FR 2225
Annual Daylight Overdraft Capital
Report for U.S. Branches and Agencies of Foreign
Banks
Description:
The FR 2225 report requests
information needed to identify the foreign bank
respondent and its fiscal year-end and to
determine its capital and assets for purposes of
daylight overdraft monitoring. The capital and
assets items include the following: capital for
the foreign bank parent, capital used by any
direct or indirect subsidiary of the respondent
that has its own net debit cap, the foreign bank's
worldwide capital base calculation, the bank's
worldwide assets, and the exchange rate used in
the calculation.
OMB: 7100-0216
Purpose: The FR 2225 report provides the
Federal Reserve with the foreign bank's worldwide
capital figure, which, in connection with a net
debit cap multiple, is used to calculate the bank's
daylight overdraft limit.
Background:
This report was implemented in
March 1986 as part of the procedures used to
administer the Board's Payments System Risk (PSR)
Policy. Under the policy, all institutions that
maintain a Federal Reserve account are assigned or
may establish a net debit cap. The net debit cap
represents a maximum limit on daylight overdrafts
incurred in that account on a single day or on
average during a two-week maintenance period. The
net debit cap is calculated by applying a net
debit cap multiple to a capital measure. For a
U.S.-chartered institution, the net debit cap
multiple is applied to risk-based capital. For
U.S. branches or agencies of a foreign bank, the
net debit cap multiple is applied to a
consolidated U.S. capital equivalency measure. In
2000, as part of a broad review of its daylight
credit policies, the Federal Reserve assessed the
method of determining U.S. capital equivalency for
foreign banking organizations. The review
included analysis of trends in daylight credit,
consideration of supervisory issues, analysis of
new or emerging payments system initiatives, and
discussions with an FBO. The revised PSR policy
(1) eliminated the Basel Capital Accord criteria
and replaced it with the strength-of-support-
assessment (SOSA) rankings and financial holding
company status in determining U.S. capital
equivalency for an FBO, (2) raised the percentage
of capital used in calculating U.S. capital
equivalency for certain FBOs, and (3) revised the
definition of an alternative measure for U.S.
capital equivalency.
Respondent Panel:
The FR 2225 reporting panel
comprises foreign banking organizations with U.S.
branches or agencies that wish to and are eligible
to establish a non-zero net debit cap for their U.S.
branches and agencies under the PSR policy.
Frequency:
Annually, within three months of the
end of the foreign bank's fiscal year.
Public Release:
The FR 2225 is a public report.
Respondents may request confidential treatment for
portions of the report.
Last Update: December 29, 2021