1557-0229 Supporting Statement for CSFT (6.2.25)

Supporting Statement

Interagency Statement on Complex Structured Finance Transactions

OMB Control No. 1557-0229

A. Justification.

1. Circumstances that make the collection necessary:

The Office of the Comptroller of the Currency (OCC) is seeking an extension of its approval of its information collection titled, “Interagency Statement on Complex Structured Finance Transactions” (CSFT) (statement).¹ The statement describes sound internal control and risk management practices that help financial institutions identify and address certain risks associated with complex structured finance transactions.

As financial intermediaries, financial institutions play a critical role in ensuring the integrity of financial markets and maintaining the trust and public confidence essential to the proper functioning of the capital markets. Structured finance products generally serve the legitimate business interests of customers and are an essential part of U.S. and international capital markets. Financial institutions need appropriate policies and procedures to identify, conduct due diligence for, and approve those complex structured finance transactions that may involve heightened risk. Internal controls and risk management practices that are commensurate with the nature, scope, and risk of CSFT activities will help ensure that the institution docs not participate in illegal or inappropriate transactions or expose the institution to other elevated risk.

2. Use of the information:

A financial institution’s policies and procedures ensure that its operations are conducted in compliance with applicable law and regulations. In the context of complex structured finance transactions, this function of policies and procedures is critical to the institution’s sound operation. For instance, an institution may face substantial legal risk, including enforcement action by a supervisory agency and lawsuits by private parties if it participates in structured finance transactions that are used by a customer to circumvent regulatory or financial reporting requirements, evade tax liabilities, or further other illegal or improper behavior.

3. Consideration of the use of improved information technology:

Respondents may use any technology that allows compliance with the collection.

4. Efforts to identify duplication:

The information is not duplicated elsewhere. This collection is unique in that it involves policies and procedures specific to a particular institution and appropriate to the types of structured finance transactions that the institution conducts.

5. If the collection of information impacts small businesses or other small entities, describe any methods used to minimize burden.

The guidance in the statement applies to all OCC-supervised institutions regardless of asset size but the activity is limited to larger banks. The guidance describes some of the internal controls and risk management procedures that may help financial institutions identify, manage, and address heightened risks that may arise from elevated-risk CSFTs. There are no alternatives that would result in further lowering the burden on small institutions while still accomplishing the purpose of the guidance as the activity is undertaken in larger institutions.

6. Consequences to the federal program if the collection were conducted less frequently:

If the collection were conducted less frequently, it would hinder banks’ ability to identify and address the risks associated with complex structured finance transactions.

7. Special circumstances that would cause an information collection to be conducted in a manner inconsistent with 5 CFR Part 1320:

Not applicable. The information collection is conducted in accordance with the requirements of 5 CFR Part 1320.

8. Efforts to consult with persons outside the agency:

The OCC issued a 60-day Federal Register notice on March 13, 2025, 90 FR 12032. No comments were received.

9. Payment or gift to respondents:

None.

10. Any assurance of confidentiality:

The information will be kept private to the extent permitted by law.

11. Justification for questions of a sensitive nature:

There are no questions of a sensitive nature.

12. Burden estimate:

Number of Respondents: 9, each with 1 response

Burden per Respondent: 25 hours

Total Burden: 225 hours

Cost of Hour Burden

225 hours x $131.10 = $29,497.50

To estimate wages the OCC reviewed May 2024 data for wages (by industry and occupation) from the U.S. Bureau of Labor Statistics (BLS) for credit intermediation and related activities (NAICS 5220A1).  To estimate compensation costs associated with the rule, the OCC uses $131.10 per hour, which is based on the average of the 90th percentile for six occupations adjusted for inflation (3.6 percent as of Q1 2025), plus an additional 35.6 percent for benefits (based on the percent of total compensation allocated to benefits as of Q4 2024 for NAICS 522: credit intermediation and related activities).

13. Estimate of total annual costs to respondents (excluding cost of hour burden in Item #12):

None.

14. Estimate of annualized costs to the federal government:

None.

15. Change in burden:

There is no change in burden.

16. Information regarding collections whose results are to be published for statistical use:

The OCC has no plans to publish the information for statistical purposes.

17. Reasons for not displaying OMB approval expiration date:

Not applicable.

18. Exceptions to the certification statement in Item 19 of OMB Form 83-I:

None.

B. Collections of Information Employing Statistical Methods.

Not applicable.

1 72 FR 1372 (Jan. 11, 2007).