FRW_20250417_omb

Supporting Statement for the
Reporting and Recordkeeping Requirements Associated with Regulation W
(FR W; OMB No. 7100-0304)
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 Reporting and Recordkeeping Requirements Associated with Regulation W
(FR W; OMB No. 7100-0304). The Board’s Regulation W - Transactions Between Member
Banks and Their Affiliates (12 CFR Part 223), implements sections 23A and 23B of the Federal
Reserve Act (FRA) by defining terms used in the statute, explaining the statute’s requirements,
and exempting certain transactions from certain restrictions on transactions between member
banks and their affiliates. The reporting and recordkeeping requirements of FR W are triggered
by specific events.
FR W filings are required from insured depository institutions and uninsured member
banks (collectively, depository institutions)1 that seek to request certain exemptions from the
requirements of sections 23A and 23B. The FR W is separate from the quarterly Holding
Company Report of Insured Depository Institutions’ Section 23A Transactions with Affiliates
(FR Y-8; OMB No. 7100-0126), which collects information on transactions between an insured
depository institution and its affiliates that are subject to section 23A of the FRA.
The estimated total annual burden for the FR W is 56 hours. There is no formal reporting
form for this information collection.
Background and Justification
Sections 23A and 23B of the FRA are designed to protect a depository institution from
exposure arising from certain transactions with affiliates.2 They also limit the ability of an
insured depository institution to transfer the subsidy arising from access to the federal safety net
to such affiliates. Sections 23A and 23B apply, by their terms, to banks that are members of the
Federal Reserve System (member banks). As discussed in footnote 1, other federal law subjects
insured nonmember banks and insured thrifts to sections 23A and 23B in the same manner and to
the same extent as member banks.
As discussed below, the regulation includes provisions requiring the reporting of
information to the Board under certain circumstances. This information is not available from
other sources and is critical to the Federal Reserve and other federal banking agencies being able
Sections 23A and 23B of the FRA and Regulation W apply by their terms to “member banks;” that is, any national
bank, state bank, trust company, or other institution that is a member of the Federal Reserve System. In addition, the
Federal Deposit Insurance Act (12 U.S.C. § 1828(j)) applies sections 23A and 23B to insured state nonmember
banks in the same manner and to the same extent as if they were member banks. The Home Owners’ Loan Act
(12 U.S.C. §1468(a)) also applies sections 23A and 23B to insured savings associations in the same manner and to
the same extent as if they were member banks (and imposes two additional restrictions). See generally 12 CFR
223.1.
2
See 12 U.S.C. §§ 371c and 371c-1.
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to determine whether a depository institution is complying with sections 23A and 23B of the
FRA and Regulation W and whether a proposed transaction is financially sound and consistent
with the public interest.
Description of Information Collection
Reporting Requirements
Loan participation renewal notice (Section 223.15(b)(4)). Generally, a depository
institution is prohibited from purchasing a low-quality asset, as defined by Regulation W, from
an affiliate unless, pursuant to an independent credit evaluation, the depository institution had
committed itself to purchase the asset before the time the asset was acquired by the affiliate.
However, a depository institution may renew or extend additional credit with respect to a loan
participation if the loan was not a low-quality asset at the time the depository institution
purchased its participation, and if certain other requirements are met. One such requirement is
that the participating depository institution must provide its appropriate federal banking agency
with a written notice of the renewal of, or the extension of additional credit in connection with, a
low-quality asset not later than 20 calendar days after consummation.
Acquisition notice (Section 223.31(d)(4)). In general, a depository institution’s
acquisition of a security issued by a company that was an affiliate of the depository institution
before the acquisition is treated as a purchase of assets from an affiliate if, as a result of the
transaction, the company becomes an operating subsidiary of the depository institution and the
company has liabilities or the depository institution gives cash or any other consideration in
exchange for the security. However, such a transaction is exempt from the requirements of
Regulation W if it is a “step transaction,” as described in section 223.31(d) of Regulation W.
One of the requirements for this exemption is that the depository institution must notify the
appropriate federal banking agency and the appropriate Reserve Bank of its intention to acquire
the company at or before the time that the company becomes an affiliate of the depository
institution.
Internal corporate reorganization transactions notice (Section 223.41(d)(2)). An
internal corporate reorganization transaction is exempt from the quantitative limits and collateral
requirements of Regulation W if certain conditions are met. The depository institution involved
must provide the appropriate federal banking agency and the appropriate Reserve Bank with
written notice of the transaction before consummation. The notice must describe the primary
business activities of the affiliate and indicate the proposed date of the asset purchase.
Additional exemptions from the requirements of section 23A (Section 223.43(b)).
The Board may, at its discretion, by regulation or order, exempt transactions or relationships
from the requirements of section 23A if it finds such exemptions to be in the public interest and
consistent with the purposes of section 23A. A state member bank may request an exemption by
submitting a written request to the General Counsel of the Board. Other depository institutions
should contact their federal supervisor to determine the procedures that the institution needs to
follow. The request must describe in detail the transaction or relationship for which the state
member bank seeks exemption, explain why the Board should exempt the transaction or

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relationship, and explain how the exemption would be in the public interest and consistent with
the purposes of section 23A.
Recordkeeping Requirements
Purchasing certain marketable securities (Section 223.42(f)(6)). Certain transactions
with affiliates are exempt from the quantitative limits, collateral requirements, and low-quality
asset prohibition of Regulation W. This section exempts from those restrictions certain purchases
by a depository institution of securities from a securities affiliate if, among other requirements,
the depository institution maintains, for a period of two years, records and supporting
information that are sufficient to enable the appropriate federal banking agency to ensure the
depository institution’s compliance with the terms of the exemption.
Purchasing municipal securities (Section 223.42(g)(3)). This section exempts from the
restrictions on affiliate transactions purchases by a depository institution of municipal securities
from a securities affiliate if, among other requirements, the price of the security is quoted
routinely on an unaffiliated electronic service that provides indicative data from real-time
financial networks, and the price paid for the security can be verified by reference to the written
summary provided by the syndicate manager to syndicate members that discloses the aggregate
par values and prices of all bonds sold from the syndicate account, so long as the depository
institution obtains a copy of the summary from its securities affiliate and retains the summary for
three years.
The Board understands that respondents use information technology to comply with these
requirements by storing records digitally and submitting these notices electronically to the
appropriate Reserve Bank.3
Respondent Panel
The FR W panel comprises insured depository institutions and uninsured member banks.4
Frequency and Time Schedule
The notifications required under Regulation W are event-generated and must be provided
to the appropriate federal banking agency and, if applicable, the appropriate Reserve Bank within
the time periods established by the law, as discussed above. The recordkeeping requirements of
Regulation W are event-generated and their record retention schedules are also outlined above.
Public Availability of Data
No data collected by this information collection are published.

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4

Respondents may choose to submit and store these records in hard copy format.
See supra note 1.

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Legal Status
Sections 23A and 23B of the FRA authorize the Board to issue these requirements
(12 U.S.C. §§ 371c(f) and 371c-1(e)). Compliance with the FR W requirements is required to
obtain a benefit.
Information provided on the Loan Participation Renewal notice is confidential under
exemption 4 of the Freedom of Information Act (FOIA) as confidential commercial or financial
information that is both customarily and actually treated as private (5 U.S.C. § 552(b)(4)).
Information provided on the Acquisition notice, the Internal Corporate Reorganization
Transaction notice, and the Section 23A Additional Information request generally is not
considered confidential, but respondents may request confidential treatment under exemption 4
of FOIA if the information is confidential commercial or financial information that is both
customarily and actually treated as private. Information collected under the FR W may also be
considered confidential under FOIA exemption 8 if it is obtained as part of an examination or
supervision of a financial institution (5 U.S.C. § 552(b)(8)).
Consultation Outside the Agency
There has been no consultation outside the Federal Reserve System.
Public Comments
On November 15, 2024, the Board published an initial notice in the Federal Register (89
FR 90283) requesting public comment for 60 days on the extension, without revision, of the
FR W. The comment period for this notice expired on January 14, 2025. The Board did not
receive any comments. The Board adopted the extension, without revision, of the FR W as
originally proposed. On April 2, 2025, the Board published a final notice in the Federal Register
(90 FR 14445).
Estimate of Respondent Burden
As shown in the table below, the estimated total annual burden for the FR W is 56 hours.
The number of respondents is based on the average number of FR W filings received in the past
3 years. The burden estimate was produced using the standard Board burden calculation
methodology. These reporting and recordkeeping requirements represent less than 1 percent of
the Board’s total paperwork burden.

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Estimated
number of
respondents5

FR W
Reporting
Section 223.15(b)(4)
Section 223.31(d)(4)
Section 223.41(d)(2)
Section 223.43(b)
Recordkeeping
Section 223.42(f)(6)
Section 223.42(g)(3)

Estimated
Estimated
Estimated
annual
average hours annual burden
frequency per response
hours

2
2
2
2

1
1
1
1

2
6
6
10

4
12
12
20

2
2

1
1

2
2

4
4

Total

56

The estimated total annual cost to the public for the FR W is $4,040.6
Sensitive Questions
This information collection contains 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 this
information collection is negligible.

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Of these respondents, none are considered small entities as defined by the Small Business Administration (i.e.,
entities with less than $850 million in total assets). Size standards effective March 17, 2023. See
https://www.sba.gov/document/support-table-size-standards.
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Total cost to the responding public is estimated using the following formula: total burden hours, multiplied by the
cost of staffing, where the cost of staffing is calculated as a percent of time for each occupational group multiplied
by the group’s hourly rate and then summed (30% Office & Administrative Support at $24, 45% Financial
Managers at $87, 15% Lawyers at $88, and 10% Chief Executives at $126). Hourly rates for each occupational
group are the (rounded) mean hourly wages from the Bureau of Labor Statistics (BLS), Occupational Employment
and Wages, May 2024, published April 2, 2025, 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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