FR4035_20201029_omb_emergency

Supporting Statement for the
Reporting, Recordkeeping, and Disclosure Requirements Associated with
Rules Regarding Availability of Information
(FR 4035; OMB No. 7100-NEW)
Summary
The Board of Governors of the Federal Reserve System (Board), under authority
delegated by the Office of Management and Budget (OMB), has temporarily implemented the
Reporting, Recordkeeping, and Disclosure Requirements Associated with Rules Regarding
Availability of Information (FR 4035; OMB No. 7100-NEW) pursuant to its authority to approve
temporarily a collection of information without providing opportunity for public comment.1
The information collection consist of reporting, recordkeeping, and disclosure
requirements under subpart C (Nonpublic Information Made Available to Supervised Financial
Institutions, Governmental Agencies, and Others in Certain Circumstances) of Rules Regarding
Availability of Information (12 CFR Part 261).2 Subpart C contains reporting requirements that
enable third parties to request the Board’s authorization to access, use, or further disclose
confidential supervisory information or other nonpublic information of the Board, and that
ensure that the Board is notified when any subpoena or other legally enforceable demand
requires production of confidential supervisory information or other nonpublic information of the
Board in the form of documents or testimony. Subpart C also contains one recordkeeping
requirement related to a provision that allows supervised financial institutions3 to disclose
confidential supervisory information to service providers if the disclosure is deemed necessary to
the service provider’s provision of services, and two disclosure requirements that apply when
individuals are served with a subpoena, order, or other judicial or administrative process
requiring the production of confidential supervisory information or other nonpublic information
of the Board in the form of documents or testimony.
The estimated total annual burden for the FR 4035 is 134 hours.
Background and Justification
Section 9 of the Federal Reserve Act provides that the Board “may furnish ... confidential
supervisory information ... to any ... person that the Board determines to be proper” (12 U.S.C. §
326) and 12 CFR 261.20(a) provides that “all confidential supervisory information and other
nonpublic information, including but not limited to information made available under this
subpart, remains the property of the Board, and except as otherwise provided in this regulation,
no person, entity, agency, or authority to whom the information is made available or who
1

5 CFR Part 1320, Appendix A (1)(a)(3)(i)(A).
There is no formal reporting form for this collection of information (the FR 4035 designation is for internal
purposes only). The Board recently modified 12 CFR Part 261. See 86 FR 57616 (September 15, 2020).
3
For purposes of Part 261, a “supervised financial institution” includes any institution that is supervised by the
Board, including a bank; a bank holding company, intermediate holding company, or savings and loan holding
company (including their non-depository subsidiaries); an Edge Act or agreement corporation; a U.S. branch or
agency of a foreign bank; any company designated for Board supervision by the Financial Stability Oversight
Council; or any other entity or service subject to examination by the Board. 12 CFR § 261.2(f).
2

otherwise possesses the information, including any officer, director, employee, or agent thereof,
may use any such information for an unauthorized purpose or disclose any such information
without the prior written permission of the General Counsel.” Given the prohibitions on the
disclosure of confidential supervisory information, the Board has codified rules at subpart C to
set forth permissible disclosures by supervised financial institutions, the procedures for
requesting access to the Board’s confidential supervisory information and other nonpublic
information, and the actions required of individuals who are served with a subpoena or legally
enforceable demand for confidential supervisory information. The rules include Paperwork
Reduction Act (PRA) reporting, recordkeeping, and disclosure requirements that enable the
Board to respond to requests for confidential supervisory information and to ensure that
confidential supervisory information is not disclosed other than as authorized by the Board.
Implementation of FR 4035 on a Temporary Basis
The delegation of authority to the Board from OMB that permits the Board to approve
collections of information under the PRA includes the authority to temporarily approve a
collection of information without seeking public comment. To exercise this authority, the Board
must determine that a new collection of information or a change to an existing collection must be
instituted quickly and that public participation in the approval process would defeat the purpose
of the collection or substantially interfere with the Board’s ability to perform its statutory
obligation. Following the temporary approval of an information collection, the Board must
conduct a normal delegated review of the collection within six months, including publishing in
the Federal Register a notice seeking public comment.
The Board has temporarily approved the collections of information contained within
subpart C of 12 CFR Part 261 under the title FR 4035. The Board has determined that this
collection of information must be instituted quickly and that public participation in the approval
process would defeat the purpose of the collection of information and substantially interfere with
the Board’s ability to perform its statutory obligations. In particular, the Board has determined
that because the reporting and disclosure requirements are existing requirements that facilitate
the Board’s processing of requests to access and use the Board’s confidential supervisory
information, the Board’s ability to perform its statutory responsibilities relating to the disclosure,
production, or withholding of the Board’s information would be diminished if the Board were
unable to enforce the collections of information contained within subpart C due to possible
noncompliance with the PRA.
Description of Information Collection
Reporting Requirements
Section 261.22(c). Pursuant to section 261.22(c), state, local, and foreign agencies,
including law enforcement agencies, and other entities exercising governmental authority,4 may
file written requests with the Board for access to confidential supervisory information and other
Such a request may also be made by a federal agency. However, a federal agency is not considered a “person”
under the PRA. Therefore, the FR 4035 information clearance for section 261.22(c) encompasses only requests by
persons other than federal agencies.
4

2

nonpublic information, including information in the form of testimony and interviews from
current or former Federal Reserve System staff. Under section 261.22(c)(1), requesters must
submit a letter request to the General Counsel specifying (1) the particular information, kinds of
information, and where possible, the particular documents to which access is sought, (2) the
reasons why such information cannot be obtained from the supervised financial institution in
question or another source rather than from the Board, (3) a statement of the law enforcement
purpose or other statutory purpose for which the information shall be used, (4) a commitment
that the information requested shall not be disclosed to any person outside the requesting agency
or entity without the written permission of the General Counsel, and (5) if the document or
information requested includes customer account information subject to the Right to Financial
Privacy Act (the Act), as amended (12 U.S.C. § 3401 et seq.), any federal agency request must
include a statement that such customer account information need not be provided, or a statement
as to why the Act does not apply to the request, or a certification that the requesting federal
agency has complied with the requirements of the Act.
The information provided in written requests made by state, local, and foreign agencies
and other entities exercising governmental authority pursuant to section 261.22(c) enables the
General Counsel to determine, pursuant to section 261.22(c)(2), whether the information is
needed in connection with a formal investigation or other official duties of the requesting agency
or entity, whether satisfactory assurances of confidentiality have been given, and whether
disclosure is consistent with the supervisory and regulatory responsibilities and policies of the
Board.
Section 261.23(b). Section 261.23(b)(1) provides that in connection with any proposed
use of confidential supervisory information in litigation before a court, board, commission,
agency, or arbitration, any person who (A) seeks access to confidential supervisory information
from the Board or a Reserve Bank (including the testimony of present or former Board or
Reserve Bank employees on matters involving confidential supervisory information, whether by
deposition or otherwise), (B) seeks to use confidential supervisory information in its possession
or to disclose such information to another party, or (C) seeks to require a person to disclose
confidential supervisory information to a party, shall file a written request with the General
Counsel.
Section 263.23(b)(2) provides that the request shall include (1) the judicial or
administrative action, including the case number and court or adjudicative body and a copy of
the complaint or other pleading setting forth the assertions in the case, (2) a description of any
prior judicial or other decisions or pending motions in the case that may bear on the asserted
relevance of the requested information, (3) a narrow and specific description of the confidential
supervisory information the requester seeks to access or to disclose for use in the litigation
including, whenever possible, the specific documents the requester seeks to access or disclose,
(4) the relevance of the confidential supervisory information to the issues or matters raised by the
litigation, (5) the reason why the information sought, or equivalent information adequate to the
needs of the case, cannot be obtained from any other source, and (6) a commitment to obtain a
protective order acceptable to the Board from the judicial or administrative tribunal hearing the
action preserving the confidentiality of any information that is provided. Additionally, section

3

261.23(b)(3) provides that the Board may require the party to whom disclosure would ultimately
be made to substantiate its need for the information prior to acting on any request.
The information provided in written requests pursuant to section 261.23(b) allows the
Board to determine, pursuant to section 261.23(d), whether the person seeking access, or the
person to whom access would be provided, has shown a substantial need to access confidential
supervisory information that outweighs the need to maintain confidentiality and whether
approval is consistent with the supervisory and regulatory responsibilities and policies of the
Board.
Section 261.23(c). Under section 261.23(c), any other person seeking to access, use, or
disclose confidential supervisory information for any other purpose shall file a written request
with the General Counsel. A request shall describe the purpose for which access, use, or
disclosure is sought and the requester shall provide other information as requested by the General
Counsel. The information provided in written requests pursuant to section 261.23)(c) allows the
Board to determine, pursuant to section 261.23(d), whether the person seeking access, or the
person to whom access would be provided, has shown a substantial need to access confidential
supervisory information that outweighs the need to maintain confidentiality and whether
approval is consistent with the supervisory and regulatory responsibilities and policies of the
Board.
Section 261.24(a)(1). Under section 261.24(a)(1), any person (including any officer,
employee, or agent of the Board or any Reserve Bank) who is served with a subpoena, order, or
other judicial or administrative process requiring the production of confidential supervisory
information or other nonpublic information of the Board or requiring the person’s testimony
regarding such Board information in any proceeding, shall promptly inform the Board’s General
Counsel of the service and all relevant facts, including the documents, information or testimony
demanded, and any facts relevant to the Board in determining whether the material requested
should be made available. The information provided pursuant to section 261.24(a) allows the
Board to determine whether the Board’s confidential supervisory information or other nonpublic
information should be disclosed in response to a subpoena or other legally enforceable demand.
Recordkeeping Requirements
Section 262.21(b)(4). Under section 261.21(b)(4), a supervised financial institution shall
maintain a written account of the disclosures of confidential supervisory information that the
supervised financial institution makes to service providers under this section and provide the
Board or Reserve Bank with a copy of such a written account upon the Board’s or Reserve
Bank’s request. This requirement is necessary to maintain accountability and supervisory
oversight with respect to disclosures of the Board’s privileged information to a wide array of
third-party service providers.
Disclosure Requirements
Section 261.24(a). In addition to the reporting requirements described above pursuant to
section 261.24(a)(1), section 261.24 imposes two related disclosure requirements on persons who
4

are served with a subpoena, order, or other judicial or administrative process requiring the
production of confidential supervisory information or other nonpublic information of the Board
in the form of documents or testimony. Under section 261.24(a)(2) and (a)(3), the person is
required to inform the entity issuing the process of the substance of these rules and, in particular,
of the obligation to follow the request procedures in section 261.23(b) and at the appropriate time
inform the court or tribunal that issued the process of the substance of these rules. These
disclosure requirements help to ensure that the Board’s confidential supervisory information is
not disclosed in response to a subpoena or other legally enforceable demand except as authorized
by the Board’s General Counsel.
Respondent Panel
The FR 4035 respondent panel comprises supervised financial institutions (12 CFR
261.21(b)(4)), state, local, and foreign agencies and entities exercising governmental authority
(12 CFR 261.22(c)), and any person, entity, agency or authority (12 CFR 261.23(b), 261.23(c),
261.24(a)).
Time Schedule for Information Collection
While all the reporting, recordkeeping, and disclosure requirements in the FR 4035 are
event-generated, the reporting required under section 261.24(a)(1) must occur “promptly,” and
the disclosure required under section 261.24(a)(3) must occur “at the appropriate time.”
Public Availability of Data
There is no data related to this information collection available to the public.
Legal Status
The FR 4035 is authorized pursuant to section 9 of the Federal Reserve Act (12 U.S.C. §
326), which provides that the Board “may furnish ... confidential supervisory information ... to
any other person that the Board determines to be proper.” Persons seeking to obtain, use, or
disclose confidential supervisory information must comply with the reporting requirements of
the Rules Regarding Availability of Information. Additionally, persons served with a subpoena,
order, or other judicial or administrative process requiring the production of confidential
supervisory information or other nonpublic information of the Board or requiring the person’s
testimony regarding such information in any proceeding must comply with the disclosure
requirements of FR 4035. Thus, the FR 4035 is required to obtain a benefit, in part, and
mandatory, in part.
Any confidential supervisory information that is submitted in connection with the
FR 4035 would be considered confidential pursuant to exemption 8 of the Freedom of
Information Act (FOIA), which protects information contained in “examination, operating, or
condition reports” obtained in the bank supervisory process (5 U.S.C. § 552(b)(8)). Individual
respondents may request that other information submitted to the Board through the FR 4035 be
kept confidential. If a respondent requests confidential treatment, the Board will determine
5

whether the information is entitled to confidential treatment on a case-by-case basis. To the
extent a respondent submits nonpublic commercial or financial information in connection with
the FR 4035, which is both customarily and actually treated as private by the respondent, the
respondent may request confidential treatment pursuant to exemption 4 of the FOIA (5 U.S.C. §
552(b)(4)).
Consultation Outside the Agency
There has been no consultation outside the Federal Reserve System.
Estimate of Respondent Burden
As shown in the table below, the estimated total annual burden for the FR 4035 is 134
hours. The estimated total annual burden is based on the average number of requests the Board
received in connection with the types of requests covered by sections 261.22(c), 261.23(b), and
261.23(c) in 2017, 2018, 2019, and the average number of notices the Board received pursuant to
the notice requirement covered by section 261.24(a)(1) in 2017, 2018, and 2019. Although these
provisions were recently modified by the Board, the Board does not believe that the number of
requests and notices made pursuant to those sections will materially change due to those
modifications. Furthermore, the estimated annual burden hours with respect to the new
recordkeeping requirement under section 261.21(b)(4) is based on the average number of
requests the Board received in 2017, 2018, 2019 from supervised financial institutions to
disclose confidential supervisory information to their service providers. These reporting,
recordkeeping, and disclosure requirements represent less than 1 percent of the Board’s total
paperwork burden.

6

Estimated
number of
respondents5

FR 4035
Reporting
Section 261.22(c)
Section 261.23(b)
Section 261.23(c)
Section 261.24(a)(1)
Recordkeeping
Section 262.21(b)(4)
Disclosure
Section 261.24(a)(2)
Section 261.24(a)(3)

Estimated
Estimated
Annual
average hours annual burden
frequency
per response
hours

20
15
30
3

2
1
1
1

0.5
1
1
1

20
15
30
3

60

46

0.25

60

3
3

1
1

1
1

Total

3
3
134

The estimated total annual cost to individuals is $1,458,7 while the estimated total annual
cost to institutions and governments is $4,620.8 Accordingly, the estimated total annual cost to
the public for the FR 4035 is $6,078.
Sensitive Questions
These collections of information contain no questions of a sensitive nature, as defined by
OMB guidelines.
Estimate of Cost to the Federal Reserve System
The estimated cost to the Federal Reserve System for collecting and processing the
FR 4035 is negligible.

5

Of these respondents, 2 for section 261.22(c), 2 for section 261.23(b), 2 for section 261.23(c), and 2 for section
262.21(b)(4) are considered small entities as defined by the Small Business Administration (i.e., entities with less
than $600 million in total assets), https://www.sba.gov/document/support--table-size-standards. There are no special
accommodations given to mitigate the burden on small institutions.
6
The Board determined that supervised financial institutions would record an average of four disclosures to service
providers a year. The Board reached this determination by utilizing its records of requests from supervised financial
institutions to disclose confidential supervisory information to their service providers. Specifically, the Board
determined that approximately 60 supervised financial institutions submitted an average of four requests a year to
disclose confidential supervisory information to service providers. Accordingly, the Board estimated that supervised
financial institutions would need to account for disclosures of confidential supervisory information to their service
providers on approximately 240 occasions annually.
7
The average consumer cost of $27 is estimated using data from the BLS Economic News Release (USDL-20-0300)
https://www.bls.gov/news.release/archives/cewqtr_02202020.htm.
8
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 $20, 45% Financial Managers at
$71, 15% Lawyers at $70, and 10% Chief Executives at $93). Hourly rates for each occupational group are the
(rounded) mean hourly wages from the Bureau of Labor and Statistics (BLS), Occupational Employment and Wages
May 2019, published March 31, 2020, http://www.bls.gov/news.release/ocwage.t01.htm. Occupations are defined
using the BLS Standard Occupational Classification System, http://www.bls.gov/soc/.

7