined using the
BLS Occupational Classification System, www.bls.gov/soc/.

9

Attachment I
Summary of annual
Reporting, Recordkeeping, and Disclosure Requirements
Associated with Regulation BB
Requirements

Recordkeeping

Reporting

Disclosure

Assessment area (.41(a); .42(g))
All Banks

delineate assessment
area

Large Banks1

collect list of
geographies in
assessment area(s)

report this list

Public file: (.41(a); .43(a)(1); .43(a)(2); .43(a)(3); .43(a)(4); .43(a)(5); .43(a)(6); .43(a)(7);
.43(b)(1); .43(b)(2); .43(b)(3); .43(b)(4); .43(b)(5); .43(c); .43(d))

o comment letters and
responses (current and
prior two years)
o public section of most
recent CRA performance evaluation
o list of bank branches
o list of branch openings
and closings
o list of services offered
o map of each assessment
area
if applicable:
o strategic plan
o description of current
efforts to improve its
CRA performance
o CRA Disclosure Statements (prior two years)
if applicable:
o consumer loan data
(prior two years)
o HMDA Disclosure
Statements (prior two
years)
o loan-to-deposit ratio;
each quarter prior year
if applicable:
o information required
under disclosure rules
for large banks

All Banks

Large Banks

Small Banks and
Intermediate
Small Banks

Public notice by banks (.44)
prescribed notices
informing consumers
of their rights to certain
information

All Banks

1

For the purpose of this attachment large banks are defined as any bank other than a small bank or intermediate small
bank, as defined by Regulation BB, or any small bank or intermediate small bank electing not to employ the reporting
exemptions available to small lenders.

10

Attachment I
Summary of annual
Reporting, Recordkeeping, and Disclosure Requirements
Associated with Regulation BB
Requirements

Recordkeeping

Reporting

Small business and small farm loan register (.42(a))

Large Banks

must collect and
maintain:
o unique symbol
o loan amount
o loan location
o indicator
whether loan was to
business or farm with
gross annual revenues
of $1 million or less

Small business and small farm loan data (.42(b)(1))

Large Banks

report aggregate number and amount of
loans:
o $100,000 or less at
origination
o $100,000 but less
than or equal to
$250,000 at origination
o More than $250,000 at origination
o to business or farm
with gross annual
revenue of $1
million or less

Community development loan data (.42(b)(2))
Large Banks

aggregate number and
amount of community
development loans
originated or purchased

Home mortgage loan data (.42(b)(3))

Large Banks

if applicable:
location of each loan
application, origination
or purchase outside
MSAs where bank has
offices (property
location)

11

Disclosure

Attachment I
Summary of annual
Reporting, Recordkeeping, and Disclosure Requirements
Associated with Regulation BB
Requirements

Recordkeeping

Reporting

Disclosure

Consumer loan data (optional) (.42(c)(1))

All Banks

loans originated or
purchased:
o unique symbol to
identify loan file
o loan amount
o loan location
o borrower’s gross
income considered
in making credit
decision

Other loan data (optional) (.42(c)(2))
All Banks

other lending
performance
information

Affiliate lending data (optional) (.42(d))

All Banks

loan data the bank
would have collected
and maintained had the
loans been originated
or purchased by the
bank2

loan data the bank
would have reported
had the loans been
originated or
purchased by the bank

Data on lending by a consortium or a third party (optional) (.42(e))
All Banks

loan data the bank
would have reported
had the loans been
originated or
purchased by the bank

Strategic plan (optional) (.27(a); .27(d)(3); .27(e); .27(f); .27(h))
All Banks

submitted to and
approved by the Board

Request for designation as a wholesale or limited purpose bank (optional) (.25(b))
All Banks

request in writing filed
with the Board 3
months in advance of
proposed effective date
of designation

2

For home mortgage loans, the bank must be prepared to identify the home mortgage loans reported under Regulation C by the
affiliate.

12