The regulators are continuing on their burden reducing approach and announced more reductions in November 2018 to the FFIEC 051 forms. The regulators are proposing to increase the small bank eligibility size for filing on the FFIEC 051 form from $1 billion in assets size to $5 billion and to make more line items required only semi-annually. In a second proposal, the regulators are considering regulatory burden relief to qualifying community banking organizations by allowing an option to calculate a simple leverage ratio, rather than multiple measures of capital adequacy.
In September 2018 the regulators issued proposed revisions to the 2019 Call Report to align the information in the call report with the new accounting credit loss accounting standard. In June 2018 the regulators implemented further burden-reducing changes for both FFIEC 051 and 041 filers. Additional changes to the June 2018 Call Report were included in the supplemental instructions. The regulators issued an update to the reporting of high volatility commercial real estate (HVCRE) exposures as well as reciprocal deposits.
The Call Report Preparation seminar will help preparers and reviewers understand the preparation process and eliminate errors. The seminar will begin with an overview of proposed and approved revisions for 2019 & 2018 and other recent changes, followed by a review of several new accounting standard updates.
March 2019 Proposed Revisions
- Increase in small bank asset size eligibility for filing on the FFIEC 051 form from $1 billion to $5 billion
- Option to calculate a simple leverage ratio, rather than multiple measures of capital adequacy for banks that meet certain criteria
- Semi-annual reporting for several more line items on the FFIEC 051 form, primarily RCR Pt II lines 1-25, risk weighting of on and off balance sheet assets
- Banks with assets over $1 billion that file on the FFIEC 051 form will still have to provide information on consumer deposit accounts and the related service charges, disaggregated data on the allowance for credit losses, and uninsured deposits in certain quarters
- Updates to twelve schedules to address the broader scope of financial assets for which an allowance for credit losses must be established and maintained.
June 2018 Revisions
- New information on the HVCRE definition as well as reporting of reciprocal deposits
- Further burden-reducing changes for the FFIEC 051 and 041 forms
March 2018 Revisions
- Maintaining phase in percentage deduction and risk weighting on certain RCR items
Proposed Simplifications to the Capital Rules
- Proposed changes to the capital deductions and risk weighting of mortgage servicing assets (MSAs), deferred tax assets (DTAs) arising from timing differences not realizable through carryback, investments in the capital of unconsolidated financial institutions, and minority interests
THE SEMINAR WILL COVER
- Proposed and approved changes to the 2019 and 2018 Call Reports as well as other recent revisions
- Recent Accounting Guidance (equities, leases, other real estates)
- In-Depth Discussion of Loan Classification reporting rules
- Common Errors made in call report preparation
Annual training in Call Report Preparation is highly recommended by bank regulators, not just for preparers of the call report, but also for reviewers. A reviewer needs to understand the reporting requirements and should spend at least 3-4 hours performing a detailed check of the completed Call Report Schedules and supporting documentation. New and experienced preparers and reviewers should be trained.