FR2064_20210817_omb

Supporting Statement for the
Recordkeeping Requirements Associated with Changes in Foreign Investments
Made Pursuant to Regulation K
(FR 2064; OMB No. 7100-0109)
Summary
The Board of Governors of the Federal Reserve System (Board), under authority
delegated by the Office of Management and Budget (OMB), has extended for three years,
without revision, the Recordkeeping Requirements Associated with Changes in Foreign
Investments Made Pursuant to Regulation K (FR 2064; OMB No. 7100-0109). This collection
concerns internal records that internationally active U.S. banking organizations (such as
internationally active member banks, Edge Act and agreement corporations, and bank holding
companies) should maintain to demonstrate compliance with the investment provisions contained
in Subpart A of Regulation K - International Banking Operations (12 CFR Part 211).1
The estimated total annual burden for the FR 2064 is 160 hours.
Background and Justification
U.S. banking organizations may make investments abroad pursuant to Subpart A of
Regulation K.2 In February 2002, the Board’s Division of Supervision and Regulation issued
SR Letter 02-2. Among other things, this SR Letter states that internationally active U.S. banking
organizations should maintain adequate internal records regarding their investments abroad.
These records are reviewed by examiners during examinations, allowing the examiners to
determine a banking organization’s compliance with the Federal Reserve Act and Subpart A of
Regulation K. Monitoring banking organizations’ international investments also permits the
Federal Reserve to ensure that banking organizations do not expose themselves to undue risk.
Although internationally active U.S. banking organizations must report changes to their
organizational structure in the Report of Changes in Organizational Structure (FR Y-10; OMB
No. 7100-0297) and internationally active U.S. bank holding companies must provide
organizational information in the Annual Report of Holding Companies (FR Y-6; OMB No.
7100-0297), the investment information described in SR Letter 02-2 is much more detailed and
is not available from other sources.
Description of Information Collection
For each investment made under Subpart A of Regulation K, a banking organization
investor should maintain internal records regarding the type of investment, for example: equity
1

See SR Letter 02-2 published February 7, 2002.
The Board has granted its general consent to U.S. banking organizations to make foreign investments without prior
notice to the Board if the investment meets certain criteria. The criteria relate to the dollar amount of the investment,
whether the investment is in a subsidiary or a joint venture, or is a portfolio investment, and whether the investor is a
bank holding company, a member bank, or an Edge Act or agreement corporation that is well capitalized and well
managed.
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(voting shares, nonvoting shares, partnerships, interests conferring ownership rights,
participating loans), binding commitments, capital contributions, and subordinated debt; the
amount of the investment; the percentage ownership; activities conducted by the company and
the legal authority for such activities; and whether the investment was made under general
consent, prior notice, or specific consent authority. With respect to investments made under
general consent authority, information also should be maintained that demonstrates compliance
with the various limits set out in section 211.9 of Regulation K. The Board does not suggest that
such information be maintained in a specific format.
Respondent Panel
The FR 2064 panel comprises U.S. banking organizations that have made a foreign
investment (internationally active member banks, Edge Act and agreement corporations, and
bank holding companies).
Time Schedule for Information Collection
The recordkeeping provisions in SR Letter 02-2 are ongoing.
Public Availability of Data
No data collected by the Federal Reserve pursuant to this information collection are made
available to the public.
Legal Status
The FR 2064 is authorized pursuant to section 5(c) of the Bank Holding Company Act of
1956 (12 U.S.C. § 1844(c)) and sections 25(7) and 25A(17) of the Federal Reserve Act
(12 U.S.C. §§ 602 and 625). The institutions’ obligation to retain the records is mandatory.
The records related to the FR 2064 are retained at banking organizations. However, in the
event the records are obtained by the Board as part of an examination or supervision of a
financial institution, this information 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)). Additionally, to the extent that such information obtained by the Board
constitutes nonpublic commercial or financial information, which is both customarily and
actually treated as private by the financial institution, the financial institution may request
confidential treatment pursuant to exemption 4 of FOIA (5 U.S.C. § 552(b)(4)).
Consultation Outside the Agency
There has been no consultation outside the Federal Reserve System.

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Public Comments
On February 17, 2021, the Board published an initial notice in the Federal Register
(86 FR 9938) requesting public comment for 60 days on the extension, without revision, of the
FR 2064. The comment period for this notice expired on April 19, 2021. The Board did not
receive any comments. The Board adopted the extension, without revision of the FR 2064 as
originally proposed. On June 9, 2021, the Board published a final notice in the Federal Register
(86 FR 30606).
Estimate of Respondent Burden
As shown in the table below, the estimated total annual burden for the FR 2064 is 160
hours. The Board estimates that the effort associated with the recordkeeping requirements will
take an average of two hours per quarter. These recordkeeping requirements represent less than 1
percent of the Board’s total paperwork burden.

FR 2064

Estimated
number of
respondents3

Annual
frequency

Current

20

4

Estimated
Estimated
average hours annual burden
per response
hours
2

160

The estimated total annual cost to the public for the FR 2064 is $9,464.4
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
Because the Federal Reserve does not collect these records, the estimated cost to the
Federal Reserve System for collecting and processing this information collection is negligible.

3

Of these respondents, none 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.
4
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
$73, 15% Lawyers at $72, and 10% Chief Executives at $95). 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 2020, published March 31, 2021, https://www.bls.gov/news.release/ocwage.t01.htm. Occupations are defined
using the BLS Standard Occupational Classification System, https://www.bls.gov/soc/.

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