FR2314_FR2314S_20201231_i_draft

Financial Statements of Foreign Subsidiaries of U.S. Banking Organizations

FR2314_FR2314S_20201231_i_draft

OMB: 7100-0073

Document [pdf]
Download: pdf | pdf
INSTRUCTIONS FOR PREPARATION OF

Financial Statements of Foreign
Subsidiaries of U.S. Banking
Organizations
FR 2314 and FR 2314S

Who Must Report

(4) Any subsidiary in which shares have been acquired,
directly or indirectly, by a financial holding company
under Section 4(k)(4) of the BHC Act, as amended
by the Gramm−Leach−Bliley Act for bank holding
companies or Section 10(c)(2)(H) of the HOLA for
savings and loan holding companies, domiciled outside of the United States,2 (except subsidiaries that
are functionally regulated as discussed in the exemptions section below). Refer to the FR Y-9C Glossary
entry for ‘‘Addressee (Domicile)’’ for the definition
of domicile.

AF

The Financial Statements of Foreign Subsidiaries of U.S.
Banking Organizations (FR 2314/FR 2314S) must be
filed by foreign subsidiaries of U.S. banking organizations (USBOs). Regulation K defines foreign or foreign
country as one or more foreign nations, and includes the
overseas territories, dependencies, and insular possessions of those nations and of the United States, and the
Commonwealth of Puerto Rico.

organization’s equity capital or if the Board’s consent to the acquisition is conditioned on the furnishing of reports;

T

GENERAL INSTRUCTIONS

The FR 2314/FR 2314S must be submitted for each legal
entity subject to reporting requirements. Therefore, consolidation of individual entities is not permitted.

D
R

Unless otherwise instructed, the FR 2314/FR 2314S is to
be submitted for any organization, also referred to as a
‘‘subsidiary,’’ described below except a corporation which
itself is organized under Section 25 or 25A of the Federal
Reserve Act.1 For purposes of this report, ‘‘subsidiaries’’
include, but are not limited to:
(1) Any organization which is a ‘‘subsidiary’’ as defined
by Section 211.2(w) of Regulation K of the Board of
Governors of the Federal Reserve System (see ‘‘Definitions’’);

(2) Any other subsidiary in which shares have been
acquired under Regulation K where the Board’s
consent to such acquisitions is conditioned on the
furnishing of reports, and all subsidiaries of such
organizations;
(3) Any organization in which shares have been acquired,
directly or indirectly, by a bank holding company
under Section 4(c)(13) of the Bank Holding Company Act of 1956 (BHC Act), as amended, if such
acquisition represents greater than 50 percent of this
1. Such Edge or agreement corporations report on the FR 2886b.

FR 2314 and 2314S
General Instructions September 2016

(5) Any other foreign organization directly or indirectly
managed or controlled by, or operated on behalf of, a
bank that is a member of the Federal Reserve System, a holding company, or any organization required
to report under 1 through 4 above, through management contracts, trust agreements, or similar
instruments.
For purposes of this report, holding company is
collectively used for bank holding company, savings
and loan holding company, securities holding company, and U.S. intermediate holding companies.
(6) Any domestic subsidiary of USBOs (principally held
by an Edge or agreement corporation), that qualifies
under Regulation K or Section 4 (c) (13) of the BHC
Act, as amended (i.e., subsidiaries authorized to
conduct overseas activities even if domiciled in the
U.S.).

2. Any such organization domiciled in the United States should file
either the Financial Statements of U.S. Nonbank Subsidiaries of Holding
Companies (FR Y-11) or the Abbreviated Financial Statements of U.S.
Nonbank Subsidiaries of Holding Companies (FR Y-11S) pursuant to the
reporting threshold requirements for those reports.

GEN-1

General Instructions

4

A USBO must file the FR 2314 quarterly for its subsidiary if the subsidiary is owned or controlled by a parent
U.S. holding company that has total consolidated assets
of $500 million or more as of June 30 of the preceding
year or files the FR Y-9C to meet supervisory needs, or
the subsidiary is owned or controlled by a state member
bank or an Edge or agreement corporation that has total
consolidated assets equal to or greater than $500 million,
and the subsidiary meets any one of the following
criteria:

Foreign subsidiaries that do not meet the quarterly filing
thresholds may be requested to file quarterly if the
Federal Reserve Bank has determined that these subsidiaries have significant risk exposures.
5

AF

(1) Total assets of the foreign subsidiary are equal to or
greater than $1 billion;

Once a nonbank subsidiary begins filing the FR 2314
quarterly, it should file a complete FR 2314 quarterly
going forward. If the parent USBO is a holding company
that has total consolidated assets of $500 million or more
as of June 30 of the preceding year or files the FR Y-9C to
meet supervisory needs or a state member bank or an Edge
or agreement corporation that has total consolidated assets
equal to or greater than $500 million, and the subsidiary
does not meet any one of the other quarterly nonbank
subsidiary filing criteria for four consecutive quarters,
then the parent organization may revert to annual filing
beginning with the first upcoming December report date.

T

Quarterly Filers—Detailed Report
(FR 2314)

(2) The foreign subsidiary’s off-balance-sheet activities3
are equal to or greater than $5 billion;
(3) The foreign subsidiary’s equity capital is equal to or
greater than 5 percent of the top-tier organization’s
consolidated equity capital; or
(4) The foreign subsidiary’s operating revenue is equal
to or greater than 5 percent of the top-tier organization’s consolidated operating revenue.

D
R

Operating revenue is defined as the sum of total interest
income and total noninterest income, before deduction of
expenses.
For foreign subsidiaries held by a USBO that is, in turn,
owned by a foreign banking organization (FBO), the
operating revenue and equity capital of the USBO are
used as the top-tier organization’s values.

If a foreign subsidiary meets the criteria above to file
quarterly as of June 30 of the preceding year, the parent
organization must file the FR 2314 quarterly for the
subsidiary beginning in March of the current year. In
addition, if the subsidiary meets the quarterly criteria due
to being newly formed or a business combination, then
the parent organization must report the FR 2314 quarterly
beginning with the first quarterly report date following
the effective date of the inception of the subsidiary or
business combination, respectively.

3. Off-balance-sheet activities (defined as the sum of Schedule BS,
items 20 through 30) include commitments to purchase foreign currencies
and U.S. dollar exchange, all other future and forward contracts, option
contracts, and the notional value of interest rate swaps, exchange swaps,
and other swaps.

Annual Filers—Detailed Report
(FR 2314)

A foreign subsidiary that does not meet any of the criteria
to file quarterly, but has total assets greater than or equal
to $500 million and less than $1 billion as of the report
date must file the entire FR 2314 report on an annual
basis.
6

Annual Filers—Abbreviated Report
(FR 2314S)

A foreign subsidiary that does not meet the criteria to
file the detailed report, but has total assets greater than or
equal to $250 million and less than $500 million as of the
report date must file the Abbreviated Financial Statements of Foreign Subsidiaries of U.S. Banking Organizations (FR 2314S) on an annual basis.

Other Reporting Criteria
• Each USBO must submit a separate FR 2314/FR
2314S for each of its foreign subsidiaries satisfying the
above criteria whether directly or indirectly owned.
The reporting USBO must submit a report on a parent
only (non-consolidated) basis for each parent subsidiary meeting the criteria and submit individual reports
for each lower level subsidiary required to file the
report.
• Consolidation of individual entities, including variable
interest entities (VIEs), is not permitted. Each USBO

See Insert 1
GEN-2

FR 2314 and 2314S
General Instructions March 2018

Insert 1
4

For report dates through December 31, 2021, quarterly filing not required if
nonbank subsidiary has total assets less than $1 billion using the lesser of normal
reporting applicability measurement date or 12/31/2019 as-of-date and does not
meet any of other criteria to file quarterly.

5

For report dates through December 31, 2021, annual filing not required if
nonbank subsidiary total assets was not greater than $500 million and less than
$1 billion using the lesser of normal reporting applicability measurement date or
12/31/2019 as-of-date and does not meet any of other criteria to file quarterly.

6

D
R

AF

T

For report dates through December 31, 2021, annual filing (abbreviated report)
not required if nonbank subsidiary total assets was not greater than $250 million
and less than $500 million using the lesser of normal reporting applicability
measurement date or 12/31/2019 as-of-date and does not meet any of other
criteria to file quarterly.


File Typeapplication/pdf
File Modified2021-03-16
File Created2020-12-21

© 2024 OMB.report | Privacy Policy