Seal of the Board of Governors of the Federal Reserve System
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C.  20551
DIVISION OF BANKING
SUPERVISION AND REGULATION
SR 04-15
November 4, 2004

TO THE OFFICER IN CHARGE OF SUPERVISION
AT EACH FEDERAL RESERVE BANK
SUBJECT:  Termination of the Regulatory Reports Monitoring Program and New Procedures for Monitoring Regulatory Reports

The Federal Reserve is terminating the Regulatory Reports Monitoring Program, under which the Board used various monitoring, reporting, and consultation requirements to identify banking organizations' noncompliance with their filing obligations. As a result, this letter supersedes previously issued supervisory guidance on this program (SR letters 93-38, 93-47, 94-4, and 95-9).

Notwithstanding the termination of the Program, Reserve Banks should continue to monitor the filing of all regulatory reports, including those submitted under the Home Mortgage Disclosure Act, to ensure that they are filed in a timely manner and are accurate and not misleading. The Federal Reserve System's Committee on Current Reporting Series, which represents staff from the statistics functions from each of the Reserve Banks and the Board, will continue to play an active role in this process.

Background

The Regulatory Reports Monitoring Program was started in 1992 to address the statutory requirement that banking organizations file timely, accurate, and non-misleading regulatory reports and to ensure a consistent approach to supervisory actions and sanctions associated with late, false or misleading filings. Under the program, the Federal Reserve developed and maintained an ongoing monitoring system to record the timeliness of regulatory reports and to identify those banking institutions that exhibited a pattern of late or false reporting.

The Program was implemented in two phases. In SR letter 92-38, dated October 15, 1992, the first phase of the Program required the Reserve Banks to maintain monitoring systems capable of identifying and maintaining records of institutions that filed late reports. The Program required the Reserve Banks to submit to the Board summary reports of late reporters after each reporting period. The reports were reviewed by Board staff and appropriate follow-up actions were taken. To ensure consistent treatment of reporters' requests for extensions of time to file reports, the Reserve Banks were required to consult with Board staff prior to authorizing extensions. Extensions of due dates for the filing of regulatory reports were not allowed unless there were mitigating circumstances.

In SR letter 93-47, dated August 13, 1993, the second phase of the Program required the Reserve Banks to monitor regulatory reports for accuracy and completeness in addition to timeliness, to contact reporters who submitted inaccurate or incomplete filings, and to submit reports to Board staff concerning any identified regulatory reporting deficiencies. The second phase also added the requirement for Reserve Banks to monitor compliance with banking organizations' annual reporting requirements under the Home Mortgage Disclosure Act and to submit annual reports on the timeliness, completeness, and accuracy of HMDA reports to Board staff. In SR letter 94-4, dated January 14, 1994, the Federal Reserve issued procedures to track whether HMDA reports are filed in a timely manner and whether they are both complete and error free.

SR letter 95-9, dated February 28, 1995, modified the Program to reflect the generally satisfactory level of compliance by banking organizations with regulatory reporting requirements. Reserve Banks were no longer required to make quarterly submissions to the Board, but were still required to identify late and false reporters. In addition, Reserve Banks were still required to submit annual reports of late and false HMDA reporters and to consult with Board staff prior to granting extensions of time for filing reports.

Termination of Program and Revised Procedures

Since the implementation of the Regulatory Reports Monitoring Program, Federal Reserve staff has found that banking organizations have consistently been fulfilling their legal obligations related to regulatory reports and that they have rarely missed filing deadlines, or submitted inaccurate or misleading information in their regulatory reports. Where serious problems were identified, banking organizations re-filed the appropriate reports and, in some cases, provisions related to regulatory report filing obligations were included in formal and informal enforcement actions.

Board staff has determined that, in light of the high level of compliance by state member banks, bank holding companies, and the U.S. branches and agencies of foreign banks with their regulatory report filing requirements, it is appropriate to reduce the administrative burden on the Reserve Banks by eliminating the Regulatory Reports Monitoring Program. This means that Reserve Banks are no longer required to submit reports to Board staff on late and false reporters. In addition, there is no further need for the Reserve Banks to submit requests to Board staff for extensions of time to file reports. It is expected that the Committee on Current Reporting Series will establish procedures for the Reserve Banks to follow in granting extensions of time to file reports and will issue whatever guidance may be necessary in this area to ensure continued consistency among the Reserve Banks.

The staff of the Board's Division of Community and Consumer Affairs will continue to be responsible for the oversight of HMDA reports. DCCA staff, assisted by the Board's Information Technology Division, will continue to monitor the timeliness and accuracy of HMDA reports as part of its supervisory function.

The staff of the Enforcement Section of the Division of Banking Supervision and Regulation will continue to work with the Reserve Banks in the event that regulatory report filing deficiencies or violations are discovered. Serious problems in this area should be referred to the Enforcement Section staff for appropriate follow-up corrective action. Enforcement Section staff will coordinate with DCCA if the problems relate to HMDA filings.

In the event that you have any questions concerning any of these matters, please contact Joan Wolff, Counsel, Enforcement Section, at (202) 728-5881; Robert Maahs, Manager, Regulatory Reports Section, at (202) 872-4935; or John Bell, CCRS Chair, Vice President, Federal Reserve Bank of Philadelphia, at (215) 574-6442.

Richard Spillenkothen
Director


Supersedes:
SR letters 92-38, 93-47, 94-4, and 95-9
SR letters | 2004
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