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MARCH 2010
Table of Contents
General Instructions ............................................................................................................................... 101
Schedule SC – Consolidated Statement of Condition ........................................................................ 201
Schedule SO – Consolidated Statement of Operations ...................................................................... 301
Schedule VA – Consolidated Valuation Allowances ........................................................................... 401
Schedule PD – Consolidated Past Due and Nonaccrual..................................................................... 501
Schedule LD – Consolidated Loan Data ............................................................................................... 601
Schedule CC – Consolidated Commitments and Contingencies....................................................... 701
Schedule CF – Consolidated Cash Flow Information ......................................................................... 801
Schedule DI – Consolidated Deposit Information ............................................................................... 901
Schedule SI – Supplemental Information ........................................................................................... 1001
Schedule SQ – Consolidated Supplemental Questions.................................................................... 1101
Schedule SB – Consolidated Small Business Loans........................................................................ 1201
Schedule FS – Fiduciary and Related Services ................................................................................. 1301
Schedule HC – Thrift Holding Company............................................................................................. 1401
Schedule CCR – Consolidated Capital Requirements ...................................................................... 1601
Schedule FV – Consolidated Assets and Liabilities Measured at Fair Value
on a Recurring Basis .................................................................................................. 1701
Schedule RM – Annual Supplemental Consolidated Data on Reverse Mortgages ........................ 1801
Schedule CMR – Consolidated Maturity and Rate............................................................................. 1901
Glossary ................................................................................................................................................. 2101
Index ....................................................................................................................................................... 2201
TABLE OF CONTENTS
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THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
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GENERAL INSTRUCTIONS
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
1.
REQUESTS FOR INFORMATION OR ASSISTANCE
Please direct all requests for assistance in Thrift Financial Report (TFR) preparation to your assigned
financial reporting analyst in the Office of Thrift Supervision (OTS) Financial Reporting Division (FRD),
Dallas, Texas. A list of Financial Reporting Division contacts is on the OTS web site and is included in
most Financial Reporting Bulletins. If you do not know the name or phone number of your assigned FRD
analyst, call 972-277-9618. If you have questions concerning the EFS (Electronic Filing System) software
or transmission, call the EFS Helpline Message Center at 866-314-1744 or email
efs-info@ots.treas.gov.
OTS maintains a series of TFR questions and answers on its web site at www.ots.treas.gov. If you have
a question for which you would like an e-mail response, please submit it to your financial reporting analyst
or to tfr.instructions@ots.treas.gov.
The TFR Form, Instructions, and Financial Reporting Bulletins can be viewed and printed from the OTS
web site at www.ots.treas.gov
2.
SCHEDULES
The TFR comprises the following schedules:
NS
Optional Narrative Statement: Statement by institution management concerning issues
relevant to the TFR
SC
Consolidated Statement of Condition: Assets, liabilities, and equity capital
SO
Consolidated Statement of Operations: Income and expense
VA
Consolidated Valuation Allowances and Related Data: Reconciliation of valuation
allowances, charge-offs and recoveries, and other data on troubled assets
PD
Consolidated Past Due and Nonaccrual: Information on delinquent and nonaccrual loans
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LD
Loan Data: Information on high loan-to-value loans secured by 1-4 family residential
properties without PMI or government guarantee
CC
Consolidated Commitments and Contingencies: Information on commitments and
contingencies
CF
Consolidated Cash Flow Information: Information on mortgage, deposit, and other activity
affecting cash flow during the quarter
DI
Consolidated Deposit Information: Information on deposits and escrows
SI
Consolidated Supplemental Information: Information on QTL, loans to insiders, reconciliation
of equity capital, transactions with affiliates, mutual fund and annuity sales, average balance
sheet data, and other data
SQ
Consolidated Supplemental Questions: Questions concerning structural and other activity
during the quarter
SB
Consolidated Small Business Loans: Data completed annually as of June 30 to comply with
Section 122 of the FDIC Improvement Act
FS
Fiduciary and Related Services: Data on trust assets and activities. Summary data is
completed quarterly; more detailed information is reported annually at December 31st
HC
Thrift Holding Company: Summary of holding company financial data for both the parent only
and consolidated
CCR
Consolidated Capital Requirement: Balances necessary to compute the OTS minimum
capital requirement
FV
Consolidated Assets and Liabilities Measure at Fair Vale on a Recurring Basis
CMR
Consolidated Maturity and Rate: Information on interest rate and repricing/maturity
characteristics of selected balance-sheet and off-balance-sheet items
FILING DEADLINES
The filing deadline for all schedules except Schedules HC and CMR is no later than the 30th day following
the end of the reporting period. The filing deadline for Schedules HC and CMR is no later than the 45th day
following the end of the reporting period.
The Filing Schedule for Regulatory Reports is included as an attachment to the quarterly Financial
Reporting Bulletin that is e-mailed to institution report preparers. The Filing Schedule is also available on
the OTS web site at www.ots.treas.gov.
4.
FILING THE TFR
OTS provides all savings associations with EFS (Electronic Filing System) software for filing the TFR.
The software facilitates the preparation, edit, and transmission of the TFR and other financial reports.
Please direct your questions concerning EFS to the EFS Helpline Message Center at 866-314-1744 or by
email to efs-info@ots.treas.gov.
All institutions regulated by OTS as of the last day of the quarter are required to file the TFR for the entire
quarter. If the documentation submitted to OTS by an institution reflects that the effective date of a
charter conversion to OTS-regulation from another banking agency is either during the quarter or prior
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to the close of business on the last day of the quarter, the institution is required to file a TFR for that
quarter. An institution with a charter conversion from OTS to another banking regulator or merger with
a non-OTS regulated institution, effective after close of business on the last day of the quarter, is required
to file a TFR for the entire previous quarter. Institutions changing banking charters are never required to
file a partial report to their former banking regulator; they must file a financial report only with the agency
regulating them on the last day of the quarter, reporting activities for the entire quarter. Therefore, an
institution that is required to file a TFR is not required to file a Call Report and vice versa. If a newly
formed OTS-regulated institution opens for business at any time during the quarter, even if on the last day
of the quarter, it is required to file a TFR for the period of operations during the quarter.
5.
RECORD RETENTION
You should retain at least one copy of your completed TFR for reference; do not send paper copies to
OTS. Section 7(b)(5) of the Federal Depository Institutions Act requires each insured depository
institution to maintain records for verifying the correctness of the institution’s insurance assessment for
five (5) years from the date of filing.
6.
AMENDING THE TFR
To have amendments included in the first public release of the OTS data file, you must transmit your TFR
amendments within 45 calendar days of the end of the quarter; that is, within 15 days after the TFR filing
deadline. Amendments submitted after the 45-day period should have the approval of FRD in Dallas,
before transmission. In no case can OTS process amendments beyond 135 days after the end of the
quarter. With every amendment you file, you should send a user note explaining the reason for the
amendment.
You may correct material errors in prior-period TFRs in one of the following ways depending on the time
period being corrected:
1. If you can file an amendment within 135 days of the end of the quarter being corrected, transmit
the amendment correcting the TFR in which the error occurred after you discuss it with your FRD
analyst in Dallas.
2. If the correction is to an income statement in a quarter that can no longer be amended and is
within the current calendar year, include the correction with the current TFR in the same data field
that would have carried it in the original report. If the adjustment distorts yields or results in
negative numbers in fields that do not permit negatives, you may include the amendment in Other
Noninterest Income, SO488, or Other Noninterest Expense, SO580.
3. If the correction is to an income statement for a quarter from a prior calendar year that can no
longer be amended, make the adjustment directly to retained earnings on SI668, Prior Period
Adjustments.
You must file TFR amendments electronically, rather than by phone or fax in order to automatically
update your EFS files on your computer. Please direct questions regarding the electronic filing of
amended TFRs to the EFS Helpline Message Center at 866-314-1744 or email efs-info@ots.treas.gov.
The amendment filing deadlines above also apply to amending Schedule CMR. All amendments to
Schedule CMR must be submitted within 135 days of the end of the quarter.
7.
REPORTING BASIS
Prepare the TFR on a consolidated basis in accordance with generally accepted accounting principles
(GAAP) unless specifically stated otherwise, and based on calendar year reporting. Unless otherwise
specified, all data is reported as of the end of the calendar quarter or in the case of income, expense, and
other activity data, for the period of one calendar quarter. Note that Schedule FS requires reporting
income and expense on a calendar year-to-date basis.
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Report subordinate organizations that are not GAAP-consolidated subsidiaries using the equity or cost
methods of accounting. Subordinate organization is defined by OTS regulation. It includes any
corporation, partnership, business trust, association, joint venture, pool, syndicate, or other similar
business organization in which a savings association has a direct or indirect ownership interest. It
excludes an ownership interest that qualifies as a pass-through investment pursuant to 12 CFR § 560.32
and is so designated by the reporting savings association. GAAP-consolidated subsidiaries as defined in
12 CFR § 559.2 mean entities in which a savings association has a direct or indirect ownership interest
and whose assets are consolidated with those of the savings association for purposes of reporting under
GAAP.
You should apply GAAP unless we specifically state otherwise in these instructions. Accordingly, the
instructions for each data field reflect, to the extent possible, GAAP applicable to savings associations.
Note, however, that financial statements of savings associations prepared in accordance with GAAP have
flexible presentation formats and may require significantly less detail on a less frequent basis than the
TFR. The TFR collects additional detail to facilitate supervision by the OTS and to provide uniform
information on industry activities. Certain GAAP reporting and presentation concepts may not be
consistent with the conventions and frequency of the TFR. In these cases, the TFR instructions override
GAAP presentation practices.
The amounts reported on the TFR must be readily reconcilable to the savings association’s books and
records.
8.
EXEMPTION FROM FILING SCHEDULE CMR
Savings associations with less than $300 million in assets and with risk-based capital ratios in excess of
12 percent for two consecutive quarters are exempt from filing Schedule CMR. All savings associations
newly regulated by the OTS are exempt from filing Schedule CMR for the first two quarters that they are
under OTS regulation.
You lose your exemption from filing Schedule CMR if you do not meet the exemption criteria for two
consecutive quarters. You must file Schedule CMR beginning the quarter after the second consecutive
quarter in which you do not meet the criteria. For example, you fail the criteria in March and June,
therefore, you must file Schedule CMR for the September quarter, and each quarter thereafter until your
OTS Regional Director reinstates the exempt status.
You may also lose your exempt status if your OTS Regional Director requires you to file Schedule CMR.
You must continue to file Schedule CMR until your OTS Regional Director reinstates the exemption in
writing.
9.
TFR PREPARATION
a. Round all dollar amounts to the nearest thousand. If any balance sheet data field or other balance as
of the end of the reporting period is less than $500, enter a 1 in the data field to indicate that the
amount is not zero. This does not apply to the data fields representing income, expense, and other
activity. Where necessary for balancing purposes, make adjustments to the appropriate other
category.
b. Data fields that we indicate in the instructions and forms as being deducted should not be input as
negative; these data fields will be subtracted by EFS. Indicate these data fields as negative only
when the instructions say that the netting of certain amounts within these data fields might result in an
amount that should be added rather than subtracted. We identify these data fields in italics on the
form and mention them in the accompanying instructions.
c. You should check all data before and after input. Crosscheck data fields that should agree with other
data fields. All edit failures indicated in EFS should be thoroughly verified and corrected where
necessary prior to submission. Explain edit exceptions with the user note function of the filing
software.
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d. Persons knowledgeable of the overall financial condition and operations of the savings association
should review the final TFR. The Officers’ and Directors’ Certification at the front of the paper copy of
the TFR must be signed by an officer and three directors of the savings association for each TFR
submitted, including amendments. You must retain this certification form and have it available for
inspection by OTS.
e. Input into EFS (use institution setup, report preparer info) the name and telephone number of the
person we should contact if questions arise concerning the TFR. This person should be familiar with
OTS’s reporting requirements. When someone other than the savings association’s personnel
prepares the TFR, the contact should be someone who can either answer questions or can quickly
obtain such answers from savings association personnel. The name and address of the TFR contact
that you enter is used for the mailing list to distribute quarterly TFR mailings.
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SCHEDULE SC – CONSOLIDATED STATEMENT
OF CONDITION
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete this Statement of Condition, Schedule SC, on a consolidated basis from the savings
association downward. Do not consolidate your holding company in this statement of condition. You
should apply generally accepted accounting principles (GAAP) unless we specifically state otherwise in
these instructions.
ASSETS
In general, report all assets net of all appropriate carrying value adjustments. Such adjustments include
specific valuation allowances (SVAs), charge-offs, unamortized yield adjustments, unearned income,
loans-in-process (LIP), and the accumulated gain or loss (change in fair value) on the asset attributable to
the designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133.
For the following assets that may be included on various lines on this schedule, also report the balances
on Schedule SI:
SI375, Financial Assets Held for Trading Purposes
SI376, Financial Assets Carried at Fair Value through Earnings
SI385, Available-for-Sale Securities
SI387, Assets Held for Sale
SI390, Loans Serviced for Others
SI394, Pledged Loans
SI395, Pledged Trading Assets
SI402, Residual Interests in the Form of Interest-Only Strips
SI404, Other Residual Interests
(Do not include Servicing Assets on these Schedule SI line items, as they are not considered financial
assets per FAS141).
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CASH, DEPOSITS, AND INVESTMENT SECURITIES
In accordance with FASB Statement No. 115, Accounting for Certain Investments in Debt and Equity
Securities, securities reported on SC130, SC140, SC180, SC182, and SC185 fall into one of the following
categories:
1. Held-to-maturity securities: Applies to debt securities only if there is a positive intent and ability
to hold these securities to maturity. You must report held-to-maturity securities at amortized cost.
2. Trading securities: Applies to securities purchased and held for sale in the near term. You must
report trading securities at fair value, with unrealized gains or losses reported in earnings on
SO485.
3. Available-for-sale securities: Applies to securities not classified as trading or as held-tomaturity. You must report available-for-sale securities at fair value. The unrealized gains and
losses of available-for-sale securities are excluded from earnings and reported, net of taxes, as a
separate component of equity capital on SC860.
SC11:
Total
The EFS software will compute this line as the sum of SC110 through SC191.
SC110: Cash and Non-interest-earning Deposits
Report the total amount of cash, cash items, and non-interest-earning deposits.
Include:
1. Non-interest-earning deposits in a bank or savings association under the control of a supervisory
authority.
2. Cash items in the process of collection, such as redeemed U.S. Savings Bonds.
3. Checks or drafts in the process of collection that are drawn on another depository institution,
Federal Reserve Bank, Federal Home Loan Bank (FHLBank), or the U.S. government.
Do not include:
1. Checks drawn against zero-balance accounts or accounts not routinely maintained with sufficient
balances to cover checks drawn in the normal course of business. Report on SC710, Deposits.
2. Federal Reserve Bank deposits earning interest. Include these deposits on SC118.
3. All other accounts with credit balances that do not have the right of offset. Report on SC760,
Other Borrowings.
SC112: Interest-Earning Deposits In FHLBs
Report all interest-earning checking accounts and time deposits (CDs) held with FHLBanks.
Do not include:
Accounts with credit balances that do not have the right of offset. Report on SC760, Other
Borrowings, except for credit balances in zero-balance accounts, which are reported on SC710,
Deposits.
SC118: Other Interest-Earning Deposits
Report all interest-earning checking accounts and time certificates held with banks and other depository
institutions.
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Include:
Federal Reserve Bank deposits earning interest.
Do not include:
Accounts with credit balances that do not have the right of offset. Report on SC760, Other
Borrowings, except for credit balances in zero-balance accounts, which are reported on SC710,
Deposits.
SC125: Federal Funds Sold and Securities Purchased Under
Agreements to Resell
Include:
1. The balance of excess Federal Funds invested.
2. Securities purchased under agreements to resell that do not meet the criteria for a sale under
FASB Statement No. 140, including dollar-repurchase and fixed-coupon agreements.
Do not include:
1. Term Federal Funds
Treat as a commercial loan, not as federal funds sold any lending of immediately available funds
where the loan has an original maturity of more than one business day, other than securities
purchased under agreements to resell. Such transactions are sometimes referred to as Term
Fed Funds.
SC130: U.S. Government, Agency, and Sponsored Enterprise
Securities
Report nonmortgage debt instruments issued by the U.S. government, its agencies, and sponsored
enterprises.
Include:
1. Interest-only and principal-only strips.
2. U.S. Treasury bills, certificates, notes, and bonds.
3. Nonmortgage debt issued by FHLBanks, Federal National Mortgage Association (Fannie Mae),
Federal Home Loan Mortgage Corporation (Freddie Mac), and Government National Mortgage
Association (Ginnie Mae).
4. Federal agency debt securities, such as those of: Small Business Administration (SBA)
nonmortgage pools, Tennessee Valley Authority (TVA), Federal Farm Credit Bank, Federal Land
Bank, Federal Intermediate Credit Bank, Student Loan Marketing Association (Sallie Mae), and
the Export-Import Bank.
5. Financing Corporation (FICO) bonds.
6. U.S. government and agency securities pledged as collateral on margin accounts for futures and
options.
Do not include:
1. Investments in mutual funds that invest in U.S. government, agency, and sponsored enterprise
securities. Report on SC140, Equity Securities Subject to FASB Statement No. 115.
2. Stock of FHLBanks. Report on SC510, Federal Home Loan Bank Stock.
3. Equity securities issued by sponsored enterprises of the U.S. government, such as Freddie Mac
preferred stock. Report on SC140.
4. Securities issued by state and local governments. Report on SC180.
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5. Securities purchased under a repurchase or dollar-repurchase agreement. Report on SC125,
Federal Funds Sold and Securities Purchased Under Agreements to Resell.
6. Mortgage-backed instruments and derivatives issued or guaranteed by Fannie Mae, Freddie Mac,
or Ginnie Mae. Report on SC210 or SC217.
SC140: Equity Securities Subject to FASB Statement No. 115
Report all investments in equity securities that have readily determinable fair values and that are
accounted for pursuant to FASB Statement No. 115.
Include:
1. Common and preferred stock that has a readily determinable market value, including Freddie
Mac and Fannie Mae stock.
2. Shares of all mutual funds, including those restricting their investments to debt instruments, such
as U.S. government, agency, and sponsored enterprise securities.
Do not include:
1. FHLBank stock. Report on SC510, Federal Home Loan Bank Stock.
2. Other equity investments not subject to FASB Statement No. 115, including ownership
interests in unconsolidated subordinate organizations and entities designated as pass-through
investments, even though they are not subordinate organizations. Report on SC540, Other
Equity Investments Not Subject to FASB Statement No. 115.
3. Your association’s own treasury stock. Report as a reduction of capital on SC891, Other
Components of Equity Capital.
SC180: State and Municipal Obligations
Report debt securities issued by state and local governments.
SC182: Securities Backed By Nonmortgage Loans
Report the outstanding balance, as determined in accordance with GAAP, of all securities collateralized
by nonmortgage loans such as credit card loans and auto loans.
SC185: Other Investment Securities
Report investment securities and other instruments not reported on SC110 through SC182 or SC510 or
SC540.
Include:
1. Investments in commercial paper and corporate debt securities.
2. Promissory notes.
3. Mortgage-backed bonds and notes.
SC191: Accrued Interest Receivable
Report accrued interest and dividends receivable on deposits and investment securities reported on
SC110 through SC185.
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MORTGAGE-BACKED SECURITIES:
In accordance with FASB Statement No. 115, Accounting for Certain Investments in Debt and Equity
Securities, mortgage-backed securities fall into one of the following three categories:
1. Held-to-maturity securities: Applies to mortgage-backed securities only if there is a positive
intent and ability to hold these securities to maturity. You report held-to-maturity mortgagebacked securities at amortized cost.
2. Trading securities: Applies to mortgage-backed securities that you hold for sale in the near
term. Report them at fair value, with unrealized gains or losses reported in earnings, on SO485.
3. Available-for-sale securities: Applies to mortgage-backed securities not classified as trading or
as held-to-maturity. Report available-for-sale securities at fair value. Report the accumulated
unrealized gains and losses on such securities, net of taxes, as a separate component of equity
capital on SC860.
Adjust the balances in this section for:
1. Discounts and premiums on the purchase of the securities.
2. Specific valuation allowances.
3. The accumulated fair value gain or loss on the security attributable to the designated risk being
hedged on a qualifying fair-value hedge under FASB Statement No. 133.
Do not adjust the balances in this section for: General valuation allowances. Report on SC229.
Do not include:
Mortgage-backed securities purchased subject to repurchase agreements. Report on SC125,
Federal Funds Sold and Securities Purchased Under Agreements to Resell.
SC22:
Total
The EFS software will compute this line as the sum of SC210 through SC228, less SC229.
PASS-THROUGH:
A security must meet all of the following criteria to be classified as a pass-through security:
1. The security is collateralized by mortgage loans.
2. The security provides each investor with a proportional ownership interest in the underlying
collateral.
3. Payments received by the issuer are passed through to the investor proportionate to ownership
interest and with the same timing with which they are received.
You should report a security that meets item 1 but not 2 or 3 on SC217, SC219, or SC222, unless it is a
mortgage-backed bond, in which case you should report it on SC185, Other Investment Securities. You
should report a security collateralized by loans that meets items 2 and 3 but does not meet item 1 on
SC182, Securities Backed by Nonmortgage Loans. Report a debt security that does not meet any of the
above or meets only item 2 or item 3, but not both, on SC185, Other Investment Securities, except for
those government securities reported on SC130 and SC180.
If the subordinate piece of a senior-subordinated security (1) exists solely for the purpose of credit
enhancements and not for redirecting cash flows, (2) is no larger than necessary to provide the credit
enhancement, and (3) meets the criteria of mortgage pass-through securities, above, then the senior
piece is essentially a pass-through security, and you should report it in this section.
Include pass-through securities collateralized by home equity mortgages.
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SC210: Insured or Guaranteed by an Agency or Sponsored Enterprise
of the U.S.
Report all mortgage pass-through securities insured or guaranteed by an agency or sponsored enterprise
of the United States.
Include:
1. Freddie Mac participation certificates.
2. Ginnie Mae and Fannie Mae pools.
Do not include:
1. Fannie Mae and Freddie Mac bonds. Report on SC130, U.S. Government, Agency, and
Sponsored Enterprise Securities.
2. Mortgage derivatives, including CMOs collateralized by Fannie Mae, Ginnie Mae, and Freddie
Mac mortgage-backed securities. Report on SC217, SC219, or SC222.
3. Mortgage pass-through securities not insured or guaranteed by an agency or instrument of the
United States, even if they are issued by a government-sponsored enterprise. Report on SC215.
SC215: Other
Report mortgage pass-through securities that are not insured or guaranteed by an agency or sponsored
enterprise of the United States.
OTHER MORTGAGE-BACKED SECURITIES (EXCLUDING BONDS):
SC217: Issued or Guaranteed By FNMA, FHLMC, or GNMA
Report the outstanding balance, as determined in accordance with GAAP, of securitized mortgage
derivatives that FannieMae, FreddieMac, or Ginnie Mae issues or guarantees. Include the following
instruments FannieMae, FreddieMac, or Ginnie Mae issues or guarantees: REMICs, IO and PO strips,
collateralized mortgage obligations (CMOs), securitized residual interests of such derivatives, and other
subordinated tranches.
SC219: Collateralized By Mortgage-Backed Securities Issued or
Guaranteed By FNMA, FHLMC, or GNMA
Report the outstanding balance, as determined in accordance with GAAP, of securitized mortgage
derivatives that are collateralized by mortgage derivatives that FannieMae, FreddieMac, or Ginnie Mae
issues or guarantees. Include the following instruments issued or guaranteed by FannieMae,
FreddieMac, or Ginnie Mae: REMICs, IO and PO strips, collateralized mortgage obligations (CMOs),
securitized residual interests of such derivatives, and other subordinated tranches.
SC222: Other
Report the outstanding balance, as determined in accordance with GAAP, of all other mortgage-backed
securities not reported on SC210 through SC219. Include: REMICs, IO and PO strips, collateralized
mortgage obligations (CMOs), securitized residual interests of such derivatives, and other subordinated
tranches.
SC228: Accrued Interest Receivable
Report accrued interest receivable on mortgage backed securities reported on SC210 through SC222.
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SC229: General Valuation Allowances
Substantially all of the mortgage-backed securities reported on SC210 through SC222 are accounted for
as debt securities under FASB Statement No. 115. Accordingly for these securities, the establishment of
any valuation allowance would be not be consistent with GAAP. As a result, in substantially all cases, it
would not be appropriate to report valuation allowances on this line.
MORTGAGE LOANS
Mortgage loans are defined as all real estate loans subject to 12 CFR 560.100-101 (real estate lending
standards) and OTS Thrift Bulletin 72a and include all loans predicated upon a security interest in real
property. When a loan to finance a small business is primarily secured by a single-family residence, you
may classify the loan as either a single-family mortgage loan or a commercial nonmortgage loan.
Mortgage loans reported on SC230 through SC265 fall into four categories:
1. Those held for investment: Report these at cost.
2. Those originated for sale: Report these at the lower of cost or market value at the reporting
date.
3. Those previously held for investment and now held for sale: Report these at the lower of
cost or market value at the reporting date.
4. Those held in a trading portfolio: Report these at market value at each reporting date by
directly adjusting the asset balance. Do not include adjustments to mark a trading portfolio to
market in valuation allowances.
Report all loans at recorded investment reduced by specific valuation allowances, but not reduced by the
allowance for loan and lease losses.
Recorded investment is the principal balance of a loan adjusted for:
1.
2.
3.
4.
Direct write-downs.
Deferred loan fees net of direct costs.
Discounts and premiums on the purchase of mortgage loans and contracts.
Application of lower-of-cost-or-market accounting treatment to mortgages held for sale but not in
a trading account.
5. Any undisbursed balances of loans closed, loans-in-process. Report the undisbursed amounts
as commitments on CC105-115.
6. The undisbursed portion of mortgage lines of credit on 1-4 dwelling units. Report these amounts
as commitments on CC412.
7. The undisbursed portion of mortgage lines of credit on multifamily residential property. Report
these amounts as commitments on CC290.
8. Unearned interest.
9. Interest receivable that is capitalized to the loan balance.
10. Deposits accumulated for the payment of loans, hypothecated deposits.
11. Accumulated fair value gain or loss on mortgage loans attributable to the designated risk being
hedged on a qualifying fair-value hedge under FASB Statement No. 133.
Report the related allowance for loan and lease losses on SC283. Report accrued interest and advances
for taxes and insurance on SC272 and SC275, respectively.
Do not divide a loan between categories. You should report loans secured by property with more than
one use, such as residential and commercial, in the data field that describes the property type comprising
the largest percentage of the value of the property securing the loan.
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Include:
1.
2.
3.
4.
FHA/VA and conventional first mortgage loans.
Junior mortgage liens, both open-end and closed-end.
Your share of participating interests in loans.
Loans to commercial entities collateralized by mortgages of third-party borrowers, such as
warehouse loans, provided the underlying loans are secured by real estate.
5. Disbursed portion of open-end home equity loans if you secure the loan by a lien on real estate.
6. The unpaid balance of the gross loan in a wrap-around mortgage if you wrapped a loan held by a
third party. Report the loan payable to the third party as a liability on SC760, Other Borrowings.
7. Loans on units in cooperative buildings.
Do not include:
1. Mortgage-backed securities. Report on SC210 through SC222.
2. The portion of participations sold qualifying as a sale under GAAP; you should no longer report
the sold portion in your statement of condition.
3. Mortgage-backed bonds. Report on SC185.
4. Real estate loans where the characteristics dictate treatment as an investment in real estate in
accordance with GAAP. Report on SC45, Real Estate Held for Investment.
5. Foreclosed assets. Report on SC405 through SC428, Repossessed Real Estate.
6. Loans secured by assets that you physically possess, although foreclosure has not yet occurred,
in-substance foreclosures. Report on SC405 through SC428, Repossessed Real Estate.
7. Loans purchased subject to agreements to resell, that is, you hold these loans as collateral
received for loans made to others. Report on SC125, Federal Funds Sold and Securities
Purchased Under Agreements to Resell.
8. Loan commitments that you have not yet taken down, even if you have received fees. Prior to
disbursement of the loan, report refundable fees on SC712, Escrows, and nonrefundable fees on
SC796, Other Liabilities and Deferred Income, as Code 04.
9. Loans on timeshare arrangements. Report on SC330, Other Consumer Loans.
10. Unsecured home improvement loans. Report on SC316, Home Improvement Loans.
SC26: TOTAL
The EFS software will compute this line as the sum of SC230 through SC275, less SC283.
Construction Loans on:
SC230: 1-4 Dwelling Units
Report the outstanding balance of all construction loans secured by 1-4 dwelling units. Adjust balances
as described above in the general instructions to mortgage loans.
Include:
1. Construction loans to developers secured by tracts of land on which single-family houses,
including townhouses, are being constructed.
2. Construction loans secured by single-family dwelling units in detached or semidetached
structures, including manufactured housing.
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3. Construction loans secured by duplex units and town houses, excluding garden apartment
projects where the total number of units that will secure the permanent mortgage is greater than
four.
4. Combination land and construction loans on 1-4 dwelling units regardless of the current stage of
construction or development;
5. Combination construction-permanent loans on 1-4 dwelling units until construction is completed
or principal amortization payments begin, whichever comes first.
6. Bridge loans to developers on 1-4 dwelling units where the buyer will not assume the same loan,
even if construction is completed or principal amortization payments have begun.
Do not include:
Loans for the development of building lots unless the same loan finances the erection of building
improvements. Report on SC265.
SC235: Multifamily (5 or More Dwelling Units)
Report the outstanding balance of all construction loans secured by 5 or more dwelling units. Adjust
balances as described above in the general instructions to mortgage loans.
Include:
1. Loans for the construction of apartment buildings including condominium and cooperative
apartments.
2. Loans for the construction of fraternity or sorority houses offering sleeping accommodations.
3. Loans for the construction of living accommodations for students or staff of a college or hospital.
4. Loans for the construction of retirement homes with sleeping and eating accommodations for
permanent residents. Each bedroom equals one dwelling unit.
5. Combination land-construction loans on 5 or more dwelling units regardless of the current stage
of construction or development.
6. Combination construction-permanent loans on 5 or more dwelling units until construction is
completed or principal amortization payments begin, whichever comes first.
7. Bridge loans to developers on 5 or more dwelling units where the buyer will not assume the same
loan, even if construction is completed or principal amortization payments have begun.
8. Loans for the construction of mobile home parks.
SC240: Nonresidential Property
Report the outstanding balance of all construction loans secured by nonresidential property. Adjust
balances as described above in the general instructions to mortgage loans.
Include:
1. Loans for the construction of hospitals, nursing and convalescent homes, hotels, churches,
stores, and other commercial properties.
2. Combination land and construction loans on nonresidential property regardless of the current
stage of construction or development.
3. Combination construction and permanent loans on nonresidential property until construction is
completed or principal amortization payments begin, whichever comes first.
4. Bridge loans to developers on nonresidential property where the buyer will not assume the same
loan, even if construction is completed or principal amortization payments have begun.
Do not include:
1. Loans to purchase land. Report on SC265.
2. Loans to purchase land used for farming. Report on SC260.
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Permanent Mortgages on:
1-4 Dwelling Units:
Include:
1. Mortgages secured by all 1-4 dwelling units where construction has been completed.
2. Refinancing loans on 1-4 dwelling units where the original loan was a permanent mortgage.
3. Junior liens on 1-4 dwelling units where the senior lien is a permanent mortgage.
Do not include:
1. Combination land-construction loans regardless of the current stage of construction or
development. Report on SC230.
2. Combination construction-permanent loans until construction is completed or principal
amortization payments begin, whichever comes first. Report on SC230.
3. Bridge loans to developers where the buyer will not assume the same loan. Report on SC230.
4. Timeshare loans. Report on SC330, Other Consumer Loans.
SC251:
Revolving, Open-End Loans
Report the outstanding balance of all revolving, open-end lines of credit secured by 1-4 dwelling units and
extended under lines of credit, where you secured the loan with a lien on the real estate. You generally
secure these loans, called “home equity lines of credit,” by a junior lien, and the funds may be accessible
by check or credit card. However, where no senior lien exists, you may secure these lines by a first lien
on the real estate. .
SC254:
Secured by First Liens
Report the outstanding balance of all closed-end loans secured by first liens on 1-4 family residential
properties.
SC255:
Secured by Junior Liens
Report the outstanding balance of all closed-end loans secured by junior liens on 1-4 family residential
properties.
SC256: Multifamily (5 or More Dwelling Units)
Report the outstanding balance of all loans secured by 5 or more dwelling-unit property. Adjust balances
as described above in the general instructions to mortgage loans.
Include:
1. Mortgages on 5 or more dwelling units where construction has been completed.
2. Mortgages on apartment buildings.
3. Refinancing loans on 5 or more dwelling units where the original loan was a permanent
mortgage.
4. Junior liens on 5 or more dwelling units where the senior lien is a permanent mortgage.
5. Permanent mortgages secured by fraternity or sorority houses offering sleeping accommodations.
6. Permanent mortgages secured by living accommodations for students or staff of a college or
hospital.
7. Permanent mortgages secured by retirement homes with sleeping and eating accommodations
for permanent residents, where the units are not condominiums or cooperatives. Each bedroom
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equals one dwelling unit. Report mortgages secured by retirement community condominiums or
cooperatives on SC254 or SC255.
8. Permanent mortgages secured by developed mobile home parks where the individual units are
under the mortgage.
Do not include:
1. Mortgages on individual condominium units where the mortgage covers fewer than five units in
the same project. Report on SC251 through SC255.
2. Combination land and construction loans regardless of the current stage of construction or
development. Report on SC235.
3. Combination construction and permanent loans until construction is completed or principal
amortization payments begin, whichever comes first. Report on SC235.
4. Bridge loans to developers where the buyer will not assume the same loan. Report on SC235.
SC260: Nonresidential Property, Except Land
Report the outstanding balance of all loans secured by nonresidential property excluding land. Adjust
balances as described above in the general instructions to mortgage loans.
Include:
1. Mortgages on nonresidential properties where construction has been completed.
2. Mortgages on properties to be used extensively for farming, regardless of the presence or
absence of a dwelling unit on the property.
3. Refinancing loans where the original loan was a permanent mortgage on nonresidential property.
4. Junior liens on property where the senior lien is a permanent mortgage on nonresidential
property.
5. Permanent loans on hospitals, nursing and convalescent homes, hotels, churches, stores, and
other commercial properties.
Do not include:
1. Combination land and construction loans regardless of the current stage of construction or
development. Report on SC240.
2. Combination construction and permanent loans until construction is completed or principal
amortization payments begin, whichever comes first. Report on SC240.
3. Bridge loans to developers where the buyer will not assume the same loan. Report on SC240.
SC265: Land
Report the outstanding balance of all mortgage loans secured by land. Adjust balances as described
above in the general instructions to mortgage loans. .
Include:
1. Loans for the acquisition and development of land, that is, loans to finance the purchase of land
and the accomplishment of all improvements to convert it to developed building lots.
2. Loans for the acquisition of developed building lots.
3. Loans secured by vacant land.
4. Refinancing loans where the original loan was a permanent mortgage on land.
5. Junior liens on land where the senior lien is a permanent mortgage.
Do not include:
1. Combination land-construction loans. Report on SC230 through SC240.
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2. Land used for farming. Report on SC260, Permanent Mortgages on Nonresidential Property,
Except Land.
SC272: Accrued Interest Receivable
Report accrued interest receivable on mortgage loans reported on SC230 through SC265 if collection
was probable at the time of accrual. You should place loans on which collection of interest is not
probable in a nonaccrual status.
Do not include:
1. Interest receivable if collection was not probable at the time it was recorded.
2. Interest receivable on loans or participations serviced for others. Report on SC689, Other
Assets.
3. Interest receivable that is capitalized to the loan balance. Report with the loan balance on SC230
through SC265.
SC275: Advances for Taxes and Insurance
Report amounts you paid by on behalf of borrowers for taxes and insurance on loans reported on SC230
through SC265. This line primarily contains negative balances in tax and insurance escrows for loans
you own.
Do not include:
1. Credit balances. Report on SC712, Escrows.
2. Advances for taxes and insurance on loans and participations serviced for others. Report on
SC689, Other Assets, as Code 09.
SC283: Allowance for Loan and Lease Losses
Report all allowances for loan and lease losses (ALLL) established to recognize credit losses on
mortgage loans reported on SC230 through SC275. You must include all ALLL in the reconciliation of
valuation allowances in Schedule VA.
Do not include:
1. Mark-to-market adjustments to mortgage loans held in a trading portfolio; these directly adjust the
asset balance.
2. Specific valuation allowances; these directly adjust the asset balance.
NONMORTGAGE LOANS
Adjust the balances in this section for:
1.
2.
3.
4.
Specific valuation allowances.
Deferred loan fees net of direct costs.
Discounts and premiums on the purchase of nonmortgage loans and contracts.
Application of lower-of-cost-or-market accounting treatment to loans held for sale but not in a
trading account.
5. Any undisbursed balance of closed-end loans, loans-in-process. Report the undisbursed amount
of nonmortgage loans on CC125.
6. The undisbursed portion of lines of credit. Report the undisbursed amount on CC420-425.
7. Unearned interest, such as add-on interest of loans issued at a discount.
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8. Deposits accumulated for the payment of loans, hypothecated deposits.
9. Accumulated gain or loss (change in fair value) on nonmortgage loans attributable to the
designated risk being hedged on a qualifying fair-value hedge under FASB Statement No. 133.
Do not adjust the balances in this section for: Allowance for loan and lease losses. Report these on
SC357.
Include:
1. Unsecured loans.
2. Loans secured with tangible property other than real estate, except as noted below.
Do not include:
1. Investments in securities collateralized by nonmortgage loans. Report these securities on
SC182, Securities backed by Nonmortgage Loans. Note: Although you report pass-through
securities backed by nonmortgage loans with nonmortgage loans in Schedule CMR, in Schedule
SC report securities backed by nonmortgage loans with Investment Securities.
2. Loan commitments that you have not yet taken down, even if you have received fees. Prior to
disbursement of the loan, report refundable fees on SC712, Escrows, and nonrefundable fees on
SC796, Other Liabilities and Deferred Income, as Code 04.
SC31:
Total
The EFS software will compute this line as the sum of SC300 through SC348 less SC357.
Commercial Loans:
SC32:
Total
The EFS software will compute this line as the sum of SC300 through SC306.
SC300: Secured
Report all loans to corporations, partnerships, and individuals for business purposes that are secured by
tangible property or insured or guaranteed by a federal, state, or municipal government or agency thereof.
Include:
1.
2.
3.
4.
Secured loans for farming operations.
Floor-planning, inventory and wholesale, loans to dealers for automobiles or mobile homes.
Retail auto loans if the autos are for commercial use.
Nonmortgage loans insured or guaranteed by state or municipal government authority or an
agency of the federal government, including Farmers Home Administration, Agency for
International Development, and the insured portion of nonmortgage Small Business
Administration (SBA) loans.
5. Secured nonmortgage loans to unconsolidated subordinate organizations.
6. Outstanding balances of secured commercial lines of credit.
7. Loans secured by residential property to finance small businesses if the loans are not reported as
mortgages.
Do not include:
1. Commercial financing leases. Report on SC306.
2. The uninsured portion of SBA loans. Report on SC303.
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SC303: Unsecured
Report all unsecured loans to corporations, partnerships, and individuals for business purposes.
Include:
1. Unsecured construction loans to builders.
2. Unsecured loans for the improvement of multifamily and other commercial property.
3. The outstanding balance of unsecured commercial lines of credit, overdrafts on commercial
demand deposits, and business credit cards.
4. Unsecured loans for farming operations.
5. Term Federal Funds - Any lending of immediately available funds where the loan has an original
maturity of more than one business day, other than securities purchased under agreements to
resell, is to be treated as a loan. Such transactions are sometimes referred to as Term Fed
Funds.
6. All other unsecured loans made for commercial purposes.
Do not include:
1. Unsecured loans to unconsolidated subordinate organizations. Report on SC540, Other Equity
Investments Not Subject to FASB Statement No. 115.
2. Corporate debt securities even if included in calculating OTS commercial loan limitations. Report
on SC185, Other Investment Securities.
3. Non-interest-bearing overdrafts on commercial deposit accounts where the institution grants
modest sized overdrafts for the convenience of the customer. Typically, such overdraft protection
plans are offered to most customers on a fee for service basis rather than incurring interest
charges. Report such overdrafts on SC 689, “Other Assets.” Report fee income on such
overdrafts as SO 420, “Other Fees and Charges.”
SC304: Credit Card Loans Outstanding – Business
Report all unsecured credit card business loans included on SC303.
SC306: Lease Receivables
Report all direct financing leases and leveraged leases to corporations, partnerships, and individuals for
business purposes. Include ground rents on commercial properties.
Consumer Loans:
Report loans issued at a discount net of the related unearned interest in accordance with APB No. 21.
SC35:
Total
The EFS software will compute this line as the sum of SC310 through SC330.
SC310: Loans on Deposits
Report share loans and other loans to individuals for household, family, and other personal expenditures
fully secured by the pledge or assignment of the borrower’s deposits or other credits held by your
institution. When a loan is secured by a lien on real estate or chattel and is also secured by a pledge on
deposits, you should classify the entire loan based on what you consider the loan’s primary collateral.
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SC316: Home Improvement Loans (Not Secured by Real Estate)
Report all unsecured home improvement loans, insured or uninsured, for the equipping, alteration, repair,
or improvement of 1-4 dwelling units.
Do not include:
1. Unsecured loans for the improvement of multifamily housing, 5 or more dwelling units, or for
nonresidential property. Report on SC303, Unsecured Commercial Loans.
2. Home equity lines of credit. Report on SC251.
SC320: Education Loans
Report loans originated solely for funding educational expenses.
SC323: Auto Loans
Report all loans to consumers secured by automobiles, including pickup or panel trucks, vans, and sport
utility vehicles that are primarily for personal use.
Do not include:
1. Loans on cars or trucks intended primarily for commercial, industrial, and professional purposes.
Report on SC300, Secured Commercial Loans.
2. Loans on motorcycles. Report on SC330, Other Consumer Loans, Including Lease Receivables.
3. Loans on recreational vehicles such as boats and airplanes. Report on SC330, Other Consumer
Loans, Including Lease Receivables.
4. Floor-planning loans, both inventory and wholesale. Report on SC300, Secured Commercial
Loans.
SC326: Mobile Home Loans
Report consumer loans secured by mobile homes.
Do not include:
Floor-planning loans, both inventory and wholesale. Report on SC300, Secured Commercial Loans.
SC328: Credit Cards
Report the disbursed portion of open-end consumer credit cards.
Do not include:
1. Credit extended under credit card plans to business enterprises; report as commercial loans on
SC303.
2. Credit extended to individuals through credit cards secured by real estate; report as mortgage loans.
3. Credit extended to individuals under prearranged overdraft plans underwritten as loans; report on
SC330.
SC330: Other, Including Lease Receivables
Report loans to individuals for household, family, and other personal expenditures not included
elsewhere, and direct financing leases to consumers.
Include:
1. Loans on timeshare units.
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2. Loans on motorcycles.
3. Loans on boats.
4. Loans on airplanes.
5. Loans on other recreational vehicles.
6. Open-ended personal lines of credit extended to individuals including prearranged overdraft lines of
credit underwritten as loans.
7. Overdrafts of consumer accounts.
8. Ground rents on properties used for one-to-four dwelling units.
Do not include:
1. Loans on units in cooperative buildings. Report on SC254 or SC255, Permanent Mortgages on
1-4 Dwelling Units.
2. Non-interest-bearing overdrafts on consumer deposit accounts where the institution grants
modest sized overdrafts for the convenience of the customer. Typically, such overdraft protection
plans are offered to most customers on a fee for service basis rather than incurring interest
charges. Report such overdrafts on SC 689, “Other Assets.” Report fee income on such
overdrafts as SO 420, “Other Fees and Charges.”
SC348: Accrued Interest Receivable
Report accrued interest receivable on nonmortgage loans reported on SC300 through SC330, if collection
was probable at the time of accrual. You must place loans on which the collection of interest is not
probable in a nonaccrual status.
Do not include:
1. Interest receivable if collection was not probable at the time the interest was recorded.
2. Interest receivable on loans or participations serviced for others. Report on SC689, Other
Assets.
SC357: Allowance for Loan and Lease Losses
Report all allowances for loan and lease losses (ALLL) established to recognize credit losses on
nonmortgage loans reported on SC300 through SC348. You must include all ALLL in the reconciliation of
valuation allowances in Schedule VA.
REPOSSESSED ASSETS
Throughout these instructions, we use foreclosure and repossession and other forms of those terms
interchangeably. In addition, foreclosed assets and repossessed assets include in-substance
foreclosures.
Foreclosed assets are deemed held for sale and are initially recorded at the lower of: (1) recorded
investment in the loan, carrying value before deduction for valuation allowances, or; (2) fair value, less
cost to sell, of the foreclosed asset.
At foreclosure, any excess of recorded investment over fair value less cost to sell is classified Loss and is
charged off. This loss classification may not be represented by a valuation allowance. Accordingly, the
lower of: (1) recorded investment in the loan, or (2) fair value less cost to sell of the foreclosed asset,
becomes the new recorded investment in the foreclosed asset. Legal fees and direct costs of acquiring
title to foreclosed assets are expensed as incurred, and thus are not part of the recorded investment.
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After foreclosure, any excess of recorded investment over the current fair value less cost to sell is
classified Loss and is charged off, or may be represented by a specific valuation allowance. Deduct
valuation allowances from recorded investment to arrive at carrying value. You should report
repossessed assets net of specific valuation allowances.
For a foreclosed asset subject to a third-party liability – a lien senior to that settled by the foreclosure, you
should report the third-party liability on SC760, Other Borrowings. Therefore, you do not offset the
carrying value of such a foreclosed asset by the third-party liability.
Include:
1. Real estate and other assets for which you have acquired a marketable title by foreclosure or by
a deed in lieu of foreclosure.
2. Real estate and other assets acquired through in-substance foreclosure for which you have not
yet acquired a marketable title.
3. Real estate and other assets you acquired as part of a troubled debt restructuring.
4. Capitalized costs for repossessed assets during construction not exceeding fair value less cost to
sell.
5. Property that a loan servicer has acquired through foreclosure on your behalf, including insubstance foreclosures, where there is no recourse to a third party.
6. Real estate originally acquired for future use by you but no longer intended for that purpose.
Do not include:
1. Real estate held for investment or development. Report on SC45, Real Estate Held for
Investment.
2. Real estate intended for your future use. Report on SC55, Office Premises and Equipment.
3. Foreclosed real estate from a loan treated as an investment in real estate in accordance with
GAAP; continue to report these on SC45, Real Estate Held for Investment.
4. Foreclosed real estate from loans to entities such as joint ventures in which you or your
subsidiaries are investors. Report these on SC45, Real Estate Held for Investment.
SC40:
Total
The EFS software will compute this line as the sum of SC405 through SC430 less SC441.
Real Estate:
SC405: Construction
Report repossessed real estate that is under construction. Do not include land being developed into
building lots prior to constructing improvements, which you report on SC428.
SC415: 1-4 Dwelling Units
Report repossessed property consisting of 1-4 dwelling units that is not under construction.
SC425: Multifamily (5 or More Dwelling Units)
Report repossessed property consisting of 5 or more dwelling units that is not under construction.
SC426: Nonresidential, Except Land
Report repossessed nonresidential property. Do not include land, which you report on SC428.
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SC428: Land
Report repossessed land.
Include:
1. Vacant land.
2. Developed building lots on which no building construction has begun.
3. Land being subdivided and developed into lots.
SC429: U.S. Government-Guaranteed or -Insured Real Estate Owned
Report repossessed property where the loans were wholly or partially guaranteed or insured by agencies
of the U.S. government.
SC430: Other Repossessed Assets
Report all other repossessed property, excluding real estate.
SC441: General Valuation Allowances
Report all general valuation allowances established on repossessed assets.
Do not include:
1. Specific valuation allowances; these must directly reduce the asset balance.
2. Write-downs to mark repossessed assets to fair value less cost to sell at foreclosure; these must
directly reduce the asset balance.
3. Valuation allowances established prior to transfer to REO.
SC45:
REAL ESTATE HELD FOR INVESTMENT
Report the recorded investment of all real estate you acquired for development, investment, or resale, net
of specific valuation allowances, general valuation allowances, and accumulated depreciation.
Include:
1. Real estate acquired and held for investment purposes.
2. Real estate loans that are accounted for as investments in real estate in accordance with GAAP.
3. Real estate that you formerly occupied, unless you are holding it for sale, in which case you
report it on SC55.
4. Real estate you acquired through foreclosure that no longer qualifies as repossessed real estate
because of the length of time you have held it or the purpose for which you are holding it.
5. Capitalized carrying costs of real estate under construction in accordance with FASB Statement
No. 34, Capitalization of Interest Costs.
Do not include:
1. Office buildings and land that you own and use in your business operations. Report on SC55,
Office Premises and Equipment.
2. Real estate acquired as part of a troubled debt restructuring. Report on SC405 through SC428,
Repossessed Assets: Real Estate.
3. Real estate acquired indirectly through an entity designated as a pass-through investment as
described in 12 CFR § 560.32. Report the pass-through investment on SC540, Other Equity
Investment Not Subject to FASB Statement No. 115.
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4. The share of investments owned in real estate joint ventures qualifying as unconsolidated
subordinate organizations. Report on SC540, Other Equity Investment Not Subject to FASB
Statement No. 115.
5. Real estate originally acquired for your future use but no longer intended for that purpose. Report
as REO on SC405 through SC428.
EQUITY INVESTMENTS NOT SUBJECT TO SFAS NO. 115
SC51:
Total
The EFS software will compute this line as the sum of SC510 and SC540.
SC510: Federal Home Loan Bank Stock
Report the carrying value of Federal Home Loan Bank Stock.
SC540: Other
Report (1) investments in all unconsolidated subordinate organizations, and (2) pass-through
investments, where such investments are accounted for at either cost or using the equity method.
Include in the reported amount any advances (secured or unsecured) to the investee entity.
SC55:
OFFICE PREMISES AND EQUIPMENT
Report the book value of all premises and equipment that are used in your business operations net of
accumulated depreciation whether they were purchased directly or acquired by means of a capital lease.
In a sale-leaseback where the resulting lease is a capital lease, report the capital lease net of the
unamortized deferred gain or loss.
Report depreciation expense for the quarter on SO530, Office Occupancy and Equipment Expense.
Include:
1. All land, buildings, and parking lots occupied by you, including those that you only partially
occupy.
2. Land or improved real estate intended for future use in your business operations.
3. Real estate you formerly occupied, if the real estate is held for sale.
4. Capital leases for your office premises and equipment.
5. Carrying costs capitalized during the construction of your premises.
6. The unamortized balance of all improvements to leased quarters and any capital improvements
made to land leased for your use.
7. Office furniture, fixtures, equipment, and vehicles you own.
Do not include:
1. Repossessed assets, unless you used them on other-than-a-temporary basis. Report on SC405
through SC430.
2. Real estate held for investment. Report on SC45.
3. Real estate you originally acquired for future use but no longer intend to use for that purpose.
Report as REO on SC405 through SC428.
4. Real estate you formerly occupied and did not actively hold for sale. Report on SC45.
5. Real estate you acquired as part of a troubled debt restructuring. Report on SC405 through
SC428, Repossessed Real Estate.
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6. Technology-based intangible assets, such as computer software. Report on SC660.
OTHER ASSETS:
SC59:
Total
The EFS software will compute this line as the sum of SC615 through SC689 less SC699.
Bank-Owned Life Insurance:
SC615: Key Person Life Insurance
Include the value of bank-owned life insurance that you consider key-person insurance, where the
intended purpose is to provide the institution protection against the potential for losses arising from the
untimely death of a key employee or borrower. You generally surrender these policies when the key
employee leaves your institution or when the borrower pays off his loan. Include amounts represented in
the contractual terms of the policy as defined by FASB Technical Bulletin No. 85-4 and EITF Issue No.
06-5 (i.e. cash surrender value, claim stabilization reserves, and tax on deferred acquisition costs.
SC625: Other
Report the value of all bank-owned life insurance that you do not consider key-person insurance, and
therefore that you do not include on SC615. Include amounts represented in the contractual terms of the
policy (i.e. cash surrender value, claim stabilization reserves, and tax on deferred acquisition costs).
Intangible Assets:
Servicing Assets:
Report the carrying amount of servicing assets on mortgage and nonmortgage loans.
Servicing assets may be carried at either a.) the lower of cost or fair value, or b.) fair value.
For servicing assets carried at the lower of cost or fair value, adjust the carrying amount for:
1. Accumulated gain or loss (change in fair value) on the servicing asset attributable to the
designated risk being hedged on a qualifying fair-value hedge.
2. Any valuation allowances.
Servicing assets are subject to certain regulatory capital limitations. Refer to the instructions for data field
CCR133.
Do not include amounts for any rights to future interest income from the serviced loans that exceed
contractually specified servicing fees, defined below. Such rights are not servicing assets. Report such
amounts on SC665, Interest-only Strip Receivables and Certain Other Instruments.
Contractually specified servicing fees are all amounts that, per the contract, are due to you as the servicer
in exchange for the servicing. In other words, you would no longer receive fees if the beneficial owners of
the serviced assets were to exercise their actual or potential authority under the contract to shift the
servicing to another servicer.
SC642:
Mortgage Loans
Report servicing assets on mortgage loans only.
SC644:
Nonmortgage Loans
Report servicing assets of loans other than mortgages, such as automobile and credit card loans.
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SC660: Goodwill and Other Intangible Assets
Report the balance of goodwill and other intangible assets.
Include:
1.
2.
3.
4.
5.
Goodwill.
Core deposit premium.
Intangible pension assets.
Technology-based intangible assets, such as computer software.
Other intangible assets (i.e., purchased credit card relationships (PCCRs)) excluding servicing
assets reported on SC642 and SC644.
Do not include:
1. Servicing assets; report on SC642 and SC644.
2. Interest-only strip receivables and certain other instruments; report on SC665.
3. Organization costs, which should be expensed as incurred.
SC665: Interest-only Strip Receivables and Certain Other Instruments
Report the amortized cost of certain nonsecurity financial instruments (CNFIs) accounted for under FASB
Statement No. 140. CNFIs include interest-only strip receivables, loans receivable, other receivables, or
retained interests in securitizations that can be contractually prepaid or otherwise settled in such a way
that the holder would not recover substantially all of its recorded investment. Adjust the carrying amount
for: (1) accumulated gain or loss (change in fair value) on CNFIs attributable to the designated risk being
hedged on a qualifying fair-value hedge under FASB Statement No. 133; and (2) any valuation
allowances.
Do not include interest-only strips in security form. Report on SC217 through SC222, Other MortgageBacked Securities, or SC185, Other Investment Securities, as appropriate.
In general, CNFIs are initially recorded at cost, which often approximates fair value. Subsequent to initial
recording, CNFIs are measured at fair value, like investments in debt securities classified as available for
sale or trading under FASB Statement No. 115. All CNFIs should be reported on either SI375 or SI385,
depending on whether they are classified as held for trading or available-for-sale pursuant to FASB
Statement No. 115.
SC689: Other Assets
Report the total of assets not reported elsewhere on Schedule SC. You can find examples of the types of
assets to be included in the memo items detailing other assets below.
Do not include:
1. Premiums on deposits and borrowed money that you purchased. Report premiums on deposits
on SC715 and premiums on borrowed money with the related borrowing.
2. Deferred credits, deferred income, that do not have a related asset. Report on SC796, Other
Liabilities and Deferred Income.
3. Accounts with a material credit balance that are not contra-assets. Report on SC796, Other
Liabilities and Deferred Income.
4. Identified core deposit intangibles. Report on SC660, Goodwill and Other Intangible Assets.
Memo: Detail of Other Assets
Report the three largest items constituting the amount reported in SC689. You should select codes best
describing these items from the list below and report them on SC691, 693, and 697; report the
corresponding amounts on SC692, 694, and 698. You must complete this detail if you report an amount
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on SC689. You should combine similar accounts, for example, all prepaid expenses should be combined
and reported as 07. However, you should not combine unlike accounts in reporting code 99. You may
have more than one code 99 if you cannot find codes describing the items you report.
SC691, 693 and 697: Codes
01
02
03
04
06
07
08
09
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
99
No longer used
Accrued Federal Home Loan Bank dividends.
Federal, state, or other taxes receivable, whether as the result of prepayment or net operating
loss carrybacks.
Net deferred tax assets in accordance with FASB Statement No. 109.
Prepaid deposit insurance premiums.
Prepaid expenses.
Deposits for utilities and other services.
Advances for loans serviced for others, including advances for taxes and insurance and
advances to investors.
Property leased to others under an operating lease as provided in 12 CFR § 560.41, net of
accumulated depreciation.
Deferred issuance costs related to subordinated debentures, mandatory convertible securities,
and redeemable preferred stock.
Amounts receivable under interest rate swap agreements.
Non-interest-bearing accounts receivable from a holding company or affiliate.
Other miscellaneous, non-interest-bearing, short-term accounts receivable.
No longer used
No longer used
No longer used
No longer used
Receivables from a broker for unsettled transactions.
Include all receivables from a broker or other party for unsettled transactions between trade
and settlement dates.
Fair value of all derivative instruments reportable as assets under FASB Statement No. 133.
No longer used
Unapplied loan disbursements.
Include only those loan disbursements that you cannot categorize.
No longer used
No longer used
No longer used
Non-interest-bearing overdrafts of consumer and commercial deposit accounts where the
institution does not perform a credit analysis but offers overdraft protection to most customers
for their convenience.
Other. Use this code only for those items not identified above.
SC692, 694, and 698:
Amounts
Report the dollar amounts corresponding to the codes reported on SC691, 693, and 697.
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SC699: General Valuation Allowances
Report all general valuation allowances established to recognize credit losses on receivables included in
Other Assets.
You must include all valuation allowances in the reconciliation of valuation allowances in Schedule VA.
SC60:
TOTAL ASSETS
The EFS software will compute this line as the sum of SC11, SC22, SC26, SC31, SC40, SC45, SC51,
SC55, and SC 59. This amount must equal SC90, Total Liabilities and Equity Capital.
LIABILITIES
For the following liabilities that may be included on various lines on this schedule, also report the balance
on Schedule SI if the liability is recorded under a fair value option on:
SI377, Financial Liabilities Carried at Fair Value through Earnings
DEPOSITS AND ESCROWS:
SC71: Total Deposits and Escrows
The EFS software will compute this line as the sum of Deposits (SC710), Escrows (SC712), and
Unamortized Yield Adjustments on Deposits and Escrows (SC715).
SC710: Deposits
Report all deposits at their face value except zero-coupon deposits, which you report at face value net of
the unamortized discount.
Include:
1. All deposits whether interest-bearing or not.
2. Deposits exceeding DIF insurance limits, including those collateralized by your assets, such as
deposits of public funds.
3. Unposted credits, such as:
a. Deposit transactions that you include in a general ledger account and have not yet posted to
a deposit account.
b. Deposits you received in one branch for deposit into another branch, typically another branch
in another state or outside of continental USA.
You should report unposted credits net of unposted debits. We define unposted debits as
cash items in your possession that are drawn on you and immediately chargeable, but not yet
charged, against your deposits at the close of business on the reporting date.
Exclude the following from unposted credits:
a. Cash items drawn on other financial institutions.
b. Overdrafts and nonsufficient fund (NSF) items.
c. Cash items returned unpaid to the last endorser for any reason.
d. Drafts and warrants that are payable at or payable through you for which there is no written
authorization from the depositor and no state statute allowing you at your discretion to
charge the items against the deposit accounts of the drawees.
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Report the above excluded unposted debit amounts in assets on SC110. Note: If the total of
unposted credits is negative, that is, a debit, you can deduct it from SC710.
4. Outstanding cashier’s checks, money orders, or other official checks drawn on an internal
account issued in the usual course of business for any purpose, including, without being limited
to, those that you issued in payment for your debts or expenses, or payable to a third party
named by a customer making the withdrawal.
5. Accounts pledged by your directors and organizers as protection against operating deficits and
other nonwithdrawable accounts, whether or not they are used in determining compliance with
minimum capital requirements.
6. U.S. Treasury tax and loan accounts that represent funds received as of the close of business of
the reporting date. Do not include funds credited prior to the reporting date that are automatically
converted into open-ended interest-bearing notes. Report such balances on SC796, Other
Liabilities and Deferred Income.
7. Unapplied loan balances, such as receipts from borrowers that have not yet been classified as
principal, or interest, unless you credit the applicable customer accounts as of the date you
initially received the funds.
8. Credit balances in credit card accounts, credit card customer overpayments.
9. Funds you received or held in connection with drafts or checks that you have drawn on another
depository institution, a Federal Home Loan Bank, or a Federal Reserve Bank. The funds
reported here are only those drawn either on a zero-balance account or on an account that is not
routinely maintained with sufficient balances to cover checks drawn in the normal course of
business, including accounts where you remit funds only when the checks or drafts are
presented. For example, funds received from a customer for a cashier’s check that is drawn on a
zero-balance account in another financial institution.
10. Dealer reserve accounts, when considered a liability under GAAP. Dealer reserve accounts are
refundable amounts held as collateral in the purchase of installment notes from a dealer. For
example, a savings association purchases $100,000 in installment notes from a dealer for the full
face amount, for which it pays $90,000 to the dealer and holds the remaining $10,000 as
collateral. The $10,000 held is a dealer reserve account, which you should report as a deposit. If
you hold dealer reserves that under GAAP are reported as contra-assets, then you should report
the assets net of these dealer reserves in Schedule SC.
11. Outstanding travelers’ letters of credit and other letters of credit you issued for cash or its
equivalent (prepaid letters of credit), less outstanding drafts accepted against the letters of credit.
12. Funds you hold as security for an obligation due to the bank or others, except hypothecated
deposits, and funds deposited by a debtor to meet maturing obligations, such as amounts
pledged against sinking fund mortgages and as collateral for loans.
Certain items should be added back to the appropriate deposit control totals and reported on SC689,
Other Assets, as Code 99. Such items are: the gross amount of debit items (rejects) that you cannot
post to the individual deposit accounts without creating overdrafts or that you cannot post for some other
reason, such as stop payment, missing endorsement, post or stale date, or account closed, but which
have been charged to the control accounts of the various deposit categories on the general ledger.
You should report assets and liabilities in Schedule SC in accordance with GAAP. Certain items defined
in the Federal Deposit Insurance Act as includable in the deposit premium assessment base may, under
GAAP, be considered contra-assets rather than liabilities. Report assets in Schedule SC net of such
items, but you must also report these items on Schedule DI, as appropriate, so that they will be included
in the deposit premium assessment base.
You should report reciprocal balances with commercial banks and other savings associations on a net
basis where the right of set-off exists. Reciprocal demand balances arise when two depository
institutions maintain deposit accounts with each other. In certain cases you will need to report reciprocal
demand balances on DI520, Total Allowable Exclusions (Including Foreign Deposits).
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Do not include:
1. Escrow accounts. Report on SC712, Escrows.
2. Custodial accounts established pursuant to loan servicing agreements. Report on SC712,
Escrows.
3. Deposit accounts that you set up in your own name for which there is a corresponding cash
account in assets. Eliminate the cash account from assets and the same amount from deposits.
See item 4 under Include above concerning outstanding checks.
4. Outstanding checks drawn on, or payable at or through, a non-zero-balance account at a Federal
Reserve Bank or a Federal Home Loan Bank. Deduct these amounts from cash-in-bank,
typically, from amounts on SC110 or SC112, as appropriate, and also report them on DI510 for
inclusion in the deposit base for FDIC insurance assessment purposes. See item 9 under
Include above concerning outstanding checks drawn on zero-balance accounts.
5. Outstanding checks written against accounts in other depository institutions, as defined by the
Federal Deposit Insurance Act. Deduct these from the related deposit reported on SC110 or
SC118.
6. Discounts and premiums that result from marking assets and liabilities to fair value because of an
acquisition, merger, or change in control. Report on SC715, Unamortized Yield Adjustments on
Deposits and Escrows.
7. Deductions for commissions and other capitalized items. Report on SC715, Unamortized Yield
Adjustments on Deposits and Escrows.
8. Deductions for customers’ overdrafts in NOW and demand accounts unless the right of set-off
under a valid cash management arrangement exists for accounts of the same legal entity. Report
as loans on SC303, Unsecured Commercial Loans, SC330 Other Consumer Loans or SC689
Other Assets, code 26.
9. U.S. Treasury tax and loan account balances credited prior to the reporting date that are
automatically converted into open-ended interest-bearing notes. Report such balances in
liabilities on SC796, Other Liabilities and Deferred Income.
10. Hypothecated deposits, deposits accumulated for the payment of loans. Deduct these from the
related loan.
11. Accumulated gain or loss, change in fair value, on deposits attributable to the designated risk
being hedged on a qualifying fair-value hedge under FASB Statement No. 133. Report on
SC715, Unamortized Yield Adjustments on Deposits and Escrows.
SC712: Escrows
Report all escrow funds held by your savings association and your consolidated subsidiaries on behalf of
others. Include only those accounts where the institution or its consolidated subsidiary is a party to the
escrow agreement.
Include:
1. Tax and insurance escrows for mortgage loans.
2. Escrow accounts you have established pursuant to loan servicing agreements, including both tax
and insurance and principal and interest escrows.
3. Custodial accounts you have established pursuant to loan servicing agreements.
4. Credit balances of uninvested trust funds that you hold. Do not offset balances of different
accounts. Report only accounts with credit balances; accounts with debit balances should be
reported as loans. However, we permit netting for overdrafts in principal or income cash in
individual trust accounts maintained in the same right and capacity.
5. Amounts that you hold in conjunction with the sale of travelers’ checks, money orders, and similar
instruments.
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6. Amounts you hold and have not yet remitted in conjunction with the sale or issuance of
government bonds, mutual funds, or other securities.
7. Refundable loan commitment fees you have received prior to loan disbursement.
8. Refundable amounts you received from stock subscribers for unissued stock.
9. Amounts that you have withheld from employee compensation for payment to a third party such
as withholding taxes, health and life insurance premiums, and pension funds.
10. Interest you have withheld from deposits for remittance to taxing authorities. .
11. Interest you have accrued on escrows included above.
Do not include:
1. Advances for borrowers’ taxes and insurance, T&I escrow accounts with debit balances. If you or
your consolidated subsidiaries own the related loan, report the advances on SC275, Advances for
Taxes and Insurance. If you service the related loan for others, report them on SC689, Other
Assets, as Code 09.
2. Advances to investors for loans you serviced for others prior to receipt from the borrower. Report
as assets on SC689, Other Assets, Code 09.
3. Custodial accounts held by a depositor for another for example, a custodial account held for a
minor where the parent or some other depositor is the custodian. Report as deposits on SC710.
4. IRA and Keogh accounts. Report as deposits on SC710.
5. Escrows where the funds are deposited in other depository institutions. Report as liabilities on
SC796, Other Liabilities, Code 99.
6. Accumulated gain or loss on escrows attributable to the designated risk being hedged on a
qualifying fair-value hedge under FASB Statement No. 133. Report on SC715, Unamortized
Yield Adjustments on Deposits and Escrows.
7. Escrows where your holding company or unconsolidated affiliate is a party to the escrow
agreement and where you are not a party to the escrow agreement. Report on SC710, Deposits.
SC715: Unamortized Yield Adjustments on Deposits and Escrows
Report the unamortized balance of discounts and premiums on deposits. Report the face amounts of the
related deposits on SC710 and SC712. These yield adjustments are amortized to interest expense on
SO215, Interest Expense on Deposits. This data field may be negative, representing a debit. .
Include:
1. Discounts and premiums resulting from initially recording purchased deposits and escrows at fair
value.
2. Discounts and premiums related to accounting for a derivative instrument embedded in deposits
and escrows as either a separate asset or liability, when required by FASB Statement No. 133.
3. The accumulated gain or loss (the change in fair value) on deposits and escrows attributable to
the designated risk being hedged on a qualifying fair value hedge under FASB Statement No.
133.
4. Unamortized brokers fees.
Do not include:
1. Yield adjustments related to advances and borrowings; these directly reduce the related
borrowing.
2. Core deposit intangibles resulting from an acquisition, merger, or change in control. Report on
SC660, Goodwill and Other Intangible Assets.
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BORROWINGS
Adjust the balance due for (1) discounts and premiums in accordance with APB No. 21, Paragraph 16;
and (2) the accumulated gain or loss on borrowings attributable to the designated risk being hedged on a
qualifying fair-value hedge under FASB Statement No. 133. Amortize the discounts and premiums to
interest expense. Report issuance costs related to borrowings in SC689, Other Assets.
SC72:
Total
The EFS software will compute this line as the sum of SC720 through SC760.
SC720: Advances from FHLBank
Report all FHLBank borrowings.
Include:
1. All FHLBank advances.
2. Deferred commitment fees you paid on FHLBank advances; these reduce the outstanding
balance.
3. Prepayment penalties you paid on FHLBank advances that qualify for deferral under GAAP;
these reduce the outstanding balance. Generally FHLBank prepayment penalties should be
expensed on SO580, Other Noninterest Expense. However, in limited circumstances (outlined in
EITF 96-19), prepayment penalties may be deferred and amortized as a yield adjustment on
SO230, Interest Expense: Advances from FHLBank.
Do not include:
1. Amounts due a FHLBank in the form of securities sold under agreements to repurchase. Report
on SC730.
2. Accrued interest. Report on SC766, Other Accrued Interest Payable.
SC730: Federal Funds Purchased and Securities Sold Under
Agreements to Repurchase
Include:
1. Funds you received from securities sold under agreements to repurchase that do not meet the
criteria for a sale under FASB Statement No. 140, including retail repurchase, dollar-reverserepurchase, and dollar-roll agreements.
2. Amounts due a FHLBank in the form of securities sold under agreements to repurchase.
3. Federal Funds purchased.
Include in the gain or loss on the sale funds received from transactions accounted for as a sale, such as,
yield maintenance, dollar-reverse-repurchase agreements, and certain dollar-roll transactions. Note that
the repurchase transaction and subsequent investment of these borrowed funds are independent
transactions. Therefore, you should not offset any income generated by this subsequent investment by
the interest expense incurred in the reverse repurchase transaction. Report interest income on SO115,
Interest Income on Deposits and Investment Securities, and interest expense on SO260, Interest
Expense: Other Borrowed Money.
SC736: Subordinated Debentures (Including Mandatory Convertible
Securities and Limited-Life Preferred Stock)
Report subordinated debentures and mandatorily convertible securities that you or your consolidated
subsidiaries issued, net of premiums and discounts. For thrifts that have elected to be taxed under
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Subchapter S or are organized in mutual form, include the full amount of all subordinated debt securities
issued to the Treasury Department under the CPP. Include REIT preferred stock issued by a consolidated
subsidiary to a third party that you report as a liability. Report related issuance costs on SC689, Other
Assets.
SC740: MORTGAGE-COLLATERALIZED SECURITIES ISSUED
Report all mortgage-collateralized securities issued by you and your consolidated subsidiaries adjusted
for issuance costs, discounts, and premiums.
SC760: Other Borrowings
Report all other borrowings not included on SC720 through SC745.
Include:
1. Redeemable preferred stock issued by consolidated subsidiaries to third parties.
2. Mortgages and other encumbrances on your office premises or real estate owned for which you
are liable.
3. Obligations of an employee stock ownership plan (ESOP) to a lender other than yourself, when
such reporting is required under GAAP, including AICPA SOP No. 93-6, Employers’ Accounting
for Employee Stock Ownership Plans.
4. The underlying mortgage in a wrap-around loan unless the holder of the underlying mortgage has
accepted a subordinated position, in which case you deduct the underlying loan against the
related loan.
5. Senior liens on foreclosed real estate.
6. Overdrafts in your transaction accounts in other depository institutions, where there is no right of
set-off against other accounts in the same financial institution. If the overdraft is in a zero-balance
account or an account that is not routinely maintained with sufficient balances to cover checks
drawn in the normal course of business, you should include in deposits the funds received or held
in connection with checks drawn on the other depository institutions.
7. Commercial paper that you have issued.
8. Liabilities for capital leases related to assets that you’ve reported on SC55.
9. Eurodollar issues.
10. The liability from a sale of loans with recourse accounted for as a financing.
11. The related liability for delinquent mortgage loans previously securitized with Ginnie Mae, where
you have an unconditional repurchase option. The recording of such mortgage loans and the
related liability is required under GAAP (including FASB Statement No. 140).
12. Clearing items.
13. Purchase acquisition debt.
14. Borrowings from the Federal Reserve Bank.
Do not include:
1. Accrued interest due and payable. Report on SC766, Other Accrued Interest Payable.
2. Redeemable preferred stock you have issued. Report on SC800, Noncontrolling Interest.
You must charge the interest and dividends on all borrowings and yield adjustments reported on this line
to expense on SO260, Other Borrowed Money. You must not net the interest expense against the
interest income on the related asset.
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OTHER LIABILITIES
SC75:
Total
The EFS software will compute this line as the sum of SC763 through SC796.
SC763: Accrued Interest Payable - Deposits
Report accrued interest that has not been credited to deposit or escrow accounts.
Do not include:
Interest withheld from deposits for remittance to taxing authorities. Report on SC712, Escrows.
SC766: Accrued Interest Payable - Other
Include:
Accrued interest and dividends due on borrowings that you have reported on SC720 through SC760.
SC776: Accrued Taxes
Include:
1.
2.
3.
4.
Current portion of federal, state, and local income taxes.
Real estate taxes.
Employer’s share of payroll taxes.
Other miscellaneous taxes.
Do not include:
1. Taxes withheld from employees’ salaries. Report on SC712, Escrows.
2. Tax accrual accounts with debit balances. Report as accounts receivable on SC689, Other
Assets, as Code 03.
3. Interest withheld from deposits for remittance to taxing authorities. Report on SC712, Escrows.
SC780: Accounts Payable
Report the amount accrued for services, supplies, materials, and other expenses.
Reclassify accounts payable with material debit balances to accounts receivable. Report on SC689,
Other Assets, as Code 14.
SC790: Deferred Income Taxes
Report net deferred income taxes with a credit balance. Report deferred income taxes from the same
jurisdiction net. Report net debit balances as deferred tax assets on SC689, Other Assets, Code 04.
SC796: Other Liabilities and Deferred Income
Report the total of liabilities not reported elsewhere on Schedule SC. You can find a list of the types of
liabilities to be included in the memo items detailing other liabilities below.
Memo: Detail of Other Liabilities
Report the three largest items constituting the amount reported on SC796. You should select codes best
describing these items from the list below and report them on SC791, 794, and 797; report the
corresponding amounts on SC792, 795, and 798. You must complete this detail if you report an amount
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on SC796. You should combine similar accounts, for example, all nonrefundable loan fees received prior
to loan disbursement should be combined and reported as 04. However, you should not combine unlike
accounts in reporting code 99. You may have more than one code 99 if you cannot find codes describing
the items you report.
SC791, 794 and 797:
01
02
03
04
05
06
07
08
09
10
11
12
13
14
15
16
17
18
19
20
21
22
99
Codes
Dividends payable on stock.
No longer used
No longer used
Nonrefundable loan fees received prior to loan disbursement.
Deferred gains from sale/leaseback where the resulting lease is an operating lease.
Balances in U.S. Treasury tax and loan accounts administered under the note option that
provide for the conversion of the previous day’s balance to an interest-bearing demand note.
Deferred gains from the sale of real estate recorded under the percentage-of-completion or
deposit methods pursuant to FASB Statement No. 66, Accounting for Sales of Real Estate.
Negative investments in entities accounted for under the equity method.
Fees received for standby contracts and other option arrangements where the savings
association is obligated to purchase or sell securities at the option of the other party.
Amounts due brokers for unsettled transactions.
The liability recorded for pensions and other postretirement benefits.
No longer used.
Amounts payable under interest-rate-swap agreements.
Unapplied loan payments received for which the customer’s account will be credited as of the
date of receipt.
Liability when the benefits of a loan servicing contract are not expected to adequately
compensate the servicer.
Recourse loan liability.
Do not include liabilities for credit losses on off-balance-sheet credit exposures; include these
under code 21.
Non-interest-bearing payables due to holding companies and affiliates.
Litigation reserves.
Nonrefundable stock subscriptions. Note that refundable stock subscriptions are reported as
escrows on SC712.
Fair value of all derivative instruments reportable as liabilities under FASB Statement No. 133.
Liabilities for credit losses on off-balance-sheet credit exposures.
Include liabilities established for credit losses on commitments, standby letters of credit, and
guarantees. Do not include liabilities for sale of loans with recourse; include these under code
16.
Deposit insurance assessments payable.
Other. Use this code only for those items not identified above.
Do not include:
1. Escrows. Report on SC712, Escrows.
2. Deferred credits classified as contra-assets, such as loans in process and deferred loan fees.
Deduct these from the related asset.
3. Yield adjustments on deposits. Report on SC715, Unamortized Yield Adjustments on Deposits
and Escrows.
4. Yield adjustments, commitment fees, and issue costs on FHLBank advances and other
borrowings. Report as part of the borrowings’ balance.
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5. Accrued interest on escrow accounts. Report on SC712, Escrows, or SC763, Accrued Interest
Payable - Deposits.
6. U.S. Treasury tax and loan accounts administered under the remittance option requiring the
remittance of the previous day’s balance to a federal reserve bank. Report on SC710, Deposits.
7. Unapplied loan payments received for which the customer’s account will be credited as of the
date of transfer rather than the date of receipt from the customer. Report on SC710, Deposits.
SC792, 795, and 798:
Amount
Report the dollar amounts corresponding to the codes reported on SC791, 794, and 797.
SC70:
TOTAL LIABILITIES
The EFS software will compute this line as the sum of SC71, SC72, and SC75.
EQUITY CAPITAL
PERPETUAL PREFERRED STOCK
Include:
1. Preferred stock you issued that is nonredeemable by the purchaser and that qualifies as equity
capital under GAAP.
2. Preferred stock convertible into common stock.
Report preferred stock net of issuance costs, premiums, and discounts. If you issued preferred stock
above par value, include the amount paid in excess of par with the par value.
Dividends on perpetual preferred stock reduce retained earnings when declared. Report them on SI620,
Dividends Declared on Preferred Stock.
Do not include:
1. Redeemable preferred stock you issued. Report on SC800, Noncontrolling Interest.
2. Redeemable preferred stock issued by a consolidated subsidiary. Report on SC760, Other
Borrowings.
3. Permanent preferred stock issued by a consolidated subsidiary. Report on SC800,
Noncontrolling Interest.
SC812: Cumulative
Report permanent preferred stock where the stockholders are entitled to receive unpaid dividends before
the payment of dividends on other classes of stock. Include U.S. Treasury Department Capital Purchase
Program preferred stock and warrants.
SC814: Noncumulative
Report permanent preferred stock whose dividends do not accumulate if unpaid.
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COMMON STOCK
SC820: Par Value
Report the par value of all outstanding common stock – permanent, reserve, or guaranty stock – that you
have issued.
If the par value of common stock issued is less than $500, report “1” in this data field to indicate that it is
not zero, and, if necessary, reduce the amount that you report on SC830 by one.
You must reduce retained earnings at the time that you declare dividends on common stock. Report the
reduction of retained earnings on SI630, Dividends Declared on Common Stock.
Do not include deductions for:
1. Stock you reacquired – treasury stock. Report as a negative on SC891, Other Components of
Equity Capital.
2. Unallocated ESOP shares. Report as a negative on SC891, Other Components of Equity Capital.
SC830: Paid in Excess of Par
Include:
1. Amounts paid in excess of par value from the issuance of common stock for cash or nonmonetary
assets. Deduct the costs of issuing common stock.
2. Permanent capital contributions by the stockholders not related to the purchase of stock.
Do not include:
Paid-in capital from the issuance of preferred stock. Report on SC812 or SC814, Perpetual Preferred
Stock.
ACCUMULATED OTHER COMPREHENSIVE INCOME
SC86: Total
The EFS software will compute this line as the sum of Unrealized Gains (Losses) on Available-for-Sale
Securities (SC860), Gains (Losses) on Cash Flow Hedges (SC865), and Other Accumulated Other
Comprehensive Income (SC870).
SC860: Unrealized Gains (Losses) on Certain Securities
Report unrealized gains (losses), net of taxes, for you and your subordinate organizations on securities
and on certain nonsecurity financial instruments (CNFIs) classified as available for sale (AFS).
Gains and losses reported here are not reported in the statement of operations until either the asset is
sold, an other-than-temporary impairment loss is recognized, or this amount is amortized in accordance
with the following paragraph.
Include the unamortized amount of the unrealized gain or loss at the date of transfer of debt securities
transferred from AFS to held-to-maturity (HTM). Continue to report this gain or loss on this line until it is
completely amortized over the remaining life of the security as an adjustment of yield in the same manner
as a discount or premium.
In addition, report on this line the amount of the other-than-temporary impairment (OTTI) on AFS and
HTM debt securities that is related to all factors other than credit, where that amount is appropriately
recognized in other comprehensive income.
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Do not report unrealized gains (losses) on securities and CNFIs as valuation allowances.
Report this data field as negative when your unrealized losses exceed unrealized gains.
Do not include declines in fair value that you judge to be other-than-temporary. Report such losses in
earnings on SO441, Other-Than-Temporary Impairment Charges on Debt and Equity Securities.
SC865: Gains (Losses) on Cash Flow Hedges
Report the accumulated fair value gain or loss, net of taxes, on cash flow hedges pursuant to FASB
Statement No. 133.
SC870: Other
Report any accumulated other comprehensive income not included on SC860 or SC865.
Include:
1. Any minimum pension liability adjustment recognized in accordance with FASB Statement No.
87, Employers’ Accounting for Pensions and FAS Statement No. 158, Employers’ Accounting for
Defined Benefit Pension and Other Postretirement Plans.
2. Cumulative foreign currency translation adjustments and qualifying foreign currency transaction
gains and losses, net of applicable income taxes.
3. Any other items of accumulated other comprehensive income.
SC880:
RETAINED EARNINGS
Retained earnings are your accumulated net income since inception less distributions to shareholders
and amounts transferred to other equity capital accounts.
Include:
1.
2.
3.
4.
Undistributed income – net income from interim periods of operation prior to closing your books;
Retained earnings from prior operating periods.
Restrictions or appropriations of retained earnings as designated by your board of directors.
If you are in receivership, a deduction for the amount by which liabilities exceed identified assets,
because you may not report goodwill upon conversion to receivership. Refer to EITF Consensus
No. 85-41.
SC891:
OTHER COMPONENTS OF EQUITY CAPITAL
Report amounts reported under GAAP as separate components of equity capital. In most cases the
amounts in this data field will be negative, as these items typically reduce equity capital.
Include:
1. Treasury stock.
2. Unearned employee stock ownership plan (ESOP) shares, when such reporting is required under
GAAP, including AICPA SOP No. 93-6, Employers’ Accounting for Employee Stock Ownership
Plans.
SC80:
TOTAL SAVINGS ASSOCIATION EQUITY CAPITAL
The EFS software will compute this line as the sum of SC812, SC814, SC820, SC830, SC86, SC880,
plus SC891.
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SC800: NONCONTROLLING INTERESTS IN CONSOLIDATED
SUBSIDIARIES
Include:
Common and perpetual preferred stock issued by consolidated subsidiaries to third parties
constituting a noncontrolling interest.
Report any net income or loss attributable to noncontrolling interest in a consolidated subsidiary on
SO880, Net Income (Loss) Attributable to Noncontrolling Interests.
SC84: TOTAL EQUITY CAPITAL
The EFS software will compute this line as the sum of SC80 plus SC800.
SC90:
TOTAL LIABILITIES AND EQUITY CAPITAL
The EFS software will compute this line as the sum of SC70 and SC84. This line must equal SC60, Total
Assets.
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SCHEDULE SO — CONSOLIDATED STATEMENT
OF OPERATIONS
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete this Statement of Operations, Schedule SO, on a consolidated basis from the savings
association downward. Do not consolidate your holding company. You should apply generally accepted
accounting principles (GAAP) unless we specifically state otherwise in these instructions. Report net
income or loss attributable to noncontrolling shareholders on SO880, Net Income (Loss) Attributable to
Noncontrolling Interests.
Report income and expense for the quarter ending on the report date, regardless of your fiscal year end.
Do not report data in Schedule SO on a year-to-date basis. Note that GAAP requires the accrual basis of
accounting.
When you correct errors made in prior periods within the current calendar year, you should report them in
the same data field in which you would have reported them on the original report. However, you should
not report them in the same data field if the adjustment distorts yields for the quarter or results in negative
numbers in fields that do not permit negatives. Where the latter would occur, you may include the
adjustments in Other Noninterest Income, SO488, or Other Noninterest Expense, SO580. Generally, you
may file amendments only within 45 days of the report date. For further information on correcting prior
period errors, see Item 5 in the General Instructions.
INTEREST INCOME
The balance of financial assets carried at fair value where the changes in fair value are reflected in
current earnings is reported on SI376. For such assets, report the interest income earned on the
appropriate lines described in this section, unless it is not appropriate under GAAP to recognize income
(for example, where a loan is on nonaccrual status because of collectibility concerns). Report the
changes in fair value of such assets in noninterest income on SO485.
SO11: TOTAL
The EFS software will compute this line as the sum of SO115 through SO172.
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SO115: DEPOSITS AND INVESTMENT SECURITIES
Report income on all deposits and investments included in SC112 through SC185.
Include:
1. The gross income earned on all deposits and investment securities including those you use as
collateral under agreements to resell.
2. The net amount of yield adjustments made to interest and dividend income on deposits and
investment securities.
Do not include:
Interest on assets reported on SC689, Other Assets. Report this interest on SO488, Other
Noninterest Income.
SO125: MORTGAGE-BACKED SECURITIES
Report income on mortgage-backed securities reported on SC210 through SC228, including amortization
of premiums and discounts.
SO141: MORTGAGE LOANS
Report income on mortgage loans, including amortization of yield adjustments, reported on SC230
through SC265. Do not include prepayment fees, late fees, and assumption fees on mortgage loans.
If you have bought or sold a participating interest in mortgage loans, report only the interest applicable to
the portion of the loans you own. If you have purchased mortgage loans or participating interests in
mortgage loans on a net-yield basis, report the net interest earned.
If you assume a liability to a third party in connection with a wrap-around mortgage loan where you report
the assumed liability on SC760, Other Borrowings, report the gross interest income and charge the
interest incurred on the assumed liability to expense on SO260, Interest Expense on Other Borrowed
Money.
SO142: PREPAYMENT FEES, LATE FEES, AND ASSUMPTION FEES
FOR MORTGAGE LOANS
Report the total prepayment fees, late fees, and assumption fees received for mortgage loans.
NONMORTGAGE LOANS:
Report the contractual interest earned and the net yield adjustments on nonmortgage loans.
SO160: Commercial Loans and Leases
Report the net interest earned, including any yield adjustments, on commercial nonmortgage loans that
you reported on SC300 through SC306, Secured and Unsecured Commercial Loans and Financing
Leases. Do not include prepayment fees, late fees, and assumption fees on commercial loans and
leases.
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SO162: Prepayment Fees, Late Fees, and Assumption Fees for
Commercial Loans
Report the total prepayment fees, late fees, and assumption fees received for commercial loans.
SO171: Consumer Loans and Leases
Report income including any yield adjustments on consumer loans reported on SC35. Include with yield
adjustments the amortization of credit card fees. Do not include prepayment fees, late fees, and
assumption fees on consumer loans and leases.
SO172: Prepayment Fees, Late Fees, and Assumption Fees for
Consumer Loans
Report the total prepayment fees, late fees, and assumption fees received for consumer loans.
DIVIDEND INCOME ON EQUITY INVESTMENTS NOT
SUBJECT TO FASB STATEMENT NO. 115
SO18: TOTAL
The EFS software will compute this line as the sum of SO181 and SO185.
SO181: FEDERAL HOME LOAN BANK STOCK
Report cash and stock dividends on FHLBank stock reported on SC510.
SO185: OTHER
Report dividend and interest income on investments reported on SC540 accounted for using the cost
method, including interest income on advances (secured and unsecured) that are included in SC540. Do
not include net income or loss recorded under the equity method; include this on SO488, Other
Noninterest Income, using Code 06.
INTEREST EXPENSE
The balance of financial liabilities carried at fair value where the changes in fair value are reflected in
current earnings is reported on SI377. For such liabilities, report the interest expense incurred on the
appropriate lines described in this section. Report the changes in fair value of such liabilities in
noninterest income on SO485.
SO21: TOTAL
The EFS software will automatically compute this line as the sum of SO215 through SO260, less SO271.
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SO215: DEPOSITS
Report the sum of the following:
1. All interest expense on deposits that you reported on SC710, Deposits.
2. The amortization of yield adjustments to deposits that you reported on SC715, Unamortized Yield
Adjustments, less the amount for penalties charged to depositors for early withdrawals.
Do not include:
Interest on escrow accounts that you reported on SC712, Escrows. Report the interest on escrow
accounts on SO225.
SO225: ESCROWS
Report interest expense on escrows reported on SC712, Escrows.
SO230: ADVANCES FROM FHLBANK
Report interest expense and the amortization of any related yield adjustments on FHLBank advances that
you reported on SC720, Advances from FHLBank.
Generally FHLBank prepayment penalties should be expensed on SO580, Other Noninterest Expense.
However, in limited circumstances (outlined in EITF Issue No. 96-19), prepayment penalties may be
deferred and amortized as a yield adjustment increasing interest expense.
SO240: SUBORDINATED DEBENTURES (INCLUDING MANDATORY
CONVERTIBLE SECURITIES)
Report interest, dividends, and the amortization of yield adjustments on all subordinated debentures,
mandatory convertible securities, and REIT preferred stock that you or your consolidated subsidiaries
issued and that you reported on SC736, Subordinated Debentures (Including Mandatory Convertible
Securities and Limited Life Preferred Stock).
SO250: MORTGAGE COLLATERALIZED SECURITIES ISSUED
Report interest expense and amortization of yield adjustments on all mortgage collateralized securities
that you issued and that you reported on SC740 and SC745, Mortgage Collateralized Securities Issued.
SO260: OTHER BORROWED MONEY
Report interest expense and amortization of yield adjustments on borrowings not included above.
Include interest on:
1. SC730, Federal Funds Purchased and Securities Sold Under Agreements to Repurchase.
2. SC760, Other Borrowings.
Report the gross amount of interest that you pay on securities sold under agreements to repurchase and
loans sold with recourse accounted for as financings. Do not reduce the amount of interest that you paid
for such securities or loans by the amount of interest income you received on the securities and loans
sold under such agreements.
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SO271: CAPITALIZED INTEREST
Report all capitalized interest costs in accordance with FASB Statement No. 34, Capitalization of Interest
Costs. Do not use an interest rate that exceeds the weighted average rate for total interest-bearing
deposits and other liabilities. Capitalized interest will be deducted from interest expense. Therefore,
report this as a positive number even though it will always be a credit balance.
SO312:
NET INTEREST INCOME (EXPENSE) BEFORE
PROVISION FOR LOSSES ON INTEREST-BEARING
ASSETS
The EFS software will automatically compute this line as SO11 plus SO18 less SO21.
SO321:
NET PROVISION FOR LOSSES ON INTERESTBEARING ASSETS
Report the provision for losses on all earning assets, including loans, as well as debt and equity securities
Report credit balances as negative.
For a discussion on how to calculate provision for losses, refer to the general instructions for Schedule
VA.
Do not report adjustments to valuation allowances as prior period expenses. Report adjustments to
valuation allowances as an expense in the period in which you determined the amount of the loss even if
the loss actually occurred in a prior period.
Include:
1. Losses you recognized in marking loans to fair value at the time of foreclosure or in-substance
foreclosure.
Do not include:
1. Adjustments to available-for-sale securities for unrealized gains or losses in accordance with
FASB Statement No. 115. Report the adjustments on SC860, Unrealized Gains (Losses) on
Available-for-Sale Securities.
2. Adjustments to trading assets. Report on SO485, Net Income (Loss) from Trading Assets
(Realized and Unrealized).
3. Recoveries of valuation allowances at the time of sale. Include these in the gain or loss on the
sale.
4. Provisions for losses on noninterest-bearing assets. Report the provision for losses on SO570,
Net Provision for Losses on Non-interest-bearing Assets.
5. Adjustments to or recording of a liability for off-balance-sheet commitments or contingencies;
include these in SO580, Other Noninterest Expense.
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SO332:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
NET INTEREST INCOME (EXPENSE) AFTER
PROVISION FOR LOSSES ON INTEREST-BEARING
ASSETS
The EFS software will automatically compute this line as SO312 less SO321.
NONINTEREST INCOME
Do not include material adjustments to income from prior calendar years; refer to page 3 of the General
Instructions for procedures to correct prior periods.
SO42: TOTAL
The EFS software will compute this line as the sum of SO410 through SO488.
SO410: MORTGAGE LOAN SERVICING FEES
Include:
1. Fees earned from servicing mortgage loans for others.
2. Impairment losses on servicing assets reported on SC642.
Do not include:
1. Servicing fees for nonmortgage loans. Report the servicing fees on nonmortgage loans on
SO420, Other Fees and Charges.
2. Amortization of loan servicing assets or liabilities and valuation adjustments for classes of loan
servicing accounted for using the amortization method.
3. Fair value adjustments for classes of servicing carried at fair value.
Report the difference between the net interest retained from mortgage loan servicing and the amortization
or other write-down of mortgage servicing assets. Do not deduct servicing expenses.
SO411: AMORTIZATION OF AND FAIR VALUE ADJUSTMENTS TO
LOAN SERVICING ASSETS AND LOAN SERVICING
LIABILITIES
Report the total servicing amortization and valuation adjustments.
Include:
1. Amortization of loan servicing assets or liabilities and valuation adjustments for classes of loan
servicing accounted for using the amortization method
2. Fair value adjustments for classes of servicing carried at fair value.
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SO420: OTHER FEES AND CHARGES
Report all fees and charges not reported on SO410.
Include:
1. Loan servicing fee income on nonmortgage loans, including credit card servicing income.
2. Trust fee income.
3. Amortization of commitment fees when it is unlikely that the borrower will exercise the
commitment.
4. Brokerage fee income.
5. Annuity fee income.
6. Insurance premiums, fees, and commissions.
7. Transaction account fees, including overdraft and non-sufficient funds (NSF) fees.
8. Credit enhancement fees.
9. All other fees not reported on SO410.
Do not include:
Amortization of loan fees. Report amortization of loan fees as a yield adjustment to interest income.
NET INCOME (LOSS) FROM:
Report net income or loss on the categories below. Enter a loss as negative.
SO430: SALE OF AVAILABLE-FOR-SALE SECURITIES
Report the realized gain or loss from the sale of available-for-sale securities. When you sell securities
classified as available-for-sale pursuant to FASB Statement No. 115, reverse the amount of the
unrealized gain or loss previously recorded on SC860, Unrealized Gains (Losses) on Available-for-Sale
Securities, and report the entire difference between amortized cost and net sales proceeds in earnings.
SO431: SALE OF LOANS AND LEASES HELD FOR SALE
Report the realized gain or loss from the sale of loans and leases held for sale. In computing the gain or
loss, the cost of the loans and leases sold reflect the associated valuation allowances.
Do not include “lower of cost or fair value” adjustments on such assets. Rather, report such amounts on
SO465.
SO432: SALE OF OTHER ASSETS HELD FOR SALE
Report the gain or loss from the sale of other assets held for sale.
Do not include “lower of cost or fair value” adjustments on such assets. Rather, report such amounts on
SO465.
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SO441: OTHER-THAN-TEMPORARY IMPAIRMENT CHARGES ON
DEBT AND EQUITY SECURITIES
Report other-than-temporary impairment (OTTI) charges on debt and equity securities. Such charges
reflect losses resulting from the recognition of credit losses and/or losses related to all factors other than
credit. These OTTI losses are not necessarily related to any sale of the securities.
Do not report losses from the sale of securities on this line. Rather report those losses on SO430,
SO467, SO475, or SO477, as appropriate.
SO461: Operations and Sale of Repossessed Assets
Include:
1. Net income or loss from repossessed assets reported on SC40, Repossessed Assets. Report
direct expenses on repossessed assets, even if there is no income.
2. Gains and losses from the sale of repossessed assets reported on SC40, Repossessed Assets.
Do not include:
1. Adjustments to valuation allowances established on REO. Report these adjustments on SO570,
Net Provision for Losses on Noninterest-Bearing Assets.
2. Write-downs taken when marking foreclosed assets to fair value at time of foreclosure. Report
these write-downs on SO321, Net Provision for Losses on Interest-bearing Assets.
SO465: LOCOM Adjustments Made to Assets Held for Sale
Report adjustments to assets held for sale to value them at the lower-of-cost-or-market. The amounts
reported here should directly adjust the asset and should not be established as a valuation allowance.
Do not include:
1. Any unrealized gains or losses on available-for-sale securities recorded pursuant to FASB
Statement No. 115. Report these unrealized gains or losses only as a separate component of
equity capital on SC860.
2. Profit or loss on the sale of assets held for sale. Report the profit or loss on SO430.
3. Operating income and expense from mortgage banking activities. Report in the appropriate
income or expense category.
SO467: Sale of Securities Held-to-Maturity
Include:
1. Gains and losses from the sale or other disposition of mortgage-backed securities that you
reported on SC210 through SC228, Mortgage-Backed Securities, and that were held-to-maturity.
2. Gains and losses from the sale or other disposition of securities that you reported on SC130
through SC185, Cash, Deposits and Investment Securities, and that were held-to-maturity.
Do not include:
1. Gains and losses from the sale of securities held in a trading portfolio. Report these gains or
losses on SO485.
2. Gains and losses from the sale of available-for-sale securities. Report these gains and losses on
SO430.
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SO475: Sale of Loans Held for Investment
Report gains and losses from the sale or other disposition of mortgage and nonmortgage loans that you
reported on SC230 through SC265 and SC300 through SC330.
Do not include:
1. Gains and losses from the sale of loans and securities in a trading portfolio. Report these gains
and losses on SO485;
2. Gains and losses from the sale of loans held for sale. Report these gains and losses on SO431.
3. Recoveries of losses previously written off. Report on VA140, Recoveries.
SO477: Sale of Other Assets Held for Investment
Report gains and losses from the sale or other disposition of any assets that you did not report on SO430
through SO475 or SO485.
Include:
1. Gains and losses from the sale of real estate held for investment reported on SC45, Real Estate
Held for Investment, that you may account for as current income in accordance with FASB
Statement No. 66, Accounting for Sales of Real Estate.
2. Gains and losses from the sale of a branch operation or a portion thereof, such as deposits.
3. Gains and losses from the sale of loan servicing rights when sold separately from the loan.
4. Gains and losses from the sale of subsidiaries.
SO485: Gains and Losses on Financial Assets and Liabilities Carried
at Fair Value
The balances of financial assets and liabilities carried at fair value where the change in fair value is
reflected in current earnings are reported on SI376 and SI377. For such instruments, report interest
income earned and interest expense incurred on the appropriate lines under Interest Income and Interest
Expense, and report the changes in fair value in noninterest income on this line.
Derivatives are financial assets and liabilities, and therefore the balances of derivatives are included on
SI376 and SI377. In general for derivatives, include the changes in fair value in noninterest income on
this line. However, for derivatives subject to fair value or cash flow hedge accounting, it may be
appropriate under GAAP to include the changes in fair value that are reflected in current earnings in other
lines on Schedule SO, including interest income or interest expense.
The balance of available-for-sale securities (carried at fair value) is reported on SI385. For such
instruments, the changes in fair value are not reflected in current earnings, but rather in other
comprehensive income net of any deferred tax impact. Accordingly, do not include the changes in fair
value on available-for-sale securities on this line. Rather, report such changes in other comprehensive
income on SI662.
Under a “fair value option”, servicing assets may be carried at fair value with the changes in fair value
reflected in current earnings. However, servicing assets are not financial assets, and therefore the
balance is not included on SI376. Accordingly, do not include the changes in fair value on servicing
assets on this line. Rather, report such changes in noninterest income on SO411.
Include:
1. Realized and unrealized gains and losses on financial assets and liabilities carried at fair value
where the balances are reported on SI376 and SI377.
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2. Realized and unrealized gains and losses on financial assets held for trading purposes where the
balance is reported on SI375 (and where the balance is also included on SI376).
SO488: Other Noninterest Income
Report the total of all noninterest income that you did not include on SO410 through SO485. You can find
a list of the types of income to include under Memo: Detail of Other Noninterest Income below.
Do not include:
1. Loan servicing fees. Report these fees on SO410 or SO420, as appropriate;
2. Trust fee income. Report this income on SO420.
3. Other fees. Report these fees on SO420.
Memo: Detail of Other Noninterest Income
SO489, 495, 497 and SO492, 496, and 498:
Report the three largest items comprising the amount reported on SO488, excluding dividends on
FHLBank stock. Codes best describing these items should be selected from the list below and reported
on SO489, 495, and 497. You must complete this detail if you reported an amount on SO488.
Because SO488 may consist of both positive and negative amounts – for example, net income or loss
from leasing operations, you should report the three amounts that have the greatest impact on the total,
regardless of their sign. Therefore, when selecting the three largest amounts comprising the amount
reported on SO488, disregard the sign of the number. However, although you should disregard the sign
when you select the three largest numbers; you should use the correct sign when you report the amount.
Combine similar accounts with the same code; that is, do not report a code more than once. However,
you should not combine unlike accounts in reporting code 99. You may have more than one code 99 if
you cannot find codes describing the items you report.
SO489, 495, and 497:
01
02
03
04
05
06
07
08
09
10
11
12
13
14
15
310
Codes
No longer used
Interest income from income tax refunds.
No longer used
Net income or loss from leasing or subleasing space in the association’s office quarters, future
office quarters, and parking lots.
Net income or loss from real estate held for investment.
Net income or loss from investments in unconsolidated subordinate organizations and passthrough investments, accounted for using the equity method, after the elimination of
intercompany profits.
Net income or loss from leased property.
No longer used.
Net income from data processing equipment leased or services provided to others.
No longer used.
Adjustments to prior periods.
Income received on real estate acquired through foreclosure or deed in lieu of foreclosure on
VA or FHA loans pending conveyance to the insuring agency.
No longer used
Income from interest-only strip receivables and certain other instruments reported on SC665.
Income from corporate-owned life insurance
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99
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Report adjustments to cash surrender value of corporate-owned life insurance that you
reported on SC615 and SC625.
Other. (Use this code only for an item not identified above.)
SO492, 496, and 498:
Amounts
Report the dollar amounts (using the correct positive or negative sign) corresponding to the codes
reported on SO489, 495, and 497.
NONINTEREST EXPENSE
Do not include material adjustments to expenses from prior calendar years; refer to page 3 of the
General Instructions for procedures to correct prior periods.
SO51: TOTAL
The EFS software will compute this line as the sum of SO510 through SO580.
SO510: ALL PERSONNEL COMPENSATION AND EXPENSE
Report gross salaries, wages, bonuses, and other compensation and expenses of officers, directors and
employees, whether employed full- or part-time.
Include:
1. The cost of temporary help and employment contractors.
2. Fringe benefits such as the employer’s share of payroll taxes, insurance premiums, lunchroom
expenses, tuition fees, uniforms, parking, and other such benefits.
3. Bonuses and awards.
4. Employer contributions to pension and retirement funds and ESOP plans.
5. Pensions paid directly by you.
6. Lump-sum pension contributions.
7. Payments related to past services, such as severance pay.
8. Directors’ fees.
9. Travel and other expenses for directors, officers, and employees.
10. The fair value of employee stock options granted.
Do not include:
Allowances for privately owned automobiles used in connection with your business, or any depreciation
and other noninterest expense incurred on leased automobiles. Report these figures on SO530.
SO520: LEGAL EXPENSE
Report all legal fees and retainers, including accruals and amortization.
Do not include material legal settlements; most settlement payments should be reported on SO580.
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SO530: OFFICE OCCUPANCY AND EQUIPMENT EXPENSE
Include:
1. Depreciation and other expenses of association-owned space, capital leases, furniture and
fixtures, automobiles and equipment reported on SC55, Office Premises and Equipment.
2. Amortization of leasehold improvements.
3. Rent, net of the amortization of deferred gain on a sale/leaseback.
4. Uncapitalized equipment purchases.
5. Taxes, assessments, and insurance premiums on office premises, equipment, and land for future
use.
6. Rental costs, maintenance contracts, and expenses on office furniture, machines, and data
processing equipment.
7. Accounting servicing fees paid to a data center.
If a portion of office premises and equipment is leased to others, allocate related expenses to SO488,
Other Noninterest Income. When actual data are not available, a reasonable, consistent, and
documented estimate is acceptable.
SO540: MARKETING AND OTHER PROFESSIONAL SERVICES
Include:
1.
2.
3.
4.
5.
6.
7.
8.
Advertising, production, agency fees, and direct mail.
Market research, including consultants.
Public relations, including consultants, seminars, or customer magazines.
Sales training by consultants.
Public accountants’ fees.
Management services.
Consulting fees for economic surveys.
Other special advisory services.
Do not include:
1.
2.
3.
4.
Legal fees; report on SO520.
Data processing fees; report on SO530.
Supervisory examination fees; report on SO580.
Deposit promotions, giveaways, premiums, and commissions that are capitalized. Report
amortization on SO215, Interest Expense on Deposits.
SO550: LOAN SERVICING FEES
Report fees paid to others to service mortgage and nonmortgage loans.
Include:
1. Fees for servicing loans owned by you.
2. Fees for servicing loans owned by others where you own the servicing rights.
Do not include:
1. Amortization of loan servicing assets. Report the amortization on SO411.
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2. Servicing fees for loans acquired on a net yield basis. Deduct the servicing fees from related
interest income.
SO560: GOODWILL AND OTHER INTANGIBLES EXPENSE
Report write-downs and expense of SC660, Goodwill and Other Intangible Assets.
Include amortization of:
1. Goodwill, an unidentifiable intangible asset, recorded pursuant to APB No. 16 or FASB Statement
No. 141.
2. The unidentifiable intangible asset recorded pursuant to FASB Statement No. 72.
3. Core deposit premium, an identifiable intangible asset.
4. Intangible pension assets recorded pursuant to FASB Statement No. 87.
5. Technology-based intangible assets, such as computer software.
6. Other intangible assets, excluding servicing assets.
Also, include impairment write-downs on goodwill and other intangible assets.
Do not include amortization of Servicing assets; report this on SO410.
Upon adoption of FASB Statement No. 142 in 2002, goodwill recorded pursuant to APB No. 16 or FASB
Statement No. 141 will no longer be amortized. However, this unidentifiable intangible asset will continue
to be subject to impairment write-downs. The exact adoption date of FASB Statement No. 142 in 2002
will depend on your fiscal year-end.
SO570: NET PROVISION FOR LOSSES ON NON-INTEREST-BEARING
ASSETS
Report the provision for losses on all non-interest-bearing assets. Report credit balances as negative.
Refer to the general instructions for Schedule VA for a discussion of how to properly calculate provision
for losses. Report adjustments to valuation allowances as an expense in the period in which you
determine the amount of the loss even if that loss actually occurred in a prior period.
Include adjustments to valuation allowances on:
1. Real estate owned.
2. Other assets.
Do not include:
1. Recoveries of valuation allowances at the time of sale. Include these recoveries in the gain or
loss on the sale.
2. Provisions for losses on interest-bearing assets. Report the losses on SO321, Net Provision for
Losses on Interest-bearing Assets.
3. Direct charge-offs of servicing assets. Report the direct charge-offs on SO410, Mortgage Loan
Servicing Fees.
4. Losses recognized in marking foreclosed assets to fair value at the time of foreclosure or insubstance foreclosure. Report these as losses on loans on SO321, Net Provision for Losses on
Interest-bearing Assets.
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SO580: OTHER NONINTEREST EXPENSE
Report the total of all noninterest expense not included on SO510 through SO570. A list of the types of
expense you should include appears below in the memo items detailing other noninterest expense.
Memo: Detail of Other Noninterest Expense
Report the three largest items comprising the amount you reported on SO580. Select codes best
describing these items from the list below and report the codes on SO581, 583, and 585. Report the
corresponding amounts on SO582, 584, and 586. You must complete this detail if an amount is reported
on SO580.
If SO580 consists of both positive and negative amounts, you should report the three amounts that have
the greatest impact on the total, regardless of their sign. Therefore, when selecting the three largest
amounts comprising the amount reported on SO580, disregard the sign of the number. However,
although you should disregard the sign when you select the three largest numbers; you should use the
correct sign when you report the amount.
Combine similar accounts with the same code; that is, do not report a code more than once. However,
you should not combine unlike accounts in reporting code 99. You may have more than one code 99 if
you cannot find codes describing the items you report.
SO581, 583, and 585:
01
02
03
04
05
06
07
08
09
10
11
12
13
14
15
16
17
99
Codes
Deposit Insurance premiums.
OTS assessments.
Interest expense on income taxes.
Interest expense on Treasury tax and loan accounts administered under the note option.
Forfeited commitment fees on FHLBank advances not taken down by the association.
Supervisory examination fees.
Office supplies, printing, and postage.
Telephone, including data lines.
Loan origination expense
Include appraisal reports, credit reports, and other similar expenses; also include, as a negative
amount, reversals of origination costs when such costs are capitalized.
ATM expense.
Adjustments to prior periods (and other immaterial audit adjustments).
Acquisition and organization costs, including mergers and branch office acquisitions.
Miscellaneous taxes other than income taxes and real estate taxes.
Losses from fraud.
Foreclosure expenses.
Web site expenses.
Charitable Contributions.
Other. (Use this code only for an item not identified above.)
SO582, 584, and 586:
Amounts
Report the dollar amounts corresponding to the codes reported on SO581, 583 and 585.
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SO60: INCOME (LOSS) BEFORE INCOME TAXES
The EFS software will compute this line as the sum of SO332 plus SO42 less SO51.
INCOME TAXES
SO71: TOTAL
The EFS software will compute this line as the sum of SO710 and SO720.
SO710: FEDERAL
Report federal income tax expense. Report a net credit as negative.
Include:
1. Deficiency payments, penalties.
2. Immaterial adjustments to correct prior period accruals for which the amendment cycle is no
longer open.
3. Amortization of prepaid or deferred federal income taxes.
4. Reductions for refunds from prior periods not previously reported.
5. Reductions for NOL carrybacks.
Do not include:
Interest income and expense on tax accounts. Report these on SO488, Other Noninterest Income, or
SO580, Other Noninterest Expense.
SO720: STATE, LOCAL, AND OTHER
Report state, local, and other income tax expenses. Report a net credit as negative.
Include:
1. Deficiency payments, penalties.
2. Immaterial adjustments to correct prior period accruals for which the amendment cycle is no
longer open.
3. Amortization of prepaid or deferred state, local and other income taxes.
4. Reductions for refunds from prior periods not previously reported.
5. Reductions for NOL carrybacks.
6. Gross receipts taxes.
Do not include:
1. Interest income and expense on tax accounts. Report these on SO488, Other Noninterest
Income, or SO580, Other Noninterest Expense.
2. Any local taxes other than those based on income. Report real estate taxes on SO530, Office
Occupancy and Equipment Expense; report franchise and other local taxes on SO580, Other
Noninterest Expense.
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SO81: INCOME (LOSS) BEFORE EXTRAORDINARY ITEMS
The EFS software will compute this line as the sum of SO60 less SO71.
SO811: EXTRAORDINARY ITEMS
Extraordinary items are material events and transactions that are unusual and infrequent. Both of these
conditions must exist for an event or transaction to be an extraordinary item.
•
Unusual – To be unusual, an event or transaction must be highly abnormal or clearly unrelated to the
ordinary and typical activities of the association. An event or transaction beyond the control of
management is not automatically considered unusual.
•
Infrequent – To be infrequent, an event or transaction should not reasonably be expected to recur in
the foreseeable future. Although the past occurrence of an event or transaction provides a basis for
estimating the likelihood of its future occurrence, the absence of a past occurrence does not
automatically imply that an event or transaction is infrequent.
Rarely do events or transactions qualify for treatment as extraordinary items. Among those that qualify
are:
•
The excess of fair value over cost of net assets acquired in a purchase business combination
(negative goodwill) recognized in earnings at the date of combination;
•
Losses that result directly from a major disaster such as an earthquake (except in areas where
earthquakes are expected to recur in the foreseeable future);
•
Gains or losses from a government expropriation;
•
Gains or losses from discontinued operations; or
•
Losses from a prohibition under a newly enacted law or regulation.
Do not include:
1. Adjustments to valuation allowances. Report these on SO32, Net Provision for Losses on
Interest-Bearing Assets, or SO570, Net Provision for Losses on Noninterest-Bearing Assets, even
if the actual loss occurred in a prior period.
2. Audit adjustments for corrections of accruals. For information on correcting prior period errors,
see Item 5 in the General Instructions.
3. Adjustments for periods where the cycle is open for amendments to the TFR. Refer to the
general instructions for the submission of amended reports.
4. Adjustments related to prior interim periods of your current fiscal year. Report these adjustments
currently in the appropriate current income or expense data field.
5. Net income or loss allocable to noncontrolling shareholders. Report in SO488, Other Noninterest
Income.
6. Gains and losses on extinguishments of debt that do not meet the criteria in APB Opinion No. 30
for classification as an extraordinary item. Generally prepayment penalties should be expensed
on SO580, Other Noninterest Expense.
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SO88:
MARCH 2010
NET INCOME (LOSS) ATTRIBUTABLE TO SAVINGS
ASSOCIATION AND NONCONTROLLING INTERESTS
The EFS software will compute this line as the sum of SO81 plus SO811.
SO880: NET INCOME (LOSS) ATTRIBUTABLE TO
NONCONTROLLING INTERESTS
Report the net income or loss attributable to noncontrolling interests in consolidated subsidiaries. This
amount will be subtracted in computing SO91, Net Income (Loss) Attributable to Savings Association.
Accordingly, enter net income as a positive amount and a net loss as a negative amount.
SO91:
NET INCOME (LOSS) ATTRIBUTABLE TO SAVINGS
ASSOCIATION
The EFS software will compute this line as the sum of SO88 less SO880.
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SCHEDULE VA — CONSOLIDATED VALUATION
ALLOWANCES
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
This schedule reports the combined activity for the period in all valuation allowance accounts. The
reconciliation consists of three columns:
1. General valuation allowances, including allowances for loan and lease losses, ALLL.
2. Specific valuation allowances, including valuation allowances established for assets classified as
loss.
3. Total valuation allowances. The EFS software generates this column.
Valuation allowances are contra-asset accounts that reduce the recorded investment in an asset to its
carrying amount. In preparing financial statements, management should review the carrying amount of all
assets and adjust the related valuation allowances as necessary. Assessing the adequacy of valuation
allowances is crucial to preparing the financial statement.
The ending balance in a valuation allowance account is the balance at the beginning of the period
adjusted for the activity during the period. The following table shows the types of activity that flow through
the valuation allowance account:
Beginning Balance (ending balance from previous period)
Add:
Provision for Loss
Recoveries
Adjustments
Deduct:
Charge-offs
Ending Balance
Charge-offs
When you charge off an asset, the accounting entries reduce the total recorded investment of the asset
and reduce the valuation allowance. However, since the carrying value is the recorded investment less
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the specific valuation allowance, the carrying value decreases when you charge-off a general valuation
allowance. The carrying value does not change when you charge-off a specific valuation allowance.
Record direct charge-offs in this schedule even though there is no valuation allowance relating to the
asset. You should also record a charge-off if the established valuation allowance is inadequate to absorb
the entire charge-off. You can record a charge-off against either a general or specific valuation
allowance.
The Sales section discusses eliminating valuation allowances when you sell the related asset.
Recoveries
A recovery is a payment received after you charge-off an asset. A recovery increases both the general
valuation allowance and cash accounts.
In Schedule VA, recoveries do not include profits from assets that you had previously written down and
later sold at a price exceeding the carrying value. For example, you would record profits from the sale of
REO as a gain on the sale.
Provision for Loss
Calculate the provision for loss as the amount required to establish the appropriate ending balance in the
valuation allowance account. You should base the amount of the ending balance on your management’s
review of the following:
•
An assessment of all assets.
•
Valuation calculations for troubled real estate assets.
•
Estimates of credit and other losses inherent in the portfolios of homogeneous assets.
•
The results of your self-classification of assets.
The following formula reconciles the provision for loss with the valuation allowance accounts:
+
-
The valuation allowance ending balance per analysis (VA165 and 168)
The valuation allowance beginning balance (VA105 and 108)
=
+
-
Net change in valuation allowances
Charge-offs (including sales) (VA155 and 158)
Adjustments (VA145 and 148)
Recoveries (VA135)
=
Provision for loss (VA115 and 118)
The process of determining the appropriateness of the ending balances in valuation allowance accounts
results in the provision for loss being a net adjustment. For example, in the rare circumstance that a
troubled real estate asset with a valuation allowance increases in value, you should adjust the required
valuation allowance downward. This increase in the asset’s value is a reduction of the current provision.
Do not confuse this with a recovery of assets previously charged-off discussed above. Carefully analyze
the total valuation allowance before you record a gain or reduction of the provision for loss.
The total provision for loss consists of the provision for loss on interest-bearing assets, SO321, and the
provision for loss on non-interest-bearing assets, SO570. Do not include the LOCOM adjustments for
assets held for sale, SO465, because LOCOM adjustments are due to changes in interest rates, and not
due to credit losses. You should not establish a valuation allowance for the credit to assets resulting from
LOCOM adjustments, but rather should directly reduce the asset.
You may record a negative provision for loss when management determines that the valuation allowance
is higher than required. If this occurs, management should consider whether it has analyzed all possible
situations and determine if the previously established valuation allowances were higher than necessary.
To reverse a portion of the valuation allowance, report a negative amount in the provision for loss on
SO321 or SO570.
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Sales
When you sell an asset with a previously established valuation allowance or that had been reduced by a
direct charge-off, compute the gain or loss as follows: Sales price minus the asset’s carrying value, which
is net of the specific valuation allowance and charge-off.
The sale of an asset in excess of its carrying value is not a recovery when reconciling valuation
allowances. Do not report profits from this type of sale in the net provision for loss. Report the profit as a
gain on sale.
To remove an existing specific valuation allowance after selling the related asset, you must report the
valuation allowance on VA158, Charge-offs of Specific Valuation Allowances.
Foreclosures
In cases involving foreclosure, including in-substance foreclosure, compare the recorded investment to
the current fair value less cost to sell. Classify as loss any excess of recorded investment over fair value
less cost to sell. Record this excess as a charge-off against the existing specific valuation allowance. If
the specific valuation allowance is not sufficient to absorb the loss, you should record an additional
charge-off against the loan. Record assets acquired through in-substance foreclosures as REO at the fair
value less cost to sell at date of transfer. You should apply the same procedures described above.
VALUATION ALLOWANCE RECONCILIATION
VA105, 108, AND 110:BEGINNING BALANCE
The EFS software automatically generates beginning balances from the prior quarter’s ending balances.
Generally, the beginning balances must equal the amounts reported on VA165, 168 and 170, Ending
Balances, from the immediately preceding reporting period.
If during the quarter you have consummated a business combination accounted for under the purchase
method, report the beginning balance of the surviving association only. Report valuation allowances on
purchased assets on VA145, 148, and 150, Adjustments.
ADD OR DEDUCT:
Report increases in valuation allowance accounts, net credits, as positive numbers and decreases in
valuation allowance accounts, net debits, as negative numbers.
VA115, 118, and 120: Net Provision for Loss
The EFS software automatically generates the total net provision for loss, VA120, from SO321 plus
SO570. The EFS software also automatically generates VA118 after you enter VA115. On VA115, report
the provision for loss related to general valuation allowances.
A net credit to assets increases valuation allowances and charge-offs and flows through to the Statement
of Operations as a debit, which is an expense. You should report a net credit as a positive number.
Conversely, a net debit to assets decreases valuation allowances and flows through to the Statement of
Operations as a credit or income. Report a net debit as a negative number on these lines.
VA125 and 128: Transfers
Report transfers between general and specific valuation allowances. VA125 and VA128 will have
opposite signs even though they are always equal. Once you enter VA125, the transfer from general
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valuation allowances, the EFS software automatically generates VA128, the corresponding transfer to
specific valuation allowances.
ADD:
VA135 and 140: Recoveries
You should report any amount recovered during the quarter due to repayment of assets previously
charged off. Refer to the discussion of recoveries in the general instructions to Schedule VA. VA135
always equals VA140, and VA 140 is the sum of VA371, 47, 57, and 931. Therefore, once you enter
VA371, 47, 57, and 931, the EFS software automatically sums these and generates VA135 and 140.
VA145, 148, and 150: Adjustments
Acquisitions
Report the amount of valuation allowances on assets you purchased but for which you did not take a
direct charge-off. Under certain circumstances, you may carry the existing valuation allowances of assets
that you purchase forward to your books. You should include any valuation allowances acquired in a
business combination accounted for under the purchase method. You should also include necessary
adjustments that resulted from purchasing or selling a consolidated subsidiary, where the valuation
allowances on the books of the subsidiary are consolidated with yours. The EFS software automatically
generates VA150, which is the sum of VA145 and VA148.
Do not include:
Additional valuation allowances established after an acquisition, even if previous management should
have established the valuation allowances. Report such additions to the valuation allowances in
VA120, Net Provision for Loss.
Adjustments for Charge-Offs on Credit Card Loans
On VA145, report as a positive number that portion of charge-offs included on VA556 that reduce an
account other than a valuation allowance (for example, interest income). This reporting will permit the
valuation allowance reconciliation to balance, because on VA556 you should report all charge-offs on
credit card loans, including those that do not reduce valuation allowances.
DEDUCT:
VA155, 158 and 160: Charge-Offs
VA155 equals the sum of the charge-off detail below, VA370, 46, 56, 60, and 930. The EFS software
automatically generates VA 155 once you enter charge-offs on VA370, 46, 56, 60, and 930. The software
also generates VA160, total charge-offs. VA160 is the sum of VA155, charge-offs against general
valuation allowances, and VA158, charge-offs against specific valuation allowances.
Report charge-offs as positive amounts, since EFS will deduct them from the ending valuation allowance
balance.
If there is no specific valuation allowance established for the asset you are charging off, report chargeoffs in the detail below and on VA155. If there is a specific valuation allowance for the asset, report the
charge-off on VA158 for purposes of reconciliation. You should not report charge-offs of specific
valuation allowances in the detail below because they have no effect on the balance sheet, Schedule SC,
or on the income statement, Schedule SO.
Include:
1. Charge-offs to mark repossessed assets, including in-substance foreclosures, to fair value.
2. Charge-offs to eliminate valuation allowances of sold assets. See Sales above.
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3. Charge-offs on credit card loans that do not reduce valuation allowances, as described in the
instructions for VA556.
Do not include:
1. Charge-offs due to recognizing unrealized losses on trading assets.
2. Charge-offs in connection with marking assets to market in a business combination accounted for
as a purchase.
VA165, 168 AND 170: ENDING BALANCE
The EFS software automatically generates these balances as the sum of the General, Specific, and Total
columns, and brings them forward as the beginning balances for the next reporting period. VA165 must
equal the sum of the general valuation allowances that you reported in Schedule SC on SC229, SC283,
SC357, SC441, and SC699.
CHARGE-OFFS, RECOVERIES, AND SPECIFIC VALUATION
ALLOWANCE ACTIVITY
CHARGE-OFFS
Report the amount of loss that you charged off during the quarter against general valuation allowances.
You should only include charge-offs for which no specific valuation allowance has previously been
established.
The sum of VA370, 46, 56, 60, and 930 must equal VA155. The EFS software automatically generates
VA155 once you enter charge-offs on VA370, 46, 56, 60, and 930.
VA370: Mortgage-Backed Securities
Report the amount of loss that you charged off on SC210 through SC228, Mortgage-Backed Securities.
Mortgage Loans:
Report charge-offs of mortgage loans, accrued interest receivable, and advances for taxes and insurance
in the appropriate mortgage loan category below.
Include charge-offs to mark repossessed assets to fair value at the date of foreclosure.
VA46:
Total
The EFS software automatically generates this amount as the sum of VA420, 430, 440, 446, 456, 466,
470, 480, and 490.
Construction:
VA420:
1-4 Dwelling Units
Report the amount of loss that you charged off on SC230, Construction Loans on 1-4 Dwelling Units.
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VA430:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Multifamily (5 or More) Dwelling Units
Report the amount of loss that you charged off on SC235, Construction Loans on 5 or More Dwelling
Units.
VA440:
Nonresidential Property
Report the amount of loss that you charged off on SC240, Construction Loans on Nonresidential
Property.
Permanent:
VA446:
1-4 Dwelling Units: Revolving, Open-End Loans
Report the amount of loss that you charged off on SC251, Permanent: 1-4 Dwelling Units: Revolving,
Open-End Loans.
VA456:
1-4 Dwelling Units: Secured By First Liens
Report the amount of loss that you charged off on SC254, Permanent: 1-4 Dwelling Units: Secured By
First Liens.
VA466:
1-4 Dwelling Units: Secured by Junior Liens
Report the amount of loss that you charged off on SC255, Permanent: 1-4 Dwelling Units: Secured by
Junior Liens.
VA470:
Multifamily (5 or More) Dwelling Units
Report the amount of loss that you charged off on SC256, Permanent Mortgages on 5 or More Dwelling
Units.
VA480:
Nonresidential Property (Except Land)
Report the amount of loss that you charged off on SC260, Permanent Mortgages on Nonresidential
Property.
VA490:
Land
Report the amount of loss that you charged off on SC265, Permanent Mortgages on Land.
Nonmortgage Loans
Report charge-offs of nonmortgage loans and accrued interest receivable in the appropriate loan category
below.
VA56:
Total
The EFS software automatically generates this line as the sum of VA520, 510, 516, 530, 540 550, 556,
and 560.
VA520: Commercial Loans
Report the amount of loss that you charged off on SC300, Secured Commercial Loans, SC303,
Unsecured Commercial Loans, and SC306, Commercial Financing Leases.
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Consumer Loans
VA510:
Loans on Deposits
Report the amount of loss that you charged off on SC310, Consumer Loans on Deposits.
VA516:
Home Improvement Loans
Report the amount of loss that you charged off on SC316, Consumer Home Improvement Loans.
VA530:
Education Loans
Report the amount of loss that you charged off on SC320, Consumer Education Loans.
VA540:
Auto Loans
Report the amount of loss that you charged off on SC323 Consumer Auto Loans.
VA550:
Mobile Home Loans
Report the amount of loss that you charged off on SC326, Consumer Mobile Home Loans.
VA556:
Credit Cards
Report the amount of loss that you charged off on SC328, Credit Cards.
VA560:
Other
Report the amount of loss that you charged off on SC330, Other Closed-End Consumer Loans.
Repossessed Assets:
Report all direct charge-offs on repossessed assets. You should mark repossessed assets to fair value
at the date of foreclosure and charge the markdown against the loan balance.
VA60:
Total
The EFS software automatically generates this amount as the sum of VA605 through VA630.
Real Estate:
VA605:
Construction
Report the amount of loss that you charged off on SC405, Repossessed Real Estate Construction.
VA613:
1-4 Dwelling Units
Report the amount of loss that you charged off on SC415, Repossessed 1-4 Dwelling Unit Real Estate.
VA616:
Multifamily (5 or More) Dwelling Units
Report the amount of loss that you charged off on SC425, Repossessed 5 or More Dwelling Unit Real
Estate.
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Nonresidential (Except Land)
Report the amount of loss that you charged off on SC426, Repossessed Nonresidential Real Estate,
Except Land.
VA628:
Land
Report the amount of loss that you charged off on SC428, Repossessed Land.
VA630: Other Repossessed Assets
Report the amount of loss that you charged off on SC430, Other Repossessed Assets.
VA930: Other Assets
Report the amount of loss that you charged off on SC689, Other Assets, and on any other assets not
otherwise reported as charge-offs.
Do not include:
1. Write-downs of office buildings, leasehold improvements, furniture, fixtures, equipment, and
automobiles. Report these write-downs as an adjustment of depreciation on SO440, Net Income
(Loss) from Office Building Operations, and SO530, Office Occupancy and Equipment Expense.
2. Write-downs on SC660, Goodwill and Other Intangible Assets. Report these write-downs as an
adjustment of amortization on SO560, Amortization of Goodwill.
RECOVERIES
Report the amount of recoveries during the quarter due to the repayment of assets previously charged off
in the recovery column. For additional information, see the general instructions to Schedule VA.
The EFS software automatically generates VA135 once you enter recoveries on VA371, 47, 57, and 931.
Do not include:
1. Sale of an asset at a sales price exceeding the carrying value. Report this amount in income on
SO430 and SO467 through SO477.
2. Payments received on assets for which a valuation allowance has been established. Adjust the
ending balance of the valuation allowance appropriately.
VA371: Mortgage-Backed Securities
Report the amount of recoveries on mortgage-backed securities that you reported on SC210 through
SC228.
Mortgage Loans
Include recoveries of accrued interest receivable and advances for taxes and insurance in the appropriate
mortgage loan category below. Report recoveries on deficiency judgments in the mortgage loan
category to which the judgment applies.
VA47: Total
The EFS software automatically generates this amount as the sum of VA421, 431, 441, 447, 457, 467,
471, 481, and 491.
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Construction:
VA421:
1-4 Dwelling Units
Report the amount of recoveries on SC230, Construction Loans on: 1-4 Dwelling Units.
VA431:
Multifamily (5 or More) Dwelling Units
Report the amount of recoveries on SC235, Construction Loans on: 5 or More Dwelling Units.
VA441:
Nonresidential Property
Report the amount of recoveries on SC240, Construction Loans on: Nonresidential Property.
Permanent:
VA447:
1-4 Dwelling Units: Revolving, Open-End Loans
Report the amount of recoveries on SC251, Permanent: 1-4 Dwelling Units: Revolving, Open-End Loans.
VA457:
1-4 Dwelling Units: Secured By First Liens
Report the amount of recoveries on SC254, Permanent: 1-4 Dwelling Units: Secured By First Liens.
VA467:
1-4 Dwelling Units: Secured by Junior Liens
Report the amount of recoveries on SC255, Permanent: 1-4 Dwelling Units: Secured by Junior Liens.
VA471:
Multifamily (5 or More) Dwelling Units
Report the amount of recoveries on SC256, Permanent Mortgages on: 5 or More Dwelling Units.
VA481:
Nonresidential Property (Except Land)
Report the amount of recoveries on SC260, Permanent Mortgages on: Nonresidential Property (Except
Land).
VA491:
Land
Report the amount of recoveries on SC265, Permanent Mortgages on: Land.
Nonmortgage Loans
Report recoveries of nonmortgage loans and accrued interest receivable in the appropriate loan category
below.
VA57:
Total
The EFS software automatically generates this amount as the sum of VA521, VA511, VA517, 531, 541,
551, 557, and 561.
VA521: Commercial Loans
Report the amount of recoveries on Commercial Loans on SC300, Commercial Loans: Secured, SC303,
Commercial Loans: Unsecured, and SC306, Commercial Loans: Financing Leases.
SCHEDULE VA
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Consumer Loans
VA511:
Loans on Deposits
Report the amount of recoveries on SC310, Closed-End Consumer Loans: Loans on Deposits.
VA517:
Home Improvement Loans
Report the amount of recoveries on SC316, Closed-End Consumer Loans: Home Improvement Loans.
VA531:
Education Loans
Report the amount of recoveries on SC320, Closed-End Consumer Loans: Education Loans.
VA541:
Auto Loans
Report the amount of recoveries on SC323, Closed-End Consumer Loans: Auto Loans.
VA551:
Mobile Home Loans
Report the amount of recoveries on SC326, Closed-End Consumer Loans: Mobile Home Loans.
VA557:
Credit Cards
Report the amount of recoveries on SC328, Credit Cards.
VA561:
Other
Report the amount of recoveries on SC330, Consumer Loans: Other, Including Lease Receivables.
VA931: Other Assets
Report the amount of recoveries on all other financial assets that you did not include above. Include
recoveries on miscellaneous receivables that you reported on SC689, Other Assets.
Do not include:
1. Gains on the sale of REO. Report these gains on SO461, Operations and Sale of Repossessed
Assets.
2. Recoveries on deficiency judgments or other recoveries of loans foreclosed upon. Report these
recoveries as a recovery of the loan in the appropriate loan category above.
SPECIFIC VALUATION ALLOWANCE PROVISIONS & TRANSFERS
FROM GENERAL ALLOWANCES
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances during the quarter. This applies to any specific valuation
allowance activity with the exception of charge-offs and acquisitions.
The sum of VA38, 372, 48, 58, 62, 72, 822, and 932 must equal the sum of VA118 and 128.
VA38:
Deposits, and Investment Securities
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on all deposits and investment securities that you reported on
SC110 through SC191.
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VA372: Mortgage-Backed Securities
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC210 through SC228, Mortgage-Backed Securities.
Mortgage Loans:
Report the provision for loss established for specific valuation allowances and the transfers between
general valuation allowances of mortgage loans in the appropriate mortgage loan category below. You
should report specific valuation allowance activity of accrued interest receivable and advances for taxes
and insurance in the appropriate mortgage loan category of the related loan.
VA48:
Total
The EFS software automatically generates this amount as the sum of VA422, 432, 442, 452, 462, 472,
482, and 492.
Construction:
VA422:
1-4 Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC230, Construction Loans on: 1-4 Dwelling Units.
VA432:
Multifamily (5 or More) Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC235, Construction Loans on: 5 or More Dwelling Units.
VA442:
Nonresidential Property
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC240, Construction Loans on: Nonresidential Property.
Permanent:
VA448:
1-4 Dwelling Units: Revolving, Open-End Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC251, Permanent: 1-4 Dwelling Units: Revolving, Open-End
Loans.
VA458:
1-4 Dwelling Units: Secured By First Liens
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC254, Permanent: 1-4 Dwelling Units: Secured By First
Liens.
VA468:
1-4 Dwelling Units: Secured by Junior Liens
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC255, Permanent: 1-4 Dwelling Units: Secured by Junior
Liens.
SCHEDULE VA
411
MARCH 2010
VA472:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Multifamily (5 or More) Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC256, Permanent Mortgages on: 5 or More Dwelling Units.
VA482:
Nonresidential Property (Except Land)
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC260, Permanent Mortgages on: Nonresidential Property.
VA492:
Land
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC265, Permanent Mortgages on: Land.
Nonmortgage Loans
Report the provision for loss established for specific valuation allowances and the transfers between
general valuation allowances of mortgage loans in the appropriate nonmortgage loan category below.
You should report specific valuation allowance activity of accrued interest receivable in the related loan
category.
VA58:
Total
The EFS software automatically generates this amount as the sum of VA522, 512, 518, 532, 542, 552,
558, and 562.
VA522: Commercial Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC300, Commercial Loans: Secured, SC303, Commercial
Loans: Unsecured, and SC306, Commercial Loans: Financing Leases.
Consumer Loans
VA512:
Loans on Deposits
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC310, Closed-End Consumer Loans: Loans on Deposits.
VA518:
Home Improvement Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC316, Closed-End Consumer Loans: Home Improvement
Loans.
VA532:
Education Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC320, Closed-End Consumer Loans: Education Loans.
VA542:
Auto Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC323, Closed-End Consumer Loans: Auto Loans.
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VA552:
MARCH 2010
Mobile Home Loans
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC326, Closed-End Consumer Loans: Mobile Home Loans.
VA556:
Credit Cards
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC328, Credit Cards.
VA562:
Other
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC330, Consumer Loans: Other, Including Lease Receivables.
Repossessed Assets:
Report the provision for loss established for specific valuation allowances and the transfers between
general valuation allowances of repossessed assets after the date of foreclosure. Do not include
adjustments to mark repossessed assets to fair value at the date of foreclosure; these adjustments
should be charged off against the loan balance and reported on VA420 through VA560.
VA62:
Total
The EFS software automatically generates this amount as the sum of VA606, 614, 617, 626, 629, and
632.
Real Estate:
VA606:
Construction
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC405, Repossessed Assets: Real Estate: Construction.
VA614:
1-4 Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC415, Repossessed Assets: Real Estate: 1-4 Dwelling Units.
VA617:
Multifamily (5 or More) Dwelling Units
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC425, Repossessed Assets: Real Estate: 5 or More Dwelling
Units.
VA626:
Nonresidential (Except Land)
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC426, Repossessed Assets: Real Estate: Nonresidential
(Except Land).
VA629:
Land
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC428, Repossessed Assets: Real Estate: Land.
SCHEDULE VA
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VA632: Other Repossessed Assets
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC430, Other Repossessed Assets.
VA72:
Real Estate Held for Investment
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC45, Real Estate Held for Investment.
VA822: Equity Investments Not Subject to FASB Statement No. 115
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC51, Equity Investments Not Subject to FASB Statement No.
115.
VA932: Other Assets
Report the amount of provision for loss established for specific valuation allowances and the transfers
between general valuation allowances on SC689, Other Assets.
ADJUSTED NET CHARGE-OFFS
The EFS software automatically generates this column.
This column totals:
•
Charge-offs
•
Less Recoveries
• Plus specific valuation allowance provisions and transfers from general allowances
Therefore, this total represents adjusted net charge-offs.
OTHER ITEMS
TROUBLED DEBT RESTRUCTURED:
A troubled debt restructuring (TDR) occurs when you, as a creditor, for economic or legal reasons
related to the debtor’s financial difficulties, grant a concession to the debtor that you would not otherwise
consider. That concession either stems from an agreement between you and the debtor or is imposed by
law or a court. Whatever the form of concession you grant to the debtor, your objective is to make the
best of a difficult situation. Additionally, you expect to obtain more cash or other value from the debtor by
granting the concession than by not granting it.
You may accept any of the following when you restructure a troubled debt:
1. A note, secured or unsecured, from a third party as payment of your receivable from the
borrower.
2. The underlying collateral as payment of the loan, either through foreclosure, other title transfer, or
in-substance foreclosure.
3. Other assets in payment of a loan.
4. An equity interest in either the borrower or its assets in lieu of its receivable.
5. A modification of the debt terms, including, but not limited to the following:
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a. Reduction in stated interest rate.
b. Extension of maturity.
c. Reduction in the face amount of the debt.
d. Reduction in the accrued interest.
Include:
1. Restructured real estate loans that are equity investments under GAAP and that you reported on
SC45, Real Estate Held for Investment.
2. Restructured loans that you reported on SC230 through SC265 (Mortgage Loans) and SC300
through SC330 (Nonmortgage Loans).
3. Foreclosed assets that you reported on SC405 through SC430 (Repossessed Assets).
4. Troubled debt restructurings even if you recorded no losses this quarter, but had previous
charge-offs.
VA940: Amount this Quarter
Report the amount of new TDR this quarter. Report the recorded investment less specific valuation
allowances in the restructured asset after restructuring. The recorded investment is the outstanding
principal balance, adjusted for charge-offs and unamortized yield adjustments. The restructured asset
would comprise, for instance, a modified loan or foreclosed asset (if loss was incurred). Report all new
TDR even if you subsequently sold or otherwise disposed of the asset during the quarter.
VA942: Included in Schedule SC in Compliance with Modified Terms
Report the recorded investment of loans that have been modified in troubled debt restructurings, reduced
by specific valuation allowances, that remain on the books at the end of the quarter that are not past due
or in nonaccrual status, and, therefore, that you do not report in Schedule PD. Report such TDRs
regardless of the quarter in which the restructuring took place.
In general, you should continue to report loans as TDRs until they are paid off. However, you only need
to report a TDR that yields a market rate at issuance during the first year of the restructuring if the
borrower complies with the terms of the restructured contract.
Do not include repossessed assets acquired in troubled debt restructurings.
MORTGAGE LOANS FORECLOSED DURING THE QUARTER
Report the recorded investment less specific valuation allowances of mortgage loans foreclosed during
the quarter.
Include the types of mortgages that you reported on SC230 through SC265 and real estate loans that are
considered equity investments under GAAP that you reported on SC45, that you either foreclosed on and
acquired a voluntary deed in lieu of foreclosure or on which you performed an in-substance foreclosure
during the quarter.
Note: Even though foreclosed real estate loans that are considered equity investments under GAAP are
reported here as foreclosures, do not transfer them on Schedule SC to Repossessed Assets, SC405
through SC430. These foreclosures should remain in Real Estate Held For Investment, SC45.
Report all foreclosures during the quarter, even if you have sold or otherwise disposed of the property
since foreclosure.
Include:
1. Cancellations of real estate contracts or similar actions where you reacquire any property you
previously owned that you sold on contract or on installment basis.
SCHEDULE VA
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2. FHA/VA mortgage loans, other federally insured or guaranteed mortgage loans, or privately
insured mortgage loans that have been foreclosed, whether or not title has been subsequently
transferred to the insurer.
3. The portion of participations that you held at the time of foreclosure whether or not you were the
lead lender or initiated foreclosure proceedings.
4. Loans and participations that you sold with recourse and reacquired prior to foreclosure. If you
reacquired a loan and obtained a foreclosure judgment, in fact or in substance, in the same
quarter, report it as a purchase on CF280 through CF300, Loans and Participations Purchased,
and as a foreclosure on VA95.
Do not include:
1. Loans to which title reverted to the seller prior to foreclosure.
2. Loans serviced for others unless you reacquired the loan prior to foreclosure.
VA95:
Total
The EFS software will compute this line as sum of VA951 through VA955.
VA951: Construction
Report foreclosures during the quarter on loans that you previously reported on SC230 through SC240,
Mortgage Construction Loans, and SC450 through SC470, Real Estate Held for Investment.
Permanent Loans Secured By:
VA952:
1-4 Dwelling Units
Report foreclosures during the quarter on permanent mortgages secured by one-to-four dwelling unit
property that you previously reported on SC251 through SC255, Permanent Mortgages on 1-4 Dwelling
Units.
VA953:
Multifamily (5 or More Dwelling Units)
Report foreclosures during the quarter on permanent mortgages secured by five or more dwelling unit
property that you previously reported on SC256, Permanent Mortgages on Multifamily (5 or More)
Dwelling Units.
VA954:
Nonresidential (Except Land)
Report foreclosures during the quarter on permanent mortgages secured by nonresidential property that
you previously reported on SC260, Permanent Mortgages on: Nonresidential Property (Except Land).
VA955:
Land
Report foreclosures during the quarter on permanent mortgages secured by land that you previously
reported on SC265, Permanent Mortgages on Land.
CLASSIFICATION OF ASSETS
Report classified assets and assets designated special mention, net of related specific valuation
allowances, accumulated charge-offs, and recorded liabilities. Include off-balance-sheet items, such as
loan commitments, loans sold with recourse, and lines and letters of credit that you are required to
classify.
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End of Quarter Balances:
VA960: Special Mention
Report all assets, portions of assets, and off-balance-sheet items as of the end of the quarter that are not
classified but are designated as special mention pursuant to the Examination Handbook Section 260
and 12 CFR § 560.160.
VA965: Substandard
Report all assets, portions of assets, and off-balance-sheet items as of the end of the quarter classified as
substandard pursuant to the Examination Handbook Section 260 and 12 CFR § 560.160.
Assets classified Substandard may be characterized by an asset that is a deteriorating loan or an
investment that is nonperforming or nonearning. This includes REO, and nonperforming loans and
investments, including residual tranches of securities that are on nonaccrual status.
VA970: Doubtful
Report all assets, portions of assets, and off-balance-sheet items classified doubtful as of the end of the
quarter pursuant to the Examination Handbook Section 260 and 12 CFR § 560.160.
VA975: Loss
Report all assets, portions of assets, and off-balance-sheet items classified loss as of the end of the
quarter pursuant to Examination Handbook Section 260 and 12 CFR. § 560.160.
You should deduct any related specific valuation allowances, accumulated charge-offs, and recorded
liabilities prior to reporting the amount of assets classified loss. Accordingly, you should generally report
zero in this data field.
OTHER
VA979: Credit Card Charge-Offs Related to Accrued Interest
Report the amount of loss that you charged off on credit cards (SC328) due to accrued interest.
PURCHASED IMPAIRED LOANS HELD FOR INVESTMENT
ACCOUNTED FOR IN ACCORDANCE WITH AICPA SOP 03-3
(EXCLUDE LOANS HELD FOR SALE)
Report purchased impaired loans as defined by SOP 03-3 that your savings association has purchased,
including those acquired in a purchase business combination, when there is evidence of deterioration of
credit quality since the origination of the loan and it is possible, at the purchase date, that the savings
association will be unable to collect all contractually required payments receivable. SOP 03-3 does not
prohibit placing loans on nonaccrual status and any nonaccrual purchased impaired loans should be
reported accordingly in Schedule PD. For those purchased impaired loans that are not on nonaccrual
status, you should determine the loans’ delinquency status in accordance with the contractual repayment
terms of the loans without regard to the purchase price of (initial investment in) these loans or the amount
and timing of the cash flows expected at acquisition.
SCHEDULE VA
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VA980: Outstanding Balance (Contractual)
Report the outstanding balance of purchased impaired loans. The outstanding balance is the
undiscounted sum of all amounts, including amounts deemed principal, interest, fees, penalties, and other
under the loan, owed to the savings association at the report date, whether or not currently due and
whether or not any such amounts have been charged off by the savings association. However, the
outstanding balance does not include amounts that would be accrued under the contract as interest, fees,
penalties, and other after the report date.
VA981: Recorded Investment (Carrying Amount Before Deducting Any
Loan Loss Allowances)
Report the recorded investment (carrying amount before deducting any loan loss allowances) as of the
report date of the purchased impaired loans held for investment. Loans held for investment are those
loans that the savings association has the intent and ability to hold for the foreseeable future or until
maturity or payoff. Thus, the outstanding balance and recorded investment of any purchased impaired
loans that are held for sale would not be reported in these memorandum items.
VA985: Allowance Amount Included In Allowance for Loan and Lease
Losses (SC283, SC357)
Report the amount of post-acquisition loan loss allowances for purchased impaired loans held for
investment that is included in the total amount of the allowance for loan and lease losses as of the report
date.
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SCHEDULE PD – CONSOLIDATED PAST DUE
AND NONACCRUAL
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Report all loans and leases that you own that are contractually past due or are in nonaccrual status,
regardless of whether such loans are held for sale or are secured, unsecured, or guaranteed by the
Government or by others. Report the entire loan, not simply the amount of the delinquent payment. You
should report the balance of the recorded investment after deducting specific valuation allowances.
Recorded investment is the principal balance, adjusted for charge-offs and unamortized yield
adjustments.
PAST DUE
1. Do not take grace periods into account when determining past due status.
2. Report loans and lease financing receivables as past due when either interest or principal is unpaid
in the following circumstances:
a) Amortizing closed-end mortgage loans, closed-end nonmortgage installment loans, and any
other loans and lease financing receivables with:
i)
Payments scheduled monthly – when the borrower’s interest and/or principal amount is
past due thirty or more days (or one calendar month). For example, a loan payment is due
March 15th. At March 31, the loan is not a full month past due, so it would not be reported in
Schedule PD until after April 15th. On April 30 it would be 30 – 89 days past due.
ii)
Payments scheduled other than monthly – when one scheduled payment of interest
and/or principal is due and unpaid for 30 calendar days or more.
b) Open-end loans such as home equity loans, charge-card plans, check credit, and other revolving
credit plans when the customer has not made the minimum payment for two or more billing
cycles.
c) Single payment and demand notes providing for the payment of interest at stated intervals
(such as certain construction loans) after one interest payment is due and unpaid for 30 days or
more.
d) Single payment notes providing for the payment of interest at maturity if interest or principal
remains unpaid for 30 days or more after maturity.
e) Unplanned overdrafts if the account remains continuously overdrawn for 30 days or more.
SCHEDULE PD
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You have the option to use actual days as stated in the schedule headings in lieu of months when you
calculate the past due period.
Example using months (instead of actual days):
In this example, the payment is due on the first of the month and the first payment missed is the one due
March first.
Payment
Due Date
March 1
April 1
May 1
June 1
Payments
Missed
(one)
(two)
(three)
(four)
Actual Days
Overdue At
Month-End
30
60
91
121
Complete Months
Overdue At
Month-End
0
1
2
3
Past-Due
Category At
Month-End
Under 30 Days
30 - 89 Days
30 - 89 Days
90 Days or More
In the March TFR, you would not report this loan in Schedule PD. In the June TFR, you would report this
loan in either the 90 Days or More or Nonaccrual category.
Example using actual days:
In this example, the payment is due on the first of the month and the first payment missed is the one due
first.
Actual Days
Past-Due
Payment
Payments
Overdue At
Category At
Missed
Month-End
Month-End
Due Date
March 1
(one)
30
30 - 89 Days
April 1
(two)
60
30 - 89 Days
May 1
(three)
91
90 Days or More
June 1
(four)
121
90 Days or More
In the March TFR, you would report this loan the 30 - 89 Days category. In the June TFR, you would
report this loan in either the 90 Days or More or Nonaccrual category.
Partial Payments for Amortizing Closed-end Loans:
When borrowers make partial payments, they get credit for the amount of payment they make, so the
loan will generally not be reported as past due until two or more months of partial payments have been
made.
For example:
If the payment due were $100 and the borrower, due to a temporary condition, only paid $25 a month, the
loan would be $75 past due at the end of the first month, $150 past due the second month, and $225 past
due the third month.
If the loan were due on January 1, the loan would be $75 past due on February 1 (and February 28),
$150 past due on March 1 (and March 31), and $225 on April 1 (and April 30). On the March 31 TFR, the
loan would be more than 30 days delinquent and would be reported as 30-89 days past due on Schedule
PD.
Likewise, if the borrower paid $50 a month, the loan would be $50 past due on February 1 (and February
28), $100 past due on March 1 (and March 31), and $150 on April 1 (and April 30). Again, on the March
31 TFR, the loan would be 30 days delinquent and reported as 30-89 days past due.
However, if the borrower paid $51 a month, the loan would be $49 past due on February 1 (and February
28), $98 past due on March 1 (and March 31), and $147 on April 1 (and April 30). Therefore, on the
March 31 TFR, the loan would be less than 30 days delinquent and would not be reported as past due.
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MARCH 2010
Restructured loans:
You need not maintain a loan in nonaccrual status where you have formally restructured the loan so that
you are reasonably assured of repayment and of performance according to the modified terms, provided
the restructured loan is well secured and collection under the revised terms is probable. To determine
probability of collection, consider the borrower’s sustained historical repayment performance for a
reasonable period, which may take into account performance prior to restructuring. A sustained period of
repayment performance generally would equal a minimum of six months and would involve payments of
cash or cash equivalents.
Do not include:
1. Loans on which interest is being accrued for record-keeping purposes but not for reporting
purposes.
2. Accrued interest and advance payments of borrowers’ taxes and insurance unless they have
been capitalized to the loan balance.
3. Deductions for allowances for loan and lease losses (ALLL) or the assumed liability of wraparound loans applicable to such loans.
NONACCRUAL
Report loans on which you no longer accrue interest.
Interest does not accrue on:
1. An asset that you maintain on a cash basis due to the borrower’s deteriorating financial position.
2. An asset for which you do not expect to receive full payment of interest or principal.
3. An asset with principal or interest in default unless the value of the property securing the loan
exceeds the receivable balance, including principal, interest, and escrows, and collection is
probable.
MORTGAGE LOANS:
PD115, 215, AND 315:CONSTRUCTION
Report loans included on SC230 through SC240, Construction Loans.
Permanent, Secured by:
1-4 Dwelling Units:
PD121, PD221, and PD321: Revolving, Open-End Loans
Report past due and nonaccrual revolving, open-end mortgages on 1-4 dwelling units reported on SC251.
All Other:
PD123, PD223, and PD323: Secured by First Liens
Report past due and nonaccrual mortgages with a first lien on 1-4 dwelling units reported on SC254.
PD124, PD224, and PD324: Secured by Junior Liens
SCHEDULE PD
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Report past due and nonaccrual mortgages with a junior lien on 1-4 dwelling units reported on SC255.
PD125, 225, and 325:
Multifamily (5 or More) Dwelling Units
Report loans included on SC256, Permanent Mortgages on: Multifamily (5 or More) Dwelling Units.
PD135, 235, and 335:
Nonresidential Property (Except Land)
Report loans included on SC260, Permanent Mortgages on: Nonresidential Property (Except Land).
PD138, 238, and 338:
Land
Report loans included on SC265, Permanent Mortgages on: Land.
NONMORTGAGE LOANS AND LEASES:
PD140, 240, AND 340:
COMMERCIAL
Report loans and leases included on SC300 through SC306, Nonmortgage Loans: Commercial Loans.
CONSUMER LOANS:
PD161, 261, and 361: Loans on Deposits
Report loans included on SC310, Consumer Loans: Loans on Deposits.
PD163, 263, and 363: Home Improvement Loans
Report loans included on SC316, Consumer Loans: Home Improvement Loans.
PD165, 265, and 365: Education Loans
Report loans included on SC320, Consumer Loans: Education Loans.
PD167, 267, and 367: Auto Loans
Report loans included on SC323, Consumer Loans: Auto Loans.
PD169, 269, and 369: Mobile Home Loans
Report loans included on SC326, Consumer Loans: Mobile Home Loans.
PD171, 271, and 371: Credit Cards
Report past due and nonaccrual consumer credit cards reported on SC328
PD180, 280, and 380: Other
Report past due and nonaccrual consumer loans reported on SC330.
504
SCHEDULE PD
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
PD10, 20, AND 30:
MARCH 2010
TOTAL
The EFS software automatically computes these totals as the sum of PD115 through PD180 on PD10,
the sum of PD215 through PD280 on PD20, and the sum of PD315 through PD380 on PD30.
MEMORANDA:
PD190, 290, AND 390:
TROUBLED DEBT RESTRUCTURED
INCLUDED ABOVE
Report troubled debt restructurings that you included above in Schedule PD. Refer to the instructions for
VA942 for a discussion of troubled debt restructured. These lines plus the amount reported on VA942 will
equal the total troubled debt restructured included in your balance sheet as of the quarter end.
PD192, 292, AND 392:
LOANS AND LEASES REPORTED IN
PD115 – PD380 THAT ARE HELD FOR
SALE
Report loans and leases held for sale that are included above in Schedule PD.
PD195, 295, AND 395:
LOANS AND LEASES REPORTED IN
PD115 – PD380 THAT ARE WHOLLY OR
PARTIALLY GUARANTEED BY THE U.S.
GOVERNMENT, AGENCY, OR
SPONSORED ENTITY
Report the recorded investment included above in Schedule PD of past due or nonaccrual loans that are
wholly or partially recoverable from the U.S. Government, its agencies, and its government sponsored
entities.
PD196, 296, AND 396:
GUARANTEED PORTION OF OTHER
LOANS AND LEASES INCLUDED IN
PD195-PD395 (EXCLUDE REBOOKED
“GNMA LOANS”)
Report the guaranteed portion of loans (excluding rebooked “GNMA loans”) reported in PD195 through
PD395 above.
SCHEDULE PD
505
MARCH 2010
PD197, 297, AND 397
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
REBOOKED “GNMA LOANS”
REPURCHASED OR ELIGIBLE FOR
REPURCHASE INCLUDED IN
PD195 – PD395
Report the amount of “GNMA loans” repurchased or eligible for repurchase that are reported in PD195
through PD395 above.
LOANS IN PROCESS OF FORECLOSURE:
Report the amount of loans currently in process of foreclosure. Loans in process of foreclosure include
loans that have been issued a notice of default, or lis pendens, or notice of trustee sale, or notice of
foreclosure sale. Do not include loans where the foreclosure process has been completed (properties
that have been repurchased by your institution and taken into real estate owned).
PD415: Construction Loans
Report the amount of loans included in SC230, SC235, and SC240 that are currently in process of
foreclosure.
PD421: 1-4 Dwelling Units Secured by Revolving Open-End Loans
Report the amount of loans included in SC251 that are currently in process of foreclosure.
PD 423: 1-4 Dwelling Units Secured by First Liens
Report the amount of loans included in SC254 that are currently in process of foreclosure.
PD 424: 1-4 Dwelling Units Secured by Junior Liens
Report the amount of loans included in SC255 that are currently in process of foreclosure.
PD425: Multifamily (5 or More) Dwelling Units
Report the amount of loans included in SC256 that are currently in process of foreclosure.
PD 435: Nonresidential Property (Except Land)
Report the amount of loans included in SC260 that are currently in process of foreclosure.
PD 438: Land Loans
Report the amount of loans included in SC265 that are currently in process of foreclosure.
PD40: TOTAL
The EFS software automatically computes this total as the sum of PD415 through PD438.
506
SCHEDULE CC
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
SCHEDULE LD — CONSOLIDATED LOAN DATA
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
You should report on this schedule only information about your loans and those of your consolidated
subsidiaries. Do not include information of your holding company, affiliates, or unconsolidated
subsidiaries.
HIGH LOAN-TO-VALUE LOANS SECURED BY 1-4 AND
MULTIFAMILY PROPERTIES, WITHOUT PMI OR
GOVERNMENT GUARANTEE
Report data on 1-4 family and multifamily (5 or more dwelling units) real estate loans that meet both of the
following conditions:
•
The loan-to-value equals or exceeds 90 percent.
•
There is no private mortgage insurance (PMI) or government guarantee, such as FHA or VA.
For reporting high loan-to-value loans on this schedule, include small business loans secured by 1-4 and
multifamily residences classified as commercial loans on Schedule SC, as well as loans reported as
mortgages. The only 1-4 and multifamily real estate loans that you can exclude are those that the
borrower has otherwise substantially secured and where you take the mortgage as an abundance of
caution (for example secured auto loans), and where you have not made the terms more favorable than
they would have been in the absence of the real estate lien. Report all loans at recorded investment less
specific valuation allowances. See the instructions for mortgage loans in Schedule SC for a definition of
recorded investment. Note that the amount you report as the loan value may differ from the amount
used in the calculation of LTV as explained below.
You may exclude from this schedule loans that you intend to sell within 90 days from origination, without
recourse, to a financially responsible third party. However, you must include any uninsured, high LTV
loans originated for sale that are more than 90 days old.
SCHEDULE LD
601
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Include both permanent and construction loans secured by 1-4 and multifamily dwellings. Include
conventional construction loans that have been approved for PMI that will be effective when the loan
converts to a permanent loan, but where the construction loan is not yet covered by PMI.
In determining the LTV ratio, you must combine all loans secured by the same property regardless of
whether you classify the loan as a mortgage or consumer loan in Schedule SC. If you hold a junior lien,
you must include all liens senior to your lien in the LTV calculation, even if you do not hold all the
senior liens.
In calculating LTV, use the recorded investment of the loan as the numerator. Do not deduct specific
valuation allowances. If you have not yet disbursed the entire loan and you are legally bound to fund an
undisbursed commitment, for the numerator use the recorded investment plus the undisbursed
commitment, including letters of credit.
Use the borrower’s purchase price of the real estate or appraised value at origination, whichever is less,
for the denominator in the LTV calculation. Subsequent to origination if the real estate market has
changed significantly and the value of the real estate has increased, you may use a current market
valuation. You must support this valuation by a current appraisal or evaluation performed in accordance
with 12 CFR 564. However, if the value of the real estate has decreased, you may use the appraised
value at origination; we do not require that you use a lower current appraisal unless you have refinanced
the loan or disbursed additional funds. When the borrower has paid down his loan below 90% LTV, you
no longer have to report the loan in Schedule LD.
If you make an adjustable rate mortgage loan where the loan contract permits negative amortization when
interest rates rise, such that the loan could exceed 90 percent LTV, you do not need to report the loan as
a high LTV loan until the balance of the loan reaches 90 percent of the value of the property. See
definitions in 12 CFR § 560.101.
Example 1: You make a loan with a principal balance of $90,000 on the purchase of a house, with
deferred fees net of origination costs of $2,000. At origination the appraised value is $100,000. There is
no PMI on this loan. The recorded investment at origination is $88,000 ($90,000 less $2,000). Therefore,
at origination the LTV equals 88 percent and the loan is not reported as a high LTV loan in Schedule LD.
Example 2: You purchase a loan with a principal balance of $88,000 at a premium of $3,000. The
originator appraised the property at $100,000. Your recorded investment is $91,000 ($88,000 plus
$3,000), and thus the LTV is 91 percent. There is no PMI on this loan. You must include your recorded
investment in this loan in the 90 up to 100 LTV category.
Example 3: You make a legally binding commitment of $9 million on a construction loan on a project of
single-family homes, with a projected value at completion of $10 million. Therefore, the LTV equals 90
percent. There is no PMI on this loan. At the reporting date, you have disbursed $3 million on this loan;
this is the recorded investment. You must report the $3 million in the 90 up to 100 LTV category.
Example 4: You make an adjustable rate mortgage loan with a principal balance of $85 thousand on the
purchase of a house for $100 thousand. There is no PMI on this loan. The loan document guarantees
that the monthly payment will not exceed $750. The LTV at origination is 85 percent, and you, therefore,
do not report the loan as a high LTV loan. Interest rates rise to the point that, if you fully amortized the
loan, the loan payment would exceed $750. Each month you add the amount of the loan amortization in
excess of $750 to the recorded investment of the loan. In time, the recorded investment of the loan
reaches 90 percent. At that time, you must include the recorded investment of the loan in the 90 up to
100 LTV category.
BALANCES AT QUARTER-END:
Report the recorded investment less specific valuation allowances of all mortgages secured by 1-4 and
multifamily residential properties where the loan-to-value falls in the range indicated and that are not
covered by PMI or government guarantee.
602
SCHEDULE LD
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
If you hold junior and senior liens on the same property and the senior lien is covered by PMI but the
junior lien is a home equity loan that is not covered by PMI or government guarantee, report the recorded
investment of only the home equity loan. However, for purposes of calculating LTV, you include the
recorded investments of the first mortgage and the home equity loan and the undisbursed commitment of
the home equity loan as the numerator. If the first mortgage has an LTV less than 80% and therefore has
no PMI, you must combine it with junior liens on the same property on LD110 and LD120.
LD110:
90% up to 100% LTV : 1–4 Family
LD111:
90% up to 100% LTV: Multifamily
LD120:
100% and greater LTV: 1-4 Family
LD121:
100% and greater LTV: Multifamily
PAST DUE AND NONACCRUAL BALANCES:
Report the recorded investment less specific valuation allowances of all past due and nonaccrual
mortgages secured by 1-4 and multifamily residential properties, where the loan-to-value falls in the range
indicated and that are not covered by PMI or government guarantee. You should use the same
definitions of past due and nonaccrual that we provide in Schedule PD. If you have made multiple loans
on the same property, report only the loans that are past due.
Past Due and Nonaccrual Balances:
30 - 89 Days
LD210:
90% up to 100% LTV: 1-4 Family
LD211:
90% up to 100% LTV: Multifamily
LD220:
100% and greater LTV: 1-4 Family
LD221:
100% and greater LTV: Multifamily
90 Days or More:
LD230:
90% up to 100% LTV: 1-4 Family
LD231:
90% up to 100% LTV: Multifamily
LD240:
100% and greater LTV: 1-4 Family
LD241:
100% and greater LTV: Multifamily
SCHEDULE LD
603
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Nonaccrual:
LD250:
90% up to 100% LTV: 1-4 Family
LD251:
90% up to 100% LTV: Multifamily
LD260:
100% and greater LTV: 1-4 Family
LD261:
100% and greater LTV: Multifamily
CHARGE-OFFS AND RECOVERIES:
Net Charge-offs (including Specific Valuation Allowance Provisions &
Transfers from General to Specific Allowances):
We define net charge-offs as charge-offs from general valuation allowances, as reported on VA155, less
recoveries, as reported on VA135, plus specific valuation allowance provisions, as reported on VA118,
and transfers from general allowances, as reported VA128. This is also referred to as adjusted net
charge-offs. You also report adjusted net charge-offs on Schedule VA in the column beginning with
VA39. Include adjusted net charge-offs of all balances reportable on LD110 and LD 120 for 1-4 family
mortgages and LD111 and LD121 for multifamily mortgages. Include all charge-offs, recoveries and
specific valuation allowance activity on high loan-to-value 1-4 and multifamily. Report charge-offs and
recoveries that occurred during the quarter.
LD310:
90% up to 100% LTV: 1-4 Family
LD311:
90% up to 100% LTV: Multifamily
LD320:
100% and greater LTV: 1-4 Family
LD321:
100% and greater LTV: Multifamily
PURCHASES
Report the cost of all high loan-to-value loans secured by 1-4 and multifamily residential properties
purchased during the quarter from other entities. You should also report these purchases in Schedule
CF.
LD410:
90% up to 100% LTV: 1-4 Family
LD411:
90% up to 100% LTV: Multifamily
LD420:
100% and greater LTV: 1-4 Family
LD421:
100% and greater LTV: Multifamily
ORIGINATIONS
Report the amount disbursed for all high loan-to-value loans secured by 1-4 and multifamily residential
properties during the quarter. Note that you report all amounts net of loans-in-process (LIP), and report
additional disbursements in the quarter in which you make them. Use the definition of disbursements
found in the instructions as Schedule CF for the definition of originations in this schedule.
604
SCHEDULE LD
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
LD430:
90% up to 100% LTV: 1-4 Family
LD431:
90% up to 100% LTV: Multifamily
LD440:
100% and greater LTV: 1-4 Family
LD441:
100% and greater LTV: Multifamily
MARCH 2010
SALES
Report all high loan-to-value loans secured by 1-4 family residential properties and multi-family properties
sold to other entities or otherwise disposed of during the quarter. You should also report these sales in
Schedule CF.
LD450:
90% up to 100% LTV: 1-4 Family
LD451:
90% up to 100% LTV: Multifamily
LD460:
100% and greater LTV: 1-4 Family
LD461:
100% and greater LTV: Multifamily
SUPPLEMENTAL LOAN DATA FOR ALL LOANS
LD510: 1-4 DWELLING UNITS CONSTRUCTION-TO-PERMANENT
LOANS
Report the outstanding balance of all construction-to-permanent loans secured by 1-4 dwelling units, and
construction loans to the ultimate owner-occupant, that are reported in SC230, Construction loans on 1-4
Dwelling Units. Do not include loans to builders who plan to sell or rent after completion.
LD520: OWNER-OCCUPIED MULTIFAMILY PERMANENT LOANS
Report the outstanding balance of all owner-occupied multifamily permanent loans secured by 5 or more
dwelling units that are reported in SC256, Multifamily (5 or More) Dwelling Units.
The determination as to whether a multifamily property is considered “owner-occupied” should be made
upon acquisition (origination or purchase) of the loan. However, for purposes of determining whether
existing multifamily real estate loans should be reported as “owner-occupied”, the institution may consider
the source of repayment either when the loan was acquired or based on the most recent available
information. Once the institution determines whether a loan should be reported as “owner-occupied” or
not, this determination need not be reviewed thereafter.
Loans secured by owner-occupied multifamily properties are those multifamily property loans for which
the primary source of repayment is the cash flow from the ongoing operations and activities conducted by
the party, or an affiliate of the party, who owns the property. Thus, for loans secured by owner-occupied
multifamily properties, the primary source of repayment is not derived from third party, nonaffiliated, rental
income associated with the property (i.e., any such rental income is less than 50 percent of the source of
repayment) or the proceeds of the sale, refinancing, or permanent financing of the property.
SCHEDULE LD
605
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
LD530: OWNER-OCCUPIED NONRESIDENTIAL PROPERTY (EXCEPT
LAND) PERMANENT LOANS
Report the outstanding balance of all owner-occupied nonresidential property (except land) permanent
loans that are reported in SC260, Permanent Loans - Nonresidential Property (Except Land).
The determination as to whether a nonresidential property is considered “owner-occupied” should be
made upon acquisition (origination or purchase) of the loan. However, for purposes of determining
whether existing nonresidential real estate loans should be reported as “owner-occupied”, the institution
may consider the source of repayment either when the loan was acquired or based on the most recent
available information. Once the institution determines whether a loan should be reported as “owneroccupied” or not, this determination need not be reviewed thereafter.
Loans secured by owner-occupied nonresidential properties are those nonresidential property loans for
which the primary source of repayment is the cash flow from the ongoing operations and activities
conducted by the party, or an affiliate of the party, who owns the property. Thus, for loans secured by
owner-occupied nonresidential properties, the primary source of repayment is not derived from third party,
nonaffiliated, rental income associated with the property (i.e., any such rental income is less than 50
percent of the source of repayment) or the proceeds of the sale, refinancing, or permanent financing of
the property. Include loans secured by hospitals, golf courses, recreational facilities, and car washes
unless the property is owned by an investor who leases the property to the operator who, in turn, is not
related to or affiliated with the investor. Also include loans secured by churches unless the property is
owned by an investor who leases the property to the congregation.
LD610: 1-4 DWELLING UNITS OPTION ARM LOANS
Report the outstanding balance of all option ARM loans secured by 1-4 dwelling units that are reported in
SC251, Revolving, Open-End Loans on 1-4 Dwelling Units, SC254, First Liens, Closed-End on 1-4
Dwelling Units, and SC255, Junior Liens, Closed-End on 1-4 Dwelling Units.
Option ARMs loans generally represent adjustable rate mortgages where the borrower may have the
option to opt for a minimum payment or an interest only payment.
LD620: 1-4 DWELLING UNITS ARM LOANS WITH NEGATIVE
AMORTIZATION
Report the outstanding balance of all ARM loans with negative amortization secured by 1-4
dwelling units that are reported in SC251, Revolving, Open-End Loans on 1-4 Dwelling Units, SC254,
First Liens, Closed-End on 1-4 Dwelling Units, and SC255, Junior Liens, Closed-End on 1-4 Dwelling
Units.
LD650: TOTAL CAPITALIZED NEGATIVE AMORTIZATION
Report the total capitalized negative amortization included in the outstanding balances reported in LD620,
1-4 Dwelling Units ARM Loans with Negative Amortization.
CONSTRUCTION LOANS WITH CAPITALIZED INTEREST:
LD710: CONSTRUCTION LOANS ON 1-4 DWELLING UNITS WITH
CAPITALIZED INTEREST
Report the outstanding balance at quarter-end of all construction loans on 1-4 dwelling units with
capitalized interest that are reported in SC230, Construction Loans on 1-4 Dwelling Units.
606
SCHEDULE LD
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
LD715: CAPITALIZED INTEREST ON CONSTRUCTION LOANS ON 1-4
DWELLING UNITS INCLUDED IN CURRENT QUARTER
INCOME
Report the amount of capitalized interest included in LD710, Construction Loans on 1-4 Dwelling Units
with Capitalized Interest, that is included in current quarter income.
LD720: CONSTRUCTION LOANS ON MULTIFAMILY (5 OR MORE)
DWELLING UNITS WITH CAPITALIZED INTEREST
Report the outstanding balance at quarter-end of all construction loans on multifamily (5 or more) dwelling
units with capitalized interest that are reported in SC235, Construction Loans on Multifamily (5 or More)
Dwelling Units.
LD725: CAPITALIZED INTEREST ON MULTIFAMILY (5 OR MORE)
DWELLING UNITS WITH CAPITALIZED INTEREST INCLUDED
IN CURRENT QUARTER INCOME
Report the amount of capitalized interest included in LD720, Construction Loans on Multifamily (5 or
More) Dwelling Units with Capitalized Interest, that is included in current quarter income.
LD730: CONSTRUCTION LOANS ON NONRESIDENTIAL PROPERTY
WITH CAPITALIZED INTEREST
Report the outstanding balance at quarter-end of all construction loans on nonresidential property with
capitalized interest that are reported in SC240, Construction Loans on Nonresidential Property.
LD735: CAPITALIZED INTEREST ON CONSTRUCTION LOANS ON
NONRESIDENTIAL PROPERTY INCLUDED IN CURRENT
QUARTER INCOME
Report the amount of capitalized interest included in LD730, Construction Loans on Nonresidential
Property with Capitalized Interest, that is included in current quarter income.
COLLATERALIZED DEBT OBLIGATIONS (CDOS), COLLATERALIZED
LOAN OBLIGATIONS (CLOS), AND COMMERCIAL MORTGAGEBACKED SECURITIES (CMBSS):
CDOs, CLOs, and CMBSs are types of asset-backed securities and structured credit products. CDOs are
constructed from a portfolio of fixed-income assets that are pooled together and passed on to different
classes of owners. CLOs are structured from a portfolio of nonmortgage business loans that are pooled
together and passed on to different classes of owners.
CMBSs are structured from a portfolio of commercial mortgage loans that are pooled together and
passed on to different classes of owners.
The market values at the end of the reporting period for items LD755, LD765, and LD775 should be
estimated by your institution for the current interest rate environment. The market value estimates should
be consistent across quarters.
SCHEDULE LD
607
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
LD750: COLLATERALIZED DEBT OBLIGATIONS: CARRYING VALUE
LD755: COLLATERALIZED DEBT OBLIGATIONS: MARKET VALUE
LD760: COLLATERALIZED LOAN OBLIGATIONS: CARRYING VALUE
LD765: COLLATERALIZED LOAN OBLIGATIONS: MARKET VALUE
LD770: COMMERCIAL MORTGAGE-BACKED SECURITIES:
CARRYING VALUE
LD775: COMMERCIAL MORTGAGE-BACKED SECURITIES: MARKET
VALUE
608
SCHEDULE LD
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
SCHEDULE CC — CONSOLIDATED
COMMITMENTS AND CONTINGENCIES
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
COMMITMENTS OUTSTANDING
Report all commitments outstanding that will close in your name. In the case of securities held by an
agent, report commitments made on your behalf.
In reporting commitments to originate loans on CC280 through CC310, do not include the portion of
refinancings, including wrap-around loans, that will not involve your disbursing cash. Report only the
amount you will disburse. Do not report the gross commitment amount.
Report commitments to purchase or sell loans or securities on CC320 through CC375 on a gross basis.
Do not net commitments to sell against commitments to purchase, even if the commitments are for the
same or similar investments and even if no cash will be disbursed or received. For example, report a
commitment to swap mortgages for mortgage pool securities as a commitment to sell mortgages and
purchase mortgage pool securities, even though no cash will be involved in the transaction. Do not
include resale agreements accounted for as financings.
UNDISBURSED BALANCE OF LOANS CLOSED (LOANS-IN-PROCESS
EXCLUDING LINES OF CREDIT)
Report loan distributions on loans closed, but not disbursed.
Include:
1.
2.
3.
4.
All undisbursed amounts relating to construction loans reported on SC230, SC235, and SC240.
Loans disbursed according to a specified schedule or upon completion of specified terms.
Loans awaiting completion of certain contractual terms prior to disbursal.
Loans where you have executed the documents but have not yet disbursed loan proceeds.
Do not include:
1. The undisbursed portion of open-ended lines of credit, including home equity loans.
2. Borrower’s advances or deposits that are reported on SC710, Deposits, or SC783, Escrows.
SCHEDULE CC
701
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
CC105: Mortgage Construction Loans
Report undisbursed amounts (loans-in-process) on mortgage construction loans of the types reported on
SC230 through SC240.
CC115: Other Mortgage Loans
Report the undisbursed balance of closed-end permanent mortgage loans of the types reported on
SC254 through SC265.
CC125: Nonmortgage Loans
Report the undisbursed balance of closed-end nonmortgage loans of the types reported on SC300
through SC330.
TO ORIGINATE MORTGAGES SECURED BY
Report outstanding commitments made to builders, owners, or purchasers of real estate to originate
mortgage loans that will close in your name, classified by the type of property securing the loan.
CC280: 1-4 Dwelling Units
Report outstanding commitments to originate mortgage loans secured by 1-4 dwelling units. Include the
full amount committed for revolving lines of credit not yet closed that will be secured by 1-4 dwelling units.
Once the revolving line of credit has closed, report the unused line on CC412.
CC290: Multifamily (5 or More) Dwelling Units
Report outstanding commitments to originate mortgage loans secured by multifamily (5 or more) dwelling
units. Include unused lines of credit committed for revolving lines of credit secured by permanent
mortgages on multifamily (5 or more) dwelling units.
CC300: All Other Real Estate
Report outstanding commitments to originate mortgage loans on nonresidential property and land.
Include unused lines of credit committed for revolving lines of credit secured by permanent mortgages on
nonresidential property.
CC310: TO ORIGINATE NONMORTGAGE LOANS
Report outstanding commitments to originate nonmortgage loans that will close in your name.
CC320: TO PURCHASE LOANS
Report outstanding commitments to purchase whole mortgage and nonmortgage loans and participating
interests.
CC330: TO SELL LOANS
Report outstanding commitments to sell whole mortgage and nonmortgage loans and participating
interests.
702
SCHEDULE CC
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
TO PURCHASE OR SELL MORTGAGE-BACKED SECURITIES AND
INVESTMENT SECURITIES
Report all commitments to purchase mortgage-backed securities and investment securities whether or not
they are accounted for under SFAS Statement No. 133 (e.g., when-issued, regular-way trades, or normal
purchases and sales) on the appropriate line: CC335, CC355, CC365, or CC375. Report commitments
to purchase and sell when-issued securities that are accounted for as derivatives under SFAS Statement
No. 133 on a gross basis (except you may net purchases and sales of the identical security with the same
party). For example, report a GSE To-Be-Announced (TBA) mortgage-backed security where there is
expectation of physical delivery upon issuance of the security (regular-way trade) on CC335. Similarly,
report a GSE TBA where there is no expectation of delivery, and therefore, accounted for under SFAS
Statement No. 133 as a forward contract, also on CC335.
CC335: TO PURCHASE MORTGAGE-BACKED SECURITIES
Report outstanding commitments to purchase mortgage-backed securities of the types included on
SC210 through SC222.
CC355: TO SELL MORTGAGE-BACKED SECURITIES
Report outstanding commitments to sell mortgage-backed securities of the types included on SC210
through SC222.
CC365: TO PURCHASE INVESTMENT SECURITIES
Report outstanding commitments to purchase investment securities of the types reported on SC130
through SC185.
CC375: TO SELL INVESTMENT SECURITIES
Report outstanding commitments to sell investment securities of the types reported on SC130 through
SC185.
LINES AND LETTERS OF CREDIT:
UNUSED LINES OF CREDIT:
Report all unused lines of credit that you issue in connection with credit cards or open-end loans.
Unused lines of credit are defined as the difference between the amount authorized by contract and the
actual amount outstanding at quarter-end.
Do not include loans-in-process on constructions loans; report construction LIP on CC105.
CC412: Revolving Open-End Loans On 1-4 Dwelling Units
Report unused lines of credit on mortgage loans on 1-4 dwelling units for revolving, open-end loans
(home equity lines of credit) reported on SC251.
SCHEDULE CC
703
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
CC420: Commercial Lines
Report unused lines of credit on nonmortgage commercial loans reported on SC300, SC303, and SC306.
Open-End Lines:
CC423: Credit Cards-Consumer
Report unused lines of credit on consumer credit cards reported on SC328.
CC424: Credit Cards-Other
Report unused lines of credit on business credit cards reported on SC304.
CC425: Other
Report unused lines of credit on consumer loans reported on SC330, including credit extended to
individuals under prearranged overdraft plans.
LETTERS OF CREDIT
Report the undrawn portion of outstanding letters of credit at the end of the quarter. Do not report any
other type of commitment. Report most other types of commitments on CC280 through CC375.
There are two classifications of letters of credit:
1. A commercial letter of credit is one where the issuer expects to pay drafts or other demands for
payment.
2. A standby letter of credit is one where the issuer stands ready to pay in the unexpected event
that the customer defaults or fails to perform on the underlying contract with the third party.
Do not include unused lines of credit.
CC430: Commercial
Report the undrawn portion of commercial letters of credit.
CC435: Standby, Not Included on CC465 or CC468
Report the undrawn portion of all standby letters of credit not included on CC465 or CC468. Include both
collateralized and uncollateralized standby letters of credit.
RECOURSE OBLIGATIONS AND DIRECT CREDIT
SUBSTITUTES
If you have recourse obligations, residual interests, credit-enhancing interest-only strips, subordinated
securities, or direct credit substitutes, you should use the lines below to report these interests and the
amount of assets that they enhance.
You may find it helpful to review the definitions in 12 CFR 567.1. While that section does not include a
specific definition for subordinated securities, in context you should consider subordinated securities as a
type of direct credit substitute.
You also use these lines to report exposures arising through a nonsecurity financial instrument under
FASB Statement No. 140.
704
SCHEDULE CC
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
CC455: TOTAL PRINCIPAL AMOUNT OF ALL ASSETS COVERED BY
RECOURSE OBLIGATIONS OR DIRECT CREDIT
SUBSTITUTES
Report the outstanding principal balance of assets you enhance, fully or partially, by recourse obligations,
credit-enhancing interest-only strips, residual interests, subordinated securities, or direct credit
substitutes.
Include:
1. The full amount of assets enhanced by your recourse obligations, requiring you to absorb credit
losses on assets held by a third party.
Example: If you sell $1000 in loans, and agree to absorb the first 10% of losses, you report
$1000 on this line, and $100 on line CC468.
2. The full amount of assets enhanced by your residual interests.
Example: If you create and securitize a $1000 pool of loans and you sell $900 and retain a “first
loss” residual interest of $100, you report $1,000 on this line and $100 on line CC468.
3. The full amount of assets enhanced by your subordinated securities:
Example: If you buy a subordinated security in a senior/subordinated structure, the total structure
is $1,000, and your subordinated security is $200, you report $1,000 on this line and $200 on line
CC465.
4. The full amount of assets enhanced by your letters of credit, or other direct credit substitutes,
both collateralized and uncollateralized, to cover credit obligations of another party.
Example: If you provide a simple line of credit of $100 to another party, you report $100 on this
line, and $100 on line CC465.
Example: If you provide a line of credit of $100 to another party that is available to enhance the
other party’s “first loss” or otherwise subordinate obligation on a $1,000 loan pool, you report
$1000 on this line and $100 on line CC465.
5. Assets covered by recourse obligations even if the obligation is limited to 120 days or less.
Do not Include:
Positions subordinate to your own.
Example: If you have retained a $100 mezzanine “second loss” security in a $1000 pool of assets
that you have securitized or purchased and you have sold the $100 first loss security (subordinate to
your security) and the $800 security (senior to your security), you report $900 on this line and $100
on line CC468.
CC465: AMOUNT OF DIRECT CREDIT SUBSTITUTES ON ASSETS IN
CC455
Include the amount of direct credit substitutes, including purchased credit-enhancing interest-only strips,
purchased subordinated securities, and other similar exposures that you have purchased from another
party.
Report the face amount of the exposure, residual, or security that you have purchased from another
party, or the face amount of a letter of credit that you supply to another party. Refer to the examples in
item 4, CC455 above.
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CC468: AMOUNT OF RECOURSE OBLIGATIONS ON ASSETS IN
CC455
Include the amount of recourse obligations, as well as residuals, credit-enhancing interest-only strips, and
subordinated securities which arise from your own securitization activities.
Report the face amount of the exposure, residual, or security that arises from your own securitization
activities. Include letters of credit issued on behalf of affiliates or on behalf of any securitization trust that
you have created. Refer to the examples under CC455 above.
AMOUNT OF RECOURSE OBLIGATIONS ON LOANS IN CC468
WHERE RECOURSE IS LIMITED TO:
CC469: 120 DAYS OR LESS
Report the face amount of the exposure on loans included in CC468 where the recourse obligations
expire within 120 days or less.
CC471: GREATER THAN 120 DAYS
Report the face amount of the exposure on loans included in CC468 where the recourse obligations
expire beyond 120 days.
CC480:
OTHER CONTINGENT LIABILITIES
Report all contingent liabilities that you do not report elsewhere in this schedule or in Schedule SC.
CC490:
CONTINGENT ASSETS
Report all contingent assets not reported elsewhere in this schedule or Schedule SC.
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SCHEDULE CF — CONSOLIDATED CASH FLOW
INFORMATION
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
You should report on this schedule only the activity of you and your consolidated subsidiaries. Do not
include activity of your holding company, affiliates, or unconsolidated subsidiaries. Do not report as new
activity the following: bulk sales and purchases of loans and deposits, branch purchases and
sales, and assets and deposits acquired through a merger. In the case of a merger of depository
institutions, you should report activity for all institutions involved in the merger for the entire quarter. If
you have been acquired by a holding company where you used pushdown accounting, you should
report your activity for the entire quarter regardless of the date of acquisition.
MORTGAGE-BACKED SECURITIES
Report purchases and sales of securities included on SC210 through SC222, including those that you
purchased and sold during the same quarter.
PASS-THROUGH:
CF143: Purchases
Report the purchase price of mortgage-backed securities reported on SC210 and SC215 that you
purchased during the quarter.
CF145: Sales
Report the carrying value of mortgage pool securities reported on SC210 and SC215 that you sold during
the quarter.
CF148: Other Balance Changes
Report other balance changes of mortgage pool securities reported on SC210 and SC215. Include cash
repayments of principal, adjustments pursuant to FASB Statements 115 and 133, and amortization of
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discounts and premiums. Report as negative amounts decreases in the security balance, and as positive
amounts, increases in the security balance.
OTHER MORTGAGE-BACKED SECURITIES:
CF153: Purchases
Report the purchase price of mortgage-backed securities reported on SC217 through SC222 that you
purchased during the quarter.
CF155: Sales
Report the carrying value of mortgage-backed securities reported on SC217 through SC222 that you sold
during the quarter.
CF158: Other Balance Changes
Report other balance changes of mortgage-backed securities reported on SC217 through SC222.
Include cash repayments of principal, adjustments pursuant to FASB Statements No. 115 and No. 133,
and amortization of discounts and premiums. Report as negative amounts decreases in the security
balance, and as positive amounts, increases in the security balance.
MORTGAGE LOANS
MORTGAGE LOANS DISBURSED:
Report the amount disbursed for mortgage loans during the quarter. Note that you report all amounts net
of loans-in-process, LIP. Report additional disbursements in the quarter in which you make them.
Include:
1. All loans closed in your name. Report all loans closed, even if a third party funds the loans or you
immediately transfer the loans to a third party. Include loans whether or not you, an affiliate, or
another entity performs the actual closing. Do not report subsequent transfers to you from the
closing entity as purchases. This is because you already reported the loans as your originations.
2. Increases in loan balances of existing loans such as the following:
a. Disbursement of LIP.
b. Disbursement of a previously closed but undisbursed mortgage.
c. Negative amortizations.
d. Additional disbursements of home equity loans.
e. The amount disbursed for refinanced loans.
3. Combination construction-permanent loans both when the construction loan closes and when the
loan converts to permanent financing, even if you disburse no new funds.
4. All loans meeting the above definitions, even if you immediately securitize or sell the loans. Also
report these loans on CF310 through CF330.
Do not include:
1. Loans closed in the name of an affiliated unconsolidated entity. If you subsequently acquire
mortgages closed in the name of an affiliated unconsolidated entity, you should report the
acquisition as a purchase on CF280 through CF300.
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2. The undisbursed portion of construction and open-end home equity loans. Report as
contingencies on Schedule CC.
3. Mortgages closed by brokers under warehouse lines of credit where you closed the loans, but
disbursed no money. Report only as you disburse funds as described in item 2 under Include
above.
Construction Loans On:
CF190: 1-4 Dwelling Units
Report the amount of construction loans disbursed during the quarter of the type on SC230, Construction
Loans on 1-4 Dwelling Units.
Do not include:
Construction loans secured by condominium projects. Report on CF200.
CF200: Multifamily (5 or More) Dwelling Units
Report the amount of construction loans disbursed during the quarter of the type on SC235, Construction
Loans on 5 or More Dwelling Units.
Include:
Construction loans secured by apartment buildings including condominium and timeshare projects.
CF210: Nonresidential
Report the amount of construction loans disbursed during the quarter of the type on SC240, Construction
Loans on Nonresidential Property.
Permanent Loans On:
When a single loan provides permanent financing for more than one type of property, you should report
the entire loan in the data field describing the type of property representing the largest use of loan
proceeds.
CF225: 1-4 Dwelling Units
Report the amount of mortgage loans disbursed during the quarter of the type reported on SC251,
SC254, and SC255. Include the amounts disbursed for open-end home equity loans, revolving, open-end
loans secured by 1-4 dwelling units and extended under lines of credit.
CF226: Home Equity and Junior Liens
Report the amount of mortgage loans disbursed during the quarter included under CF225 that are of the
type reported on SC251 and SC255.
CF245: Multifamily (5 or More) Dwelling Units
Report the amount of mortgage loans disbursed during the quarter of the type reported on SC256,
permanent mortgages on multifamily residential property.
CF260: Nonresidential (Except Land)
Report the amount of mortgage loans disbursed during the quarter of the type on SC260, Permanent
Mortgages on Nonresidential Property (Except Land).
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CF270: Land
Report the amount of mortgage loans disbursed during the quarter of the type on SC265, Permanent
Mortgages on Land.
Include:
1. Developed building lots.
2. Land in the acquisition or development stage such as loans for making improvements required to
convert to developed building lots.
3. Unimproved land.
Do not include:
1. Land used for farming. Report on CF260.
2. Combination land and construction loans. Report on CF190 through CF210.
LOANS AND PARTICIPATIONS PURCHASED, SECURED BY:
Include:
The purchase price of mortgage loans and participations purchased from other entities after adjusting
for discounts, premiums, and LIP.
Do not include:
1. Transfers from an unconsolidated affiliate where you closed the loans in your name. Report as
mortgage loans disbursed when originated.
2. Acquisitions of mortgage-backed securities. Report on CF143 and CF153.
CF280: 1-4 Dwelling Units
Report loans and participations purchased during the quarter of the types on SC230, Construction Loans
on: 1-4 Dwelling Units, and SC251 through SC255, Permanent Mortgages on 1-4 Dwelling Units.
CF281: 1-4 Dwelling Units Purchased From Entities Other Than
Federally-Insured Depository Institutions or Their
Subsidiaries
Report loans and participations included in CF280 that were purchased from entities other than federallyinsured depository institutions or their subsidiaries during the quarter that are included under CF280 and
of the types on SC230, Construction Loans on: 1-4 Dwelling Units, and SC251 through SC255,
Permanent Mortgages on 1-4 Dwelling Units.
CF282: Home Equity and Junior Liens
Report loans and participations included in CF280 that are of the type reported on SC251 and SC255.
CF290: Multifamily (5 or More) Dwelling Units
Report loans and participations purchased during the quarter of the types on SC235, Construction Loans
on 5 or More Dwelling Units, and SC256, Permanent Mortgages on 5 or More Dwelling Units.
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CF300: Nonresidential
Report loans and participations purchased during the quarter of the types on SC240, Construction Loans
on Nonresidential Property, SC260, Permanent Mortgages on Nonresidential Property (Except Land), and
SC265, Permanent Mortgages on Land.
LOANS AND PARTICIPATIONS SOLD, SECURED BY:
Include:
1. The carrying value of mortgage loans and participations sold to other entities or otherwise
disposed of.
2. Securitized loans, both those sold and those you retain in your security portfolio. If you retain a
portion of a loan securitization, report that portion as an acquisition on CF143 or CF153.
CF310: 1-4 Dwelling Units
Report loans and participations sold during the quarter of the types on SC230, Construction Loans on 1-4
Dwelling Units, and SC251 through SC255, Permanent Mortgages on 1-4 Dwelling Units.
CF311: Home Equity and Junior Liens
Report loans and participations included under CF310 that are of the type reported on SC251 and
SC255.
CF320: Multifamily (5 or More) Dwelling Units
Report loans and participations sold during the quarter of the types on SC235, Construction Loans on 5
or More Dwelling Units, and SC256, Permanent Mortgages on 5 or More Dwelling Units.
CF330: Nonresidential
Report loans and participations sold during the quarter of the types on SC240, Construction Loans on
Nonresidential Property; SC260, Permanent Mortgages on Nonresidential Property (Except Land); and
SC265, Permanent Mortgages on Land.
CF361: MEMO: REFINANCING LOANS
Report the gross amount of refinanced or restructured mortgage loans during the quarter.
Include:
1. Both refinanced loans that you reported on CF190 through CF270 where the reporting
institution held the original mortgage and refinanced loans where another institution held the
original mortgage.
2. Any loan where the terms of the loan (principal, rate, or maturity) are modified, including TDRs.
3. The full amount of the new refinanced loan even though you report only the new amount
disbursed on CF190 through C270.
4. All loans refinanced this quarter, even if you disbursed no new funds; these loans will not be
reported on CF190 through CF270.
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CF365: MEMO: LOANS SOLD WITH RECOURSE 120 DAYS OR LESS:
Report the gross amount of loans sold during the quarter with recourse obligations of 120 days or less.
CF366: MEMO: LOANS SOLD WITH RECOURSE GREATER THAN 120
DAYS:
Report the gross amount of loans sold during the quarter with recourse obligations greater than 120 days.
NONMORTGAGE LOANS:
Report the amount disbursed for commercial and consumer nonmortgage loans and financing leases.
Include both loans originated by you and loans you purchased.
Include:
1. Disbursements made during the quarter on lines of credit.
2. Disbursements of LIP.
3. Disbursements made on loans even if the loans paid off or you sold them during the same quarter
– line-of-credit transactions and loans originated for sale.
Refer to the general instructions at the beginning of this schedule for reporting when there is a merger or
bulk acquisition.
COMMERCIAL:
CF390: Closed or Purchased
Report disbursements of loans and financing leases that you originated or purchased during the quarter
of the types on SC300 through SC306, Commercial Loans.
CF395: Sales
Report the carrying value of nonmortgage commercial loans you sold or otherwise disposed of during the
quarter. Include commercial loans that you securitized, including both those securities sold and those
retained in your portfolio.
CONSUMER:
CF400: Closed or Purchased
Report disbursements of loans and financing leases that you originated or purchased during the quarter
of the types on SC310 through SC330, Consumer Loans.
CF405: Sales
Report the carrying value of nonmortgage consumer loans sold or otherwise disposed of during the
quarter. Include consumer loans that have been securitized, including both those securities sold and
those retained in your portfolio.
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DEPOSITS
CF430: INTEREST CREDITED TO DEPOSITS
Report amount of interest and dividends credited during the quarter to accounts on SC710, Deposits.
In the case of a merger, include the following:
Merger with a savings association regulated by the OTS:
Report your combined interest credited and any from a savings association that you merged with for the
full quarter, regardless of whether you used the purchase or pooling method of accounting. This should
reflect the entire quarter’s interest credited regardless of the merger date.
Merger with depository institution not previously regulated by the OTS:
Do not report the interest credited by the acquired non-OTS depository institution before the merger date.
After the merger date, report your interest credited combined with the merged institution.
Do not include:
1. Interest paid out in cash.
2. Accrued interest reported on SC763, Accrued Interest Payable – Deposits.
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SCHEDULE DI — CONSOLIDATED DEPOSIT
INFORMATION
Throughout these instructions, you and your refers to the savings association and its consolidated
subsidiaries; we and our refers to the Office of Thrift Supervision.
DEPOSIT DATA:
TOTAL BROKER-ORIGINATED DEPOSITS:
DI100: Fully Insured
Report brokered deposits included on SC710, Deposits, and SC712, Escrows, and received from brokers,
dealers, or agents, for the account of others where the individual account balances are less than
$100,000. Include reciprocal brokered deposits reported in DI230 below.
DI102: Fully Insured
Report brokered deposits included on SC710, Deposits, and SC712, Escrows, and received from brokers,
dealers, or agents, for the account of others where the individual account balances are $100,000 through
$200,000. Include reciprocal brokered deposits reported in DI230 below.
DI110: Other
Report brokered deposits included on SC710, Deposits, and SC712, Escrows, received from brokers,
dealers, or agents, for the account of others where the individual account exceeds the account insurance
limit. Report the full amount of the deposit, both insured and uninsured portions. Include reciprocal
brokered deposits reported in DI230 below.
DI114: INTEREST EXPENSE FOR FULLY INSURED BROKERED
DEPOSITS
Report interest expense for fully insured brokered deposits.
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DI116: INTEREST EXPENSE FOR OTHER BROKERED DEPOSITS
Report interest expense for other brokered deposits. Based on the FDIC definition of deposits in Section
3(l), each institution must complete lines DI120 through DI185, DI210, DI510, DI520, and DI530 on an
unconsolidated single FDIC certificate number basis. Each separately chartered depository institution that
is insured by the FDIC has a unique FDIC certificate number. When an insured institution owns another
depository institution as a subsidiary, each institution should report only its own deposit liabilities in this
section (i.e., the parent institution should not combine the subsidiary institution’s deposit liabilities with its
own in this section). Each of the above referenced lines should also include accrued interest that is
reported on SC763 and exclude unposted debits and unposted credits.
The sum of DI120, DI130, DI170, and DI175 must equal the institution’s assessable deposits, i.e. line
DI510, less DI520.
DEPOSITS (EXCLUDING RETIREMENT ACCOUNTS) WITH BALANCES:
DI120: $250,000 or Less
Report deposits (excluding retirement accounts) included on SC710, Deposits, and SC712, Escrows, and
SC763, Accrued Interest Payable-Deposits, with current balances of $250,000 or less. Include brokeroriginated deposits (excluding retirement accounts) where the current balances of the investors’
participating shares are $250,000 or less.
DI130: Greater than $250,000
Report deposits (excluding retirement accounts) included on SC710, Deposits, and SC712, Escrows, and
SC763, Accrued Interest Payable-Deposits, with current balances greater than $250,000. Include brokeroriginated deposits (excluding retirement accounts) where the current balances of the investors’
participating shares exceed $250,000.
NUMBER OF DEPOSIT ACCOUNTS (EXCLUDING RETIREMENT
ACCOUNTS) WITH BALANCES:
DI150: $250,000 or Less
Report the actual number of accounts (excluding retirement accounts) that have outstanding balances
including accrued interest of $250,000 or less. Do not report the outstanding balances. Report each
investor participation in a broker-originated deposit (excluding retirement accounts) as a separate
account. Report the actual number; do not round to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you
hold and that you report on SC710, Deposits, and SC712, Escrows.
DI160: Greater than $250,000
Report the actual number of accounts (excluding retirement accounts) that have outstanding balances
including accrued interest greater than $250,000. Do not report the outstanding balances. Report each
investor participation in a broker-originated deposit as a separate account. Report the actual number; do
not round to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you
hold and that you report on SC710, Deposits, and SC712, Escrows.
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RETIREMENT DEPOSITS WITH BALANCES:
DI170: $250,000 or Less
Report retirement deposits included on SC710, Deposits, and SC712, Escrows, and SC763, Accrued
Interest Payable-Deposits, with current balances of $250,000 or less. Include broker-originated deposits
where the current balances of the investors’ participating shares are $250,000 or less.
DI175: Greater than $250,000
Report retirement deposits included on SC710, Deposits, and SC712, Escrows, and SC763, Accrued
Interest Payable-Deposits, with current balances greater than $250,000. Include broker-originated
deposits where the current balances of the investors’ participating shares exceed $250,000.
NUMBER OF RETIREMENT DEPOSIT ACCOUNTS WITH BALANCES:
DI180: $250,000 or Less
Report the actual number of retirement accounts that have outstanding balances including accrued
interest of $250,000 or less. Do not report the outstanding balances. Report each investor participation
in a broker-originated retirement deposit as a separate account. Report the actual number; do not round
to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you
hold and that you report on SC710, Deposits, and SC712, Escrows.
DI185: Greater than $250,000
Report the actual number of retirement accounts that have outstanding balances including accrued
interest greater than $250,000. Do not report the outstanding balances. Report each investor
participation in a broker-originated retirement deposit as a separate account. Report the actual number;
do not round to thousands.
The sum of DI150, DI160, DI180, and DI185 must equal the total number of deposit accounts that you
hold and that you report on SC710, Deposits, and SC712, Escrows.
DI200: IRA/KEOGH ACCOUNTS
Report IRA and Keogh accounts included in SC710, Deposits, and SC712, Escrows.
Include other retirement accounts such as SEP accounts.
Do not include:
1. 401(k) accounts.
2. Accounts that, under applicable tax laws, are predominantly for uses other than retirement.
DI210: UNINSURED DEPOSITS
Institutions with less than $1 billion in total assets are not required to complete this item. Institutions with
$1 billion or more in total assets are required to report these data on a unconsolidated single FDIC
certificate number basis. To determine whether to complete this item, use your institution's total assets
from line SC60 as of the June 30 TFR prior to or current with the current reporting cycle. Once an
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institution passes the $1 billion total assets threshold, it must continue to report its estimated uninsured
deposits regardless of subsequent changes in its total assets. Report the uninsured portion of all
deposits and escrows in excess of insured limits pursuant to Section 141 of the FDIC Improvement Act,
FDICIA.
You may not be able to precisely determine the amount of uninsured deposits due to the lack of
information about interests by other parties in certain deposit accounts. However, you should diligently
seek the best estimate of your uninsured deposits. You should derive the estimate from your existing
information systems or personal knowledge of your depositor base.
The estimated amount of uninsured deposits reported in this item should be based on the institution’s
deposits included in Schedule DI, line DI510, “Total deposit liabilities before exclusions (gross) as defined
in Section 3(1) of the Federal Deposit Insurance Act and FDIC regulations,” less line DI520, “Total
allowable exclusions (including foreign deposits)”. In addition to the uninsured portion of deposits in
“domestic offices” reported in Schedule SC, line SC71, the estimate of uninsured deposits should take
into account all other items included in Schedule DI, line DI510 less line DI520, including, but not limited
to:
•
Interest accrued and unpaid on deposits in domestic offices;
•
Deposits in insured branches in Puerto Rico and U.S. territories and possessions (including
interest accrued and unpaid on these deposits);
•
Deposits on consolidated subsidiaries in domestic offices and in insured branches in Puerto Rico
and U.S. territories and possessions (including interest accrued and unpaid on these deposits);
and
•
Deposit liabilities that have been reduced by assets netted against these liabilities in accordance
with generally accepted accounting principles.
DI220: PREFERRED DEPOSITS
Report all deposits and escrows from states and political subdivisions in the U.S. included in SC710,
Deposits, secured or collateralized as required under state law, pursuant to Section 141 of FDICIA.
Do not include:
1. Deposits of the U.S. Government secured or collateralized as required under federal law.
2. Deposits of trust funds secured or collateralized as required under state law unless the
beneficiary is a state or political subdivision in the U.S.
State law may require you to pledge securities or other readily marketable assets to cover the uninsured
portion of the deposits of a state or political subdivision. If you pledge securities with a value that
exceeds the amount of the uninsured portion of the state or political subdivision’s deposits, report only the
uninsured amount and none of the insured portion of the deposits as a preferred deposit.
For example, you hold a political subdivision’s $350,000 in deposits. Under state law, you must pledge
securities to cover only the uninsured portion of such deposits, or $250,000. Although you have pledged
securities with a value of $300,000 to secure these deposits, consider only $250,000 of the political
subdivision’s $350,000 in deposits – the uninsured amount – as preferred deposits.
In other states, you must participate in a state public deposits program to receive deposits from the state
or from political subdivisions within the state in amounts exceeding federal deposit insurance. Under
state law, you calculate annually the value of the securities you must pledge to the state, but this
represents only a percentage of the uninsured portion of your public deposits. State law may require you
to participate in the state program that may ultimately require you to share in any loss to public depositors
incurred in the failure of another participating institution.
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As long as the value of the securities pledged to the state exceeds the calculated requirement, you
protect all of your uninsured public deposits from loss under the operation of the state program if you fail.
Therefore, consider all of the uninsured public deposits preferred deposits.
For example, you are participating in a state public deposits program with $1,000,000 in public deposits
under the program and $700,000 of this amount is uninsured; you pledge securities with an actual value
of $800,000. You should report the $700,000 in uninsured public deposits as preferred deposits.
DI230:
RECIPROCAL BROKERED DEPOSITS
Report the total amount of reciprocal deposits included in “Total Broker-Originated Deposits” from Lines
DI100 and DI110 above. Report the data on an unconsolidated single FDIC certificate number basis
pursuant to the first paragraph under GENERAL INSTRUCTIONS in the DEPOSIT DATA FOR DEPOSIT
INSURANCE PREMIUM ASSESSMENTS section.
As defined in Section 327.8(s) of the FDIC’s regulations, “reciprocal deposits” are “[d]eposits that
an insured depository institution receives through a deposit placement network on a reciprocal
basis, such that; (1) for any deposit received, the institution (as agent for depositors) places the same
amount with other insured depository institutions through the network; and (2) each member of the
network sets the interest rate to be paid on the entire amount of funds it places with other network
members.”
COMPONENTS OF DEPOSITS AND ESCROWS:
The sum of DI310, DI320, DI330, and DI340 must equal SC710 plus SC712.
DI310: Transaction Accounts (Including Demand Deposits)
Report the balance of all transaction accounts included in SC710, Deposits, and SC712, Escrows.
Transaction accounts are those deposit and escrow accounts from which the depositor is permitted to
make:
•
Transfers or withdrawals by negotiable or transferable instruments.
•
Payment orders of withdrawal, telephone transfers, or other similar devices for purpose of making
payments or transfers to third persons or others.
•
Third party payments at an automated teller machine (ATM), a remote service unit (RSU), or
other electronic device, including by debit card.
Transaction accounts include demand deposits, NOW (negotiable order of withdrawal) accounts, ATS
(automatic transfer service) accounts, and telephone and preauthorized transfer accounts. These
accounts may be interest-bearing or non-interest-bearing.
Exclude money market deposit accounts (MMDAs) and other savings deposits as defined below in DI320
and DI330, even though such deposits permit some third-party transfers. However, report as a
transaction account an account that otherwise meets the definition of a savings deposit but that
authorizes or permits the depositor to exceed the transfer limitations specified for that account.
DI310 plus DI320 plus DI330 plus DI340 must equal SC710 plus SC712.
DI320: Money Market Deposit Accounts
Report the balance of money market deposit accounts (MMDAs) as defined in 12 CFR §561.28 or
applicable state law.
MMDAs generally have the following requirements:
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•
The savings association reserves the right to require at least seven days’ notice prior to
withdrawal or transfer of funds in the account.
•
The depositor may make no more than six transfers per calendar month or statement cycle,
provided that no more than three of the six transfers may be by check, draft, debit card, or similar
order.
Refer to 12 CFR §561.28 for more detailed requirements of MMDAs.
DI330: Passbook Accounts (Including Nondemand Escrows)
Report the balance of nontransactional savings accounts that are not MMDAs or time deposits.
DI340: Time Deposits
Report the balance of time deposits. Time deposits are nontransactional savings deposits payable at a
specified future date with earnings at a specified rate of interest. The interest specified may adjust
periodically according to a predetermined formula or index or may be fixed for the term of the deposit.
The specified maturity date must be not less than seven days after the date of the deposit. Time deposits
may be an open savings deposit or may be evidenced by a negotiable or nonnegotiable instrument or
receipt commonly known as a certificate of deposit (CD). Open time deposits include club accounts, such
as Christmas club and vacation club accounts, are made under written contracts that provide that no
withdrawal may be made until the customer makes a certain number of periodic deposits or a certain
period of time has elapsed.
Time deposits issued to deposit brokers in the form of large ($100,000 or more) certificates of deposit that
have been participated out by the broker in shares of less than $100,000 should also be reported as
deposits of $100,000 or less.
Data reported in lines DI350 and DI360 are used by the Federal Reserve to ensure
accurate construction of the monetary aggregates for monetary policy purposes.
DI350: Time Deposits of $100,000 through $250,000 (Excluding
Brokered Time Deposits Participated Out by the Broker in
Shares of Less Than $100,000 and Brokered Certificates of
Deposit Issued In $1,000 Amounts Under a Master Certificate
of Deposit)
Report the balance of time deposits of $100,000 through $250,000. Do not include brokered time
deposits participated out by the broker in shares of less than $100,000 and brokered certificates of
deposit issued in $1,000 amounts under a master certificate of deposit.
DI352: TIME DEPOSITS GREATER THAN $250,000
Report the balance of time deposits greater than $250,000.
DI360: IRA/Keogh Accounts of $100,000 or Greater Included in Time
Deposits
Report the balance of IRA / Keogh accounts of $100,000 or greater included in time deposits.
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AVERAGE DAILY DEPOSITS TOTALS:
DI544: Report the average daily deposits totals for fully insured
brokered time deposits.
DI545: Report the average daily deposits totals for other brokered
time deposits.
DI610: NON-INTEREST-BEARING DEMAND DEPOSITS
Report all demand deposits reported on SC710, Deposits, and SC712, Escrows. FDIC Regulations 12
CFR § 329.1, 329.101, and 329.102 define the demand deposits to report on this line.
A demand deposit is a non-interest-bearing deposit with the following characteristics:
1. Is payable immediately on demand.
2. Is issued with an original maturity or required notice period of less than seven days.
3. Where the depository institution does not reserve the right to require at least seven days’ written
notice of an intended withdrawal.
Demand deposits include:
1. Matured time deposits that do not have automatic renewal provisions, unless the deposit
agreement provides for the transfer of funds at maturity to another type of account.
2. Escrow accounts reported on SC712 that meet the definition of demand deposits.
3. Outstanding checks drawn against zero-balance accounts reported on SC710, including those at
Federal Home Loan Banks.
Demand deposits do not include:
1. Money market deposit accounts, MMDAs.
2. NOW accounts not meeting the three criteria listed above for demand deposits.
3. Deposits held either in branches outside of the territories and possessions of the U.S. or by an
Edge or Agreement Subsidiary or by an International Banking Facility (IBF).
4. Amounts not included in SC710 or SC712, such as outstanding checks drawn against Federal
Home Loan Banks.
DEPOSIT DATA FOR DEPOSIT INSURANCE PREMIUM
ASSESSMENTS
GENERAL INSTRUCTIONS
Each institution must complete lines DI510, DI520, DI530, DI630, DI635, DI641, DI645, DI651, DI655,
and DI660 on an unconsolidated single FDIC certificate number basis. Each separately chartered
depository institution that is insured by the FDIC has a unique FDIC certificate number. When an insured
institution owns another depository institution as a subsidiary, each institution should report only its own
deposit liabilities in this section (i.e., the parent institution should not combine the subsidiary institution’s
deposit liabilities with its own in this section).
In addition, an institution that meets one of the criteria discussed below must complete lines DI540,
DI550, and DI560 on an unconsolidated single FDIC certificate number basis each quarter.
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Effective March 31, 2008, an institution that (a) reported $1 billion or more in total assets as of the
March 31, 2007, report date (regardless of its asset size in subsequent quarters) or (b) became insured
by the FDIC on or after April 1, 2007, but before January 1, 2008, must report both quarter-end balances
and daily averages for the quarter in this section of Schedule DI. In addition, an institution that meets one
of the following criteria must report both quarter-end deposit totals and daily averages in Schedule DI:
1. If an institution reports $1 billion or more in total assets in two consecutive Thrift Financial
Reports subsequent to its March 31, 2007, report, the institution must begin reporting both
quarter-end balances and daily averages for the quarter beginning on the later of the March 31,
2008, report date or the report date six months after the second consecutive quarter in which it
reports total assets of $1 billion or more. For example, if an institution reports $1 billion or more in
total assets in its reports for June 30 and September 30, 2007, it would have to begin reporting
daily averages in its report for March 31, 2008. If the institution reports $1 billion or more in total
assets in its reports for December 31, 2008, and March 31, 2009, it would have to begin reporting
daily averages in its report for September 30, 2009.
2. If an institution becomes newly insured by the FDIC on or after January 1, 2008, the institution
must report daily averages in Schedule DI beginning in the first quarterly Thrift Financial Report
that it files. The daily averages reported in the first report the institution files after becoming
FDIC-insured would include the dollar amounts for the days since the institution began operations
and zero for the days prior to the date the institution began operations, effectively pro-rating the
first quarter’s assessment base.
Any institution that reports less than $1 billion in total assets in its March 31, 2007, report may continue to
report only quarter-end total deposits and allowable exclusions until it meets the two-consecutive-quarter
asset size test for reporting daily averages. Alternatively, the institution may opt permanently at any time
to begin reporting daily averages for purposes of determining its assessment base. After an institution
begins to report daily averages for its total deposits and allowable exclusions, either voluntarily or
because it is required to do so, the institution is not permitted to switch back to reporting only quarter-end
balances.
The amounts to be reported as daily averages are the sum of the gross amounts of total deposits
(domestic and foreign) and allowable exclusions for each calendar day during the quarter divided by the
number of calendar days in the quarter (except as noted above for an institution that becomes insured on
or after January 1, 2008, in the first report it files after becoming insured). For days that an office of the
reporting institution (or any of its subsidiaries or branches) is closed (e.g., Saturdays, Sundays, or
holidays), the amounts outstanding from the previous business day would be used. An office is
considered closed if there are no transactions posted to the general ledger as of that date.
DI510: TOTAL DEPOSIT LIABILITIES BEFORE EXCLUSIONS
(GROSS) AS DEFINED IN SECTION 3(L) OF THE FEDERAL
DEPOSIT INSURANCE ACT AND FDIC REGULATIONS
Report on an unconsolidated single FDIC certificate number basis the gross total deposit liabilities as of
the calendar quarter-end report date that meet the statutory definition of deposits in Section 3(l) of the
Federal Deposit Insurance Act before deducting exclusions from total deposits that are allowed in the
determination of the assessment base upon which deposit insurance assessments (and FICO premiums)
are calculated. Since the FDIC’s amendments to its assessment regulations in 2006 did not substantially
change the definition of deposits for assessment purposes, an institution’s gross total deposit liabilities
are the combination of all deposits reported in line SC710 (excluding unposted credits net of unposted
debits), all escrows reported in line SC712, and accrued interest payable on deposits reported in line
SC763.
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An institution’s documentation to support the amounts reported for purposes of determining its
assessment base has always been, and continues to be, subject to verification. This documentation
includes the actual system control summaries in the institution’s systems that provide the detail sufficient
to track, control, and handle inquiries from depositors about their specific individual accounts. These
systems can be automated or manual. If the system control summaries have been reduced by accounts
that are overdrawn, these overdrawn accounts are extensions of credit that must be treated and reported
as "loans" rather than being treated as negative deposit balances.
Unposted debits and unposted credits should not be included in an institution’s system control
summaries. However, if they are included in the gross total deposit liabilities reported in this line, they
may be excluded in line DI520 below.
DI520: TOTAL ALLOWABLE EXCLUSIONS (INCLUDING FOREIGN
DEPOSITS)
Report, on an unconsolidated single FDIC certificate number basis, the total amount of allowable
exclusions from deposits as of the calendar quarter-end report date if the institution maintains such
records as will readily permit verification of the correctness of its reporting of exclusions. Any accrued and
unpaid interest on the allowable exclusions listed below should also be reported in this item as an
allowable exclusion.
The allowable exclusions include:
1. Foreign Deposits: As defined in Section 3(l)(5) of the Federal Deposit Insurance Act, foreign
deposits include
(A) any obligation of a depository institution which is carried on the books and records of an
office of such bank or savings association located outside of any State, unless -(i) such obligation would be a deposit if it were carried on the books and records of the
depository institution, and would be payable at, an office located in any State; and
(ii) the contract evidencing the obligation provides by express terms, and not by
implication, for payment at an office of the depository institution located in any State;
and
(B) any international banking facility deposit, including an international banking facility time
deposit, as such term is from time to time defined by the Board of Governors of the
Federal Reserve System in regulation D or any successor regulation issued by the Board
of Governors of the Federal Reserve System.
NOTE: Foreign deposits are deposit obligations under the FDIC certificate number of the
reporting institution only. Deposit obligations of a subsidiary depository institution chartered
in a foreign country should not be included in amounts reported in Schedule DI under the
domestic institution’s FDIC certificate number.
2. Reciprocal balances: Any demand deposit due from or cash item in the process of collection due
from any depository institution (not including a foreign bank or foreign office of another U.S.
depository institution) up to the total amount of deposit balances due to and cash items in the
process of collection due such depository institution.
3. Drafts drawn on other depository institutions: Any outstanding drafts (including advices and
authorization to charge the depository institution’s balance in another bank) drawn in the regular
course of business by the reporting depository institution. These types of drafts only apply to
unposted debits and unposted credits which have not been extracted from SC710 (due to the
institution’s system control Summaries).
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4. Pass-through reserve balances: Reserve balances passed through to the Federal Reserve by
the reporting institution that are also reflected as deposit liabilities of the reporting institution. This
exclusion is not applicable to an institution that does not act as a correspondent bank in any
pass-through reserve balance relationship. A state nonmember bank generally cannot act as a
pass-through correspondent unless it maintains an account for its own reserve balances directly
with the Federal Reserve.
5. Depository institution investment contracts: Liabilities arising from depository institution
investment contracts that are not treated as insured deposits under section 11(a)(5) of the
Federal Deposit Insurance Act (12 U.S.C. 1821(a)(5)). A Depository Institution Investment
Contract is a separately negotiated depository agreement between an employee benefit plan and
an insured depository institution that guarantees a specified rate for all deposits made over a
prescribed period and expressly permits benefit-responsive withdrawals or transfers.
6. Accumulated deposits: Deposits accumulated for the payment of personal loans that are
assigned or pledged to assure payment of the loans at maturity. Deposits that simply serve as
collateral for loans are not an allowable exclusion.
DI530: TOTAL FOREIGN DEPOSITS (INCLUDED IN TOTAL
ALLOWABLE EXCLUSIONS)
Report on an unconsolidated single FDIC certificate number basis the total amount of foreign deposits
(including International Banking Facility deposits) as of the calendar quarter-end report date included in
line DI520.
DI630: UNSECURED FEDERAL FUNDS PURCHASED
Report on an unconsolidated single FDIC certificate number basis the outstanding amount of unsecured
federal funds purchased, i.e., immediately available funds borrowed (in domestic office) under
agreements or contracts that have an original maturity of one business day or roll over under a
continuing contract, excluding such funds borrowed in the form of securities sold under agreements to
repurchase (which should be reported in Schedule DI641 and Federal Home Loan Bank advances.
Note:
•
Immediately available funds are funds that the purchasing institution can either use or
dispose of on the same business day that the transaction giving rise to the receipt or disposal
of the funds is executed.
•
A continuing contract, regardless of the terminology used, is an agreement that remains in
effect for more than one business day, but has no specified maturity and does not require
advance notice of the lender or the borrower to terminate, either party to terminate.
Report federal funds purchased on a gross basis; i.e., do not net them against federal funds sold,
except to the extent permitted under FASB Interpretation No. 39.
DI635: SECURED FEDERAL FUNDS PURCHASED
Report on an unconsolidated single FDIC certificate number basis the outstanding amount of secured
federal funds purchased pursuant to the instructions under Schedule DI630 for unsecured federal funds
purchased.
DI641: SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE
Report on an unconsolidated single FDIC certificate number basis the outstanding amount of:
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(1)
Securities repurchase agreements, regardless of maturity, if the agreement requires the
institution to repurchase the identical security sold or a security that meets the definition of
substantially the same in the case of a dollar roll.
(2)
Sales of participations in pools of securities, regardless of maturity
Note:
Report securities sold under agreements to repurchase on a gross basis, i.e., do not net them
against securities purchased under agreements to resell, except to the extent permitted under
FASB Interpretation No. 41. Include the fair value of securities sold under agreements to
repurchase that are accounted for at fair value under a fair value option.
UNSECURED “OTHER BORROWINGS” - WITH A REMAINING
MATURITY OF:
DI645
ONE YEAR OR LESS
DI651
OVER ONE YEAR
Report the amount of the institution’s unsecured “Other borrowings” in the appropriate lines DI645
or DI651 according to the amount of time remaining until their final contractual maturities. Include
both fixed rate and floating rate “Other borrowings” that are unsecured. In general, “Other
borrowings” are unsecured if the institution (or a consolidated subsidiary) has not pledged
securities, loans, or other assets as collateral for the borrowing. Exclude “Other borrowings” that
are guaranteed by the FDIC under the Debt Guarantee Program component of the FDIC’s
Temporary Liquidity Guarantee Program.
SUBORDINATED DEBENTURES-WITH A REMAINING MATURITY OF:
DI655
ONE YEAR OR LESS
DI660
OVER ONE YEAR
Report the amount of the institution’s subordinated debentures in the appropriate lines according
to the time remaining until their final contractual maturities. Include both fixed rate and floating
rate subordinated debentures.
DI540: TOTAL DAILY AVERAGE OF DEPOSIT LIABILITIES BEFORE
EXCLUSIONS (GROSS) AS DEFINED IN SECTION 3(L) OF THE
FEDERAL DEPOSIT INSURANCE ACT AND FDIC
REGULATIONS
Report on an unconsolidated single FDIC certificate number basis the total daily average for the quarter
of gross total deposit liabilities that meet the statutory definition of deposits in Section 3(l) of the Federal
Deposit Insurance Act before deducting exclusions from total deposits that are allowed in the
determination of the assessment base upon which deposit insurance assessments (and FICO premiums)
are calculated. For further information on deposit amounts to be calculated, see the instructions for line
DI510. For information on calculating the total daily average for the quarter, see the General Instructions
for reporting Deposit Data for Deposit Insurance Assessment Purposes above.
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DI550: TOTAL DAILY AVERAGE OF ALLOWABLE EXCLUSIONS
(INCLUDING FOREIGN DEPOSITS)
Report on an unconsolidated single FDIC certificate number basis the total daily average for the quarter
of the total amount of allowable exclusions from deposits (as defined in line DI520) if the institution
maintains such records as will readily permit verification of the correctness of its reporting of exclusions.
DI560: TOTAL DAILY AVERAGE OF FOREIGN DEPOSITS
Report on an unconsolidated single FDIC certificate number basis the total daily average for the quarter
of the total amount of foreign deposits (including International Banking Facility deposits) included in line
DI550.
DEPOSIT DATA FOR THRIFTS PARTICIPATING IN THE
TRANSACTION ACCOUNT GUARANTEE PROGRAM COMPONENT OF
THE FDIC'S TEMPORARY LIQUIDITY GUARANTEE PROGRAM
The following items are to be reported by insured institutions that are participating in (i.e., have not opted
out of) the Transaction Account Guarantee Program component of the FDIC's Temporary Liquidity
Guarantee Program (TLGP). Thrifts would report noninterest-bearing transaction accounts (as defined in
the FDIC’s Temporary Liquidity Guarantee Program regulations) of more than $250,000. (Do not include
custodial or escrow accounts on which "pass-through" coverage applies).
DI570: AMOUNT OF NONINTEREST-BEARING TRANSACTION
ACCOUNTS OF MORE THAN $250,000 (INCLUDING
BALANCES SWEPT FROM NONINTEREST-BEARING
TRANSACTION ACCOUNTS TO NONINTEREST-BEARING
SAVINGS ACCOUNTS
DI575: NUMBER OF NONINTEREST-BEARING TRANSACTION
ACCOUNTS OF MORE THAN $250,000
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SCHEDULE SI —SUPPLEMENTAL INFORMATION
Throughout these instructions, you and your refers to the savings association and its consolidated
subsidiaries; we and our refers to the Office of Thrift Supervision.
MISCELLANEOUS:
SI370: NUMBER OF FULL-TIME EQUIVALENT EMPLOYEES
Report the actual number of full-time equivalent employees employed by you and your consolidated
subsidiaries. Report the actual whole number; do not round to thousands.
SI375: FINANCIAL ASSETS HELD FOR TRADING PURPOSES
Financial assets held for trading purposes are defined as securities and other financial assets that are
bought and held for the purpose of short term resale or with the intent of benefiting from actual or
expected price movements, and carried at fair value with the change in fair value reflected in current
earnings. Trading generally reflects active and frequent buying and selling to generate profits in the
short-term.
Report financial assets held for trading purposes on this line and also on SI376. Financial assets held for
trading purposes reported on this line should include any trading securities accounted for under FASB
Statement No. 115 where it is management’s intent to actively buy and sell such securities to generate
profits in the short term.
SI376: FINANCIAL ASSETS CARRIED AT FAIR VALUE THROUGH
EARNINGS
Report the balance of financial assets carried at fair value where the changes in fair value are reflected in
current earnings under FASB Statement No. 115 (for trading securities), No. 133 (for derivatives), No. 155
(for hybrid instruments), and No. 159 (for all other financial assets where the fair value option is elected).
Such assets are reported on various lines on Schedule SC and, therefore, the total of all assets reported
at fair value is included on SC60. For example, derivative assets are included in SC689.
Include financial assets held for trading purposes on this line. Such assets are also reported on SI375.
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Available-for-sale securities are financial assets carried at fair value. However for available-for-sale
securities, the changes in fair value are not reflected in current earnings, but rather in other
comprehensive income net of any deferred tax impact. Accordingly, do not include the balance of
available-for-sale securities on this line. Rather, report such amount on SI385.
Under a “fair value option,” servicing assets may be carried at fair value with the changes in fair value
reflected in current earnings. However, servicing assets are not financial assets. Accordingly, do not
include the balance of any servicing assets on this line.
SI377: FINANCIAL LIABILITIES CARRIED AT FAIR VALUE THROUGH
EARNINGS
Report the balance of financial liabilities carried at fair value where the changes in fair value are reflected
in current earnings under FASB Statement No. 133 (for derivatives), No. 155 (for hybrid instruments), and
No. 159 (for all other financial liabilities where the fair value option is elected). Such liabilities are
reported on various lines on Schedule SC, and therefore the total of all net liabilities reported at fair value
is included on SC70. For example, derivative liabilities are included in SC796.
SI385: AVAILABLE-FOR-SALE SECURITIES
Report all investments in debt securities including mortgage securities not classified as held-to-maturity or
as trading, and all investments in equity securities that have readily determinable fair values that are
accounted for pursuant to FASB Statement No. 115 and are not classified as trading. Do not include
equity securities whose sale is restricted by governmental or contractual requirement – for example,
FHLB stock. Include amounts reported on SC665, Interest-Only Strip Receivables and Certain Other
Instruments, that are not classified as trading pursuant to FASB Statement No. 115.
Report available-for-sale securities at fair value. Exclude unrealized gains and losses from current
earnings and report, net of taxes, as a separate component of equity on SC860, Unrealized Gains
(Losses) on Available-for-Sale Securities, until realized. In addition, report certain nonsecurity financial
instruments, CNFIs, classified as available-for-sale pursuant to FASB Statement No. 115.
Transfer securities from the available-for-sale category to held-to-maturity at fair value as of the date of
transfer.
SI387: ASSETS HELD FOR SALE
Report all assets held for sale except securities and repossessed assets. Report assets held for sale at
the lower of cost or market, LOCOM. Recognize unrealized losses in current earnings on SO465, Net
Income (Loss) from LOCOM Adjustments Made to Assets Held for Sale.
Transfer assets from the ”for sale” category to an investment account at the lower-of-cost-or-market as of
the date of transfer.
Include:
1. Loans and participations originated or purchased by you with the intent to sell.
2. Assets originally held for investment but now held for sale.
3. Assets held for sale, including real estate and branch offices, whether or not there is an outstanding
commitment to sell.
Do not include:
1. Securities, report on SI385.
2. Repossessed assets.
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SI390: LOANS SERVICED FOR OTHERS
Report the principal balance of mortgage and nonmortgage whole loans and participating interests in
loans serviced by you, but owned by others.
Include:
1. Loans and securities that you sold to others but for which you perform the servicing.
2. Loans serviced by you for others, where the loans have been securitized, whether or not you own
the securities and whether or not you have reported any servicing assets.
3. Loans serviced by you for others, where you have transferred the loans to others, but have not
reported the transaction as a sale.
4. Loans and securities serviced by you under a contract to a third party who owns the servicing
rights.
Do not include:
1. Loans and securities where you own the servicing rights and where the servicing has been
subcontracted to a third party.
2. Loans and securities serviced for you by a consolidated subsidiary or a subsidiary depository
institution.
SI394: PLEDGED LOANS
Report the recorded investment in loans included in SC26 and SC31 that have been pledged as collateral
for borrowings.
When a thrift has pledged an entire portfolio of loans to secure its Federal Home Loan Bank advances, it
should report the amount of the entire portfolio in this line, excluding any loans within the portfolio that the
thrift has the right, without constraint, to repledge to another party. (However, if any such loans have been
repledged to another party, they should be reported in this item.)
SI395: PLEDGED TRADING ASSETS
Report trading assets included in SI375 and SI376 that have been pledged as collateral for borrowings.
Trading assets are financial assets held for trading purposes, as defined in the instructions to SI375.
RESIDUAL INTERESTS
Residual interests are defined in 12 CFR Part 567.1 as any balance sheet asset that represents an
interest, including a beneficial interest, created by a transfer of financial assets that qualifies as a sale
under GAAP and that exposes the institution to a credit risk that exceeds a pro rata share of the
institution’s claim on the transferred assets. The transfer of assets may be through securitization or
otherwise; the credit risk may be directly or indirectly associated with the transferred assets; and the
exposure to credit risk may be through either subordination provisions or other credit enhancement
techniques.
This definition of residual interests is for regulatory reporting purposes, and, therefore, is not the same as
purchased or retained beneficial interests in securitized financial assets, as that term is used in
authoritative accounting literature.
Examples of residual interests include, but are not limited to, credit-enhancing interest-only strips defined
below, spread accounts, cash collateral accounts, and retained subordinated interests.
SCHEDULE SI
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You report all residual interests somewhere on Schedule SC, typically on SC182, SC185, SC217 through
222,SC665, or SC689. The total of lines SI402 and SI404 should equal all residual interests, as defined
above, that you have included on Schedule SC.
In addition, you should report the appropriate amounts in Schedule CC, on CC455 and CC465 or CC468,
related to direct credit substitutes and recourse obligations. Also, as residual interests are subject to
specialized regulatory capital treatment pursuant to 12 CFR Parts 567.6 and 567.12, you should report
the appropriate amounts in Schedule CCR, on CCR133, CCR270, CCR375, and CCR605.
SI402: RESIDUAL INTERESTS IN THE FORM OF INTEREST-ONLY
STRIPS
Report residual interests as defined above in the form of credit-enhancing interest-only strips.
Credit-enhancing interest-only strips are defined in 12 CFR Part 567.1 as any on-balance-sheet asset
that, in form or in substance, represents the contractual right to receive some or all of the interest due on
transferred assets, and that through subordination provisions or other credit enhancement techniques
exposes the institution to credit risks that exceed its pro rata claim on the transferred assets.
Report both retained and purchased credit-enhancing interest-only strips. However, do not include
interest-only strips issued by government-sponsored entities or other interest-only strips that do not
function in a credit enhancing or otherwise subordinate capacity.
SI404: OTHER RESIDUAL INTERESTS
Report any other residual interests and on-balance-sheet recourse assets that you have not reported on
SI402. Include purchased subordinated interests, purchased subordinated securities, and any other type
of residual or recourse position that you have purchased from others. Do not include interest-only strips
issued by the government or government sponsored enterprises, unless they meet the definition of
residual interest in 12 CFR 567.1.
QUALIFIED THRIFT LENDER TEST
SI581, SI582, AND SI583:
ACTUAL THRIFT INVESTMENT
PERCENTAGE AT MONTH-END
To be a Qualified Thrift Lender, QTL, you must either meet the Home Owners’ Loan Act, HOLA, QTL test
or the Internal Revenue Service tax code Domestic Building and Loan Association, DBLA, test.
If you use the HOLA QTL test, report the ATIP from the OTS QTL worksheets, OTS Form 1427, for the
three months. If you use the IRS DBLA test, leave lines SI581, 582, and 583 blank, and complete SI585
and SI586.
IRS DOMESTIC BUILDING AND LOAN TEST:
Complete these lines only if you do not use the Home Owners’ Loan Act (HOLA) Qualified Thrift Lender
(QTL) test, but instead use the IRS Domestic Building and Loan Association (DBLA) test (IRS regulation
26 CFR § 301.7701-13A) to determine if you are a Qualified Thrift Lender. Refer to Appendix A of the
OTS Examination Handbook, Section 270.
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SI585: PERCENT OF ASSETS TEST
SI586: DO YOU MEET THE DBLA BUSINESS OPERATIONS TEST?
SI588: AGGREGATE INVESTMENT IN SERVICE
CORPORATIONS
Report your aggregate investment in the capital stock, loans and obligations, and other securities of all
service corporations, determined in a manner consistent with 12 CFR Part 559.
Loans and obligations include all loans and other debt instruments, and all guarantees or take-out
commitments of such loans or debt instruments.
For purposes of this reporting only, the measurement of the investment in capital stock should be based
on the cost method, and not the equity method. Under the cost method, your investment in capital stock
will include amounts paid to acquire the stock, but will not include accumulated undistributed earnings
and losses of the service corporations. As a result, your aggregate investment reported on this line will
likely differ from the related amount obtained from your accounting records and from the amount reported
on SC540.
EXTENSIONS OF CREDIT BY THE REPORTING ASSOCIATION (AND
ITS CONTROLLED SUBSIDIARIES) TO ITS EXECUTIVE OFFICERS,
PRINCIPAL SHAREHOLDERS, DIRECTORS, AND THEIR RELATED
INTERESTS AS OF THE REPORT DATE
Federal Reserve Regulation O defines the terms used in this item.
An extension of credit is a making or renewal of any loan, a granting of a line of credit, or an extension
of credit in any manner whatsoever. Extensions of credit include, among others, loans, prearranged
overdrafts, cash items, standby letters of credit, and securities purchased under agreements to resell.
For lines of credit, the amount reported as an extension of credit is normally the total amount of the line of
credit extended to the insider, not just the current balance of the funds that have been advanced to the
insider under the line of credit. See 12 CFR § 215.3, Regulation O.
An executive officer of the reporting savings association is person who participates or has authority to
participate, other than as a director, in major policy-making functions of the reporting savings association,
an executive officer of the savings association’s holding company, and, unless excluded by the savings
association’s board of directors or bylaws, any other subsidiary of that holding company. See 12 CFR §
215.2(e), Regulation O.
A director of the reporting savings association is person who is a director of the savings association,
whether or not receiving compensation, a director of the holding company of which the savings
association is a subsidiary, and, unless excluded by the savings association’s board of directors or
bylaws, a director of any other subsidiary of that holding company. See 12 CFR § 215.2(d), Regulation
O.
A principal shareholder of the reporting savings association is an individual or a company other than an
insured depository institution that directly or indirectly, or acting through or in concert with one or more
persons, owns controls, or has the power to vote more than 10% of any class of voting stock of the
reporting savings association. Regulation O considers shares owned or controlled by a member of an
individual’s immediate family to be held by the individual. A principal shareholder includes a principal
shareholder of a holding company of which the reporting savings association is a subsidiary and a
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principal shareholder of any other subsidiary of that holding company. See 12 CFR § 215.11(a)(1),
Regulation O.
A related interest is either:
1. A company, other than an insured depository institution or a foreign bank that is controlled by an
executive officer, director, or principal shareholder.
2. A political or campaign committee that is controlled by or the funds or services of which will
benefit an executive officer, director, or principal shareholder. See 12 CFR § 215.11(a)(2),
Regulation O.
SI590: AGGREGATE AMOUNT OF ALL EXTENSIONS OF CREDIT
Report the aggregate amount outstanding as of the report date of all extensions of credit by you and your
controlled subsidiaries to all of your executive officers, principal shareholders, directors, and their related
interests.
Include each extension of credit in the aggregate amount only one time, regardless of the number of
borrowers.
SI595: NUMBER OF EXECUTIVE OFFICERS, PRINCIPAL
SHAREHOLDERS, AND DIRECTORS TO WHOM THE AMOUNT
OF ALL EXTENSIONS OF CREDIT (INCLUDING EXTENSIONS
OF CREDIT TO RELATED INTERESTS) EQUALS OR EXCEEDS
THE LESSER OF $500,000 OR FIVE PERCENT OF
UNIMPAIRED CAPITAL AND UNIMPAIRED SURPLUS (CCR30
+ CCR35 + CCR530 + CCR105)
Report the number of your executive officers, principal shareholders, and directors to whom the amount
of all extensions of credit outstanding by you and your controlled subsidiaries as of the report date equals
or exceeds the lesser of $500,000 or five percent of unimpaired capital and unimpaired surplus. That is,
five percent x (CCR30 + CCR35 + CCR530 + CCR105). Report the actual number; do not round to
thousands.
For purposes of this item, the amount of all extensions of credit by you and your controlled subsidiaries to
an executive officer, principal shareholder, or director includes all extensions of credit by you to the
related interests of the executive officer, principal shareholder, or director. A single extension of credit to
more than one borrower must be included in full for all extensions of credit for each executive officer,
principal shareholder, and director included in the credit. That is, one loan may be included more than
once in the calculation of the $500 thousand or 5% of unimpaired capital and unimpaired surplus limit,
because it will be included for each executive officer, principal shareholder, and director listed on the
loan.
SUMMARY OF CHANGES IN SAVINGS ASSOCIATION
EQUITY CAPITAL
SI600: SAVINGS ASSOCIATION EQUITY CAPITAL, BEGINNING
BALANCE
The EFS software automatically generates this amount from your prior quarter’s SC80.
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Special instructions for mergers and reorganizations:
•
Purchase Mergers – Report SI680 for the previous quarter for the surviving savings association only.
•
Change of Control involving pushdown accounting including receiverships – Report SI680 for the
previous quarter. Adjustments should be reported on SI660.
SI610: NET INCOME (LOSS) ATTRIBUTABLE TO SAVINGS
ASSOCIATION (SO91)
The EFS software automatically generates this amount from SO91.
DIVIDENDS DECLARED:
SI620: Preferred Stock
Report the dollar amount of cash dividends declared during the period on preferred stock. These
dividends are not charged to interest expense, but directly reduce retained earnings.
Include:
Dividends declared on preferred stock reported on SC812 and SC814.
SI630: Common Stock
Report the dollar amount of cash dividends declared during the period for common stock reported on
SC820. These dividends are not charged to interest expense, but directly reduce retained earnings.
Include cash dividends made to holding companies as well as to individual shareholders.
Do not include:
1. Stock dividends.
2. Stock splits.
3. Property dividends. Report as a negative amount on SI655.
SI640: STOCK ISSUED
Report the amount of cumulative and noncumulative perpetual preferred stock and common stock issued
during the quarter.
Include:
1. Perpetual preferred stock, including discounts and premiums, issued by you during the quarter
that qualifies as equity under GAAP.
2. The par value and paid-in-capital received in connection with the stock issue.
Do not include:
1. The conversion of preferred stock into common stock.
2. Gains on treasury stock sold. Report on SI671.
3. Capital contributed not connected with a stock issue. Report on SI655.
When applying push-down accounting, report the amount paid in a change of control for your stock.
Report the previously recorded par value and capital in excess of par value on SI650.
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SI650: STOCK RETIRED
Report the amount paid for common and perpetual preferred stock retired during the quarter. Report the
amount as a positive number.
When applying push-down accounting, report the previously recorded par value and capital paid in
excess of par value of the stock acquired by the new owners. The amount paid for this stock is reported
on SI640.
SI655: CAPITAL CONTRIBUTIONS (WHERE NO STOCK IS ISSUED)
Report increases during the quarter in SC830, Common Stock: Paid in Excess of Par, that came from
stockholders but that did not result from the issuing of stock.
Include the fair value of employee stock options granted as compensation.
Also include as a negative amount property distributions to stockholders. Record the transfer of dividends
other than cash at the fair value of the asset on the declaration date of the dividend. Recognize a gain or
loss on the transferred asset in the same manner as if you disposed of the property in an outright sale at
or near the declaration date.
SI660: NEW BASIS ACCOUNTING ADJUSTMENTS
Include:
1. Adjustments made during the period in applying push-down accounting in the change-of-control.
2. Adjustments made in accounting for a savings association taken into receivership during the
period.
SI662: OTHER COMPREHENSIVE INCOME
The EFS software automatically generates this amount as the change during the quarter in SC86,
Accumulated Other Comprehensive Income: Total.
Other comprehensive income includes the change in:
1. Accumulated unrealized fair value gains and losses on available-for-sale securities, net of taxes.
2. Accumulated fair value gains and losses on cash flow hedges, net of taxes.
3. Any minimum pension liability adjustment recognized in accordance with FASB Statement No.
87, Employers’ Accounting for Pensions, net of taxes and FAS Statement No. 158, Employers’
Accounting for Defined Benefit Pension and Other Postretirement Plans.
4. Cumulative foreign currency translation adjustments and qualifying foreign currency transaction
gains and losses, net of taxes.
SI668: PRIOR PERIOD ADJUSTMENTS
Prior period adjustments for purposes of the TFR include:
1. Changes to a beginning balance of equity capital pursuant to transition requirements under newly
adopted FASB Statements.
2. Corrections to an income statement for a quarter from a prior calendar year where the TFR for
that quarter can no longer be amended.
3. Cumulative effects of a change in accounting principle.
Also refer to item number 6 in the General Instructions for the TFR.
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Do not include:
1. Audit adjustments and prior period adjustments within the current calendar year. Correct these
through an amended report within 140 days of the report date or report them currently in
Schedule SO.
2. Corrections of accruals. Report these in the current period in the same data field in Schedule SO
that they would have been reported had the accruals been made when incurred.
SI671: OTHER ADJUSTMENTS
Report other adjustments to equity capital that cannot be included elsewhere in SI610 through SI668.
Include:
1. Issuance costs of common stock offerings.
2. The change in SC891, Other Components of Equity Capital.
Do not include:
1.
2.
3.
4.
Property distributions to stockholders; report as a negative amount on SI655.
Prior period adjustments to prior calendar years; report on SI668.
Additional contributions of paid-in capital; report on SI655.
Adjustments within the current calendar year. Correct these through an amended report within
135 days of the report date, or report them currently in Schedule SO.
5. Corrections of accruals. Report these in the current period in the same data field in Schedule SO
that they would have been reported had the accruals been made when incurred.
SI680: TOTAL SAVINGS ASSOCIATION EQUITY CAPITAL, ENDING
BALANCE (SC80)
The EFS software automatically calculates this as the sum of SI600, SI610, SI640, SI655, SI660, SI662,
SI668, and SI671 less SI620, SI630, and SI650. SI680 must equal SC80, Total Savings Association
Equity Capital, on the current TFR.
TRANSACTIONS WITH AFFILIATES:
The following two line items parallel 12 CFR 563.41, Transactions with Affiliates. Section 563.41(c)(3)
requires each association to maintain records that reflect all transactions between a savings association
and its affiliates.
Section 563.41 implements the affiliate transactions regulation found in Sections 23A and 23B of the
Federal Reserve Act, as codified in 12 CFR Part 223 (Regulation W). Sections 23A and 23B of the
Federal Reserve Act are made applicable to savings associations by Section 11(a)(1) of the Home
Owners’ Loan Act. You should include transactions subject to the quantitative limits of Section 23A in
SI750. Include all other covered affiliate transactions in SI760, including transactions subject only to
Section 23B.
Affiliate and covered transaction are defined in Regulation W, as modified as appropriate for savings
associations in Section 563.41. Generally, an affiliate is defined as:
1. Your parent company.
2. Any company controlled by your parent company that is not a subsidiary of yours (except a bank
or thrift subsidiary of yours).
3. Any company that you or another affiliate sponsors or advises.
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4. Any company which shares a majority of the same directors with you or your parent company.
Information in this section is not made public on an individual institution basis, but is available in the OTS
aggregates.
SI750: ACTIVITY DURING THE QUARTER OF COVERED
TRANSACTIONS WITH AFFILIATES SUBJECT TO
QUANTITATIVE LIMITS
Report all covered affiliate transactions subject to quantitative limits. Generally, these include:
•
All purchases of assets by you from affiliates. This includes all commitments outstanding at the
end of the quarter to purchase assets entered into with affiliates that will close in your name.
Report such commitments on a gross basis. Do not net commitments to sell against
commitments to purchase, even if the commitments are for the same or similar items and even if
you will disburse or receive no cash.
•
All extensions of credit to affiliates. This includes, but is not limited to, loans and receivables
whether or not supported by a loan document or contract; purchasing a note or other obligation of
an affiliate, as well as loan guarantees or letters of credit on behalf of an affiliate. Acceptance of a
security issued by an affiliate as collateral for an extension of credit to any third party.
Include all transactions that occurred during the quarter, regardless of whether you have paid affiliates
during the quarter or owe the amount as of the end of the quarter.
SI760: ACTIVITY DURING THE QUARTER OF OTHER COVERED
TRANSACTIONS WITH AFFILIATES NOT SUBJECT TO
QUANTITATIVE LIMITS
Report all other affiliate transactions that are not included in SI750. Generally, these include:
•
The sale of securities or other assets from you to an affiliate, including assets subject to a
repurchase agreement.
•
Your payment of funds to, or furnishing of services to, an affiliate, including such tasks as
collection of debt payments, data processing, maintenance, office supplies or payroll.
•
Any transaction in which an affiliate receives an agency or broker’s fee from you for its services
on behalf of you or a third party.
Include all transactions that occurred during the quarter, regardless of whether you have paid affiliates
during the quarter or owe the amount as of the end of the quarter.
ASSETS COVERED BY FDIC LOSS-SHARING AGREEMENTS:
Under a loss-sharing agreement, the FDIC agrees to absorb a portion of the losses on a specified pool of
a failed insured depository institution’s assets in order to maximize asset recoveries and minimize the
FDIC’s losses. In general, the FDIC will reimburse 80 percent of losses incurred by an acquiring institution
on covered assets over a specified period up to a stated threshold amount, with the acquirer absorbing 20
percent of the losses on these assets. Any losses above the stated threshold amount will be reimbursed
by the FDIC at 95 percent of the losses recognized by the acquirer. Reference the FDIC’s web site for
“Loss-Share Questions and Answers”.
Report in the appropriate line items below the Schedule SC – Consolidated Statement of Condition
carrying amount as of the report date of all assets acquired from failed insured depository institutions or
otherwise purchased from the FDIC that are covered by loss-sharing agreements with the FDIC. These
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asset amounts should also be included in the balance sheet category appropriate to the asset on
Schedule SC.
Do not report the “book value” of the covered assets on the failed institution’s books, which may be the
amount upon which payments from the FDIC to the reporting bank are to be based in accordance with the
loss-sharing agreement.
REPORT THE CARRYING AMOUNT OF COVERED
SI770: LOANS AND LEASES
Report the carrying amount of loans and leases held for sale and the recorded investment in loans held
for investment (included in SC306, SC330 and SC26) acquired from the failed insured depository
institutions or otherwise purchased from the FDIC that are covered by loss-sharing agreements with the
FDIC.
SI772: REAL ESTATE OWNED
Report the carrying amount of real estate owned (included in SC40) acquired from failed insured
depository institutions or otherwise purchased from the FDIC that are covered by loss-sharing
agreements with the FDIC.
SI774: DEBT SECURITIES
Report the amortized cost of held-to-maturity debt securities and the fair value of available-for-sale debt
securities (included in SC11 and SC22) acquired from failed insured depository institutions or otherwise
purchased from the FDIC and covered by loss-sharing agreements with the FDIC.
SI776: OTHER ASSETS
Report the carrying amount off all assets that cannot properly be reported on SC1770, SC1772, and
SC774, and have been acquired from failed insured depository institutions or otherwise purchased from
the FDIC and are covered by loss-sharing agreements with the FDIC.
MUTUAL FUND AND ANNUITY SALES:
SI815: TOTAL ASSETS YOU MANAGE OF PROPRIETARY MUTUAL
FUNDS AND ANNUITIES
Report the total of net assets held by mutual funds and annuities as of the report date for which you, your
subsidiaries, your affiliates, or parent company acts as investment adviser.
AVERAGE BALANCE SHEET DATA (BASED ON MONTH-END DATA)
Report average balance sheet data for the quarter. At a minimum, compute these data based on
balances at month-end. However, you may compute these data based on other than month-end
balances, such as daily or weekly balances. All balances should be as reported in Schedule SC. For
example, the balance of loans should reflect premiums, discounts, deferred loan fees, allowances for
credit losses, etc. Each month's average should be computed using the prior month's ending balance
plus the current month's ending balance divided by two. For example, the balance at December 31 is
considered to be the beginning balance at January 1. The average for the three months in the quarter
should then be summed and divided by three.
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In the case of a business combination accounted for using the purchase method of accounting or
acquisition by a holding company where you used pushdown accounting, you should include amounts for
the acquired entity from the date of its acquisition through the end of the quarter.
Example of Averaging:
Balances
Month
Beginning
Ending
Average
N/A
1,500
N/A
January
1,500
1,575
1,538
February
1,575
1,550
1,563
March
1,550
1,695
1,623
December
Sum
4,724
Quarter Average Balance = $4,724 / 3 = $ 1,575
If you consummated a merger on February 20, the calculation would be as follows:
Ending
Average
N/A
1,500
N/A
N/A
January
1,500
1,575
1,538
1,538
February pre-merger
1,575
1,550
1,563
x 19 days = 29,698
February post-merger
3,200
3,280
3,240
x 9 days = 29,160
December
Adjustment
Adjusted
Average
Beginning
(29,698+ 29,160)/28
March
3,280
3,965
Sum
Quarter Average Balance = $7,263 / 3 =
3,623
2,102
3,623
7,263
$2,421
SI870: TOTAL ASSETS
Report your average assets for the quarter based on the calculation explained above using total assets
reported on SC60.
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SI875: DEPOSITS AND INVESTMENTS EXCLUDING NON-INTERESTEARNING ITEMS
Report your average deposits and investments for the quarter based on the calculation explained above
using interest-earning deposits and investments reported on SC112 through SC185. Do not include
mortgage loans and mortgage-backed securities included in SI880.
If you invest in adjustable rate products on which the interest rate has been reduced to zero as a result of
market conditions, you should continue to report such investments in these averages.
SI880: MORTGAGE LOANS AND MORTGAGE-BACKED SECURITIES
Report your average mortgage loans and mortgage-backed securities for the quarter based on the
calculation explained above using mortgage loans and mortgage-backed securities reported on SC210
through SC222 and SC230 through SC265.
SI885: NONMORTGAGE LOANS
Report your average nonmortgage loans for the quarter based on the calculation explained above using
nonmortgage loans reported on SC300 through SC330.
SI890: DEPOSITS AND ESCROWS
Report your average interest-earning deposits and escrows for the quarter based on the calculation
explained above using interest-earning deposits included in SC710 and SC712. If you offer deposit
products on which you periodically adjust the interest rate, and the interest rate has been reduced to zero
as a result of market conditions, you should continue to report such deposits as interest-bearing accounts
in these averages.
SI895: TOTAL BORROWINGS
Report your average interest-bearing borrowings for the quarter based on the calculation explained
above using interest-bearing borrowings reported on SC720 through SC760.
BROKERAGE ACTIVITES:
SI901: DOES YOUR INSTITUTION, WITHOUT TRUST POWERS, ACT
AS TRUSTEE OR CUSTODIAN FOR INDIVIDUAL RETIREMENT
ACCOUNTS, HEALTH SAVINGS ACCOUNTS, AND OTHER
SIMILAR ACCOUNTS THAT ARE INVESTED IN NON-DEPOSIT
PRODUCTS?
Indicate whether the institution acts as trustee or custodian for Individual Retirement Accounts (IRAs),
Health Savings Accounts (HSAs), or other similar accounts. To answer “Yes” on this line, the institution
must be acting as trustee or custodian for accounts that are invested, to some extent, in non-deposit
products (e.g. stocks, bonds, variable annuities, mutual funds) but those same accounts may also be
invested in deposit products. Note that this line item is related to that of DI200 which asks the amount of
IRA and Keogh accounts invested in deposit products.
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Other similar accounts include Roth IRAs, Coverdell Education Savings Accounts, and Archer Medical
Savings Accounts. Federal savings associations are permitted, under certain circumstances, to act as
trustee or custodian for these types of accounts without obtaining trust powers. Place an “X” in the box
marked “Yes” if the reporting institution acts as trustee or custodian for these types of accounts,
regardless of whether it has trust powers, as long as the accounts are invested, to some extent, in nondeposit products. Otherwise, place an “X” in the box marked “No.”
SI905: DOES YOUR INSTITUTION PROVIDE CUSTODY,
SAFEKEEPING OR OTHER SERVICES INVOLVING THE
ACCEPTANCE OF ORDERS FOR THE SALE OR PURCHASE
OF SECURITIES?
Indicate whether the institution takes orders from customers for the sale or purchase of securities (e.g.
stocks, bonds, mutual funds, variable annuities), in custody, escrow, safekeeping, and other similar types
of accounts. In some institutions this activity takes places in a trust department but federal savings
associations are permitted to conduct this activity without obtaining trust powers. The account holders
may be employee benefit plans, Individual Retirement Accounts, foundations, or other types of
customers. Place an “X” in the box marked “Yes” if the reporting institution takes orders from customers
for the sale or purchase of securities. Otherwise, place an “X” in the box marked “No.”
SI911: DOES YOUR INSTITUTION ENGAGE IN THIRD PARTY
BROKER ARRANGEMENTS, COMMONLY REFERRED TO AS
“NETWORKING”, TO SELL SECURITIES PRODUCTS OR
SERVICES TO THRIFT CUSTOMERS?
Indicate whether the institution has entered into a contract with a broker-dealer or registered investment
adviser to provide non-deposit products (e.g. stocks, bonds, mutual funds) or services (investment
advisory or financial planning) to its customers. The broker-dealer or registered investment adviser may
or may not be an affiliate of the institution. Institutions that have entered into a contract with an insurance
company to only provide insurance products (e.g. life insurance, fixed annuities, property & casualty
insurance) to its customers should place an “X” in the box marked “No”. Place an “X” in the box marked
“Yes” if the reporting institution has entered into a contract with a broker-dealer or registered investment
adviser to provide non-deposit products or services to its customers. Otherwise, place an “X” in the box
marked “No.”
SI915: DOES YOUR INSTITUTION SWEEP DEPOSIT FUNDS INTO
ANY OPEN-END INVESTMENT MANAGEMENT COMPANY
REGISTERED UNDER THE INVESTMENT COMPANY ACT OF
1940 THAT HOLDS ITSELF OUT AS A MONEY MARKET
FUND?
Indicate whether the institution offers a “sweep” program to its customers whereby the customer’s deposit
funds are invested or reinvested into money market mutual funds on a regular basis such as daily,
weekly, etc. Place an “X” in the box marked “Yes” if the reporting institution offers a sweep program to its
customers that invests or reinvests on a regular basis deposit funds into a money market mutual fund.
Otherwise, place an “X” in the box marked “No.”
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SCHEDULE SQ — CONSOLIDATED
SUPPLEMENTAL QUESTIONS
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision. However, in this
schedule, you should answer all questions except SQ310 based on your data alone, and not on your
consolidated subsidiaries’ data. SQ310 applies to both you and your consolidated subsidiaries.
Indicate whether an activity occurred during the period by placing an X in either the Yes or No column of
each question. No question that can be answered with a yes or no should be left blank. Check Yes if
there is any doubt as to whether an activity occurred during the quarter.
SQ270: Your fiscal year-end (MM)
Enter the month of your current fiscal year-end for audited financial statement purposes. In some cases
this may not correspond to the tax year-end.
SQ280: Code representing nature of work to be performed by
independent public accountants for the current fiscal year
Enter the code for the statement below that best describes the level of audit or other attestation work –
such as review, compilation, or agreed-upon procedures – that an independent public accountant will
have performed by the end of your current fiscal year. The current fiscal year is the 12-month period that
includes the quarter that you are reporting.
07
08
09
You do not plan to have an audit or other attestation work by an independent public accountant.
You do not plan to have an audit. However, you do plan to have other attestation work
performed and reported on by an independent public accountant.
You plan to have an audit of, and receive a report on, only the holding company’s consolidated
financial statements by an independent public accountant.
Use this code where plans are for an audit and report on:
a. Only your holding company’s consolidated financial statements.
b. Not your separate financial statements.
1. Your holding company’s consolidated financial statements include, by consolidation,
your financial statements. Use code 10 for an audit and report on, your separate
financial statements.
SCHEDULE SQ
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You plan to have an audit of, and receive a report on, your financial statements by an
independent public accountant.
1. Use this code where plans are for an audit and report on:
a. Only your separate financial statements, or
b. Both your separate financial statements and your holding company’s consolidated
financial statements.
2. Use code 09 for an audit of, and report on, only the holding company’s consolidated
financial statements.
SQ300: Did you change your independent public accountant during
the quarter?
Check yes if you did one or both of the following:
•
Gave notice to your prior independent public accountant terminating his engagement.
•
Engaged a successor accountant.
SQ310: Did you and your consolidated subsidiaries have any
outstanding futures or options positions at quarter end?
SQ320: Do you have a Subchapter S election in effect for federal
income tax purpose for the current year?
SQ410: Have you been consolidated with your parent in another TFR?
If so, enter the OTS docket number of your parent savings
association.
SQ420: Have you been consolidated with your parent in a Commercial
Bank Call Report? If so, enter the FDIC certificate number of
your parent commercial bank.
SQ530: If you have a web page on the Internet, indicate your main
Internet home page address (for transactional or
nontransactional web sites).
Report your main Internet home page address, even if you do not have a transactional web site. This
field has a maximum of 78 characters.
SQ540: Do you provide transactional Internet banking to your
customers, as defined in 12 CFR 555.300(b)?
Respond Yes if you have a transactional Internet banking web site. Transactional Internet banking web
sites are defined in 12 CFR 555.300(b).
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SCHEDULE SB — CONSOLIDATED SMALL
BUSINESS LOANS
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Starting as of March 31, 2010 complete this schedule quarterly using data as of the end of the
quarter.
SB010:
DO YOU HAVE ANY SMALL BUSINESS LOANS TO
REPORT IN THIS SCHEDULE?
Respond No if you have no loans meeting the definitions of small business loans as defined in this
schedule for agricultural and nonagricultural purposes. Respond Yes if you have loans to report in
Schedule SB. If you respond No, you should not complete any other lines in this schedule.
You should respond No and leave the remaining of Schedule SB blank if the following are true: (1)
you and your consolidated subsidiaries have no loans reported on SC260, 300, 303, and 306; (2) your
business loans and those of your consolidated subsidiaries only have original amounts, as defined
below, exceeding $1 million; (3) your farm loans only have original amounts exceeding $500
thousand.
LOANS TO SMALL BUSINESSES AND SMALL FARMS:
Complete the following data for yourself and your consolidated subsidiaries to comply with Section 122 of
the FDIC Improvement Act.
When you report the number and amount of business loans currently outstanding with original amounts
of $1 million or less and farm loans with original amounts of $500 thousand or less, use the following
guidelines:
1. For loans drawn down under lines of credit or loan commitments, the original amount of the loan
is the amount existing when the line of credit or loan commitment was most recently approved,
extended, or renewed prior to the report date. However, if the amount currently outstanding as of
the report date exceeds this size, the original amount is the amount currently outstanding.
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2. For loan participations and syndications, the original amount of the loan participation or
syndication is the entire amount of the credit originated by the lead lender.
3. For all other loans, the original amount is the total amount of the loan at origination or the
amount currently outstanding as of the report date, whichever is larger.
The amount outstanding is the amount reported on Schedule SC as of the report date and should be
reported net of loans in process, specific valuation allowances, and yield adjustments to the extent
possible.
Report the actual number of loans. Do not round to the nearest thousand.
Do not include loans to subsidiaries eliminated in consolidation.
Except as noted below for corporate or business credit card programs, when you determine original
amounts and report the number and amount currently outstanding for a category of loans in this
schedule, you should compute the amounts as follows: combine multiple loans to one borrower and
report them on an aggregate basis rather than as separate individual loans, to the extent that you do
not incur undue cost to obtain such aggregate individual borrower data. If the burden of such aggregation
would be excessive, you may report multiple loans to one borrower as separate individual loans.
If you offer corporate or business credit card programs where credit cards are issued to one or more of a
company’s employees for business-related use, you should treat each company’s entire credit card
program as a single extension of credit. You should total the credit limits for all of the individual credit
cards issued to the company’s employees, and treat this total as the original amount of the corporate or
business credit card program established for this company. The company’s program should be reported
as one loan and the amount currently outstanding would be the sum of the credit card balances as of the
quarterly reporting date on each of the individual credit cards issued to the company’s employees.
However, when aggregated data for each individual company in a corporate or business credit card
program are not readily determinable from your credit card records, you should develop reasonable
estimates of the number of corporate or business credit card programs that exist as of the report date, the
original amounts of these programs, and the amounts currently outstanding of these programs and
should then report information about these programs on the basis of your reasonable estimates. In no
case should individual credit cards issued to a company’s employees under a corporate or business
credit card program be reported as separate individual loans to small businesses.
SB100: Do you have any loans secured primarily by farms reported
on SC260 or any loans to finance agricultural production or
other loans to farmers reported on SC300, 303, or 306?
Answer Yes to this question only if the agricultural and farm loans had original amounts, as defined
above, of $500 thousand or less.
If yes, complete lines 300 through 650; do not complete 110 through 210. If no, complete the following
item, 110.
SB110: Are all or substantially all of your commercial loans (Schedule
SC lines 260, 300, 303, and 306) loans with original amounts
of $100,000 or less?
Indicate yes and complete only the following lines, 200 and 210, if:
1. The average amount outstanding of your commercial, nonfarm loans that you reported on
Schedule SC lines 260, 300, 303, and 306 is $100 thousand or less and
2. Based on your loans and other relevant information, your lending officer believes that all or
substantially all of your commercial loans have original amounts, as defined above, of $100
thousand or less.
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Otherwise, indicate no and complete lines 300 through 450.
SB200: Number of loans reported on line SC260
Report the actual number – do not round to thousands – of loans reported on SC260, Permanent
Mortgages on Nonresidential Property. Complete this line only if line 100 is no and 110 is yes – that is,
all of the loans reported on SC260, 300, 303, and 306 are nonfarm loans and substantially all of the
original amounts of the loans are $100 thousand or less.
SB210: Number of loans reported on SC300, 303, and 306
Report the actual number – do not round to thousands – of loans reported on SC300, 303, and 306,
Nonmortgage Commercial Loans. Complete this line only if line 100 is no and 110 is yes; that is, all of
the loans reported on SC260, 300, 303, and 306 are nonfarm loans and substantially all of the original
amounts of the loans are $100 thousand or less.
NUMBER AND AMOUNT OUTSTANDING OF PERMANENT
MORTGAGE LOANS SECURED BY NONFARM, NONRESIDENTIAL
PROPERTIES REPORTED ON SC260:
Number of Loans with Original Amounts of:
SB300: $100,000 or less
SB320: Greater than $100,000 thru $250,000
SB340: Greater than $250,000 thru $1 million
Outstanding Balance with Original Amounts of:
SB310: $100,000 or less
SB330: Greater than $100,000 thru $250,000
SB350: Greater than $250,000 thru $1 million
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NUMBER AND AMOUNT OUTSTANDING OF NONMORTGAGE,
NONAGRICULTURAL COMMERCIAL LOANS REPORTED ON SC300,
303, AND 306:
Number of Loans with Original Amounts of:
SB400: $100,000 or less
SB420: Greater than $100,000 thru $250,000
SB440: Greater than $250,000 thru $1 million
Outstanding Balance with Original Amounts of:
SB410: $100,000 or less
SB430: Greater than $100,000 thru $250,000
SB450: Greater than $250,000 thru $1 million
NUMBER AND AMOUNT OUTSTANDING OF LOANS SECURED
PRIMARILY BY FARMS REPORTED ON SC260:
Number of Loans with Original Amounts of:
SB500: $100,000 or less
SB520: Greater than $100,000 thru $250,000
SB540: Greater than $250,000 thru $500,000
Outstanding Balance with Original Amounts of:
SB510: $100,000 or less
SB530: Greater than $100,000 thru $250,000
SB550: Greater than $250,000 thru $500,000
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NUMBER AND AMOUNT OUTSTANDING OF NONMORTGAGE,
COMMERCIAL LOANS TO FINANCE AGRICULTURAL PRODUCTION
AND OTHER NONMORTGAGE COMMERCIAL LOANS TO FARMERS
REPORTED ON SC300, 303, AND 306:
Number of Loans with Original Amounts of:
SB600: $100,000 or less
SB620: Greater than $100,000 thru $250,000
SB640: Greater than $250,000 thru $500,000
Outstanding Balance with Original Amounts of:
SB610: $100,000 or less
SB630: Greater than $100,000 thru $250,000
SB650: Greater than $250,000 thru $500,000
SCHEDULE SB
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SCHEDULE FS — FIDUCIARY AND RELATED
SERVICES
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Complete Schedule FS on a consolidated basis, including the fiduciary or related services of any
significant, majority-owned operating subsidiaries or service corporations.
For report dates through December 31, 2008, the information reported in Schedule FS on fiduciary and
related services income (except total gross fiduciary and related services income) and on fiduciary
settlements, surcharges, and other losses will not be made available to the public on an institution basis.
Beginning with the March 31, 2009 report date, all of the information reported in Schedule FS for each
savings association will be publicly available.
The income and expense data reported on FS310 through FS35 and the fiduciary settlements,
surcharges, and other losses reported on FS710 through FS72 must be reported for the calendar year-todate.
FS110: DOES YOUR INSTITUTION HAVE FIDUCIARY POWERS?
Check Yes if OTS, a state, or another banking authority has granted you trust powers to administer
accounts in a fiduciary capacity. You should check Yes if your significant, majority-owned subsidiaries
have been granted trust powers by OTS, a state, or another banking authority. Fiduciary capacity
generally includes acting as a trustee, executor, administrator, registrar of stocks and bonds, transfer
agent, assignee, receiver, guardian or conservator of the estate of a minor or incompetent, acting in
connection with a Uniform Gift to Minors Act account, investment adviser (if you receive a fee for your
investment advice), any capacity in which you possess investment discretion on behalf of another, or any
other similar capacity.
FS120: DOES YOUR INSTITUTION EXERCISE THE FIDUCIARY
POWERS IT HAS BEEN GRANTED?
Check Yes if you exercise your fiduciary powers. Exercising fiduciary powers means that you serve in a
fiduciary capacity as described in the instructions for FS110.
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FS130: DOES YOUR INSTITUTION HAVE ANY FIDUCIARY OR
RELATED ACTIVITY (IN THE FORM OF ASSETS OR
ACCOUNTS) TO REPORT IN THIS SCHEDULE?
Check Yes if you have assets, accounts, or income from fiduciary or related services. You should check
No if you have trust powers and only use those powers to provide services in connection with land trusts
or if you act as a document custodian for mortgage-backed securities, such as those offered by Fannie
Mae (FNMA), Freddie Mac (FHLMC), or Ginnie Mae (GNMA). If you check No, do not complete the
remainder of this schedule.
Reportable related services are those services that do not require trust powers but are related to fiduciary
services. Specifically, this includes custodial services for assets held by you in a fiduciary capacity. You
should report on this schedule fiduciary related services that are offered through your trust department,
fiduciary business unit, or other distinct department or business unit that is devoted to the provision of
fiduciary or related services. You should not include custodial services provided to commercial bank
services such as hold in custody repurchase assets, escrow accounts that benefit third parties, safety
deposit boxes, and other similar commercial arrangements.
FILING REQUIREMENTS
If your answer to FS130 is Yes, complete the applicable items of Schedule FS as follows:
If your total fiduciary assets (items FS20 and FS21) are greater than $250 million for the preceding
calendar year or your gross fiduciary and related services income was greater than 10 percent of total
revenue (net interest income plus noninterest income), you must complete:
1. Items FS210 through FS30 each quarter;
2. Items FS391 through FS35 annually with the December report; and
3. Memorandum items FS410 through FS72 annually with the December report.
If your total fiduciary assets (items FS20 and FS21) are greater than $100 million but less than or equal to
$250 million for the preceding calendar year or your gross fiduciary and related services income was not
greater than 10 percent of total revenue (net interest income plus noninterest income), you must
complete:
1. Items FS210 through FS291 each quarter; and
2. FS310 through FS35 and FS410 through FS72, annually with the December report.
If your total fiduciary assets (items FS20 and FS21) are $100 million or less for the preceding calendar
year or your gross fiduciary and related services income was not greater than 10 percent of total revenue
(net interest income plus noninterest income), you must complete:
1. Items FS210 through FS291 each quarter; and
2. Memorandum items FS410 through FS65 annually with the December report.
FIDUCIARY AND RELATED ASSETS
Report fiduciary and related assets using market value as of the report date. While market value
quotations are readily available for marketable securities, many financial and physical assets held in
fiduciary accounts are not widely traded or easily valued. If the methodology for determining market
value is not set or governed by applicable law (including state or federal law governing the fiduciary
relationship, the terms of an instrument governing the fiduciary relationship, or any court order pertaining
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to the relationship), you may use any reasonable method to establish values for purposes of reporting on
this schedule. Reasonable methods may include appraisals, book value, or reliable estimates. Valuation
methods should be consistent from reporting period to reporting period. This “reasonable method”
approach to reporting market value applies both to financial assets that are not marketable and to
physical assets. Physical assets held in fiduciary accounts may include equipment, art, collectibles, and
household goods.
Only those Individual Retirement Accounts, Health Savings Accounts, and other similar accounts offered
through a fiduciary business unit should be reported in Schedule FS. When such accounts are not
offered through the trust department or fiduciary business unit, they should not be reported in Schedule
FS. Accounts that consist solely of deposits in the thrift itself should not be reported in Schedule FS.
If two institutions are named cofiduciary in the governing instrument, both institutions should report the
account. In addition, where one institution provides fiduciary or related services to another institution’s
accounts (for example: Bank A provides custody services to the trust accounts of Bank B; or Bank A
provides investment management services to the trust accounts of Bank B) both institutions should report
the accounts, according to the services provided.
Exclude unfunded trusts, anticipated testamentary executor appointments, and any other arrangements
that represent potential future fiduciary accounts.
Report asset values net of any outstanding liabilities. For example, report: (1) an employee benefit
account with participant loans net of the outstanding loan balances; (2) an account with a real estate
asset and corresponding mortgage loan net of the mortgage liability; (3) gross fiduciary assets net of any
associated overdrafts; and (4) gross assets net of the fair value of derivative instruments, as defined in
FASB Statement No. 133, even if the fair value is negative.
Reflect securities lending transactions as sales or as secured borrowings according to GAAP, as
principally prescribed in FASB Statement No. 140. A transferee (borrower) of securities generally is
required to provide collateral to the transferor (lender) of securities. When such transactions do not
qualify as sales, securities lenders and borrowers should account for the transactions as secured
borrowings in which cash (or securities that the holder is permitted by contract or custom to sell or
repledge) received as collateral by the securities lender is considered the amount borrowed and the
securities loaned are considered pledged against the amount borrowed. For purposes of this schedule,
securities held in fiduciary accounts that are loaned in securities lending transactions and are accounted
for as secured borrowings should be reported as an asset of the respective fiduciary account that loaned
the securities, but the collateral received should not be reported as an asset of the fiduciary account.
In the Fiduciary and Related Assets section (FS210 through FS291), you should include for each account
in whatever line item is pertinent, the market value of common trust fund units, collective investment fund
(CIF) units, and shares of proprietary mutual funds held by the account. Proprietary mutual funds are
those funds where you, your affiliates, or your subsidiaries act as investment adviser to the fund. You
should not report a common trust fund or a collective investment fund administered by you as a
separate account in FS260/262. You should report each proprietary mutual fund as a separate account
in FS260 and include its assets in FS262. When reporting a proprietary mutual fund in FS290, subtract
from the value of the mutual fund as a whole, those shares held by fiduciary or custodial accounts that
are already reported in the fiduciary and related section on FS210 through FS291. This will prevent
duplicate reporting.
MANAGED ASSETS
Report the total market value of assets held in managed fiduciary accounts. An account should be
categorized as managed if you have investment discretion over the assets of the account. Investment
discretion is defined as the sole or shared authority to determine what securities or other assets to
purchase or sell on behalf of the fiduciary account, even if that authority is not exercised. If you have
delegated your investment authority to another institution, then you both have investment discretion for
reporting purposes. You should report an account as either managed or nonmanaged based on your
predominant responsibility.
SCHEDULE FS
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Whether an account where investment discretion has been delegated to a registered investment adviser,
whether affiliated or nonaffiliated, should be reported as a managed account depends on whether the
delegation of investment authority to the registered investment adviser was made pursuant to the
exercise of investment discretion. If so, the account is deemed to be a managed account. Otherwise, the
account would be a non-managed account for purposes of Schedule FS.
NONMANAGED ASSETS
Report the total market value of assets held in nonmanaged fiduciary accounts. An account should be
categorized as nonmanaged if you do not have investment discretion. Accounts should be categorized
as nonmanaged where you are a fiduciary and provide a menu of investment options but the ultimate
selection authority remains with the account holder or an external manager. For example, if you provide
a choice of sweep vehicles or an array of mutual funds, you are not necessarily exercising investment
discretion. Another example of a fiduciary nonmanaged account is where you serve as trustee for a
401(k) employee benefit plan and the plan participants make their own investment selections. Investment
advisory agency accounts for which a savings association provides investment advice for a fee but where
the ultimate investment decision rests with the customer should be reported as a nonmanaged account.
NUMBER OF MANAGED ACCOUNTS
Report the total number of managed fiduciary accounts.
NUMBER OF NONMANAGED ACCOUNTS
Report the total number of nonmanaged fiduciary accounts.
FS210 Through 213: Personal Trust and Agency Accounts
Report the market value and number of accounts for all testamentary trusts, revocable and irrevocable
living trusts, and any other personal trusts and estates. Include accounts in which you serve as trustee,
executor, administrator, guardian, or conservator. Do not include personal investment management
accounts, these should be reported on FS260/262. Personal investment advisory accounts should be
reported on FS261/263. Also, do not include Keogh Act plans, and other pension or profit sharing plans
for self-employed individuals. These should be included in FS240 through FS243. Individual Retirement
Accounts, Health Savings Accounts and other similar accounts should be included in FS234 through
FS237 and in FS240 through FS243. Include accounts that only receive custody or safekeeping services
in FS280 and FS281.
Retirement-related Trust and Agency Accounts:
FS220 Through FS223: Employee Benefit - Defined Contribution
Report the market value and number of accounts for all employee benefit, defined contribution accounts
for which you serve as trustee or in another fiduciary capacity. Include 401(k) plans, 403(b) plans, profitsharing plans, money purchase plans, target benefit plans, stock bonus plans, employee stock ownership
plans, and thrift savings plans. Employee benefit accounts for which you serve as a directed trustee
should be reported as non-managed. The number of accounts reported should reflect the total number of
plans administered rather than the number of plan participants. Report employee benefit accounts for
which you are a custodian in FS280 and FS281.
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FS230 Through FS233: Employee Benefit - Defined Benefit
Report the market value and number of accounts for all employee benefit, defined benefit plans for which
you serve as trustee or in another fiduciary capacity. The number of accounts reported should reflect the
total number of plans administered rather than the number of plan participants. Report employee benefit
accounts for which you are a custodian in FS280 and FS281.
FS240 Through FS243: Other Retirement Accounts
Report the market value and number of accounts for all other retirement related accounts in which you
serve as trustee or in another fiduciary capacity. Include Keogh Act plans and other pension or profitsharing plans for self-employed individuals. Also report the market value of assets and the number of
accounts for employee welfare benefit trusts and agencies. Employee welfare benefit plans include
plans, funds, or programs that provide medical, surgical, or hospital care benefits; benefits in the event of
sickness, accident, disability, death, or unemployment; vacation benefits; apprenticeship or other training
programs; day care centers; scholarship funds; or prepaid legal services. Individual Retirement
Accounts, Health Savings Accounts, Medical Savings Accounts where you are the trustee should be
reported on this line as well as on FS234 through 237. Report employee benefit accounts for which you
are a custodian in FS280 and FS281 as well as on FS234 through FS236. The number of accounts
reported should reflect the total number of plans or accounts administered rather than the number of plan
participants.
FS250 Through FS253:
Corporate Trust and Agency Accounts
Report the market value and number of all your corporate trust accounts. Report assets for which you
have the responsibility to manage or administer in accordance with the corporate trust agreement.
Include assets of unpresented bonds or coupons relating to issues that have been called or matured. Do
not include the entire market value of the associated securities or the outstanding principal of associated
debt issues. Include accounts where you are the trustee for corporate securities, tax-exempt and other
municipal securities, and other debt securities including unit investment trusts. Also, include accounts for
which you are the dividend or interest paying agent or any other type of corporate trustee or agent.
FS260 Through FS263: Investment Management and Investment
Advisory Agency Accounts
Report the market value and number of accounts for all investment management and investment advisory
accounts that are administered within the fiduciary area. Investment management accounts are those
accounts for which you have investment discretion although title to the assets remains with the client.
Investment advisory accounts are those agency accounts that you provide investment advice for a fee,
but for which some other person is responsible for investment decisions. Investment management
accounts should be reported as managed. Investment advisory agency accounts should be reported as
non-managed. Investment management and advisory accounts maintained for foundations and
endowments should be reported in FS264 through FS267. Include accounts for which you serve as a
sub-advisor. Include those mutual funds that you advise in a separately identifiable department or
division or by an operating subsidiary. The different investment classes of a single mutual fund should be
combined and reported as a single account.
FS 264 Through FS267:
Foundations and Endowments
Report the market value and number of accounts for all foundations and endowments (whether
established by individuals, families, corporations, or other entities) that file Form 990, regardless of which
version, for which you serve as trustee or agent. Also report those foundations and endowments that do
not file Form 990, 990EZ, or 990PF solely because the organization’s gross receipts or total assets fall
below reporting thresholds, but would otherwise be required to file. Foundations and endowments
established by churches, which are exempt from filing Form 990, should also be reported in this item.
Employee benefit accounts maintained for a foundation’s or endowment’s employees should be reported
SCHEDULE FS
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in the Retirement-related Trust and Agency Accounts section. Accounts that are solely custodial or
safekeeping should be reported in FS280 and FS281.
FS270 Through FS273:
Other Fiduciary Accounts
Report the market value and number of accounts for all other fiduciary accounts not reported in FS210
through FS267. Report custody and safekeeping accounts in FS280 and FS281.
FS20 THROUGH FS23: TOTAL FIDUCIARY ACCOUNTS
The EFS software will compute these lines as the sums of their respective columns, from FS210, FS211,
FS212, and FS213 through FS270, FS271, FS272, and FS273.
FS280 and FS281: Custody and Safekeeping Accounts
Report the market value and the number of accounts for all individual and institutional custody and
safekeeping accounts administered by you. Safekeeping and custody accounts are a type of account for
which you perform custody or safekeeping services. In these accounts, you do not act in a fiduciary
capacity, such as trustee, and you do not provide investment advice for a fee or have investment
discretion. Safekeeping and custodial services may include holding assets, processing income and
redemptions, recordkeeping, or customer reporting. For employee benefit custody or safekeeping
accounts, the number of accounts you report should reflect the total number of plans administered rather
than the number of plan participants. Include accounts in which you serve as a sub-custodian for another
institution. For example, where you contract with another institution for custody services, both of you
should report the accounts. Do not include accounts for which you provide document custodial services
for Ginnie Mae, Fannie Mae, or other mortgage-backed securities. Also, do not include accounts for
which you provide services to land trusts.
Individual Retirement Accounts, Health Savings Accounts, Medical Savings Accounts where you serve as
custodian should be reported on this line as well as on FS234 through FS237. Exclude, IRAs, HSAs, and
other similar accounts not offered through your trust department or fiduciary business unit.
Accounts in which you serve as trustee or in an agency capacity in addition to being custodian should be
reported in the category of the primary relationship. For example, personal trust accounts in which you
serve as trustee and custodian should be reported as personal trust accounts and not as custodian
accounts. Include custody and safekeeping accounts that are administered by your trust department or
other identifiable business unit area that focuses on offering custodial services to individual or institutional
fiduciary clients. Do not include those custodial, escrow, and safekeeping activities that are related to
commercial bank services such as hold in custody repurchase assets, securities safekeeping services for
correspondent banks, escrow assets held for the benefit of third parties, safety deposit box assets or any
other similar commercial arrangement.
FS234 Through 237: IRAs, HSAs, and Similar Accounts
Report the market value and number of Individual Retirement Accounts, Health Savings Accounts, and
other similar accounts, included in FS240 through FS243 or FS280 and FS281. Other similar accounts
include Roth IRAs, Coverdell Education Savings Accounts, and Archer Medical Savings Accounts.
Exclude accounts not offered through your trust department or fiduciary business unit.
FS290 and FS291: Assets Included Above, Excluded for Purposes of
the OTS Assessment Complexity Component
OTS imposes semiannual assessments on savings associations based on three components: the thrift’s
size, its condition, and the complexity of its portfolio. For savings associations that have trust powers, a
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complexity component is assessed for those associations that administer over $1 billion in trust assets.
This complexity component, broken into three different categories, is calculated by utilizing different line
items of this schedule. There are situations where OTS requires savings associations to report certain
assets on a line item in Schedule FS that will not be included for assessment purposes. Therefore, the
purpose of FS290 and FS291 is to exclude certain assets for OTS assessment purposes.
Report on FS290 those assets of proprietary mutual funds that are reported as a separate account in
lines FS260 through FS263. Do not include in FS290 those shares of the proprietary mutual fund held by
fiduciary or custodial accounts that are reported in other sections of Schedule FS.
Also, include in FS290 and FS291, any amounts you have included in FS234 through FS237. Since
these assets are already included in FS240 through FS243 or FS280 and FS281 as well as FS234
through FS237, they should be excluded for purposes of assessment so as to avoid duplicate
assessment.
FIDUCIARY AND RELATED SERVICES INCOME
(CALENDAR YEAR-TO-DATE)
Report fiduciary and related services income and expense for the calendar year-to-date. The following
income categories correspond to the asset categories described in FS210 through FS237. Report
income and expense on an accrual basis. You may report both income and expense on a cash basis
only if the results would not materially differ from those obtained using an accrual basis. For report dates
through December 31, 2008, the information reported in Schedule FS on fiduciary and related services
income (except total gross fiduciary and related services income) will not be made available to the public
on an individual basis. Beginning with the March 31, 2009 report date, all of the information reported in
Schedule FS will be publicly available.
FS310: PERSONAL TRUST AND AGENCY ACCOUNTS
Report gross income generated from the services provided to personal trust and agency accounts
reported on FS210 through FS213.
RETIREMENT RELATED TRUST AND AGENCY ACCOUNTS:
FS320: Employee Benefit – Defined Contribution
Report gross income generated from the services provided to defined contribution, employee benefit trust
and agency accounts reported on FS220 through FS223.
FS330: Employee Benefit – Defined Benefit
Report gross income generated from the services provided to defined benefit, employee benefit trust and
agency accounts reported on FS230 through FS233.
FS340: Other Retirement Accounts
Report gross income generated from the services provided to other retirement accounts reported on
FS240 through FS243.
SCHEDULE FS
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FS350: CORPORATE TRUST AND AGENCY ACCOUNTS
Report gross income generated from the services provided to corporate trust and agency accounts
reported on FS250 through FS253.
FS360: INVESTMENT MANAGEMENT AND INVESTMENT ADVISORY
AGENCY ACCOUNTS
Report gross income generated from the services provided to investment management and investment
advisory agency accounts reported on FS260 through FS263. Include income received from investment
advisory activities when the assets are not held by the institution.
FS365: FOUNDATIONS AND ENDOWMENTS
Report gross income generated from the services provided to foundation and endowment accounts
reported on FS264 through FS267.
FS370: OTHER FIDUCIARY ACCOUNTS
Report gross income generated from services provided to other fiduciary accounts reported on FS270
through FS273.
FS380: CUSTODY AND SAFEKEEPING ACCOUNTS
Report gross income generated from services provided to custody and safekeeping accounts reported on
FS280 and FS281.
FS390: OTHER FIDUCIARY AND RELATED SERVICES INCOME
Report all other gross fiduciary and related services income that cannot properly be reported on FS310
through FS380. Include income received from others, including affiliates, for fiduciary and related
services provided by you. Income received from investment advisory services in which the account
assets are held in a custody or safekeeping account at the reporting institution should be reported in
FSFS380. Also, include net income generated from securities lending activities, after deduction of broker
rebates and income paid to lending accounts. Include income from providing services for land trusts and
mortgage-backed securities if you have these activities in addition to other trust and fiduciary activities.
Do not include allocations of income to the trust department from other areas of your savings association,
such as credits for fiduciary cash held as a deposit on your commercial side.
FS30:
TOTAL GROSS FIDUCIARY AND RELATED SERVICES
INCOME
The EFS software will compute this line as the sum of FS310 through FS390.
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FS391: LESS: EXPENSES
Report total direct and indirect expenses attributable to the fiduciary and related services reported in this
schedule.
Direct expenses are immediately identifiable as costs for and directly chargeable to the trust department
or fiduciary business unit. These expenses include: salaries, bonuses, hourly wages, overtime pay,
employee benefits, and incentive pay associated with officers and employees of, or associated with, the
fiduciary and related services reported in this schedule. If only a portion of their time is allocated to
reportable activities, report that proportional share of their salaries and employee benefits. For trust only
institutions, include expenses directly chargeable to the fiduciary and related services reported in this
schedule such as those associated with occupancy, i.e. maintenance, service and repairs, telephones
and utilities, insurance coverage, real estate or property taxes, depreciation/amortization, lease/rental
payments for premises and equipment, and any leasehold improvements. Also include fees paid directly
for external or internal audits of the fiduciary and related services, trust examination fees, employee
training, fees directly paid for outside legal counsel and/or consultants, and expenses paid directly for
advertising and business development activities.
Indirect expenses are those expenses charged to the fiduciary and related services activity from other
departments of the institution. The expenses are generally reflected in your retail accounting system and
include any allocation for the proportionate share of corporate expenses that you do not directly charge to
a particular department or function. If your internal accounting system is unable to provide the
information, you may use a reasonable alternate method to estimate indirect costs. Indirect expenses
include: the proportionate share of data processing expenses; building rent or depreciation; utilities; real
estate taxes; insurance; in-house and/or outside legal counsel; business development activities;
charitable contributions; corporate overhead, such as allocated expenses for corporate planning and/or
financial staff; board of director/committee fees; temporary personnel and professionals; travel;
entertainment; stationary and postage; and automobile expenses. You must keep your reporting
methods for indirect expenses consistent from period to period.
Do not include settlements, surcharges, and other losses reported in FS710 through FS742.
FS392 LESS: NET LOSSES FROM FIDUCIARY AND RELATED
SERVICES
Report net losses resulting from fiduciary and related services. Net losses are gross losses less
recoveries. Gross losses may result from settlements, surcharges, errors from trade processing,
miscalculation of fees or taxes, pricing discrepancies and other losses that are realized in the reporting
period attributable to the fiduciary and related services. Recoveries should include those that are
attributable to prior and current period losses. FS392 must equal the sum of gross managed and
nonmanaged account losses minus recoveries (FS 70 + FS 71 - FS 72) reported in the Memoranda
section of the FS Schedule.
FS393 PLUS: INTRACOMPANY INCOME CREDITS FOR FIDUCIARY
AND RELATED SERVICES
If applicable, report credits from other areas of your association for activities reportable in this schedule.
Include any intracompany income credit made available to the fiduciary area for fiduciary account
holdings of own-bank deposits. Also, include credits for other intracompany services and transactions.
FS35
NET FIDUCIARY AND RELATED SERVICES INCOME
The EFS software will compute this line as the sum of FS30 less FS391 and FS392 plus FS393.
SCHEDULE FS
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MEMORANDA
MANAGED ASSETS HELD IN FIDUCIARY ACCOUNTS
Column A, Personal Trust and Agency and Investment Management Agency Accounts
Report the market value of managed assets held in personal trust and agency accounts (as defined for
FS210/212) and investment management agency accounts (as defined for FS260/262 in accordance with
how the account is invested. Do not include investment advisory agency accounts (as defined for
FS261/263).
Column B, Employee Benefit and Retirement Related Accounts
Report the market value of managed assets held in employee benefit and retirement related trust and
agency accounts (as defined for FS220/FS222, FS230/232, and FS240/242)
Column C, All Other Accounts
Report the market value of managed assets held in corporate trust and agency accounts (as defined for
FS250/252), foundations and endowments (as defined for FS264/266), and other fiduciary accounts (as
defined for FS270/272.
For units in common trust funds and collective investment funds that are held by a managed fiduciary
account, report the market value of the units in this section. Do not allocate the underlying assets of each
common trust fund or collective investment fund attributable to managed accounts in the other lines of
this section. Please note that line items FS463 through FS465 should be used to report investments in
common trust funds and collective investment funds. Report securities held in fiduciary accounts that are
loaned in securities lending transactions, accounted for as secured borrowings, as an asset of the
fiduciary account that loaned the securities. Do not report the collateral received as an asset of this
fiduciary account.
FS410 Through FS412:
Non-interest-bearing Deposits
Report all non-interest-bearing deposits, including deposits of both principal and income cash.
FS415 Through FS417: Interest-bearing Deposits
Report interest-bearing savings and time deposits. Include NOW accounts, MMDA accounts, BICs (bank
investment contracts) that are insured by the FDIC, and certificates of deposit. Report interest-bearing
deposits of both principal and income cash.
FS420 Through FS422:
U.S. Treasury and U.S. Government Agency
Obligations
Report all securities issued by and loans to the U.S. Government and agencies and sponsored
enterprises of the U.S. Include certificates or other obligations that represent pass-through participations
in pools of real estate loans when the participation instruments: (1) are issued by FHA-approved
mortgagees and guaranteed by Ginnie Mae, or (2) are issued, insured, or guaranteed by a U.S.
Government agency or sponsored enterprise, such as Freddie Mac. Also include CMOs and REMICs
issued by Fannie Mae and Freddie Mac.
FS425 Through FS427: State, County and Municipal Obligations
Report all short and long-term obligations of state and local governments and political subdivisions of the
United States. Include obligations of U.S. territories and their political subdivisions and all Federal
income tax exempt obligations of authorities such as local housing and industrial development authorities
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that derive their tax-exempt status from relationships with state or local governments. Tax-exempt money
market mutual funds should be reported with money market mutual funds on FS428 through 430.
FS428 Through FS430:
Money Market Mutual Funds
Report all holdings of mutual funds registered under the Investment Company Act of 1940 that attempt to
maintain net asset values at $1.00 per share or that meet the SEC’s requirements at 17 C.F.R. § 270.2a7. Include both taxable and tax-exempt money market mutual funds. Do not include any short-term
common or collective investment funds.
FS431 Through FS433:
Equity Mutual Funds
Report all holdings of mutual funds registered under the Investment Company Act of 1940, exchange
traded funds (ETFs), and unit investment trusts (UITs) that invest primarily in equity securities. For this
item you should categorize these investments either on the basis of the fund’s investment objective as
stated in the fund prospectus or the fund classification of a company that tracks information on these
funds, such as Morningstar, Lipper, etc. Your methodology for categorizing mutual fund, UIT, and ETF
investments should be consistently applied.
FS437 Through FS439: Other Mutual Funds
Report all holdings of all other mutual funds registered under the Investment Company Act of 1940, ETFs
and UITs. For this item you should categorize these investments either on the basis of the fund’s
investment objective as stated in the fund prospectus or the fund classification of a company that tracks
information on these funds, such as Morningstar, Lipper, etc. Your methodology for categorizing mutual
fund, UIT, and ETF investments should be consistently applied.
FS463 Through FS465: Common Trust Funds and Collective
Investment Funds
Report all holdings of all common trust funds and collective investment funds. Common trust funds and
collective investment funds are funds that banks are authorized to administer by Section 9.18 of the
Office of the Comptroller of the Currency’s regulations or comparable state regulations.
FS434 Through FS436: Other Short-Term Obligations
Report all other short-term obligations. Short-term obligations are defined as obligations with original
maturities of less than 1 year, or 13 months in the case of the time portion of master notes. In addition to
short-term notes, include in this item such money market instruments as master note arrangements,
commercial paper, bankers’ acceptances, securities repurchase agreements, and other short-term
liquidity investments. Do not include any state, county or municipal obligations.
FS440 Through FS442: Other Notes and Bonds
Report all other bonds, notes other than personal notes, and debentures.
Include:
1. Corporate debt, insurance annuity contracts, GICs and BICs that are not insured by the FDIC,
and obligations of foreign governments.
2. Certificates or other obligations, however named, representing pass-through participation in pools
of real estate loans when the participation instruments are issued by financial institutions and
guaranteed in whole or in part by private guarantors.
3. CMOs and REMICs that are not issued by Fannie Mae or Freddie Mac, even if the collateral
consists of Ginnie Mae or Fannie Mae pass-throughs or Freddie Mac PCs.
SCHEDULE FS
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Do not include:
1. Short-term obligations that should be reported on FS435.
2. Personal notes.
FS466 Through FS468: Investment in Unregistered Funds and Private
Equity Investments
Report all holdings of funds exempt from registration under Sections 3c1 or 3c7 of the Investment
Company Act of 1940, for example, “hedge funds”. Report all holdings of private equity investments
exempt from registration under Securities Act of 1933 Regulation D. Private equity investments is an
asset class consisting of purchased equity securities in operating companies that are not publicly traded
on a stock exchange or otherwise registered with the SEC under federal securities laws. Private equityrelated funds are funds that invest primarily in private equity investments. Unregistered private equity
funds should be reported in this item.
Investments in family businesses that are associated with the grantors or beneficiaries of a fiduciary
account should not be reported in this Memorandum item as a “private equity investment”. Such
investments may arise, for example, from an in-kind transfer to a fiduciary account of securities of a
closely-held family business or an increase in a fiduciary account’s percentage ownership of an existing
closely-held family business whose securities are held in the account. Such investments should be
reported in FS460 through FS462.
FS445 Through FS447: Other Common and Preferred Stocks
Report all holdings of domestic and foreign common and preferred equities, including warrants and
options. Exclude investments in unregistered funds and private equity investments (which should be
reported in FS466 through FS468).
FS450 Through FS452: Real Estate Mortgages
Report real estate mortgages, real estate contracts, land trust certificates, and ground rents. These
assets may be reported at their unpaid balance if that figure is a fair approximation of market value.
FS455 Through FS457: Real Estate
Report real estate and other similar assets.
Include:
1.
2.
3.
4.
5.
Mineral interests.
Royalty interests.
Leaseholds.
Land and buildings associated with farm management accounts.
Investments in limited partnerships that are solely or primarily invested in real estate.
FS460 Through FS462: Miscellaneous Assets
Report personal notes, tangible personal property, and other miscellaneous assets that cannot be
properly reported on FS410 through FS457. Include crops, equipment, and livestock associated with
farm management accounts. Also, include investments in closely-held family businesses if such
investments represent in-kind transfers to a fiduciary account of securities in a closely-held family
business or an increase in a fiduciary account’s percentage ownership of an existing closely-held family
business whose securities are held in the account.
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FS40 Through FS442: Total Managed Assets
The EFS software will compute these lines as the sums of their respective columns, from FS410, FS411,
and FS412 through FS460, FS461, and FS462
INVESTMENTS OF MANAGED FIDUCIARY ACCOUNTS IN ADVISED
OR SPONSORED MUTUAL FUNDS
FS495: Market Value of Accounts Invested in Advised/Sponsored
Mutual Funds
Report the market value of all fiduciary managed assets invested in mutual funds that you, a subsidiary or
affiliate sponsors or acts as investment adviser.
FS496: Number of Accounts Invested in Advised/Sponsored Mutual
Funds
Report the number of fiduciary managed accounts with assets invested in advised or sponsored mutual
funds.
CORPORATE TRUST AND AGENCY ACCOUNTS:
FS510 and FS515:
Corporate and Municipal Trusteeships
Report in FS510 the total number of corporate and municipal issues, including equities, such as trust
preferred securities, or asset-backed securities, for which you serve as trustee. Also, report other debt
issues such as unit investment trusts and private placement leases, for which you serve as trustee. If
more than one institution is trustee for an issue, both institutions should report the issue. Consider
securities with different CUSIP numbers as separate issues; however, consider serial bond issues as a
single issue. When you serve as trustee of a bond issue and you also perform agency functions for the
issue such as transfer agent or paying agent, you should report the issue only in FS510, as the trustee
appointment is considered the primary function. Do not include issues that have been called in their
entirety or matured even if they are unpresented bonds or coupons for which funds are being held.
Report on FS515 the unpaid principal balance of the outstanding securities for the issues reported on
FS510. For zero-coupon bonds, report the final maturity amount. For trust preferred securities, report the
redemption price. Do not include assets, such as cash, deposits, and investments, that are being held for
corporate trust purposes; report these on FS250 or FS251.
FS516 and FS517:
Report in FS516 the total number and in FS517 the unpaid principal balance (redemption price for trust
preferred securities) of the issues reported in FS510 that are in substantive default. A substantive default
occurs when the issuer (a) fails to make a required payment of principal or interest, defaults on a required
payment into a sinking fund, files for bankruptcy, or is declared bankrupt or insolvent, and (b) default has
been declared by the trustee. Issues should not be reported as being in substantive default during a cure
period, provided the indenture for the issue provides for a cure period. Private placement leases where
the trustee is required to delay or waive the declaration of an event of default, unless requested in writing
to make such declaration, should not be reported as being in substantive default, provided such written
request has not been made. Once a trustee’s duties with respect to an issue in substantive default have
been completed, the issue should no longer be reported as being in default.
Do not report issues that are in technical default, i.e., if the obligor failed to provide information or
documentation to the trustee within specified time period.
SCHEDULE FS
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FS520: Transfer Agent, Registrar, Paying Agent, and Other Corporate
Agency
Report the total number of issues for which you act in a corporate agency capacity. Include the total
number of equity, debt, and mutual fund issues for which you act as transfer agent or registrar regardless
of whether the transfer agent is registered with its appropriate regulatory agency. Separate classes of a
mutual fund should be consolidated and reflected as a single issue. Include the total number of stock or
bond issues for which you disburse dividend or interest payments. Also include the total number of
issues of any other corporate appointments that are performed by you through your fiduciary capacity.
Issues where you serve in a dual capacity should be reported once. Corporate and municipal
trusteeships reported in FS510, in which you also serve as transfer agent, registrar, paying agent, or
other corporate agency capacity should not be included in FS520. Include only those agency
appointments that do not relate to issues reported in FS510.
COLLECTIVE INVESTMENT FUNDS AND COMMON TRUST FUNDS:
Report in the appropriate subitem the number of funds and the market value of the assets held in
Collective Investment Funds (CIFs) and Common Trust Funds administered by you. Common trust funds
and collective investment funds are funds that banks are permitted to administer by Section 9.18 of the
Office of the Comptroller of the Currency’s regulations or comparable state regulations. If you administer
a common or collective fund that is used more than one institution, the entire fund should be reported in
this section only by the institution that administers the fund. Do not include proprietary mutual funds in
this section. Each common or collective investment fund should be reported in the one subitem that best
fits the fund type.
FS610 and FS615: Domestic Equity
Report funds investing primarily in U.S. equities.
Include:
1. Funds seeking growth, income, or both growth and income.
2. U.S. index funds and those concentrating on small, mid, or large cap domestic stocks.
Do not include funds specializing in a particular sector, such as technology, health care, financial
institutions, or real estate. Sector funds should be reported on FS670 and FS675.
FS620 and FS625:
International/Global Equity
Report funds investing exclusively in equities of issuers located outside the U.S. and those funds
representing a combination of U.S. and foreign issuers. Include funds that specialize in a particular
country, region, or emerging market.
FS630 and FS635: Stock/Bond Blend
Report funds investing in a combination of equity and bond investments. Include funds with a fixed
allocation along with those having the flexibility to shift assets between stocks, bonds, and cash.
FS640 and FS645: Taxable Bond
Report funds investing in taxable debt securities.
Include funds that specialize in:
1. U.S. Treasury and U.S. Government agency debt.
2. Investment grade corporate bonds.
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3. High-yield debt securities.
4. Mortgage-related securities.
5. Global, international, and emerging market debt funds.
Do not include funds that invest in:
1. Municipal bonds; report these on FS650 and FS655.
2. Funds that qualify as short-term investments that should be reported on FS660 and FS665.
FS650 and FS655: Municipal Bond
Report funds investing in debt securities issued by states and political subdivisions in the U.S. Such
securities may be taxable or tax-exempt. Include funds that invest in municipal debt issues from a single
state. Do not include funds that qualify as short-term investments that should be reported on FS660 and
FS665.
FS660 and FS665: Short Term Investments/Money Market
Report funds subject to the provisions of 12 C.F.R. 9.18(b)(4)(ii)(B) or comparable state regulations that
invest in short-term money market instruments. Money market instruments may include U.S. Treasury
bills, commercial paper, bankers’ acceptances, and repurchase agreements. Include taxable and
nontaxable funds.
FS670 and FS675:
Specialty/Other
Report funds that specialize in equity securities of particular sectors, such as technology, health care,
financial, or real estate. Also report funds that do not fit into any of the above categories.
FS60 AND FS65:
TOTAL COLLECTIVE INVESTMENT FUNDS
The EFS software will compute these lines as the sum of FS610 through FS670 and the sum of FS615
through FS675.
FIDUCIARY SETTLEMENTS, SURCHARGES, AND OTHER LOSSES
(CALENDAR YEAR-TO-DATE)
Report for the calendar year-to-date all aggregate gross settlements, surcharges, and other losses arising
from errors, misfeasance, or malfeasance on managed accounts on FS710 through FS740 and on
nonmanaged accounts, including custody and safekeeping accounts on FS711 through FS741. Gross
losses should reflect losses recognized on an accrual basis before recoveries or insurance payments. Do
not include fiduciary related contingent losses, including those for pending or threatened litigation, for
which a loss has not yet been recognized in accordance with FASB Statement NO.5.
Report recoveries on FS712 through FS742. Recoveries may be for current or prior years’ losses and
should be reported when payment is actually realized, not upon the filing of an insurance claim.
For report dates through December 31, 2008, the information reported on fiduciary settlements,
surcharges, and other losses will not be made available to the public on an individual institution basis.
Beginning with the March 31, 2009 report date, all of the information reported in Schedule FS for each
savings association will be publicly available.
FS710 through FS712:
Personal Trust and Agency Accounts
Report gross losses and recoveries for managed and nonmanaged personal trust and agency accounts.
SCHEDULE FS
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FS720 through FS722:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Retirement Related Employee Benefit
Accounts
Report gross losses and recoveries for managed and nonmanaged retirement related employee benefit
accounts. Include gross losses and recoveries for all defined contribution, defined benefit, and other
retirement accounts.
FS730 through FS732:
Investment Management and Investment
Advisory Agency Accounts
Report gross losses and recoveries for investment management and investment advisory agency
accounts.
FS740 through FS742:
Other Fiduciary Accounts and Related
Services
Report gross losses and recoveries for all other fiduciary accounts and related services that are not
included in FS710 through FS732. Include losses and recoveries from corporate trust and agency
accounts, foundations and endowments, other fiduciary accounts, custody and safekeeping accounts,
and other fiduciary related service accounts.
FS70 THROUGH FS72:
TOTAL FIDUCIARY SETTLEMENTS,
SURCHARGES, AND OTHER LOSSES
The EFS software will compute these lines as the sum of FS710 through FS740, FS711 through FS741,
and FS712 through FS742. The sum of FS70 and FS71 minus FS72 must equal FS392.
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SCHEDULE HC — SAVINGS ASSOCIATION
HOLDING COMPANY
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
Complete this schedule if you are owned by a savings association holding company, except if your
holding company is a registered Bank Holding Company supervised by the Federal Reserve. If your
holding company owns more than one savings association institution, we will advise you which institution
should file this report. We will also advise you which holding company(ies) to report if you are owned by
more than one. You should continue to report for each holding company designated until advised
otherwise.
Unless otherwise instructed, report all dollar amounts in accordance with GAAP for each designated
holding company filing Schedule HC. (See the note below for insurance companies preparing financial
statements under statutory accounting principles.) Where it is appropriate under GAAP to consolidate
one or more of the holding company’s subsidiaries (which may or may not include your savings
association), the amounts in the “Consolidated” column should reflect consolidation of those subsidiaries.
The amounts in the “Parent Only” column must reflect the holding company’s investment in subsidiaries
and the operations of those subsidiaries, under the equity method of accounting. Subsidiary operations,
as a component of the investment account, would include dividends, earnings, and other activity updated
on a quarterly basis. In the infrequent circumstance where it is not appropriate under GAAP to
consolidate any of the holding company’s subsidiaries – such as a designated holding company filing
Schedule HC that is a minority shareholder of the savings association and controls no other subsidiaries
– the amounts in the “Consolidated” column should be left blank.
If the holding company has a quarter end other than a calendar quarter end, you may use data from the
fiscal quarter ending within the reporting calendar quarter. For example, if the holding company’s fiscal
year end is October, its fiscal quarter ends are January, April, July, and October. You should use its
fiscal quarter ending January 31 for the March 31 TFR, April 30 for June 30, July 31 for September 30,
and October 31 for December 31.
If your holding company is an insurance company, and does not prepare financial statements for external
use in conformity with GAAP, you may file data from financial statements prepared in conformity with
statutory accounting principles in the “Parent Only” column. If periodic consolidated financial statements
are prepared under GAAP – such as for annual reports to policyholders – data from these statements
should be used in filing Schedule HC in the appropriate “Consolidated” and “Parent Only” columns.
SCHEDULE HC
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You must file Schedule HC no later than the 45th day following the end of the calendar quarter.
HC100: Holding Company Number
Report the OTS docket number of the holding company for which you are reporting. All holding company
docket numbers begin with an H.
HC110: Fiscal Year End
Enter the month of your current fiscal year-end for audited financial statement purposes. In some cases
this may not correspond to the tax year-end.
HC125: Stock Exchange Ticker Symbol
List the symbol if the stock of the holding company is traded on a public exchange.
HC130: SEC File Number
If the holding company must file periodic securities disclosure documents with the SEC pursuant to the
Securities Exchange Act of 1934, report the SEC file number. Examples of disclosure documents are
Form 10-K and Form 10-Q.
If the reporting holding company does not file periodic securities disclosure documents with the SEC but
its parent or top tier holding company does file, you should report the SEC file number of that parent or
top tier holding company.
HC140: Website Address
If one exists, report the Internet address of the reporting holding company or of the appropriate entity
within the corporate structure where publicly available financial information is available.
PARENT ONLY
The parent holding company is an entity within the corporate structure. Parent-only reporting reflects the
activities of the holding company. The parent activities are often limited to ownership of subsidiaries,
financing activities and administrative activities. The parent records investments in subsidiaries as an
investment or under the equity method as prescribed by GAAP. On a parent-only basis, intra-group
transactions are not eliminated.
HC210: Total Assets
Report total assets on a parent only basis. Report details for components included in Total Assets on
HC301 through HC370.
HC220: Total Liabilities
Report total liabilities on a parent only basis. Report details for components included in Total Liabilities
on HC410 through HC460.
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Equity:
Perpetual Preferred Stock:
Include:
1. Preferred stock that the holding company has issued that is nonredeemable by the purchaser and
that qualifies as equity capital under GAAP.
2. Preferred stock convertible into common stock.
Report preferred stock net of issuance costs, premiums, and discounts. If the holding company issued
preferred stock above par value, include the amount paid in excess of par with the par value.
Dividends on perpetual preferred stock reduce retained earnings when declared. Include them on
HC575, Dividends Declared Attributable to Holding Company.
Do not include:
1. Redeemable preferred stock.
2. Permanent preferred stock issued by a consolidated subsidiary.
HC221: Cumulative
Report permanent preferred stock where the stockholders are entitled to receive unpaid dividends before
the payment of dividends on other classes of stock.
HC222: Noncumulative
Report permanent preferred stock whose dividends do not accumulate if unpaid.
Common Stock:
HC223: Par Value
Report the par value of all outstanding common stock – permanent, reserve, or guaranty stock – that the
holding company has issued.
If the par value of common stock issued is less than $500, report “1” in this data field to indicate that it is
not zero, and, if necessary, reduce the amount that you report on HC224 by one.
You must reduce retained earnings at the time that the holding company declares dividends on common
stock. Report the reduction of retained earnings on HC575, Dividends Declared Attributable to Holding
Company.
Do not include deductions for:
1. Stock the holding company reacquired – treasury stock. Report as a negative on HC229, Other
Components of Equity.
2. Unallocated ESOP shares. Report as a negative on HC229, Other Components of Equity.
HC224: Paid in Excess of Par
Include:
1. Amounts paid in excess of par value from the issuance of common stock for cash or nonmonetary
assets. Deduct the costs of issuing common stock.
2. Permanent capital contributions by the stockholders not related to the purchase of stock.
SCHEDULE HC
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Do not include:
Paid-in capital from the issuance of preferred stock. Report on HC221 or HC222, Perpetual Preferred
Stock.
Accumulated Other Comprehensive Income:
HC225: Accumulated Gains (Losses) on Certain Securities
Report accumulated gains (losses), net of taxes, on securities and on certain nonsecurity financial
instruments, CNFIs, classified as available for sale (AFS).
Gains and losses reported here are not reported in the statement of operations until either the asset is
sold, an other-than-temporary impairment loss is recognized, or this amount is amortized in accordance
with the following paragraph.
Include the unamortized amount of the gain or loss at the date of transfer of debt securities transferred
from AFS to held-to-maturity (HTM). Continue to report this gain or loss on this line until it is completely
amortized over the remaining life of the security as an adjustment of yield in the same manner as a
discount or premium.
In addition, report on this line the amount of the other-than-temporary impairment (OTTI) on AFS and
HTM debt securities that is related to all factors other than credit, where that amount is appropriately
recognized in other comprehensive income.
Report this data field as negative when your unrealized losses exceed unrealized gains.
HC226: Gains (Losses) on Cash Flow Hedges
Report the accumulated fair value gain or loss, net of taxes, on cash flow hedges.
HC227: Other
Report any accumulated other comprehensive income not included on HC225 or HC226.
Include:
1. Any minimum pension liability adjustment recognized in accordance with FASB Statement No.
87, Employers’ Accounting for Pensions and FASB Statement No. 158, Employers’ Accounting
for Defined Benefit Pension and Other Postretirement Plans.
2. Cumulative foreign currency translation adjustments and qualifying foreign currency transaction
gains and losses, net of taxes.
3. Any other items of accumulated other comprehensive income not reported in other Accumulated
Other Comprehensive Income HC line items.
HC228: Retaining Earnings
Retained earnings consists of the holding company’s accumulated net income, less distributions to
shareholders, and certain accounting adjustments.
HC229: Other Components of Equity
Report amounts reported under GAAP as separate components of equity. In most cases the amounts in
this data field will be negative, as these items typically reduce equity capital.
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Include:
1. Treasury stock.
2. Unearned employee stock ownership plan (ESOP) shares, when such reporting is required under
GAAP, including AICPA SOP No. 93-6, Employers’ Accounting for Employee Stock Ownership
Plans.
HC240: Total Equity
The EFS software will compute this line as the sum of HC221, HC222, HC223, HC224, HC225, HC226,
HC227, HC228, and HC229.
Generally, parent only Total Equity should be equal to consolidated Total Equity (HC630), less any
amount reported on HC620, Noncontrolling Interests in Consolidated Subsidiaries. If this is not the case,
explain the difference in a user note.
HC20: Total Liabilities and Equity
The EFS software will compute this line as the sum of HC220 and HC240. This amount should equal that
on HC210.
HC250: Net Income (Loss) Attributable to: Holding Company
Report the holding company’s net income or loss. Include the parent holding company’s proportionate
share of any thrift institution subsidiary’s income or loss. The amount reported on this line is comprised of
the amounts reported on HC509, HC570, and HC571.
HC575: Dividends Declared Attributable to: Holding Company
Report the cash and noncash dividends declared on preferred and common stock reported on HC221,
HC222, HC223, and HC224.
Included in Total Assets:
HC301: Cash, Deposits, and Investment Securities
Report the total amount of cash, including deposits with financial institutions, and investment securities.
Do not include the holding company’s investments in subsidiaries. Report such amounts on HC330 and
HC340.
Receivable from Subsidiaries:
HC310: Savings Association
Report the holding company’s receivable from savings association subsidiaries, which is sometimes
referred to as “advances to” or “due from.” Include certain ESOP borrowings reflected on the savings
association’s books that are reported as receivables on a parent only basis.
HC320: Other Subsidiaries
Report the holding company’s receivable from subsidiaries other than savings association subsidiaries,
which is sometimes referred to as “advances to” or “due from”.
SCHEDULE HC
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Investments in Subsidiaries:
HC330: Savings Association
Report the holding company’s direct investment in savings association subsidiaries in a manner that
reflects the equity method of accounting. In most cases, if you are wholly owned, this line should equal
your equity (SC80).
Report zero if this holding company is not the direct owner of the savings association.
HC340: Other Subsidiaries
Report the holding company’s investment in subsidiaries other than savings association subsidiaries in a
manner that reflects the equity method of accounting. If this holding company is not the direct owner of
the savings association, report the holding company’s investments in one or more the mid-tier holding
companies.
Intangible Assets
HC350: Mortgage Servicing Assets
Report the carrying amount of mortgage servicing assets.
HC360: Nonmortgage Servicing Assets and Other
Report the balance of the parent’s nonmortgage servicing assets and other intangible assets.
Include on this line intangible assets such as the following, taken from examples provided in FASB
Statement No. 141:
1.
2.
3.
4.
5.
6.
Goodwill.
Customer relationships and customer lists, including core deposit premiums.
Employment agreements.
Non-compete agreements.
Lease agreements.
Computer software costs.
HC370: Deferred Policy Acquisition Costs
Report deferred policy acquisition costs (DPAC) incurred by insurance companies. DPAC include
variable acquisition costs such as commissions and underwriting and policy issuance expenses related to
both new and renewal insurance policies and annuities.
Included in Total Liabilities (Excluding Deposits) Payable to
Subsidiaries:
Borrowings, as the term is used here, means short-term or long-term debt, negotiated with specified
terms, usually including interest rates and repayment dates. Borrowings exclude deposits and
transactional liabilities, such as accounts payable, income taxes payable, and accrued liabilities.
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Savings Association Subsidiaries:
HC410: Transactional
Report the holding company’s payable to savings association subsidiaries, which is sometimes referred to
as “advances from” or “due to”. Do not include amounts reported on HC420.
HC420: Debt
Report the amount of borrowings the holding company owes to the reporting savings association. Do not
include amounts reported on HC410.
Other Subsidiaries:
HC430: Transactional
Report the holding company’s payable to subsidiaries other than savings association subsidiaries, which
is sometimes referred to as “advances from” or “due to”. Do not include amounts reported on HC440.
HC440: Debt
Report the balance of the holding company's borrowings from its subsidiaries other than savings
association subsidiaries. Do not include amounts reported on HC430 and HC445.
HC445: Trust Preferred Instruments
Trust preferred securities are typically issued to third party investors by a wholly owned trust of the
holding company. The holding company typically borrows from the trust substantially all the net proceeds
from issuance of the trust preferred securities. For parent only reporting, report the balance of the holding
company's borrowings from the trust that issued the trust preferred securities.
In most cases, the holding company's financial statements do not reflect consolidation of the financial
statements of the trust that issued the trust preferred securities. Accordingly, the amounts in HC445 and
HC 670 should be equal. If the trust is consolidated, report on HC 670 the balance of the trust preferred
instruments.
HC450: Other Debt Maturing in 12 Months or Less
Report all borrowings, excluding deposits, payable to subsidiaries, and trust preferred instruments that
you would classify as current liabilities if the holding company were to present a classified balance sheet.
Include such borrowings that, within the next 12 months, either (1) contractually mature; (2) are callable at
the option of the lender; or (3) otherwise become due and payable.
Callable, as the term is used here, refers to an option by the lender to require repayment of the borrowing
before its contractual maturity.
A classified balance sheet is one that includes subtotals for current assets and current liabilities. Most
savings association holding companies do not present a classified balance sheet. However, for purposes
of HC450/HC680 and HC460/HC690, classify all borrowings as either current or noncurrent. The
parameters of current liabilities are detailed in Accounting Research Bulletin No. 43, Restatement and
Revision of Accounting Research Bulletins, Chapter 3A, as revised by SFAS No. 78, Classification of
Obligations That Are Callable by the Creditor.
Example: A holding company’s borrowings, on a consolidated basis, include a FHLBank advance where
the contractual maturity date is beyond the next 12 months. However, beginning on a date within the next
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12 months, the FHLBank may exercise its option to require immediate repayment of the advance. You
should include that advance in HC450/HC680.
HC460: Other Debt Maturing in More Than 12 Months
Report all borrowings (other than payables to subsidiaries and trust preferred securities) except:
1. Debt maturing in 12 months or less reported on HC450/HC680.
2. Deposit and escrow liabilities held by you or any other subsidiary depository institution.
Reflected in Net Income:
HC505: Interest Income
Report interest income on all interest-bearing assets, including those assets reported on HC301, HC310,
and HC320.
Dividends
As stated in the General Instructions to Schedule HC, the amounts in the “Parent Only” column should
reflect the holding company’s investment in subsidiaries, and the operations of those subsidiaries, under
the equity method of accounting. Consistent with those instructions, the holding company’s net income
on a “Parent Only” basis, as reported on HC250, should reflect the holding company’s equity in net
income or loss of its subsidiaries. Typically, such income or loss is presented as two separate
components:
1. Dividends from subsidiaries – that is, the distributed component, and
2. Equity in undistributed income or loss of subsidiaries.
Accordingly, report on HC525 and HC535 the dividends from subsidiaries component of the holding
company’s equity in net income or loss of its directly owned subsidiaries.
For example, assume that the holding company’s equity in the net income of its savings association
subsidiary is $10 million; and that dividends declared by, and received from, the subsidiary are $3 million.
The holding company’s net income on a parent only basis reported on HC250, “Net Income (Loss)
Attributable to Holding Company”, would include the $10 million. The holding company would report the
$3 million on HC525. Note that the holding company’s $7 million ($10 million - $3 million) undistributed
income component of its equity in income of the savings association subsidiary would not be reported
separately on Schedule HC.
HC525: From Savings Association Subsidiaries
Report dividends from savings association subsidiaries in which you have direct ownership. Such
dividends should be recognized by the holding company under the equity method of accounting.
HC535: From Other Subsidiaries
Report dividends from all other subsidiaries than savings association subsidiaries recognized by the
holding company under the equity method of accounting.
HC509: Total Income
Report the holding company’s total income from all sources, including the amounts reported on HC505,
HC525, and HC535.
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Interest Expense
HC545: Trust Preferred Instruments
Report interest expense from borrowings from the trust that issued the trust preferred instruments.
HC555: All Other Debt
Report interest expense, excluding interest expense on trust-preferred instruments and on deposit and
escrow liabilities held by a subsidiary depository institution.
HC570: Total Expenses
Report the holding company’s total expenses from all sources, including the amounts reported on HC545
and HC555.
HC571: Total Income Taxes
Report the holding company’s provision for current and deferred income taxes, determined in accordance
with GAAP.
HC565: Net Cash Flow From Operations Attributable to: Holding
Company
Report the net increase or decrease in cash and cash equivalents from operating activities, as it would
appear in a statement of cash flows prepared in accordance with GAAP. Do not include any change in
cash and cash equivalents from investing and financing activities.
CONSOLIDATED
Prepare the consolidated amounts on Schedule HC in accordance with GAAP unless specifically stated
otherwise. All data is reported as of the end of the quarter, or in the case of income, expense, and other
activity data, for the period of one calendar quarter. Report subsidiaries that are not GAAP-consolidated
subsidiaries using the equity method of accounting.
HC600: Total Assets
Report total consolidated assets. Report details for components included in Total Assets on HC601
through HC660.
HC610: Total Liabilities
Report total consolidated liabilities. Report details for components included in Total Liabilities on HC670
through HC690.
Equity:
Perpetual Preferred Stock:
Include:
1. Preferred stock that the holding company has issued that is nonredeemable by the purchaser and
that qualifies as equity capital under GAAP.
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2. Preferred stock convertible into common stock.
Report preferred stock net of issuance costs, premiums, and discounts. If the holding company issued
preferred stock above par value, include the amount paid in excess of par with the par value.
Dividends on perpetual preferred stock reduce retained earnings when declared. Include them on
HC775, Dividends Declared Attributable to Holding Company.
Do not include:
1. Redeemable preferred stock.
2. Permanent preferred stock issued by a consolidated subsidiary.
HC621: Cumulative
Report permanent preferred stock where the stockholders are entitled to receive unpaid dividends before
the payment of dividends on other classes of stock.
HC622: Noncumulative
Report permanent preferred stock whose dividends do not accumulate if unpaid.
Common Stock:
HC623: Par Value
Report the par value of all outstanding common stock – permanent, reserve, or guaranty stock – that the
holding company has issued.
If the par value of common stock issued is less than $500, report “1” in this data field to indicate that it is
not zero, and, if necessary, reduce the amount that you report on HC624 by one.
You must reduce retained earnings at the time that the holding company declares dividends on common
stock. Report the reduction of retained earnings on HC775, Dividends Declared Attributable to Holding
Company.
Do not include deductions for:
1. Stock the holding company reacquired – treasury stock. Report as a negative on HC629, Other
Components of Equity.
2. Unallocated ESOP shares. Report as a negative on HC629, Other Components of Equity.
HC624: Paid in Excess of Par
Include:
1. Amounts paid in excess of par value from the issuance of common stock for cash or nonmonetary
assets. Deduct the costs of issuing common stock.
2. Permanent capital contributions by the stockholders not related to the purchase of stock.
Do not include:
Paid-in capital from the issuance of preferred stock. Report on HC621 or HC622, Perpetual Preferred
Stock.
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Accumulated Other Comprehensive Income:
HC625: Accumulated Gains (Losses) on Certain Securities
Report accumulated gains (losses), net of taxes, on securities and on certain nonsecurity financial
instruments, CNFIs, classified as available for sale (AFS).
Gains and losses reported here are not reported in the statement of operations until either the asset is
sold, an other-than-temporary impairment loss is recognized, or this amount is amortized in accordance
with the following paragraph.
Include the unamortized amount of the gain or loss at the date of transfer of debt securities transferred
from AFS to held-to-maturity (HTM). Continue to report this gain or loss on this line until it is completely
amortized over the remaining life of the security as an adjustment of yield in the same manner as a
discount or premium.
In addition, report on this line the amount of the other-than-temporary impairment (OTTI) on AFS and
HTM debt securities that is related to all factors other than credit, where that amount is appropriately
recognized in other comprehensive income.
Report this data field as negative when your unrealized losses exceed unrealized gains
HC626: Gains (Losses) on Cash Flow Hedges
Report the accumulated fair value gain or loss, net of taxes, on cash flow hedges.
HC627: Other
Report any accumulated other comprehensive income not included on HC625 or HC626.
Include:
1. Any minimum pension liability adjustment recognized in accordance with FASB Statement No.
87, Employers’ Accounting for Pensions and FASB Statement No. 158, Employers’ Accounting
for Defined Benefit Pension and Other Postretirement Plans.
2. Cumulative foreign currency translation adjustments and qualifying foreign currency transaction
gains and losses, net of applicable income taxes.
3. Any other items of accumulated other comprehensive income not reported in other Accumulated
Other Comprehensive Income HC line items.
HC628: Retained Earnings
Retained earnings consists of the holding company’s accumulated net income, less distributions to
shareholders, and certain accounting adjustments.
HC629: Other Components of Equity
Report amounts reported under GAAP as separate components of equity. In most cases the amounts in
this data field will be negative, as these items typically reduce equity capital.
Include:
1. Treasury stock.
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2. Unearned employee stock ownership plan (ESOP) shares, when such reporting is required under
GAAP, including AICPA SOP No. 93-6, Employers’ Accounting for Employee Stock Ownership
Plans.
HC60: Total Holding Company Equity
The EFS software will compute this line as the sum of HC621, HC622, HC623, HC624, HC625, HC626,
HC627, HC628, and HC629.
This subtotal excludes noncontrolling interests in consolidated subsidiaries.
HC620: Noncontrolling Interests in Consolidated Subsidiaries
Include:
1. Common and perpetual preferred stock issued by the holding company’s consolidated
subsidiaries to third parties that constitute a noncontrolling interest.
For any net income or loss attributable to a noncontrolling interest in a consolidated subsidiary,
see the instructions for HC640, Net Income (Loss) Attributable to Holding Company.
Do not include:
1. Mandatorily redeemable preferred stock that must be classified as a liability under GAAP. Report
this amount on HC610, Total Liabilities.
2. Redeemable and perpetual preferred stock that was issued by consolidated subsidiaries and is
owned by the holding company or its other subsidiaries as an investment asset. When making
consolidating entries, eliminate the preferred stock of the consolidated subsidiary.
HC630: Total Equity
The EFS software will compute this line as the sum of HC60 and HC620.
Generally, consolidated Total Equity should be equal to parent only Total Equity on HC240, plus
Noncontrolling Interests in Consolidated Subsidiaries on HC620. If this is not the case, explain the
difference in a user note.
HC70: Total Liabilities and Equity
The EFS software will compute this line as the sum of HC610 and HC630. This amount should equal that
on HC600.
HC635: Net Income (Loss) Attributable to Holding Company and
Noncontrolling Interests
Report net income or loss on a consolidated basis, including the net income or loss attributable to
noncontrolling interests in consolidated subsidiaries. The amount reported on this line is comprised of the
amounts reported on HC709, HC770, and HC771.
HC640: Net Income (Loss) Attributable to Holding Company
Report net income or loss on a consolidated basis attributable to the holding company only; that is,
without regard to the net income or loss attributable to noncontrolling interests in consolidated
subsidiaries.
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HC775: Dividends Declared Attributable to: Holding Company
Report the cash and noncash dividends declared on preferred and common stock reported on HC621,
HC622, HC623, and HC624, that are attributable to the holding company. Do not include dividends
attributable to noncontrolling interests in consolidated subsidiaries.
Included in Total Assets:
HC601: Cash, Deposits, and Investment Securities
Report the total amount of cash, including deposits with financial institutions, and investment securities.
Do not include the holding company’s investments in consolidated subsidiaries, as such amounts should
be eliminated in consolidation.
Intangible Assets:
HC650: Mortgage Servicing Assets
Report the carrying amount of mortgage servicing assets.
HC655:
Nonmortgage Servicing Assets and Other
Report the balance of the total consolidated nonmortgage servicing assets and other intangible assets.
See HC360 for further explanation.
HC660: Deferred Policy Acquisition Costs
Report deferred policy acquisition costs (DPAC) incurred by insurance companies. DPAC include
variable acquisition costs such as commissions and underwriting and policy issuance expenses related to
both new and renewal insurance policies and annuities.
Included in Total Liabilities (Excluding Deposits) Payable to
Subsidiaries:
HC670: Trust Preferred Instruments
Where the holding company's financial statements reflect consolidation of the financial statements of the
trust that issued the trust preferred securities, report the balance of the trust preferred securities - not the
balance of the holding company's borrowings from the trust. Where the trust's financial statements are
consolidated with those of the holding company, the holding company's borrowings from the trust are
eliminated in consolidation. Refer to HC445 for additional information on reporting of Trust Preferred
Instruments. In most cases, the holding company’s financial statements do not reflect consolidation of
the financial statements of the trust. Accordingly, report the balance of the holding company borrowings
from the trust.
HC680: Other Debt Maturing in 12 Months or Less
Report all other borrowings (on a consolidated basis), excluding deposits, trust preferred instruments and
intercompany borrowings not eliminated in consolidation, that will mature in less than 12 months. If a
direct savings association ownership by the parent exists, then this line should include the proportionate
ownership of FHLB advances, repurchase agreements, and most of the items that would meet the
definition of borrowings as reported on SC72 at the savings association level. Intercompany accounts
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between all entities included in this consolidation should be eliminated. See HC450 for further
explanation.
HC690: Other Debt Maturing in More than 12 Months
Report other borrowings (on a consolidated basis), that will mature in more than 12 months. If a direct
savings association ownership by the parent exists, then this line should include the proportionate
ownership of FHLB advances, repurchase agreements, and most of the items that would meet the
definition of borrowings as reported on SC72 at the savings association level. Intercompany accounts
between all entities included in this consolidation should be eliminated. See HC460 for further
explanation.
Reflected in Net Income:
HC705: Interest Income
Report interest income on all interest-bearing assets, including those assets reported on HC601.
HC709: Total Income
Report the holding company’s total income from all sources, including the amount reported on HC705.
Interest Expense:
HC710: Trust Preferred Instruments
Where the holding company's financial statements do not reflect consolidation of the financial statements
of the trust that issued the trust preferred instruments, report interest expense on the borrowings from the
trust that issued the trust preferred instruments. (In this case, HC445 and HC670 will be equal). If the
trust is consolidated, report on HC710 the dividends paid on the trust preferred instruments. (When the
financial statements of the trust are consolidated with those of the holding company, the interest expense
on the holding company's borrowings from the trust are eliminated in consolidation.)
HC720: All Other Debt
Report interest expense, excluding interest expense on trust preferred instruments reported on HC710.
HC770: Total Expenses
Report the holding company’s total expenses from all sources, including the amounts reported on HC710
and HC720.
HC771: Total Income Taxes
Report the holding company’s provision for current and deferred income taxes on a consolidated basis,
determined in accordance with GAAP.
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Cash Flow:
HC730: Net Cash Flow from Operations Attributable to Holding
Company
Report the net increase or decrease in cash and cash equivalents from operating activities, as it would
appear in a statement of cash flows prepared in accordance with GAAP. Do not include any change in
cash and cash equivalents from investing and financing activities, or from operating activities attributable
to noncontrolling interests.
Supplemental Questions
Answer Supplemental Questions (HC810 through HC880) for each designated holding company and its
subsidiaries for activities that occurred during the quarter. HC810 through HC875 require either a Yes or
No answer. HC876 through HC880 may be left blank if not applicable.
For purposes of the Supplemental Questions only (HC810 through HC880):
A subsidiary means any company which is owned or controlled directly or indirectly by a person, and
includes any service corporation owned in whole or in part by a savings association, or a subsidiary of
such service corporation. As the terms are used here, a “subsidiary” may be a company whose assets
and liabilities are not consolidated with those of the holding company, and a “person” is an individual or
company.
A significant subsidiary is a subsidiary that meets any of the following criteria:
•
Accounts for five percent or more of the consolidated assets of the holding company
•
Accounts for five percent or more of the consolidated gross revenue of the holding company
•
Engages in transactions with the savings association as described in §563.41.
HC810:
Have any significant subsidiaries of the holding company been formed,
sold, or dissolved during the quarter?
Check Yes only if this activity occurred during this quarter. Do not include any organizational
structure changes that occurred during a prior period. A significant subsidiary accounts for
five percent or more of the consolidated assets of the structure or five percent or more of the
consolidated gross revenue of the structure, or engages in covered transactions with the
savings association as described in §563.41. If you are an insurance company, do not
include a response for activity in Separate Accounts.
Is the holding company or any of its affiliates:
Check Yes for each that may apply to any organization within the holding company structure, including
the holding company itself. More than one may be checked, if appropriate. Answer No if not applicable.
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HC815:
A broker or dealer registered under the Securities Exchange Act of
1934?
HC820:
An investment adviser regulated by the Securities Exchange
Commission or any State?
HC825:
An investment company registered under the Investment Company
Act of 1940?
HC830:
An insurance company subject to supervision by a State insurance
regulator?
HC835:
Subject to regulation by the Commodity Futures Trading
Commission?
HC840:
Conducting operations outside of the U.S. through a foreign branch
or subsidiary?
HC845:
Has the holding company appointed any new senior executive
officers or directors during the quarter?
Check Yes only if there has been a change during the quarter.
HC850:
Has the holding company or any of its subsidiaries entered into a
new pledge, or changed the terms and conditions of any existing
pledge, of capital stock of any subsidiary savings association that
secures short-term or long-term debt or other borrowings of the
holding company?
Check Yes only if there has been a change during the quarter.
HC855:
Has the holding company or any of its subsidiaries implemented
changes to any class of securities that would negatively impact
investors?
Check Yes only if there has been a change during the quarter. Examples of a change
that could negatively impact investors could include, but is not limited to: default terms,
collateral substitution, changes in repayment dates, interest payment dates, voting rights,
or conversion options.
HC860:
Has there been any default in the payment of principal, interest, a
sinking or purchase fund installment, or any other default of the
holding company or any of its subsidiaries during the quarter?
Check Yes only if there has been a default during the quarter.
HC865:
Has there been a change in the holding company’s independent
auditors during the quarter?
Check Yes only if there has been a change during the quarter.
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HC870:
MARCH 2010
Has there been a change in the holding company’s fiscal year-end
during the quarter?
Check Yes only if there has been a change during the quarter.
HC875:
Does the holding company or any of its GAAP consolidated
subsidiaries (other than the reporting thrift) control other U. S.
depository institutions?
Check Yes if the holding company controls a U. S. depository institution (federal or state
chartered) and it is included in its consolidated financial statements.
HC876 Through HC880:
If located in the U.S. or its territories, provide the FDIC certificate
number:
If the answer to HC875 is Yes, list the five digit FDIC certificate number for each
institution. If the answer to HC875 is No, these lines should be left blank.
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SCHEDULE CCR — CONSOLIDATED CAPITAL
REQUIREMENT
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
OTS-regulated savings associations must comply with two overlapping sets of regulatory capital
standards listed below:
12 CFR § 567, Capital (FIRREA)
1. Tangible capital: The minimum ratio, as a percent of tangible assets, is 1.5 percent.
2. Core or leverage capital: The minimum ratio, as a percent of adjusted total assets, is 3 percent for
savings associations assigned a composite CAMELS rating of ”1”, and 4 percent for all other
savings associations.
3. Risk-based capital: The minimum ratio, as a percent of risk-weighted assets, is 8 percent.
12 CFR § 565, Prompt Corrective Action (FDICIA)
4. Tangible equity: Savings associations with tangible equity equal to or less than 2 percent of
tangible assets are critically undercapitalized.
5. Tier 1 or leverage capital: Savings associations are adequately capitalized or well capitalized if
the minimum ratios, as a percent of adjusted total assets, are 4 percent or 5 percent, respectively.
Note: § 567 contains an exception to these standards.
6. Tier 1 risk-based capital: Savings associations are adequately capitalized or well capitalized if the
minimum ratios, as a percent of risk-weighted assets, are 4 percent or 6 percent, respectively.
7. Total risk-based capital: Savings associations are adequately capitalized or well capitalized if the
minimum ratios, as a percent of risk-weighted assets, are 8 percent or 10 percent, respectively.
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Note: The following paragraph refers to numbers 1 through 7 above.
Schedule CCR - Consolidated Capital Requirement uses the following conventions:
•
Tangible capital (FIRREA) [See 1 above.]
Schedule CCR does not include this measure because the minimum ratio is no longer considered
a meaningful limitation for most savings associations.
•
Tangible equity (FDICIA) [See 4 above.]
CCR840 reports the calculated tangible equity ratio.
•
Core or leverage capital (FIRREA) [See 2 above.] and Tier 1 or leverage capital (FDICIA) [See 5
above.]
Schedule CCR treats these two measurements as one and refers to them as Tier 1 (core) capital.
CCR810 reports the actual ratio. An adequately capitalized savings association must have a
minimum Tier 1(core) capital ratio of 4 percent. CCR20 reports the calculated amount.
•
Tier 1 risk-based capital (FDCIA) [See 6 above.]
CR830 reports the calculated ratio.
•
Risk-based capital (FIRREA) [See 3 above.] and total risk-based capital (FDICIA) [See 7 above.]
Schedule CCR treats these two measurements as one and refers to them as total risk-based
capital. CCR820 reports the calculated ratio. An adequately capitalized savings association must
have a minimum total risk-based capital ratio of 8 percent. CCR39 reports the calculated amount.
Generally, report all data on a consolidated basis with all subsidiaries that you would consolidate under
GAAP, except as noted in these instructions.
Subsidiary: The term subsidiary means any corporation, partnership, business trust, joint venture,
association, or similar organization where you, directly or indirectly, hold an ownership interest and
consolidate the assets with yours for purposes of reporting under GAAP. Generally these are majorityowned subsidiaries.
This definition does not include ownership interests taken in satisfaction of debts previously contracted,
provided you have not held the interest for more than five years, or a longer period if approved by OTS.
Generally, treat investments in entities not constituting subsidiaries under this definition as equity
investments for capital purposes.
The following shows the regulatory capital treatment of debt and equity investments in subsidiaries and
other subordinated organizations:
•
Consolidate includable subsidiaries in accordance with GAAP.
•
Deduct debt and equity investments in nonincludable subsidiaries in full (100 percent) from
assets and capital. All previously applicable transition provisions have expired.
•
Deduct nonincludable equity investments in subordinate organizations constituting subsidiaries in
full (100 percent) in computing total capital for the total risk-based capital standard.
Nonincludable subsidiaries: Generally include subsidiaries engaged as principal in activities not
permissible for a national bank. The instructions for CCR105 define nonincludable subsidiaries.
Note: Do not consolidate subsidiaries with investments fully covered by the FDIC. Include all FDICcovered assets in the zero percent risk-weight category, and report them on CCR409, Notes and
Obligations of FDIC, Including Covered Assets.
These instructions deal with investments in mutual funds and certain asset pools based on the
characteristics of the assets in the fund. Where the mutual fund holds various assets that have different
risk weights under the capital requirement, risk weight the entire ownership interest in the mutual fund
based on the category of the asset with the highest capital requirement – highest risk weight or subject to
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deduction. On a case-by-case basis, OTS may allow you to assign the portfolio proportionately to the
various risk-weight categories based on the proportion of the risk-weight categories represented in the
mutual fund. See 12 CFR § 567.6(a)(1)(vi)(C).
Lower-tier subsidiary: Subsidiaries where you do not directly hold an ownership interest. Rather, your
service corporation or operating subsidiary directly or indirectly holds the ownership interest.
TIER 1 (CORE) CAPITAL REQUIREMENT
CALCULATION OF CORE (TIER 1) CAPITAL
CCR100: Total Equity Capital (SC84)
The EFS software generates this line from SC84, Total Equity Capital.
Explanatory Note:
Schedule CCR adjusts Equity Capital, CCR100 in calculating Tier 1 (core) capital according to
the OTS capital rule. For example, the OTS capital rule does not include cumulative perpetual
preferred stock in Tier 1 (core) capital. Furthermore, the OTS capital rule requires you to deduct
debt and equity investments in nonincludable subsidiaries and certain other assets from total
assets and equity capital in computing Tier 1 (core) capital. In addition, OTS’s capital rule
reverses the adjustment to GAAP equity for unrealized gains and losses on available-for-sale
(AFS) debt securities included in SC860 in computing Tier 1 (core) capital. However, you report
marketable equity securities at the lower of cost or market for Tier 1 (core) capital purposes.
Deduct:
CCR105: Investments in, Advances to, and Noncontrolling Interests in
Nonincludable Subsidiaries
Reduce Tier 1 (core) capital by your investment in, advances to, guaranteed obligations of, and
noncontrolling interests in certain nonincludable subsidiaries. The general instructions to Schedule CCR
define subsidiary.
In consolidation, you eliminate the investment and intercompany loan accounts of subsidiaries, and you
establish the noncontrolling interests in subsidiaries on Schedule SC. Therefore, you must obtain the
amount of the investment and advances from your books before consolidation (as well as the
noncontrolling interests after consolidation). Calculate the investment using the equity method as
prescribed by GAAP plus any loans, advances, guaranteed obligations, or other extensions of credit,
whether secured or unsecured. Use negative investments to offset loans, guaranteed obligations, or
advances to the same subsidiary, but do not reduce this line below zero. If you have a nonincludable
subsidiary and the result on this line rounds to zero or is a negative amount, report a one to indicate that
you have reported your nonincludable subsidiary.
Note: Report investments in subsidiaries and equity investments where the FDIC fully covers the
investments on CCR409, zero percent risk weight: FDIC Covered Assets. This rule applies to your
investment regardless of the business activity of such entity.
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Nonincludable Subsidiaries
Section 5(f) of HOLA [12 USC 1464(t)(5)(A)] defines nonincludable subsidiaries as subsidiaries of a
savings association that engage in activities impermissible for a national bank with the following
exceptions:
1. Subsidiaries only engaged in impermissible activities as an agent for its customers where the
subsidiary has no risk of loss.
2. Subsidiaries engaged solely in mortgage banking activities.
3. Insured depository institutions acquired as subsidiaries before May 1, 1989.
4. Subsidiaries of federal savings associations that existed on August 8, 1989, and were chartered
before October 15, 1982, as a savings bank or cooperative bank under state law.
5. Subsidiaries of federal savings associations that existed on August 8, 1989, that acquired their
principal assets from a savings association chartered before October 15, 1982, as a savings bank
or cooperative bank under state law.
Generally, a subsidiary of a savings association is nonincludable if any of its unconsolidated assets are
impermissible for a national bank. If any lower-tier subsidiary engages in impermissible activities or
invests in an entity that engages in impermissible activities, but the first-tier subsidiary owned by the
parent savings association does not directly engage in impermissible activities, the first-tier subsidiary is
an includable subsidiary. Deduct only subsidiary’s investment in the nonincludable lower-tier subsidiary
in computing the capital of the upper-tier subsidiary on an unconsolidated basis and in computing your
consolidated capital. Deduct from total capital, equity investments of subsidiaries in lower-tier subordinate
organizations that are not considered subsidiaries, if those equity investments are not permissible for
national banks.
Fully deduct all nonincludable subsidiaries from capital.
You should report investments in and advances to nonincludable subsidiaries net of all general valuation
allowances, specific valuation allowances, and charge-offs, as they have already reduced equity capital.
CCR115:
Goodwill and Certain Other Intangible Assets
For some savings associations, this line may equal SC660. However, you may manually override this
amount in certain cases. For purposes of regulatory capital only, you may elect to:
•
Reduce the amount Goodwill by any associated deferred tax liability.
•
Reduce Core Deposit Intangible Assets (CDIs) and Certain Other Intangible Assets acquired in a
nontaxable business combination by any associated deferred tax liabilities.
•
You do not reduce the amount of Purchase Credit Card Relationships (PCCRs) by any
associated deferred tax liability.
Report this as a positive amount. The EFS software will deduct this line from equity capital in calculating
Tier 1 (core) capital.
Include:
1. Goodwill.
2. Core deposit intangible assets (CDIs).
3. Purchased credit card relationships (PCCRs).
Do not include:
1.
2.
3.
4.
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Servicing assets.
Certain nonsecurity financial instruments accounted for under FASB Statement No. 125.
Net deferred tax assets.
Computer software (purchased and internally-developed).
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5. Intangible pension assets.
CCR133:
Disallowed Servicing Assets, Disallowed Deferred Tax Assets,
Disallowed Residual Interests, and Other Disallowed Assets
Report this as a positive amount. The EFS software will deduct this line from equity capital in calculating
Tier 1 (core) capital.
Disallowed Servicing Assets
You may include servicing assets reported on SC642 and SC644 in regulatory capital, subject to both of
the following limitations:
1. For mortgage and nonmortgage servicing assets, and PCCRs, combined — include in capital the
lesser of:
a. 100 percent of Tier 1 (core) capital.
b. 90 percent of fair value.
c. 100 percent of reported amount.
2. For nonmortgage servicing assets and PCCRs, as a separate sub-limit — include in capital the
lesser of the following:
a. 25 percent of Tier 1 (core) capital.
b. 90 percent of fair value.
c. 100 percent of reported amount.
Accordingly, on CCR133, include the amount of servicing assets reported on SC642 and SC644 (that are
not in a nonincludable subsidiary) and PCCRs included on SC660 that exceed the above limitations.
For purposes of the 25 percent and 100 percent of Tier 1 (core) capital limitations above, base the
deduction on a Tier 1 (core) capital subtotal before the deduction. In addition, in computing the deduction
for the 25 percent and 100 percent limitations, you may reduce the amount of servicing assets by any
corresponding deferred tax liability.
Disallowed Deferred Tax Assets
If regulatory capital includes disallowed deferred tax assets, include the amount of the disallowed
deferred tax assets on this line. To the extent that realizing deferred tax assets depends on your future
taxable income (exclusive of reversing temporary differences and carryforwards), or your tax planning
strategies, such deferred tax assets are limited for regulatory capital purposes to the lesser of the
following:
1. The amount that you can realize within one year.
2. 10 percent of Tier 1 (core) capital.
Accordingly, disallowed deferred tax assets is that amount includable in assets under GAAP, but not
includable in regulatory capital pursuant to OTS policy. The deferred tax asset subject to the limitation is
the net deferred tax asset or liability included on Schedule SC, adjusted for the deferred tax asset or
liability added to or subtracted from total assets related to the following:
1.
2.
3.
Note:
Accumulated gains and losses on certain AFS securities and cash flow hedges on CCR280.
Goodwill and other intangible assets on CCR265 and CCR285.
Servicing assets on CCR270.
You can generally realize deferred tax assets without limitation from the following sources:
1. Taxes paid in prior carry-back years.
2. Future reversals of existing taxable temporary differences.
For purposes of the 10 percent of Tier 1 (core) capital limitation above, base the deduction on a Tier 1
(Core) capital subtotal before the deduction.
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Disallowed Residual Interests
Include on this line that portion of credit-enhancing interest-only strips (as defined) reported on SI402 that
must be deducted in computing Tier 1 capital, pursuant to 12 CFR Part 567. With certain exceptions
provided for in the regulation, you must deduct from equity capital the amount of any credit-enhancing
interest-only strips that exceeds 25% of Tier 1 capital before the deduction. In computing the deduction,
you may reduce the amount by any corresponding deferred tax liability.
CCR134:
Other
Report other items required to be deducted from Tier 1 Capital not included in CCR105 through CCR133.
Include the accumulated net increase in retained earnings (equity capital) resulting from certain net gains
reported on SO485; specifically, those gains, net of losses, on liabilities carried at fair value, net of
income taxes, that are attributable to changes in the savings association’s own creditworthiness.
Add:
CCR180:
ACCUMULATED LOSSES (GAINS) ON CERTAIN
SECURITIES AND CASH FLOW HEDGES
Report on this line:
1.
Accumulated Unrealized Gains and Losses on Certain Securities
Equity capital on SC80 includes a separate component for accumulated, unrealized gains and losses, net
of income taxes, on certain securities. See SC860, Unrealized Gains (Losses) on Certain Securities.
However, you cannot include most of that separate component of equity capital in regulatory capital, as
specified below.
For regulatory capital purposes on Schedule CCR, but not for reporting purposes on Schedule SC:
•
Report aggregate AFS debt securities at amortized cost, not at fair value.
• Report aggregate AFS equity securities at the lower of cost or fair value, not at fair value.
Report on CCR180 the amount on SC860, Unrealized Gains (Losses) on Certain Securities, adjusted for
losses on certain equity securities, as follows:
•
SC860, Unrealized Gains (Losses) on Certain Securities
•
Plus: As a positive number, any portion of the amount on SC860 that represents unrealized
losses on equity securities (but not debt securities), net of gains and net of income taxes.
2.
Accumulated Gains and Losses on Cash Flow Hedges
Equity capital on SC80 includes a separate component for accumulated gains and losses on cash flow
hedges. See SC865, Gains (Losses) on Cash Flow Hedges. However, you cannot include that separate
component of equity capital in regulatory capital.
Report the result on CCR180 as follows:
•
When the amount on this line represents gains, net of losses, report a negative number
reducing capital.
•
When the amount on this line represents losses, net of gains, report a positive number
increasing capital.
Report the corresponding adjustment to assets on CCR280. See the instructions for CCR280 for
additional information.
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CCR185:
MARCH 2010
Intangible Assets
Report PCCRs included on SC660.
CCR195:
Other
Report other items permitted to be added to Tier 1 Capital that are not included in CCR180 through
CCR185.
Include the accumulated net decrease in retained earnings (equity capital) resulting from certain net
losses reported on SO485; specifically, those losses, net of gains, on liabilities carried at fair value, net of
income taxes, that are attributable to changes in the savings association’s own creditworthiness.
CCR20:
Tier 1 (Core) Capital
The EFS software will compute this line as follows: CCR100 less CCR105, CCR115, CCR133, and
CCR134, plus CCR180, CCR185, and CCR195.
CALCULATION OF ADJUSTED TOTAL ASSETS
CCR205: Total Assets
Report total assets of the consolidated entity as reported on SC60, Total Assets. The EFS software will
compute this line from SC60, Total Assets.
Deduct:
CCR260:
Assets of "Nonincludable" Subsidiaries
Report the entire amount of the assets of nonincludable subsidiaries included in Schedule SC. For
consolidated subsidiaries, this amount should equal total assets of the subsidiary less any assets
eliminated in consolidation. For subsidiaries accounted for under the equity method, this amount should
equal your investment account plus all advances to the subsidiary.
Report this as a positive amount. The EFS software will deduct this line from total assets in calculating
Tier 1 (core) capital.
CCR265:
Goodwill and Certain Other Intangible Assets
Generally, this line will equal SC660, Goodwill and Other Intangible Assets, with the exception of certain
intangible assets such as intangible pension assets and computer software. Accordingly, the EFS
software will automatically generate this line from SC660. However, if you have an intangible asset that
is not required to be deducted from Tier 1 capital, such as intangible pension assets or capitalized
computer software costs, you may change the generated amount.
•
Goodwill
If you elect to reduce the amount of Goodwill by any associated deferred tax liability on CCR 115,
then you must also reduce the amount of Goodwill on CCR 265 by the same amount.
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Certain Other Intangible Assets
Similarly, if you elect to reduce the amount of Certain Other Intangible Assets arising from
nontaxable transactions by any associated deferred tax liability on CCR 115, then you must also
reduce the amount of Certain Other Intangible Assets on CCR 265 by the same amount.
Report this as a positive amount. The EFS software will deduct this line from total assets in calculating
Tier 1 (core) capital.
CCR270:
Disallowed Servicing Assets, Disallowed Deferred Tax Assets,
Disallowed Residual Interests, and Other Disallowed Assets
For most savings associations this line will equal CCR133. Accordingly, the EFS software will
automatically generate this line from CCR133. However, this amount may change in certain cases. For
example, deferred tax liabilities are deductible from servicing assets on CCR133, but are not deductible
from servicing assets on CCR270. In which case you may override the generated amount.
Report this as a positive amount. The EFS software will deduct this line from total assets in calculating
Tier 1 (core) capital.
CCR275:
Other
Report other items required to be deducted from Adjusted Total Assets not included in CCR260 through
CCR270.
Add:
CCR280:
Accumulated Losses (Gains) on Certain Securities and Cash
Flow Hedges
Report on this line:
1.
Accumulated Unrealized Gains and Losses on Certain Securities
Report amounts included in total assets for accumulated unrealized gains and losses on certain
securities, including any related component of income tax assets. Calculate the amount included on this
line for unrealized gains and losses on certain securities as follows:
•
The amount included in SC60, Total Assets, that corresponds to the separate component of
equity capital on SC860.
•
Add to this amount: As a positive number, any amount included in SC60 that represents net
unrealized losses on equity securities. That is, you include all unrealized gains and losses on
available-for-sale securities included in assets except for those losses on equity securities.
2.
Derivative Instruments Reported as Assets Related to Qualifying Cash Flow Hedges
Report amounts included in total assets for the gains and losses on derivative instruments reflected in
SC865, Gains (Losses) on Cash Flow Hedges, including any related component of income tax assets.
Do not include derivative instruments reported as liabilities.
Report the result on CCR280 as follows:
•
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When the amount on this line represents a net amount that increased assets reported on
Schedule SC, report a negative number that will deduct this amount from total assets for
regulatory capital purposes.
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•
When the amount on this line represents a net amount that decreased assets reported on
Schedule SC, report a positive number that will add this amount back to total assets for
regulatory capital purposes.
Report the corresponding adjustment to equity capital on CCR180. See the instructions for CCR180 for
additional information.
CCR285:
Intangible Assets
For most savings associations, this line will equal CCR185; therefore, the EFS software will generate the
amount from CCR185.
CCR290:
Other
Report other items permitted to be added to Adjusted Total assets that are not included in CCR280 or
CCR285.
CCR25: Adjusted Total Assets
The EFS software will compute this line as follows: CCR205 less CCR260, CCR265, CCR270, and
CCR275 plus CCR280, CCR285 and CCR290.
CCR27: Tier 1 (Core) Capital Requirement
This represents the Tier 1 capital necessary for adequate capitalization pursuant to 12 CFR § 565.
The EFS software will compute this line as CCR25, Adjusted Total Assets, multiplied by four percent. If
we have assigned you a composite CAMELS rating of one, you should override the calculated amount
and report CCR25 multiplied by three percent.
If you have an individual minimum capital requirement (IMCR) set by OTS that requires the maintenance
of a capital level in excess of the minimum requirement, you should override the calculated amount and
report your IMCR.
This amount should never be less than three percent of CCR25.Total Risk-Based Capital Requirement:
CCR30: TIER 1 (CORE) CAPITAL
The EFS software will bring forward Tier 1 (core) capital from CCR20.
TIER 2 (SUPPLEMENTARY) CAPITAL
Under the OTS risk-based capital regulations, there are two types of capital: Tier 1 (core) capital and Tier
2 (supplementary) capital. Tier 2 (supplementary) capital includes certain specified instruments with
characteristics of capital that do not qualify as Tier 1 (core) capital. You may include Tier 2
(supplementary) capital in your total risk-based capital, up to a maximum of 100 percent of your Tier 1
(core) capital.
Tier 2 (supplementary) capital consists of the following:
1. Permanent instruments not qualifying as Tier 1 (core) capital. Report on CCR310, Qualifying
Subordinated Debt and Redeemable Preferred Stock; CCR340, Other Equity Instruments; and
CCR355, Other.
2. Maturing instruments. After adjustments for the limitations described below, report on CCR310,
Qualifying Subordinated Debt and Redeemable Preferred Stock; CCR340, Other Equity
Instruments; and CCR355, Other.
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3. Allowances for Loan and Lease Losses. Report on CCR350, Allowances for Loan and Lease
Losses.
4. Up to 45 percent of your pretax unrealized gains, net of unrealized losses, on AFS equity
securities. Report on CCR302.
5. Noncontrolling interests in includable subsidiaries consolidated under GAAP that are not eligible
for inclusion in Tier 1 (core) Capital on CCR190, provided the noncontrolling interest meets the
other requirements for Tier 2 (supplementary) capital and neither you nor any of your subsidiaries
or other subordinate organizations that you own, directly or indirectly, hold the noncontrolling
interest. Report such noncontrolling interest on CCR340, Other Equity Instruments.
Maturing Capital Instruments Issued on or Before November 7, 1989
Maturing capital instruments approved or grandfathered by the FHLBB before December 5, 1984,
continue grandfathered status under the prior and current OTS capital regulation. You may include them
in full in Tier 2 (supplementary) capital until the last year before maturity.
With our prior approval, you may include maturing capital instruments issued on or before November 7,
1989, in Tier 2 (supplementary) capital, following the procedures below that are applicable to instruments
issued after that date.
Maturing Capital Instruments Issued After November 7, 1989
You may elect to include maturing capital instruments issued after November 7, 1989, by choosing one of
the following options. Once you elect either option, you must continue to apply that option for all
subsequent issuances of maturing capital instruments as long as there is a balance outstanding of such
issuances. Once such issuances have all been repaid, you may elect the other option for future
issuances.
Option 1
Option 2
CCR302:
Tier 2 (supplementary) capital is equal to the outstanding capital instrument multiplied by
the applicable percentage from the following amortization schedule:
Years to Maturity
Percentage Counted as Tier 2
(Supplementary) Capital
Greater than 5
100%
Greater than 4, but less than or equal to 5
80%
Greater than 3, but less than or equal to 4
60%
Greater than 2, but less than or equal to 3
40%
Greater than 1, but less than or equal to 2
20%
Less than or equal to 1
0%
Tier 2 (supplementary) capital will include only the aggregate amount of maturing capital
instruments that mature in any one year during the seven years immediately before an
instrument’s maturity that does not exceed 20 percent of your capital. Capital is Tier 1
(core) capital plus, without limitation, items included in Tier 2 (supplementary) capital.
There is no percentage of assets limitation for general loan and lease valuation allowances.
There are no limitations on maturing capital instruments based on maturity dates. There is
no limitation on Tier 2 (supplementary) based on the amount of Tier 1 (core) capital.
Unrealized Gains on Available-for-Sale Equity Securities
You may include in Tier 2 (supplementary) capital up to 45 percent of the amount of any pretax
unrealized gains. This is net of any unrealized losses, on AFS equity securities included in SC140, Equity
Securities Subject to FASB Statement No. 115. If losses exceed gains, do not report an amount on this
line. When you report unrealized gains, net of unrealized losses, here and include them in supplementary
capital, you must include the entire (100 percent) unrealized gains, net of unrealized losses, in assets to
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risk weight. In other words, you must risk weight the fair value, not the historical cost of these AFS equity
securities.
Do not include unrealized gains on AFS debt securities or on equity securities in a trading portfolio.
CCR310:
Qualifying Subordinated Debt and Redeemable Preferred Stock
Include:
1. Perpetual subordinated debentures and mandatory convertible securities.
2. Maturing subordinated debentures, mandatory convertible securities, and redeemable preferred
stock calculated according to the above instructions. For thrifts that have elected to be taxed
under Subchapter S or are organized in mutual form, include the amount of subordinated debt
securities issued to the Treasury Department under the CPP in this calculation.
CCR340:
Other Equity Instruments
Report equity instruments you issued that we permit as supplemental capital but not as Tier 1 (core)
capital and that you deducted on CCR134.
Include:
1. Cumulative preferred stock reported on SC812.
2. Preferred stock reported on SC812 or SC814 where the dividend adjusts based on current
market conditions or indexes and the issuer’s current credit rating; and
3. Any other equity instruments reported on CCR134 except preferred stock that is, in effect,
collateralized by assets of the reporting savings association.
CCR350:
Allowances for Loan and Lease Losses
Report ALLL established by you and your consolidated includable subsidiaries as defined in the
instructions for CCR105. You cannot grandfather ALLL for nonincludable subsidiaries for this calculation.
Note that Tier 2 (supplementary) capital limits the inclusion of ALLL reported on CCR 350 to 1.25 percent
of risk-weighted assets. Apply the percentage limitation to Subtotal Risk-Weighted Assets on CCR75.
For regulatory capital purposes, the ALLL potentially reportable on CCR350 consists of:
1. First − allowances established to cover probable, but not specifically identifiable, credit losses
associated with on-balance-sheet loans and leases, reported as ALLL on mortgage loans (SC283)
and on nonmortgage loans (SC357).
2. Second, if the capital limit mentioned above permits − liabilities for credit losses associated with offbalance-sheet credit exposures (such as commitments, letters of credit, and guarantees) included in
Other Liabilities and Deferred Income (SC796), with the following exception: Any portion of this
liability related to transfers of loans or other assets reported as sales with recourse is separate and
distinct from the ALLL, and therefore is not includable in CCR350.
Include purchased ALLL where the balance and nature of the purchased ALLL is consistent with OTS
policy in the Examination Handbook, Sections 260 and 261.
Do not include:
1. ALLL of unconsolidated subordinate organizations.
2. ALLL of nonincludable subsidiaries.
3. Recourse liability accounts that arise from recourse obligations for any transfers of loans or other
assets that are reported as sales. Such accounts are separate and distinct from the ALLL.
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CCR355:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Other
Report other items permitted in Tier 2 Capital that you do not include in CCR302 through CCR350.
CCR33: Tier 2 (Supplementary) Capital
The EFS software computes this line as the sum of CCR302, CCR310, CCR340, CCR350 and CCR355.
CCR35: ALLOWABLE TIER 2 (SUPPLEMENTARY) CAPITAL
The EFS software computes this line as follows.
If Tier 1 (core) capital is a positive amount, the software reports the lesser of the following:
1. Tier 2 (supplementary) Capital reported on CCR33.
2. Tier 1 (core) Capital reported on CCR30.
3. If you have negative Tier 1 (core) capital, the software reports zero on CCR35.
The amount of Tier 2 (supplementary) capital included in total capital cannot exceed the amount of Tier 1
capital.
CCR370: Equity Investments and Other Assets Required to be
Deducted
Report the assets that 12 CFR § 567.5(c) requires to be deducted from total capital unless deducted
elsewhere.
Include:
1. Investments in other depository institutions (reciprocal holdings) that other depository institutions
may count in their regulatory capital such as capital stock, qualifying subordinated debt, etc.
2. The entire amount of all the following items:
a. Your nonincludable debt and equity investments including debt and equity investments in
subordinate organizations not constituting subsidiaries under 12 CFR § 567.1 (investments in
entities not consolidated under GAAP) that engage as principal in activities impermissible for
national banks and not otherwise includable under § 5(t) of HOLA.
b. Investments in real property except real property primarily used or intended to be used by
you, your subsidiaries, subordinate organizations, or affiliates as offices.
c. Real property acquired in satisfaction of a debt, where you intend to hold the property for real
estate investment purposes or do not expect to dispose of it within five years.
The term equity securities means any:
1.
2.
3.
4.
5.
6.
7.
Stock.
Certificate of interest of participation in any profit sharing agreement.
Collateral trust certificate or subscription.
Preorganization certificate or subscription.
Investment Contract.
Voting trust certificate.
Securities immediately convertible into equity securities at the option of the holder without
payment of substantial additional consideration such as convertible subordinated debt.
8. Securities carrying any warrant or right to subscribe to or purchase an equity security.
9. Investments, loans, advances, and guarantees issued on behalf of unconsolidated subordinate
organizations.
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10. Investments in real property not classified as fixed assets or repossessed property.
Do not include:
1. Interests in real property that are primarily used by you, your subsidiaries, subordinate
organizations, or affiliates as offices or related facilities to conduct business. Report on CCR506,
100 percent Risk weight: All Other Assets.
2. Interests in real property that you acquire in satisfaction of a debt previously contracted in good
faith or acquired in sales under judgments or decrees (REO). Report on CCR506, 100 percent
Risk weight: All Other Assets.
3. FHLBank Stock.
4. Equity investments permissible for both savings associations and national banks. Risk weight
them at 100 percent on CCR506. These include:
a. Freddie Mac Stock.
b. Fannie Mae Stock.
c. Equity investments in subordinate organizations not constituting subsidiaries under 12 CFR §
567.1 – investments in subordinate organizations not consolidated under GAAP, that engage
solely in activities as agent for customers or engage as principal in activities permissible for
national banks or otherwise includable under § 5(t) of the HOLA.
d. Real estate loans that are equity investments under GAAP and are permissible investments
for national banks.
e. Mutual funds and pass-through investments, defined in 12 CFR § 560.32 that invest in any of
the above categories of permissible equity investments.
5. Investments in subsidiaries and/or equity investments that FSLIC or any successor agency fully
covers. Report the entire amount of such investment on CCR409, 0% Risk weight: Notes and
Obligations of FDIC, Including Covered Assets. There is no requirement for you to deduct such
investments from capital.
Computation of CCR370 When General Valuation Allowances have been established:
Calculate the amount of equity investments reported on CCR370 net of charge-offs and general valuation
allowances. For example, if you established a $10 specific valuation allowance against a $100 equity
investment, you only deduct $90 from total capital and enter $90 on CCR370.
In computing CCR370, you should reduce the amount you calculated using the above instructions by the
amount of general valuation allowances established against equity investments and required deductions
in real property investments. To receive this credit, you must establish the general valuation allowance at
the savings association level as a contra-asset to the equity investments and investments in real property.
You must have and maintain adequate records to enable examiners to verify your claim that you
established the general valuation allowances against these specific assets.
For example, if you have a $100 equity investment, net of charge-offs and specific valuation allowances,
against which you established no general valuation allowance after July 1, 1994, you should enter the full
asset amount, $100, on CCR370. If you established a $10 general valuation allowance against that same
asset, you should deduct the $10 general valuation allowance from the $100 investment, resulting in
deduction of $90.
Do not include general valuation allowances established on other assets in the credit computation
outlined above.
CCR375: Deduction for Low-Level Recourse and Residual Interests
If you elect the “direct deduction” approach for low-level recourse and residual interests, report on this line
the amount of 1) low-level recourse and 2) residual interests reported on SI402 and SI404. However, you
should reduce the amount of residual interests reported here by any amount reported on CCR133. In
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addition, you may reduce the amount of low-level recourse and residual interests reported here by the
amount of any corresponding deferred tax liability.
Include:
1. The amount of recourse liability you retain when it is less than the capital requirement for creditrisk exposure and therefore not converted to an on-balance-sheet equivalent. For example, in the
sale of most assets with one percent recourse, the amount of liability retained usually is less than
the capital requirements, and therefore you would report one percent of the assets sold on
CCR375 or CCR605. See the instructions for the 100 percent credit conversion factor in the
Conversion of Off-balance-sheet Items to On-balance-sheet Equivalents section above.
2. The amount of on-balance-sheet financial instruments pursuant to FASB Statement No. 140
representing subordinated credit risk interests, including interests in spread accounts and asset
pools. However, your low-level recourse requirement may exceed the amount of this instrument if
you are subject to credit losses exceeding the amount of the instrument.
CCR39: TOTAL RISK-BASED CAPITAL
The EFS software will compute this line as the total of CCR30 plus CCR35 minus CCR370, and CCR375.
RISK-WEIGHT CATEGORIES
General Instructions
To calculate the total risk-based capital standard you must classify your assets in one of four risk-weight
categories described below. Do not risk weight the assets that you have deducted from Tier 1 (core)
capital – for example, nonincludable subsidiaries, nonqualifying intangibles, and disallowed assets.
Consolidate the assets of includable, GAAP-consolidated subsidiaries in determining the appropriate riskweight categories. However, exclude the assets of nonincludable subsidiaries and nonincludable
equity investments when computing risk-weighted assets.
Tier 2 (supplementary) capital includes ALLL but does not include other general valuation allowances.
Consequently, to calculate the amount to be risk weighted, you may deduct allocated general valuation
allowances from assets other than loans and leases but you may not deduct ALLL from loans and
leases. In other words, you should risk weight loans at their recorded investment less only their specific
valuation allowances, and risk weight all other assets at their recorded investment less their specific
valuation allowances and allocated general valuation allowances.
You should risk weight assets after you make regulatory capital adjustments to those assets. For
example, if we required you to deduct gains or add back losses on AFS securities in Tier 1 (core) capital,
you should risk weight those securities at historical cost, not at fair value. The same is true for
adjustments for disallowed servicing assets, disallowed net deferred tax assets, and other adjustments to
Tier 1(core) capital. If you exclude assets, portions of assets, or adjustments to assets from Tier 1 (core)
capital, you should exclude them from risk-weighted assets. Additionally, where you have included up to
45 percent of the pretax unrealized gains, net of unrealized losses, on AFS equity securities in Tier 2
capital (CCR302), you should include 100 percent of those unrealized gains in risk-weighted assets. In
other words, you should risk weight the fair value, not the historical cost, of these AFS equity securities.
In determining the appropriate risk-weight category for secured loans, you must look at the type of
collateral. In determining the appropriate risk-weight category for investments in mutual funds, you must
look to the characteristics of the assets in the fund. Where the portfolio of a mutual fund consists of
various assets that require different treatment under the capital requirement, you have two alternatives:
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1. You may deal with the entire ownership interest in the mutual fund based on the asset with the
highest capital requirement in the portfolio, or exclude the mutual fund from assets and thus
deduct it from calculations of total capital, as appropriate.
2. You may assign different risk-weight categories to the mutual fund on a pro-rata basis, according
to the investment limits for different categories in the fund’s prospectus.
Regardless of the risk-weighting method used, the total risk weight of a mutual fund must be no less than
20 percent.
Accrued interest receivable that is not delinquent is part of the recorded investment in that loan or
investment and should be risk-weighted with the underlying asset. Generally, delinquent accrued interest
receivable is risk weighted at 100%
Multiply the sum of each risk-weight category by the appropriate risk-weight percentage for that category.
For instance, you would multiply the sum of the zero percent risk-weight category by zero percent. After
adding each risk-weight category and multiplying by its appropriate risk weight, add the product of each
risk-weight category. This results in the on-balance-sheet portion of the total risk-based capital standard.
Include off-balance-sheet items in the total risk-based capital standard after converting them into onbalance-sheet equivalents. Convert off-balance-sheet items by taking the dollar amount of the offbalance-sheet item or the grossed up amount of off-balance-sheet recourse obligations under 12 CFR §
567.1, as appropriate. Multiply that amount by the appropriate credit conversion factor from the table that
follows the discussion of risk-weight categories. Additionally, you should risk weight interest-rate and
exchange-rate contracts by calculating a credit equivalent amount. See explanation following the
discussion of off-balance-sheet items.
Report in the appropriate category all on-balance-sheet assets together with all on-balance-sheet
equivalents (off-balance-sheet items after converting them according to the discussion above). From the
sum of on-balance-sheet and off-balance-sheet risk-weighted assets, deduct ALLL that exceeds the
amount you may include as capital on CCR350.
Note: Report all loans and investments that are more than 90 days past due on CCR506, 100 percent
Risk weight. Report all of these loans on CCR506 regardless of the type of investment or collateral,
except for FDIC covered assets. Report FDIC covered assets on CCR409, 0% Risk weight: Notes and
Obligations of FDIC Including Covered Assets.
0% Risk weight
CCR400:
Cash
Report all cash-on-hand, including the amount of domestic and foreign currency owned and held or in
transit in all your offices. Convert any foreign currency into U.S. dollar equivalents as of the date of the
report.
Do not include:
1. Cash deposited in another financial institution, whether interest-bearing or non-interest-bearing.
Report on CCR445.
2. Cash equivalents such as travelers’ checks. Report on CCR445.
CCR405:
Securities Backed by Full Faith and Credit of U.S. Government
Report securities, not loans, on this line. Report the amount of securities issued by and other direct
claims on the following:
1. The U.S. Government or its agencies to the extent such securities or claims are unconditionally
backed by the full faith and credit of the U.S. Government.
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2. The central government of an Organization of Economic Cooperation and Development (OECD)
country.
Include:
1. Most Ginnie Mae securities. (Note that an interest only strip or Ginnie Mae security that exhibits
similar interest rate risk would not be eligible for 0% risk weight. Report as 100% risk weight on
CCR 505.)
2. U.S. Treasury securities.
3. SBA pools or certificates, or portions thereof, that have an unconditional guarantee by the full
faith and credit of the U.S. Government.
Do not include:
1. Notes and obligations of the FDIC. Report on CCR409.
2. Assets collateralized by U.S. Government securities. Report on CCR450, 20% Risk weight:
Other.
3. Mortgage-backed securities (MBS) where you have recourse for the underlying loans. The
capital requirement on such obligations should follow the standard treatment of recourse
obligations.
4. Delinquent mortgage loans previously securitized with Ginnie Mae, where either (a) you have an
unconditional repurchase option, or (b) you have repurchased the loans under such an option.
Report on CCR450, 20% Risk weight: Other.
CCR409: Notes and Obligations of FDIC, Including Covered Assets
Report notes and obligations of the FDIC that have the unconditional backing by the full faith and credit of
the U.S. Government. Include the portion of assets fully covered against capital loss and/or yield
maintenance agreements by the FDIC. Place that portion of assets without FDIC coverage (for example,
those included in a deductible) in a risk-weight category according to the characteristics of the asset. If
you cannot assign a deductible under a coverage agreement to a specific type of asset, then you should
place the deductible in the 100 percent risk-weight category.
Include investments in subsidiaries and equity investments with full FDIC coverage, regardless of the
percentage of ownership or business activity of the entity in which you have invested.
CCR415:
Other
Report all zero percent risk-weight assets not included above as defined in 12 CFR § 567.6(a)(1)(i).
Include:
1. Deposit reserves at, claims on, and balances due from Federal Reserve Banks, excluding interest
rate contracts. Report interest rate contracts on CCR450, 20% Risk weight: Other.
2. The book value of paid-in Federal Reserve Bank stock.
3. That portion of assets not included elsewhere in the zero percent risk-weight category directly
and unconditionally guaranteed by the U.S. Government or its agencies, or the central
government of an OECD country.
CCR420:
Total
The EFS software will compute this line as the sum of CCR400 through CCR415.
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CCR40: 0% Risk-Weight Total
The EFS software will automatically compute this line as zero percent times CCR455, the risk-weighted
product of all zero percent risk-weighted assets.
20% Risk weight
CCR430:
Mortgage and Asset-Backed Securities Eligible for 20% Risk
Weight
Report mortgage-related securities and other asset-backed securities that meet the criteria for 20% risk
weight. Note that if you have a subordinate class of an otherwise 20% risk weight, high-quality MBS,
you must gross up and risk weight your security plus the balance of all classes senior to it. However, if
you are able to utilize the ratings based approach (12 CFR 567.6), it is not necessary to gross up the
more senior positions. See also CC455, CC465, and CC468.
Include:
1. Most Fannie Mae and Freddie Mac mortgage-related securities. (Note: Report Fannie and
Freddie principal-only stripped securities (POs) and interest-only stripped securities (IOs) that are
not credit enhancing on CCR 506.)
2. Asset-backed securities with an AAA or AA rating that meet the criteria of the ratings based
approach - 12 CFR § 567.6.
Do not include:
1. Stripped MBS. Report IO and PO strips that are not credit enhancing of otherwise high quality
MBS on CCR506, 100% risk weight.
2. Ginnie Mae mortgage pool securities. Refer to instructions for CCR405.
3. MBSs where you have recourse for the underlying loans. The capital requirement on such
obligations should follow the treatment of recourse obligations.
CCR435:
Claims on FHLBs
Report all investments in, claims on, and balances due from Federal Home Loan Banks.
Include:
1.
2.
3.
4.
Book value of Federal Home Loan Bank stock.
Demand, savings, and time deposits with a FHLBank.
Securities, bonds, and notes issued by the Federal Home Loan Bank System
The credit equivalent amount of interest rate contracts, interest-rate swaps and caps, where the
counterparty is a Federal Home Loan Bank.
CCR440:
General Obligations of State and Local Governments
Report the amount of securities and other general obligations issued by state and local governments.
CCR445:
Claims on Domestic Depository Institutions
Include the following obligations of domestic depository institutions:
1. Demand deposits and other transaction accounts.
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2.
3.
4.
5.
6.
7.
8.
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Savings deposits.
Time certificates.
Travelers’ checks and other cash equivalents.
Cash items in the process of collection.
Federal funds sold.
Loans and overdrafts.
Debt securities.
The credit equivalent amount of interest and exchange rate contracts (interest-rate swaps and
caps) where the counterparty is a domestic depository institution.
Do not include:
1. Investments in other depository institutions where those institutions may count the investments in
their regulatory capital, such as capital stock, qualifying subordinated debt, etc. Report on
CCR370, Assets Required to be Deducted.
2. Interest rate contracts with a FHLBank or a Federal Reserve Bank. Report on CCR435 and
CCR450, respectively.
CCR450:
Other
Report all twenty percent risk-weight assets, not included above, as defined in 12 CFR § 567.6(a)(1)(ii).
Include:
1. Assets conditionally guaranteed by the U.S. Government, such as VA and FHA insured mortgage
loans, the guaranteed portion of SBA, FhmA, and AID loans, and FICO and REFCO bonds, etc.
2. Delinquent mortgage loans previously securitized with Ginnie Mae, where either (a) you have an
unconditional repurchase option, or (b) you have repurchased the loans under such an option.
3. Loans and other assets fully collateralized by deposits.
4. The credit equivalent amount of interest rate contracts (interest-rate swaps and caps) where the
counterparty is a Federal Reserve Bank.
5. Assets collateralized by U.S. Government securities other than mortgage related securities on
CCR430.
6. Securities issued by, or other direct claims on, U. S. Government-sponsored agencies, including
notes issued by Fannie Mae and Freddie Mac. Do not include equity securities or MBSs.
CCR455: Total
The EFS software will compute this line as the sum of CCR430 through CCR450.
CCR45: 20% Risk-Weight Total
The EFS software will compute this line as twenty percent times CCR455, the risk-weighted product of all
20 percent risk-weighted assets.
50% Risk weight
CCR460:
Qualifying Single-family Residential Mortgage Loans
Report the carrying value, outstanding balance less all specific valuation allowances, of all qualifying
single-family residential mortgage loans secured by a first lien when you have no other extensions of
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credit secured by a second lien on the same property to the same consumer, if such loans meet all of the
following criteria:
1. You have prudently underwritten the loan.
2. The loan is performing and not more than 90 days past due.
3. The current LTV ratio is 90% or less, calculated using the value at origination, including loans
individually insured by private mortgage insurance or other appropriate credit enhancement that
brings the effective LTV down to 90% or less.
Notes:
1. See 12 CFR 567.1 for the definition of Qualifying Mortgage Loan.
2. A loan with an LTV higher than 90%, without PMI or other readily marketable collateral
enhancement, would not typically qualify for the 50% risk weight. The Real Estate Lending
Guidelines urge savings associations as well as other types of banking organizations, to require
PMI or other appropriate credit enhancement if a mortgage exceeds 90% LTV. See 12 CFR
560.101, and the footnote in the section on supervisory loan-to-value limits. These guidelines
constitute a supervisory presumption of safety and soundness. To overcome that presumption
for a loan that exceeds 90% LTV, a bank or thrift must demonstrate to the examiners' satisfaction
that the loan is both prudently underwritten, and that it qualifies for the 50% risk weight in spite of
the absence of private mortgage insurance or other appropriate credit enhancement.
Also, report the combined carrying value of all mortgage and consumer loans secured by liens on the
same one- to four-family residential property, with no intervening liens. For example, you hold extensions
of credit secured by first lien and second lien positions. Include in 50 percent risk weighting, if the loan
meets all the following criteria:
1. You have prudently underwritten each loan.
2. Each loan is performing and not more than 90 days past due.
3. One of the following is true:
a.
The combined loan-to-value ratio (CLTV) does not exceed 90 percent at origination.
b.
The combined extension of credit is insured to at least a 90 percent LTV ratio by private
mortgage insurance, or there is other appropriate credit enhancement to bring the effective
LTV down to 90 percent or less.
c.
The current LTV ratio is 90% or less, calculated using the value at origination, including
loans individually insured by private mortgage insurance or other appropriate credit
enhancement that brings the effective LTV down to 90% or less.
When you hold the first lien and junior liens on a 1-to-4-family residential property and no other party
holds an intervening lien, view the loans as a single extension of credit secured by a first lien on the
underlying property. Use this treatment to determine the LTV ratio, as well as for risk weighting. Assign
the combined loan amount to either the 50 percent or 100 percent risk category, depending on whether
the credit satisfies the criteria for 50 percent risk weighting. In determining the LTV ratio, you need not
include loans classified in Schedule SC as commercial loans made to businesses and secured by
residential property when you calculate the CLTV ratio for that property. If such loans are not included in
the CLTV ratio for that property, you should risk weight such commercial loans at 100 percent.
If there is an intervening lien, do not combine the loans because another entity holds the second lien (the
intervening lien). For example, you hold a first mortgage and third lien as a home equity line. In this
case, you risk weight the carrying value of the loan secured by the first lien at 50 percent if the LTV is less
than 90 percent and it otherwise meets the 50 percent risk-weight criteria. You risk weight the carrying
value of the loan secured by the third lien at 100 percent, regardless of the CLTV.
In addition, include the following types of loans in the definition of single-family mortgage loans. These
loans must meet the criteria above to be risk weighted at 50 percent:
1. Loans on interests in cooperative buildings.
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2. Loans to individuals to fund the construction of their own home that meet the definition of a
qualifying mortgage loan in 12 CFR § 567.1. You may include any accrued interest receivable in
the loan balance.
3. Mortgage loans on mixed-use properties that are primarily single-family residential properties.
Do not include:
1. The combined carrying value of mortgage and consumer loans secured by first or second liens on
the same property when the CLTV ratio exceeds 90 percent. Report the combined carrying value
of these loans on CCR506, 100% Risk weight: All Other Assets.
2. The combined carrying value of mortgage and consumer loans secured by first and second liens
on the same property if any of the extensions of credit are nonperforming (nonaccrual) or more
than 90 days past due. Report on CCR506, 100% Risk weight: All Other Assets.
3. A loan to a consumer collateralized by a junior lien when another lender holds an intervening lien.
For example, you hold the second lien and another lender holds the first lien, or you hold the first
lien and the third lien, but do not hold the second lien (intervening lien). Report the junior lien on
CCR506, 100% Risk weight: All Other Assets.
4. Foreclosed real estate. Report on CCR506, 100% Risk weight: All Other Assets.
5. Loans to individuals to construct their own home that are not qualifying mortgage loans as
defined in 12 CFR § 567.1. Report on CCR506, 100% Risk weight: All Other Assets.
6. The portion of loans guaranteed by FHA that may be risk weighted at 20 percent. Report on
CCR450.
7. Loans to commercial entities collateralized by mortgages of third-party borrowers (warehouse
loans), or small business loans collateralized by a lien on a residential property. Report on
CCR506, 100% Risk weight: All Other Assets.
CCR465:
Qualifying Multifamily Residential Mortgage Loans
Qualifying Multifamily Mortgage Loans (12 CFR § 567.1) Under Current Rule
Report the carrying value plus accrued interest receivable, of permanent, first mortgages secured by first
liens on multifamily residential properties consisting of five or more dwelling units that meet all the
following criteria:
1. Amortization of principal and interest occurs over a period of not more than 30 years.
2. Original minimum maturity for repayment of principal on the loan is not less than seven years.
3. At the time you placed the loan in the 50 percent risk-weight category, the owner had made all
principal and interest payments on the loan for the preceding year on a timely basis according to
the loan terms (not 30 days or more past due).
4. The loan is performing and not 90 days or more past due.
5. You made the loan according to prudent underwriting standards.
6. The current outstanding loan balance does not exceed 80 percent (75 percent for variable rate
loans) of the value of the property securing the loan. “Value of the property” (when you originate
a loan to purchase a multifamily property) means the lower of either the purchase price or the
amount of the initial appraisal, or if appropriate, the initial evaluation. Where a purchaser is not
purchasing a multifamily property, but taking a new loan on his currently owned property,
determine the value of the property by the most current appraisal, or if appropriate, the most
current evaluation.
7. For the property’s most recent fiscal year, the ratio of annual net operating income generated by
the property, before payment of any debt service on the loan, to annual debt service on the loan
is not less than 120 percent, (115 percent for variable-rate loans). In the case of cooperative or
other not-for-profit housing projects, the property generates sufficient cash flows to provide you
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comparable protection. The debt service coverage ratio should be based on a fully indexed
payment that will amortize the loan over its contractual term. It has long been industry practice to
offer multifamily property loans with relatively short terms compared to the amortizing payment
schedule. For example, the loan may have a 10-year term and a payment based on a 30-year
amortization schedule with a balloon payment at the end of the term. In such cases, the DSCR
should be based on the fully amortizing, fully indexed payment over the scheduled amortization
period, but no longer than 30 years.
In cases where a borrower refinances a loan on an existing property, the borrower must comply with the
above criteria.
12 CFR § 567.1 defines residential property as houses, condominiums, cooperative units, and
manufactured homes. This definition does not include hospitals and nursing homes. Manufactured
homes are those subject to HUD regulations under Title VI of the U.S. Code.
Include mortgage loans on mixed-use properties that are primarily multifamily residential properties if they
satisfy the criteria for qualifying multifamily mortgage loans.
Grandfathered Qualifying Multifamily Mortgage Loans
Qualifying multifamily mortgage loans include multifamily mortgage loans that on March 18, 1994, met the
criteria of qualifying multifamily mortgage loans under our capital rule on March 17, 1994, and continue to
meet those criteria, namely:
1. An existing property consisting of 5 to 36 dwelling units secures the mortgage.
2. The initial LTV ratio is not more than 80 percent.
3. For the past full year, the property’s average annual occupancy rate is 80 percent or more of total
units.
CCR470:
Mortgage and Asset-Backed Securities Eligible for 50% Risk
Weight
Mortgage-Backed Securities:
Report MBS, other than high quality MBS reported on CCR430, secured by qualifying single-family
residential mortgage loans eligible to be reported on CCR460 or qualifying multifamily residential
mortgage loans eligible to be reported on CCR465. Include POs secured by qualifying single-family or
multifamily residential mortgage loans unless you can report them on CCR430.
If qualifying multifamily residential mortgage loans back the securities, you must receive timely
payments of principal and interest according to the terms of the security. Generally, consider payments
timely if they are not 30 days or more past due.
Note that if you have a subordinate class of an otherwise 50% risk-weight, high-quality MBS, you must
gross up and risk weight your security plus the balance of all classes senior to it. However, if you are
able to utilize the ratings based approach (12 CFR 567.6), it is not necessary to gross up the more senior
positions. See also CC455, CC465, and CC468.
Asset-Backed Securities:
Also include asset-backed securities eligible for 50% risk weight under the ratings-based approach (“A”
rated that meet all the criteria of the ratings based approach).
Do not include:
Interest Only Strips. Report credit-enhancing interest-only strips as residuals. Refer to the definitions
in 12 CFR 567.1 and to the capital treatment in 12 CFR 567.6(b). See instructions for lines CCR133,
CCR270, CCR375, CCR605, and SI402. Report IO and PO strips that are not credit enhancing of
otherwise high quality MBS on CCR506, 100% risk weight.
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CCR475:
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State and Local Revenue Bonds
Report securities issued by state and local governments where the revenues from a stated project such
as a toll road repay the security.
CCR480:
Other
Report all fifty-percent risk-weight assets not included above as defined in 12 CFR § 567.6(a)(1)(iii).
Include:
1. The credit equivalent amount of interest and exchange rate contracts (interest-rate swaps and
caps) where the counterparty is an entity other than a domestic depository institution, a FHLBank,
or a Federal Reserve Bank.
2. Revenue bonds issued by any public-sector entity in an OECD country that are payable solely
from the revenues generated from the project financed through the issuance of the obligations.
3. Qualifying residential construction loans, also called residential bridge loans, meeting the criteria
of 12 CFR § 567.1. Such loans must satisfy the following criteria:
a. You must make the loan according to sound lending principles to a builder with at least 15
percent equity in the project (or higher, depending upon the risk of the project) who will
construct a one- to four-family residence that, when sold, will be owner-occupied.
b. You must obtain sufficient documentation from a permanent lender (that may be the
construction lender) demonstrating all the following:
i.
The homebuyer intends to purchase the residence.
ii.
The homebuyer has the ability to obtain a permanent qualifying mortgage loan
sufficient to purchase the residence.
iii.
The homebuyer has made a substantial earnest money deposit.
c. The construction loan must meet all the following requirements:
i.
Not exceed 80 percent of the sales price of the residence.
ii.
Be secured by a first lien on the lot, residence under construction, and other
improvements.
iii.
Be performing and not more than 90 days past due.
d. The home purchaser(s) must intend that the home will be owner-occupied and must not be a
business entity or any entity that is purchasing the home(s) for speculative purposes.
e. You must retain sufficient undisbursed loan funds throughout the construction period to
ensure project completion. The builder must incur a significant percentage of direct costs; for
example, the actual costs of land, labor, and material, before he draws on the loan.
CCR485:
Total
The EFS software will compute this line as the sum of CCR460 through CCR480.
CCR50: 50% Risk-Weight Total
The EFS software will compute this line as 50 percent times CCR485, the risk-weighted product of all 50
percent risk-weight assets.
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100% Risk weight
CCR501:
Securities Risk Weighted at 100% (or More) Under RatingsBased Approach
Include on this line:
1. Asset-backed securities or exposures eligible for 100% risk weight under the ratings-based
approach. Example: “BBB” rated.
2. Also include asset-backed securities or exposures that receive a 200% risk weight under the
ratings-based approach. Example: “BB” rated. For these 200% risk weight items, you must first
multiply the balance by 2 (two).
Note: Only a limited set of asset-backed securities and other exposures arising from securitization
activities qualify for this risk weighting, and these must meet all of the requirements of the ratings-based
approach. Refer to 12 CFR 567.6(b)(3).
CCR506:
All Other Assets
Report all other assets except those included above or in any other risk-weight category.
Include:
1. Consumer loans.
2. Commercial loans.
3. All assets that are nonperforming or more than 90 days past due, except FDIC covered assets.
Report FDIC covered assets on CCR409, 0% Risk weight.
4. All repossessed assets including repossessed real estate (REO), other repossessed assets, and
equity investments that have the same characteristics as REO, for example stock from an REO
workout firm that has been approved for inclusion in the 100% risk-weight category.
5. First and junior mortgages on one- to four-family dwelling unit properties that do not qualify for
inclusion on CCR460 (50% Risk weight: Qualifying Single family Residential Mortgage Loans).
6. Multifamily mortgage loans that do not meet the qualifying criteria for inclusion on CCR465, 50%
Risk weight: Qualifying Multifamily Residential Mortgage Loans.
7. Residential construction loans, except those to individuals to build their own homes that you
report on CCR460, and except qualifying residential construction loans (bridge loans) as defined
in CCR480.
8. Nonresidential construction loans as defined in the instructions for SC260, Nonresidential
Property.
9. Obligations issued by a state or political subdivision for the benefit of a private party or enterprise
where that party or enterprise, rather than the issuing state or political subdivision, is responsible
to pay principal and interest on the obligation (industrial development bonds).
10. Private-issue debt securities, including commercial paper, except those that you report in the 20
percent or 50 percent risk-weight categories.
11. Investments in fixed assets and premises.
12. Qualifying intangible assets reported on CCR185.
13. Servicing assets, less the amount included on CCR133.
14. The gross amount of wrap-around loans where you are liable on the first mortgage or must
assume the first mortgage to perfect your position. Report the wrap-around loan net of the first
mortgage if you have no liability on the first mortgage loan or obligation to assume it.
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15. Equity investments that are permissible for both savings associations and national banks and
including the following:
a. Fannie Mae Stock.
b. Freddie Mac Stock.
c. Equity investments in unconsolidated subordinate organizations (those that do not qualify
as subsidiaries under 12 CFR § 567.1) that engage solely in activities as agent for
customers or engage as principal in activities permissible for national banks or otherwise
are includable under § 5(t) of the HOLA.
d. Real estate loans that are equity investments under GAAP and are includable under the
Office of the Comptroller of the Currency’s (OCC’s) capital rule.
e. Mutual funds and pass-through investments, defined in 12 CFR § 560.32, that invest in
any of the above categories of permissible equity investments.
16. Loans to commercial entities collateralized by mortgages of third party borrowers (warehouse
loans).
17. Interest-only (IO) and principal only (PO) stripped securities that are not credit enhancing. This
category includes most IOs and POs issued by Fannie Mae and Freddie Mac.
18. Any other remaining assets that you do not deduct from capital on CCR133 or CCR375, or that
you do not “super risk-weight” using CCR605 and CCR62.
CCR510:
Total
The EFS software will compute this line as the sum of CCR501 and CCR506.
CCR55: 100% Risk-Weight Total
The EFS software will compute this line as 100 percent times CCR510, the risk-weighted product of all
100 percent risk-weight assets.
CONVERSION OF OFF-BALANCE-SHEET ITEMS TO ON-BALANCESHEET EQUIVALENTS
Include off-balance-sheet items in the total risk-based capital standard after converting them into onbalance-sheet equivalents. Convert off-balance-sheet items to on-balance-sheet equivalents by taking
the dollar amount of the off-balance-sheet item and multiplying it by the appropriate credit conversion
factor from the table below.
SC689, Other Assets, and SC796, Other Liabilities and Deferred Income, include the fair value of
derivative instruments accounted for under FASB Statement No. 133. We treat on-balance-sheet
derivative instruments used for risk management purposes, rather than for trading, as off-balance-sheet
items for risk-based capital purposes. Accordingly, you should risk weight only the converted on-balancesheet equivalent amounts, not the amounts reported on SC689 and SC796.
Place the on-balance-sheet equivalents (converted off-balance-sheet items) in the appropriate risk-weight
category just as any other on-balance-sheet assets. For example, place an off-balance-sheet letter of
credit in the same risk-weight category as the loan would be upon execution of the letter of credit.
Loans in Process (Undisbursed Loan Balances)
You may convert all LIP that meets the following criteria at a zero percent conversion factor. In other
words, you do not risk weight it.
1. LIP that contractually must be fully disbursed or expire in one year or less under the original
terms of the contract.
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2. LIP that you may disburse over a period of time exceeding one year and that meets both of the
following criteria:
a. You may unconditionally cancel the agreement.
b. You make a separate credit decision before each draw.
Convert all LIP that does not meet the criteria in #1 or #2 above at a 50 percent conversion factor and
place in the risk-weight category appropriate for the related loan, except as follows:
1. When the borrower pays interest on the full amount of the loan, including both the disbursed and
undisbursed portions, you must convert the LIP to an on-balance-sheet equivalent at a 100
percent credit conversion factor.
2. When the LIP is a direct credit substitute, you must convert it to an on-balance-sheet equivalent
at a 100 percent credit conversion factor.
Table of Conversion Factors for Off-Balance-Sheet Items
This calculation translates the face amount of an off-balance-sheet exposure into an on-balance-sheet
credit equivalent amount.
Zero Percent Credit Conversion Factor (not risk weighted)
Include:
1. Unused commitments with an original maturity of one year or less.
2. Unused commitments with an original maturity of greater than one year:
a. That you may unconditionally cancel at any time, and
b. You have the contractual right to make, and you do make, either:
i. A separate credit decision based upon the borrower’s current financial condition
before each draw, or,
ii. An annual, or more frequent credit review, based upon the borrower’s current
financial condition to determine whether or not to continue the lending arrangement.
3. Unused portions of retail credit card lines of credit that you may unconditionally cancel to the
extent allowed by applicable law.
4. Unused portion of home equity lines of credit:
a. That you may unconditionally cancel at any time to the extent allowed by federal law, and
b. You have the contractual right to make, and you do make, either:
i. A separate credit decision based upon the borrower’s current financial condition
before each draw, or,
ii. An annual, or more frequent credit review, based upon the borrower’s current
financial condition to determine whether to continue the lending arrangement.
5. A commitment to make a permanent loan, where either the balance sheet or off-balance-sheet
includes the construction loan. If the commitment to make the permanent loan exceeds the
construction loan, treat the excess as a separate commitment and convert it to an on-balancesheet equivalent.
Twenty Percent Credit Conversion Factor
Trade-related contingencies are short term, self-liquidating instruments used to finance the movement of
goods and collateralized by the underlying shipment. For example, a commercial letter of credit.
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Fifty Percent Credit Conversion Factor
Include:
1. Transaction-related contingencies, including performance bonds and performance-based standby
letters of credit.
2. Unused commitments with an original maturity greater than one year, including home equity lines
of credit that are not in the zero percent credit conversion factor category because they are not
unconditionally cancelable.
3. Revolving underwriting facilities, note issuance facilities, and similar arrangements where the
customer can issue short-term debt in its own name, but where you have a legally binding
commitment to either:
a. Purchase the obligations the customer is unable to sell by a certain date.
b. Advance funds to its customer if the customer is unable to sell the obligations.
Example:
You have a $1 million off-balance-sheet letter of credit guaranteeing the completion of a road in a
residential construction project. Letters of credit that guarantee performance have a conversion factor of
50 percent. You convert the $1 million off-balance-sheet item into a $500,000 on-balance-sheet
equivalent ($1 million times 50 percent), and place this in the 100 percent risk-weight category on
CCR506, which is the same risk-weight category as on-balance-sheet residential construction loans.
One Hundred Percent Credit Conversion Factor
Include:
1. Financial guarantee-type standby letters of credit. Convert the face amount to a credit-equivalent
amount.
2. Assets sold with recourse:
a. If you sell a $100 loan with ten percent recourse, you must convert the full $100 – the
grossed up amount – at 100 percent, except where the amount of recourse liability that
you retain is less than the capital requirement for credit-risk exposure. In that situation,
the low-level recourse provision limits your capital charge to a dollar-for-dollar
requirement against the amount of credit-risk exposure retained. For example, in the
sale of most assets with one percent recourse, the amount of liability retained is less than
the capital requirement. Therefore, one percent of the assets sold would be the capital
requirement. Report this low-level recourse amount on CCR375 or CCR605. No offbalance-sheet conversion is necessary.
b. Loans serviced for others where you or your subsidiaries are liable for credit losses on
the loans serviced. In general, do not consider servicing of VA loans in GNMA pools as
recourse servicing; however, we reserve the right on a case-by-case basis to treat such
servicing as recourse. Note: You should not risk weight the on-balance-sheet asset.
You should convert the full outstanding balance of the loans serviced at 100 percent.
c. Treat the subordinated portions of senior/subordinated securities, both retained and
purchased subordinated pieces, identically to assets sold with partial, first-loss recourse
under 2(a) above. You generally should not risk weight the on-balance-sheetsubordinated security. You should convert the full amount of both the senior and
subordinate portions of the mortgage pool security at 100 percent.
d. You may elect to apply the 100 percent credit conversion factor to only the retained
recourse amount related to transfers of small business loans and leases of personal
property, according to § 208 of the Riegle Community Development and Regulatory
Improvement Act of 1994. Qualifying savings associations may apply the treatment under
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§ 208, as implemented, to transfers on or after March 22, 1995. See § 208 of the Riegle
Act and 12 CFR § 567.6(a)(2)(i)(C).
3. Forward agreements and other contingent obligations with a specified draw down are legally
binding agreements to purchase assets at a specified future date. You should convert the
principal amount of the assets you will purchase on the date you enter into the agreement.
4. Securities of customers where you lend such securities to others as agent and you indemnify the
customer against loss.
Example:
You have a $1 million off-balance-sheet, legally binding commitment to purchase and the institution
has the intent to take delivery of (e.g., a regular-way trade, which is not accounted for as a derivative
under SFAS Statement No. 133) FannieMae or FreddieMac MBS. Forward agreements to purchase
assets at a specified date have a conversion factor of 100 percent. You convert the $1 million offbalance-sheet item into a $1 million on-balance-sheet equivalent, and you place it in the 20 percent
risk-weight category on CCR450.
Interest-rate and Exchange-rate Contracts, and Certain Derivative
Contracts
Credit Equivalent Amount
This calculation translates interest-rate and exchange-rate contracts into an on-balance-sheet credit
equivalent amount. The credit equivalent amount of interest-rate and exchange-rate contracts is the sum
of: (1) current credit exposure, and (2) potential credit exposure.
The credit equivalent amount, consisting of the current exposure plus the potential credit exposure, is
assigned to the appropriate risk-weight category and reported on one of the following lines:
20% Risk weight
CCR435
CCR445
CCR450
50% Risk weight
CCR480
1.
Claims on FHLBs
Claims on Domestic Depository Institutions
Other (where the counter party is a Federal Reserve Bank)
Other – where the counter party is other than a domestic depository
institution, a FHLBank, or a Federal Reserve Bank
Current Credit Exposure
Current credit exposure is the replacement cost of the contract, measured in U.S. dollars, regardless of
the currency specified in the contract.
Replacement cost is the loss that you would incur if a counterparty defaults. You measure replacement
cost as the net cost of replacing the contract at the current market value. If default would result in a
theoretical profit, the replacement value is zero. The replacement cost calculation incorporates changes
in both interest rates and counterparty credit quality.
2.
Potential Credit Exposure
Potential credit exposure means the estimated potential increase in credit exposure over the remaining
life of the contract. You calculate it as follows:
Interest-rate Contracts
Multiply the notional principal amount of the contract by either:
1. Zero percent, if the contract has a remaining maturity of one year or less.
SCHEDULE CCR
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2. One-half of one percent if the contract has a remaining maturity greater than one year.
Exchange-rate Contracts
Multiply the notional principal amount of the contract by either:
1. One percent if the contract has a remaining maturity of one year or less.
2. Five percent if the contract has a remaining maturity greater than one year.
Interest Rate Contract Example:
You have a $10 million notional amount interest rate swap agreement. You report the positive fair value
of this derivative instrument of $80 thousand as an asset under FASB Statement No. 133, and include it
in line SC689, Other Assets. However, you do not include this $80 thousand on-balance-sheet amount in
assets to risk weight. Instead, you include in assets to risk weight the credit equivalent amount of this
interest rate exchange agreement, which you have calculated to be $130 thousand. You computed the
$130 thousand by adding the current credit exposure of $80 thousand (equal to the replacement cost of
the contract) to the potential credit exposure of $50 thousand (equal to the $10 million notional amount
times 0.5%, for this contract with a remaining maturity of 2 years). You include the $130 thousand in
assets to risk weight, in the 20 percent risk-weight category on CCR435, because the counterparty is a
Federal Home Loan Bank.
Foreign Exchange Rate Example:
Your thrift has a foreign currency exchange rate contract where the thrift will deliver €1 million (Euros) and
receive $1.8 million (US Dollars) in 90 days. The exchange rate was 0.90 (US Dollars/Euros) and it is
now 0.95. No matter which side of the contract your thrift has taken, it should always be measured in
dollars for capital purposes. The market loss of $100,000 is reported on SC796. As there is a market
loss, the current credit portion is $0. The potential credit portion is $18,000 because the term is less than
one year. You would report $18 on CCR480 as the counterparty is a broker (non-bank).
Do not include in risk-based assets:
(1) A foreign exchange rate contract with an original maturity of 14 calendar days or less; and
(2) Any interest rate or foreign exchange rate contract that is traded on an exchange requiring the daily
payment of any variations in the market value of the contract.
See 12 CFR 567.6 for more information.
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Netting of Current Replacement Value under Qualifying Bilateral
Netting Agreements
You may net the current replacement values of multiple rate contracts with a single counterparty under a
qualifying bilateral netting agreement in accordance with the OTS’ bilateral netting rule according to 12
CFR § 567.6(a)(2)(v)(B). A bilateral netting agreement is a master contract under which two parties
agree to net the amounts they owe each other under rate contracts covered by the agreement to reduce
their credit exposure. You may only net contracts for capital purposes under this rule if all of the following
are true:
1. The rate contracts are between the same two parties.
2. You net only interest rate contracts and foreign exchange rate contracts for capital purposes.
3. The bilateral netting contract covering the rate contracts results in a single netted amount being
payable or receivable in case of the default, insolvency, bankruptcy, or similar circumstance of
either party.
4. If you are party to the bilateral netting agreement, you have legal opinions concluding that the
courts and other legal authorities of relevant jurisdictions would uphold the contract.
CCR605: Amount of Low-Level Recourse and Residual Interests
Before Risk weighting
If you elect the “super risk weighting” approach for low-level recourse and residual interests, report on this
line the amount of 1) low-level recourse and 2) residual interests reported on SI402 and SI404. However,
you should reduce the amount of residual interests reported here by any amount reported on CCR133.
Include:
1. The amount of recourse liability (low-level recourse amount) that you retain when it is less than
the capital requirement for credit-risk exposure. Therefore, you do not convert it to an onbalance-sheet equivalent. In the sale of most assets with one percent recourse, the amount of
liability retained usually is less than the capital requirement. You would report one percent of the
assets sold on CCR375 or CCR605. See the instructions for the 100 percent credit conversion
factor in the Conversion of Off-balance-sheet Items to On-balance-sheet Equivalents section.
2. The amount of on-balance-sheet financial instruments reported pursuant to FASB Statement No.
125 representing subordinated credit risk interests, including interests in spread accounts and
asset pools. However, your low-level recourse requirement may exceed the amount of this
instrument if you are subject to credit losses exceeding the amount of the instrument.
Do not Include:
Credit-enhancing interest-only strips reported on SI402 that exceed 25% of your Tier 1 Capital.
You must deduct the amount that exceeds 25% of Tier 1 capital on CCR 133.
CCR62:
RISK-WEIGHTED ASSETS FOR LOW-LEVEL RECOURSE
AND RESIDUAL INTERESTS (CCR605 X 12.5)
This notional risk-weighted amount is your low-level recourse and residual interests amount on CCR605
multiplied by 12.5. Note: This computation results in a risk-weighted asset amount that when multiplied
by 8 percent results in your low-level recourse amount. By converting your low-level recourse and
residual interests amount into risk-weighted assets, this method increases your total risk-based capital
requirement instead of reducing your total risk-based capital like the deduction method.
The EFS software will compute this line as CCR605 multiplied by 12.5, the reciprocal of the 8 percent
risk-based capital requirement.
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CCR64:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
ASSETS TO RISK WEIGHT
The EFS software will automatically compute this line as the sum of CCR420, CCR455, CCR485,
CCR510, and CCR605.
Total assets subject to risk weighting are as follows:
1.
2.
3.
4.
5.
6.
Adjusted Total Assets, CCR25.
ALLL, CCR350 plus CCR530.
Assets you are required to deduct, reported on CCR370.
Off-balance-sheet items you are required to convert to assets to risk weight.
Unrealized gains on AFS equity securities reported on CCR302.
Less any on-balance-sheet assets reported on CCR375.
CCR75: Subtotal Risk-Weighted Assets
The EFS software will compute this line as the sum of CCR40, CCR45, CCR50, CCR55, and CCR62.
CCR530: Excess Allowances for Loan and Lease Losses (ALLL)
Report an amount on CCR530 only when the ALLL reported on CCR350 is less than the ALLL reported
on SC283 and SC357. This could occur when the total ALLL reported on Schedule SC exceeds the
regulatory capital limit of 1.25 percent of risk-weighted assets. Report on CCR530 the ALLL reported on
SC283 and SC357 that is not included on CCR350. Excess ALLL may not include amounts for liabilities
for credit losses on off-balance-sheet credit exposures.
CCR78:
TOTAL RISK-WEIGHTED ASSETS
The EFS software will compute this line as CCR75 minus CCR530.
CCR80: Total Risk-Based Capital Requirement
The EFS software will compute this line as CCR78, Total Risk-Weighted Assets multiplied by eight
percent. This represents the Total Risk-based Capital necessary to be deemed adequately capitalized
pursuant to 12 CFR Part 565.
If you have an individual minimum capital requirement (IMCR) set by OTS that requires the maintenance
of a capital level in excess of the minimum requirement, you should override the calculated amount and
report your IMCR.
This amount should never be less than eight percent of CCR78.
CAPITAL AND PROMPT CORRECTIVE ACTION RATIOS
The EFS software will compute the following ratios. These ratios provide you and the data user with
instantaneous calculation of important capital ratios.
CCR810: Tier 1 (Core) Capital Ratio
The EFS software will compute this ratio as Tier 1 (core) capital divided by adjusted total assets
(CCR20/CCR25), expressed as a percentage.
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CCR820: Total Risk-Based Capital Ratio
The EFS software will compute this ratio as total risk-based capital divided by risk-weighted assets
(CCR39/CCR78), expressed as a percentage.
CCR830: Tier 1 Risk-Based Capital Ratio
The EFS software will compute this ratio as Tier 1 (core) capital, less the deduction for low-level recourse
and residual interests, divided by risk-weighted assets ((CCR20-CCR375)/CCR78), expressed as a
percentage.
CCR840: Tangible Equity Capital
If you do not report purchased credit card relationships (PCCRS) or servicing assets on nonmortgage
loans or if you do not have non-qualifying PCCRs or non-qualifying servicing assets on nonmortgage
loans, the EFS software will compute this ratio as Tier 1 (core) capital plus cumulative perpetual preferred
stock less PCCRS and servicing assets on nonmortgage loans divided by tangible assets less PCCRS
and servicing assets on nonmortgage loans ([CCR20-CCR185+SC812-SC644]/[CCR25-CCR285SC644]), expressed as a percentage.
If you have non-qualifying PCCRs or non-qualifying servicing assets on nonmortgage loans, as
determined under CCR133, you should manually override the software calculation for CCR840. You
should take into consideration adjustments made on CCR 133 so that PCCRs and servicing assets on
nonmortgage loans in Tier 1 (core) capital are fully deducted for purposes of the tangible equity ratio.
SCHEDULE CCR
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MARCH 2010
SCHEDULE FV — CONSOLIDATED ASSETS AND
LIABILITIES MEASURED AT FAIR VALUE ON A
RECURRING BASIS
Throughout these instructions, you and your refers to the reporting savings association and its consolidated
subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
BACKGROUND
Complete this Schedule if your total assets reported on SC60 are greater than $10 billion at any time
during the fiscal year. Report on this Schedule all assets and liabilities measured at fair value on a
recurring basis (i.e. either marked-to-market through earnings each reporting period or, for available-forsale securities, reflecting changes in fair value as a component of other comprehensive income),
including on a quarterly basis for purposes of the Thrift Financial Report.
FAIR VALUE MEASUREMENTS: LEVEL 1, LEVEL 2, LEVEL 3, AND
LESS: AMOUNTS NETTED
For each asset and liability caption in this Schedule, report the fair value amounts which fall in their
entirety in Levels 1, 2, or 3, respectively, in accordance with GAAP. The level in the fair value hierarchy
within which a fair value measurement in its entirety falls should be determined based on the lowest level
input (with Level 3 being the lowest and Level 1 the highest) that is significant to the fair value
measurement in its entirety.
For each asset and liability caption in this Schedule where you have a legally enforceable master netting
agreement, you may have reported on Schedule SC the asset net of a related liability, or the liability net
of a related asset, consistent with GAAP. However, report on this Schedule the gross amount of the
asset or liability by the applicable Level (1, 2, or 3), even though you may have reported such amounts
net on Schedule SC. In addition, for each asset or liability where the amount on Schedule SC has been
reported net of a related liability or asset, respectively, and where the amount on this Schedule has been
reported gross (that is, without regard to the related liability or asset), report the related netting
adjustment.
SCHEDULE FV
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LINE-BY-LINE INSTRUCTIONS
ASSETS
FV111, 112 and 113: Federal Funds Sold and Securities Purchased
Under Agreements to Resell
For federal funds sold and securities purchased under agreements to resell that are included on SC125,
Federal Funds Sold and Securities Purchased Under Agreements to Resell, and that are measured at fair
value on a recurring basis, report these assets by the applicable Level (1, 2, or 3).
FV131, 132 and 133: Trading Securities
For trading securities that are included on SC11, Cash, Deposits, and Investment Securities, and SC22,
Mortgage-Backed Securities, report these assets by the applicable Level (1, 2, or 3). All trading securities
are measured at fair value on a recurring basis, with changes in fair value reported through earnings.
FV151, 152 and 153: Available-for-Sale Securities
For available-for-sale securities that are included on SC11, Cash, Deposits, and Investment Securities,
and SC22, Mortgage-Backed Securities, report these assets by the applicable Level (1, 2, or 3). All
available-for-sale securities are measured at fair value on a recurring basis. However, the change in fair
value on available-for-sale securities is reflected in other comprehensive income – not in earnings.
FV211, 212 and 213: Loans and Leases
For loans and leases that are included on SC26, Mortgage Loans, and SC31, Nonmortgage Loans, and
that are measured at fair value on a recurring basis, report these assets by the applicable Level (1, 2, or
3).
FV241, 242 and 243: Mortgage Servicing Rights
For mortgage servicing rights that are included on SC642, Servicing Assets on Mortgage Loans, and that
are measured at fair value on a recurring basis, report these assets by the applicable Level (1, 2, or 3).
FV261, 262 and 263: Derivative Assets
For derivative assets that are included on SC689, Other Assets, report these assets by the applicable
Level (1, 2, or 3). All derivatives are measured at fair value on a recurring basis with changes in fair value
reported through earnings.
FV311, 312 and 313: All Other Financial Assets
For all other financial assets that are included in SC60, Total Assets, and that are measured at fair value
on a recurring basis, report these assets by the applicable Level (1, 2, or 3).
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FV11:
Federal Funds Sold and Securities Purchased Under
Agreements to Resell
FV13:
Trading Securities
FV15:
Available-for-Sale Securities
FV21:
Loans and Leases
FV24:
Mortgage Servicing Rights
FV26:
Derivative Assets
FV31:
All Other Financial Assets
For each asset category, the EFS software will compute this line as the sum of the amounts reported in
the columns for each Level (1, 2, and 3), as follows:
FV11 = FV111 + FV112 + FV113
FV13 = FV131 + FV132 + FV133
FV15 = FV151 + FV152 + FV153
FV21 = FV211 + FV212 + FV213
FV24 = FV241 + FV242 + FV243
FV26 = FV261 + FV262 + FV263
FV31 = FV311 + FV312 + FV313
FV114: Federal Funds Sold and Securities Purchased Under
Agreements to Resell
FV134: Trading Securities
FV154: Available-for-Sale Securities
FV214: Loans and Leases
FV244: Mortgage Servicing Rights
FV264: Derivative Assets
FV314: All Other Financial Assets
For each asset category where the amount on Schedule SC has been reported net of a related liability,
and where the amount on this Schedule has been reported gross (that is, without regard to the related
liability), report the related netting adjustment. In all cases, the netting adjustment will be negative.
However, report the amount as positive, as the EFS software will subtract the amount from the total
before netting to arrive at the Total, After Netting. These adjustments will align the amounts reported for
assets on this Schedule with the amounts reported on Schedule SC.
SCHEDULE FV
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FV12:
Federal Funds Sold and Securities Purchased Under
Agreements to Resell
FV14:
Trading Securities
FV16:
Available-for-Sale Securities
FV22:
Loans and Leases
FV25:
Mortgage Servicing Rights
FV27:
Derivative Assets
FV32:
All Other Financial Assets
For each asset category, the EFS software will compute this line as the total before netting, less the
amount reported for Less: Amounts Netted, as follows:
FV12 = FV11 – FV114
FV14 = FV13 – FV134
FV16 = FV15 – FV154
FV22 = FV21 – FV214
FV25 = FV24 – FV244
FV27 = FV26 – FV264
FV32 = FV31 – FV314
FV41, 42, 43 and 44:
Total Assets Measured at Fair Value on a
Recurring Basis
For each Level (1, 2, or 3) and for the total before netting, the EFS software will compute this line as the
sum of the corresponding amounts reported or computed for each asset category, as follows:
FV41 = FV111 + FV131 + FV151 + FV211 + FV241 + FV261 + FV311
FV42 = FV112 + FV132 + FV152 + FV212 + FV242 + FV262 + FV312
FV43 = FV113 + FV133 + FV153 + FV213 + FV243 + FV263 + FV313
FV44 = FV11 + FV13 + FV15 + FV21 + FV24 + FV26 + FV31
FV46: Total Assets Measured at Fair Value on a Recurring Basis –
Less: Amounts Netted
The EFS software will compute this line as the sum of the corresponding amounts reported for each asset
category, as follows:
FV46 = FV114 + FV134 + FV154 + FV214 + FV244 + FV264 + FV314
FV48: Total Assets Measured at Fair Value on a Recurring Basis –
Total, After Netting
The EFS software will compute this line as the sum of the corresponding amounts reported for each asset
category, as follows:
FV48 = FV12 + FV14 + FV16 + FV22 + FV25 + FV27 + FV32
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LIABILITIES
FV511, 512 and 513: Federal Funds Purchased and Securities Sold
Under Agreements to Repurchase
For federal funds purchased and securities sold under agreements to repurchase that are included on
SC730, Federal Funds Purchased and Securities Sold Under Agreements to Repurchase, and that are
measured at fair value on a recurring basis, report these liabilities by the applicable Level (1, 2, or 3).
FV531, 532 and 533: Deposits
For deposits that are included on SC710, Deposits, and that are measured at fair value on a recurring
basis, report these liabilities by the applicable Level (1, 2, or 3).
FV611, 612 and 613: Subordinated Debentures
For subordinated debentures that are included on SC736, Subordinated Debentures, and that are
measured at fair value on a recurring basis, report these liabilities by the applicable Level (1, 2, or 3).
FV631, 632 and 633: Other Borrowings
For other borrowings that are included on SC760, Other Borrowings, and that are measured at fair value
on a recurring basis, report these liabilities by the applicable Level (1, 2, or 3).
FV651, 652 and 653: Derivative Liabilities
For derivative liabilities that are included on SC796, Other Liabilities and Deferred Income, report these
liabilities by the applicable Level (1, 2, or 3). (All derivatives are measured at fair value on a recurring
basis with changes in fair value reported through earnings.)
FV711, 712 and 713: All Other Financial Liabilities
For all other financial liabilities that are included in SC70, Total Liabilities, and that are measured at fair
value on a recurring basis, report these liabilities by the applicable Level (1, 2, or 3).
FV51:
Federal Funds Purchased and Securities Sold Under
Agreements to Repurchase
FV53:
Deposits
FV61:
Subordinated Debentures
FV63:
Other Borrowings
FV65:
Derivative Liabilities
FV71:
All Other Financial Liabilities
SCHEDULE FV
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For each liability category, the EFS software will compute this line as the sum of the amounts reported in
the columns for each Level (1, 2, and 3), as follows:
FV51 = FV511 + FV512 + FV513
FV53 = FV531 + FV532 + FV533
FV61 = FV611 + FV612 + FV613
FV63 = FV631 + FV632 + FV633
FV65 = FV651 + FV652 + FV653
FV71 = FV711 + FV712 + FV713
FV514: Federal Funds Purchased and Securities Sold Under
Agreements to Repurchase
FV534: Deposits
FV614: Subordinated Debentures
FV634: Other Borrowings
FV654: Derivative Liabilities
FV714: All Other Financial Liabilities
For each liability category where the amount on Schedule SC has been reported net of a related asset,
and where the amount on this Schedule has been reported gross (that is, without regard to the related
asset), report the related netting adjustment. In all cases, the netting adjustment will be negative.
However, report the amount as positive, as the EFS software will subtract the amount from the total
before netting to arrive at the Total, After Netting. These adjustments will align the amounts reported for
liabilities on this Schedule with the amounts reported on Schedule SC.
FV52:
Federal Funds Purchased and Securities Sold Under
Agreements to Repurchase
FV54:
Deposits
FV62:
Subordinated Debentures –
FV64:
Other Borrowings
FV66:
Derivative Liabilities
FV72:
All Other Financial Liabilities
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For each liability category, the EFS software will compute this line as the total before netting, less the
amount reported for Less: Amounts Netted, as follows:
FV52 = FV51 – FV514
FV54 = FV53 – FV534
FV62 = FV61 – FV614
FV64 = FV63 – FV634
FV66 = FV65 – FV654
FV72 = FV71 – FV714
FV81, 82, 83 and 84: Total Liabilities Measured at Fair Value on a
Recurring Basis
For each Level (1, 2, or 3) and for the total before netting, the EFS software will compute this line as the
sum of the corresponding amounts reported or computed for each liability, as follows:
FV81 = FV511 + FV531 + FV611 + FV631 + FV651 + FV711
FV82 = FV512 + FV532 + FV612 + FV632 + FV652 + FV712
FV83 = FV513 + FV533 + FV613 + FV633 + FV653 + FV713
FV84 = FV51 + FV53 + FV61 + FV63 + FV65 + FV71
FV86: Total Liabilities Measured at Fair Value on a Recurring Basis –
Less: Amounts Netted
The EFS software will compute this line as the sum of the corresponding amounts reported for each
liability category, as follows:
FV86 = FV514 + FV534 + FV614 + FV634 + FV654 + FV714
FV88: Total Liabilities Measured at Fair Value on a Recurring Basis –
Total, After Netting
The EFS software will compute this line as the sum of the corresponding amounts reported for each
liability category, as follows:
FV88 = FV52 + FV54 + FV62 + FV64 + FV66 + FV72
SCHEDULE FV
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THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
DECEMBER 2010
SCHEDULE RM – ANNUAL SUPPLEMENTAL
CONSOLIDATED DATA ON REVERSE
MORTGAGES
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
Starting as of December 31, 2010 complete this schedule annually.
RM010: DO YOU HAVE ANY REVERSE MORTGAGE LOAN
ACTIVITY FOR THE CALENDAR YEAR TO REPORT
IN THIS SCHEDULE?
Please read the entire set of instructions and Thrift Financial Report line items before responding to the
initial inquiry RM010.
Respond No if you have no loans or referrals meeting the definitions of reverse mortgage loans as
defined in this schedule. If you respond No, you should not complete any other lines in this schedule.
Respond Yes, if you have loans or referrals to report in Schedule RM. Please note that you report certain
line items for the entire calendar year and certain line items as of the end of the year.
Reverse mortgages are used by homeowners age 62 or older to convert a portion of the equity in their
homes into a source of income. The borrower receives the cash flow in monthly payments or a line of
credit. A reverse mortgage is a non-recourse loan, which means if the balance of the loan exceeds the
value of the property; the lender may not seek recourse for the excess amount owed. Furthermore,
homeowners do not have to repay the reverse mortgage until they are no longer occupying the home as a
primary residence.
The U.S. Department of Housing and Urban Development (“HUD”) created one of the first reverse
mortgage programs administrated through the Federal Housing Administration (“FHA”). The FHA
underwrites and insures the largest volume of reverse mortgages through its “Home Equity Conversion
Mortgage” (“HECM”) product. On November 25, 2009, HUD announced that the national FHA loan limit
for the HECM in 2010 remains at $650,000. 1 Report HECM loans on lines RM110, RM310, RM330,
RM420, RM510, RM610, RM620, and RM630.
1 Reference HUDs MORTGAGEE LETTER 2009-50, dated November 25, 2009 at www.hud.gov for details.
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Report all other (Non-HECMs) reverse mortgage programs as “Proprietary” on lines RM112,
RM312, RM332, RM422, RM512, RM612, RM622, and RM632. This includes reverse mortgage loan
products developed by private companies and Fannie Mae’s former reverse mortgage product known as
“The Home Keeper Mortgage.” On September 3, 2008, FNMA announced to its reverse mortgage
lenders that they planned to terminate “The Home Keeper Mortgage” product, effective December 31,
2008. 2 In addition, include any state or local government products.
Complete Schedule RM on a consolidated basis from the savings association downward to any
consolidated service corporation involved in reverse mortgage activities. Do not consolidate your holding
company in this schedule. You should apply generally accepted accounting principles (GAAP) unless we
specifically state otherwise in these instructions.
RM010: Do you have any reverse mortgage loan activity for the
calendar year to report in this Schedule?
AMOUNT OF MORTGAGE LOANS OUTSTANDING:
RM110: Amount of Home Equity Conversion Mortgage Loans
Report the amount of outstanding HECMs as of December 31.
RM112: Amount of Proprietary (Non-HECM) Reverse Mortgage Loans
Report the amount of outstanding Proprietary (Non-HECM) mortgage loans as of December 31.
ANNUAL INTEREST INCOME FROM:
RM310: Home Equity Conversion Mortgage Loans
Report the annual interest income related to HECMs for the calendar year-to-date.
RM312: Proprietary (Non-HECM) Reverse Mortgage Loans
Report the annual interest income related to Proprietary (Non-HECM) reverse mortgages for the calendar
year-to-date.
NUMBER OF REFERRALS OVER THE CALENDAR YEAR TO
ANOTHER LENDER FROM WHOM YOU RECEIVED COMPENSATION
FOR SERVICES PERFORMED FOR THE LENDER IN CONNECTION
WITH THE LENDER’S ORIGINATION OF THE REVERSAL MORTGAGE:
RM330: Home Equity Conversion Mortgage Loans
Report the number of referrals to another lender over the calendar year from whom you received
compensation for services performed for the lender in connection with the lender’s origination of the
reverse mortgage.
2 Fannie Mae’s Reverse Lender Letter 2008-3: Announcement to Terminate Purchase of Home Keeper Reverse Mortgages.
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RM332: Proprietary (Non-HECM) Reverse Mortgage Loans
Report the number of referrals to other lenders during the calendar year from whom you received
compensation for services performed for the other lender in connection with the other lender originating
the reverse mortgage.
ANNUAL ORIGINATION FEE INCOME FROM:
RM420: Home Equity Conversion Mortgage Loans
Report the annual origination fee income related to HECMs for the calendar year-to-date.
RM422: Proprietary (Non-HECM) Reverse Mortgage Loans
Report the annual origination fee income related to Proprietary (Non-HECM) mortgage loans for the
calendar year-to-date.
COMMITMENTS OUTSTANDING TO ORIGINATE
MORTGAGES SECURED BY:
RM510: Home Equity Conversion Mortgage Loans
Report the amount of commitments outstanding to originate HECMs as of December 31.
RM512: Proprietary (Non-HECM) Reverse Mortgage Loans
Report the amount of commitments outstanding to originate Proprietary (Non-HECM) mortgage loans as
of December 31.
ANNUAL MORTGAGE LOANS DISBURSED FOR
PERMANENT LOANS ON:
RM610: Home Equity Conversion Mortgage Loans
Report the total originations of Home Equity Conversion Mortgage Loans for the calendar year.
RM612: Proprietary (Non-HECM) Reverse Mortgage Loans
Report the total originations of proprietary loans for the calendar year.
ANNUAL LOANS AND PARTICIPATIONS PURCHASED
SECURED BY:
RM620: Home Equity Conversion Mortgage Loans
Report the annual loans and participations purchased secured by HECMs for the calendar year to date.
RM622: Proprietary (Non-HECM) Reverse Mortgage Loans
Report the annual loans and participations purchased secured by proprietary loans for the calendar year
to date.
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ANNUAL LOANS AND PARTICIPATIONS SOLD SECURED
BY:
RM630: Home Equity Conversion Mortgage Loans
Report the annual loans and participations sold secured by HECMs for the calendar year to date.
RM632: Proprietary (Non-HECM) Reverse Mortgage Loans
Report the annual loans and participations sold secured by proprietary loans for the calendar year to
date.
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SCHEDULE CMR — CONSOLIDATED MATURITY
AND RATE
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
GENERAL INSTRUCTIONS
INTRODUCTION
Schedule CMR provides information about the interest rate, repricing, and maturity characteristics of all
financial instruments that you hold. We use the information on Schedule CMR as input to the OTS Net
Portfolio Value Model (OTS Model). The OTS Model measures your exposure to interest rate risk by
estimating how a change in interest rates affects the market value of your assets, liabilities, and offbalance-sheet (OBS) contracts. OTS sends the output reports of the OTS Model to you after the
information you submit on Schedule CMR has passed the data edits.
To estimate the market value of a financial instrument, it is necessary to project its future cash flows. To
project the future cash flows of a financial instrument, you need the following information:
1. The outstanding balance of the instrument or, in the case of an OBS contract, the notional
principal amount of the position.
2. The contract interest rate of the instrument and, if the instrument is adjustable-rate, details
concerning how and when the coupon will adjust in the future.
3. The instrument’s amortization schedule and maturity.
Because it is not possible to collect this information on Schedule CMR for individual financial instruments,
we group together information on instruments that display similar characteristics. For example, you report
the total outstanding balance of all your 30-year, conventional, fixed-rate mortgages with coupons
between 7.00 percent and 7.99 percent on CMR002. On CMR007 and CMR012, you report the average
maturity and the average coupon of those balances.
Collecting information about financial instruments stratified by coupon range is an important feature of
Schedule CMR. When you prepare software to handle preparation of this report, please note that if there
are major changes in interest rates, OTS may modify the coupon ranges.
SCHEDULE CMR
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REPORTING OF INFORMATION
Use the same consolidation instructions that apply to the other schedules of the Thrift Financial Report.
Generally, dollar amounts reported on Schedule CMR are outstanding balances. We define outstanding
balance as the principal balance, net of LIP and before any yield adjustments or deductions for valuation
allowances. In most cases, outstanding balance is face value less charge-offs. We note exceptions to
reporting outstanding balances where appropriate. For purposes of reporting in Schedule CMR, exclude
nonperforming loans, which we define as nonaccrual loans or loans that are at least 90 days past due
but still accruing interest. Report construction LIP in the Off-Balance-Sheet Positions section of Schedule
CMR and report nonperforming loans on CMR501 and CMR511 in the Assets section.
You may estimate items requested on Schedule CMR if the necessary information is not available. For
example, you may not have ready access to all required information for your holdings of mortgage loans
and mortgage securities serviced by others.
FORMAT OF SCHEDULE CMR
We have divided Schedule CMR into six sections. The first three sections collect information on assets,
liabilities, and financial derivatives and OBS positions, respectively. You must fill out these three sections
of the report. The other three sections, Supplemental Reporting for Assets and Liabilities,
Supplemental Reporting of Market Value Estimates and Supplemental Reporting for Financial
Derivatives and Off-balance-sheet Positions, are required for most savings associations. We have
noted exceptions to the required reporting in the instructions for these sections. We provide these three
sections so that you can report additional information that results in more accurate interest rate risk
exposure estimates.
Supplemental Reporting for Assets and Liabilities
This section gives you the ability of reporting more detailed information on certain assets and liabilities
than you report in the assets and liabilities sections of Schedule CMR. Use of this data by the OTS
Model results in more accurate interest rate risk exposure estimates. Supplemental reporting is available
for the following areas:
1. Certain types of loans.
2. Investments in mortgage-related mutual funds.
3. Investments in other investment securities.
4. Variable-rate, fixed-maturity (VRFM) liabilities.
See the instructions for Supplemental Reporting for Assets and Liabilities for more information.
Supplemental Reporting of Market Value Estimates
In this section, you estimate the market value of several types of complex financial instruments for seven
different interest rate scenarios. If the OTS Model valued these instruments, we would need a significant
amount of additional data. The valuation estimates you provide will supplement or replace OTS estimates
for those instruments. The instruments are:
1. OBS contracts.
2. Mortgage-derivative securities.
3. Liabilities with embedded options. For example, callable debt.
4. Mortgage-derivative securities you issue.
5. Complex securities, such as structured securities.
Some savings associations are required to report market value estimates of these instruments. See
detailed instructions in the section Supplemental Reporting of Market Value Estimates.
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Supplemental Reporting for Financial Derivatives and Off-Balance-Sheet Positions
This section permits you to report any additional OBS positions you hold beyond the 16 that the OffBalance-Sheet section of Schedule CMR can accommodate. See the section Financial Derivatives and
Off-Balance-Sheet Positions and the section Supplemental Reporting for Derivatives and OffBalance-Sheet Positions for more information.
CALCULATING WEIGHTED AVERAGES
Certain items that you report on Schedule CMR require that you calculate weighted averages. We
describe how to calculate the weighted-average coupon (WAC) and other measures below.
Weighted-Average Coupon (WAC)
The WAC is the average coupon of a group of assets, liabilities, or OBS contracts. You weight the
coupon of each individual instrument in the group by its outstanding dollar balance, as a proportion of the
total dollar balances of the group. Unless otherwise stated in the reporting instructions for a specific
instrument, use the following general guidelines:
1. Express the interest rates for all assets as annual simple interest rates (coupon rates for
securities and contract rates for loans).
2. Express the interest rates for all liabilities as annual percentage yields (APYs).
3. For mortgage loans that others service, report the contract rate of the loan. Do not subtract the
servicing fee.
4. Express all WACs as a percent, to two decimal places. For instance, 10.54.
The following example illustrates how to calculate the WAC of a portfolio of 30-year, single-family fixedrate mortgages. The coupons are between 9.00 percent and 9.99 percent.
Example: You have three mortgages with outstanding balances totaling $350,000. The mortgages have
outstanding balances and coupons of $100,000 and 9.75 percent, $110,000 and 9.5 percent, and
$140,000 and 9.0 percent. Calculate the WAC for this portfolio as follows:
WAC
=
=
$100,000 (9.75%) + $110,000 (9.5%) + $140,000 (9.0%)
$350,000
9.37%
Details of the computation of the WAC may vary for certain instruments. For further guidance, see the
relevant sections of the instructions.
Weighted-Average Pass-Through Rate
The pass-through rate is the net interest rate passed through to the holder of a mortgage pass-through
security. This is the rate after deducting servicing, management, and guarantee fees from the gross
coupon of the mortgages underlying the security. The weighted-average pass-through rate is the
average coupon of a group of mortgage pass-through securities. Weight the coupon of each security in
the group by its outstanding dollar balance, as a proportion of the total dollar balances of the group.
Express the interest rates for all assets as annual simple interest rates. Express all weighted-average
pass-through rates as a percent, to two decimal places, for instance, 10.54.
The following example illustrates how to calculate the weighted-average pass-through rate of a portfolio
of 30-year, single-family, fixed-rate mortgage securities. The coupons are between 9.00 percent and 9.99
percent.
Example: You have three mortgage pass-through securities with outstanding balances totaling
$350,000. The securities have outstanding balances and pass-through rates of $100,000 and 9.5 percent,
$110,000 and 9.5 percent, and $140,000 and 9.0 percent. Calculate the weighted-average pass-through
rate for this portfolio as follows:
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Weighted-Average Pass-Through Rate =
=
$100,000 (9.5%) + $110,000 (9.5%) + $140,000 (9.0%)
$350,000
9.30%
Weighted-Average Remaining Maturity (WARM)
The WARM is the average remaining maturity, in months, for a group of assets or liabilities. You weight
the maturity of each individual asset or liability by taking its outstanding dollar balance, as a proportion of
the total dollar balances of the group. Round values to the nearest month. Perform rounding after you
complete the calculation. The following example illustrates how to calculate the WARM for fixed-rate
consumer loans.
Example: You have three fixed-rate consumer loans with total outstanding balances of $40,000. Two are
auto loans with respective outstanding balances and remaining maturities of $10,000 and 48 months, and
$1,000 and 12 months. The third is a mobile home loan with an outstanding balance of $29,000 and a
remaining term of 120 months. Calculate the WARM for your fixed-rate consumer loans as follows:
WARM
=
$10,000 (48) + $1,000 (12) + $29,000 (120)
$40,000
=
99.3 months
=
99 months (rounded to the nearest month)
For balloon mortgages, use the number of months until payment of the balloon. The following example
illustrates how to calculate the WARM for balloon mortgages.
Example: You have two balloon mortgages, each with an outstanding balance of $100. The first
mortgage amortizes over 240 months, but the entire remaining principal is due as a balloon in 60 months.
The second mortgage amortizes over 360 months, but has a balloon payment in 84 months. The WARM
for your balloon mortgages would be 72 months. [72 = ($100/$200) x 60 + ($100/$200) x 84].
An exception to this treatment exists for single-family adjustable-rate mortgages (ARMs) reported on
CMR096 through CMR120, Balloon Mortgages and Mortgage-Backed Securities (MBS). See that section
for details.
Loans that have matured but still have a principal balance outstanding should be included in calculating
the WARM if they are less than 90 days past due. Assign such loans a remaining maturity of one month.
Do not include such loans if more than 90 days past due.
For loans made under open-end lines of credit, calculate maturity as if the borrower will repay the existing
loan balance by making the minimum payments required by the repayment schedule.
For demand loans, either adjustable- or fixed-rate, that pay interest only and have no definite maturity,
use one month when calculating the WARM.
Weighted-Average Margin
The margin of an adjustable-rate loan or deposit is the amount added to the index rate to derive the fully
indexed coupon rate. If you have adjustable-rate loans or deposits where you determine the coupon by
multiplying an index by some factor, you should calculate an additive margin each quarter. Do this by
subtracting the value of the index from the fully indexed coupon rate. Report all weighted-average
margins in basis points. When you calculate weighted-average margins for mortgage securities and
asset-backed securities, use the net margin for securities. Do not include servicing and guarantee fees.
For loans serviced by others, use the gross margin. Do not subtract the servicing fee. For details on
specific types of loans, see the relevant section of the instructions.
The following example illustrates how to calculate the weighted-average margin of ARM loans and
securities.
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Example: You have a portfolio containing an adjustable-rate, single-family, first mortgage loan and a
mortgage security backed by adjustable-rate, single-family, first mortgage loans. Both use the one-year
Treasury rate as an index. The loan and the security each have an outstanding balance of $100,000. The
loan has a gross margin of 225 basis points. The loans backing the security have a gross margin of 225
basis points. You receive a pass-through rate of the one-year Treasury plus 175. The guarantee and
servicing fees amount to 50 basis points. Use the security’s net margin of 175 basis points to calculate
the weighted-average margin.
Weighted-Average Margin
=
=
$100,000 (225) + $100,000 (175)
$200,000
200 basis points
RELATIONSHIP OF ITEMS ON SCHEDULES CMR AND SC
Information you report on Schedule CMR relates to the information you report on Schedule SC as follows:
Assets
The EFS software computes CMR550 as the sum of the following items:
CMR125
CMR282
CMR325
CMR378
CMR508
CMR525
CMR543
CMR185
CMR261
CMR262
CMR291
CMR292
CMR311
CMR326
CMR335
CMR336
CMR490
CMR501
CMR502
CMR511
CMR512
CMR517
CMR530
CMR535
CMR538
CMR544
Less the sum of the following items:
CMR281
CMR312
CMR377
CMR503
CMR520
CMR541
CMR504
CMR540
CMR507
CMR539
CMR513
CMR516
CMR550 plus the balance for Complex Securities reported as code 121 on the section for Supplemental
Reporting of Market Value Estimates should equal SC60, Total Assets. For all editing and output data
uses, our data systems will add the balance for complex securities reported as code 121 in the section for
Supplemental Reporting of Market Value Estimates to CMR550.
SC11, Cash, Deposits, and Investment Securities, less SC182, Securities Backed by Nonmortgage
Loans, equals the sum of the following items:
CMR490
CMR538
Plus Complex Securities reported as code 121 on the section for Supplemental Reporting of Market
Value Estimates
Less the sum of the following items:
CMR539
CMR540
SC22, Mortgage-Backed Securities, plus SC26, Mortgage Loans, equals the sum of the following items:
CMR125
CMR282
CMR501
CMR377
CMR185
CMR291
CMR502
CMR378
CMR261
CMR292
CMR503
CMR262
CMR311
CMR508
CMR281
CMR312
CMR578
– Less the sum of the following items: –
CMR504
CMR507
CMR580
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SC31, Nonmortgage Loans, plus SC182, Securities Backed by Nonmortgage Loans, equals the sum of
the following items:
CMR325
CMR512
CMR326
CMR517
CMR335
CMR580
CMR336
CMR511
– Less the sum of the following items:
CMR513
CMR516
CMR578
SC40, Repossessed Assets, equals CMR525
SC45, Real Estate Held for Investment, equals CMR520
SC55, Office Premises and Equipment, equals CMR535
SC59, Other Assets, plus SC510, FHLB Stock, equals the sum of the following items:
CMR541
CMR543
CMR544
Liabilities and Equity Capital
The sum of SC710, Deposits, SC72, Borrowings, and SC715, Unamortized Yield Adjustments on
Deposits, equals the sum of the following line items:
CMR645
CMR771
CMR715
CMR782
CMR762
CMR784
Plus:
CMR765
CMR785
CMR768
(1) Variable-rate, fixed-maturity liabilities reported as codes 200, 220, and 299 in the section
Supplemental Reporting for Assets and Liabilities and (2) Structured borrowings reported as
codes 280 through 290 in the section Supplemental Reporting of Market Value Estimates.
Less the following item:
CMR755
The sum of SC75, Other Liabilities, and SC712, Escrows, equals the sum of the following items:
CMR775
CMR777
CMR779
CMR786
CMR787
SC800, Redeemable Preferred Stock and Noncontrolling Interest in Consolidated Subsidiaries, equals
the sum of CMR755 and CMR793.
SC80, Total Equity Capital, equals CMR796.
ASSETS
TERMS USED IN THE ASSETS SECTION
Dwelling Unit: A dwelling unit is a unified combination of rooms, whether existing or under construction,
designed for residence by one family. This classification does not change because of incidental use for
business purposes.
Single Family Mortgages: Single-family mortgages include all permanent loans and combination
construction-permanent loans where the permanent financing interest rate has already been set. They
may be secured by any of the following types of properties:
1. One-family dwellings in detached or semi-detached structures.
2. Individual permanently financed units in a condominium, cooperative, or timesharing arrangement
where the owner of each unit has an undivided proportional interest in the underlying real estate
and common elements of the structure.
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3. Structures consisting of two- to four-dwelling units.
Multifamily Mortgages: Multifamily mortgages include all permanent loans and combination
construction-permanent loans where the permanent financing interest rate has already been set. They
are secured by residential property containing five or more dwelling units and include the following types
of properties:
1. Mortgages on fraternity or sorority houses offering sleeping accommodations.
2. Living accommodations for students or staff of a college or hospital.
3. Retirement homes with sleeping and eating accommodations that are not condominiums or
cooperatives.
In these cases, the number of bedrooms determines the number of dwelling units.
Nonresidential Mortgages: Nonresidential mortgages include all permanent loans and combination
construction-permanent loans where the permanent financing interest rate has already been set. They
are secured by properties not covered by the definition of single-family dwelling units, multifamily dwelling
units, or land loans. This category includes the following types of properties regardless of the incidental
use of the property as a dwelling unit:
1. Mobile home parks.
2. Hospitals.
3. Nursing homes.
4. Churches.
5. Stores.
6. Other commercial property.
7. Properties used for farming.
Construction and Land Loans: Construction and land loans include land loans and the funded portion
of construction loans as a single balance. This category includes most loans classified as construction or
land loans in Schedule SC including the following types of properties:
1. Loans to acquire and develop land.
2. Loans for developed building lots.
3. Loans for unimproved land.
4. Construction loans secured by single-family, multifamily, or nonresidential properties.
5. Loans to developers secured by land where the developer is constructing any of these properties.
Construction and land loans do not include combination construction-permanent mortgages on any type
of property where the permanent financial interest rate has already been set; include such loans with
permanent mortgages in the relevant category.
Nonperforming Loans: Nonperforming loans are nonaccrual loans and loans that are still accruing
interest and are at least 90 days past due, or an equivalent number of cycles – see the instructions for
Schedule PD.
Teaser ARMs: Teaser ARMs are adjustable rate mortgages originated at introductory rates below the
fully indexed rate, teaser rates, and that remain at their introductory rates – that is, they have not reset.
Balloon Mortgages: Fixed-rate balloon mortgages are fixed-rate mortgages with a remaining maturity at
least ten years shorter than the remaining time to full amortization. For example, a fixed-rate mortgage
that matures in four years and that would require 14 years to amortize fully is a balloon mortgage.
Call Loans: Call loans are extensions of credit where the lender may require repayment of outstanding
principal on one or more contractually specified call dates, irrespective of any contractual maturity date.
Lenders often refinance, or roll over, such loans under new terms, upon mutual agreement of lender and
borrower.
Pass-through securities: Pass-through securities are securities that convey ownership of a fractional
part of each asset in a pool of assets backing the security. The issuer collects principal and interest
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payments generated by the underlying pool of assets and passes the payments through to each security
owner based on their share of ownership.
Pay-through securities: Pay-through securities represent secured debt of the issuer. They give an
investor a security interest in, but not ownership of, the underlying assets. You should consider any assetbacked security that does not meet the definition of pass-through securities above, to be a pay-through
security.
FIXED-RATE, SINGLE-FAMILY, FIRST MORTGAGE LOANS AND
MORTGAGE-BACKED SECURITIES
Report requested information about performing, fixed-rate, first mortgage, single-family loans,
participations in such loans, and pass-through securities backed by such loans.
Include:
1. Fixed-rate fully amortizing mortgages.
2. Fixed-rate balloon payment mortgages.
3. Mortgages with a single rate adjustment. For instance, those that would qualify for the FNMA
Two-Step Mortgage program.
4. Mortgages with interest rates that adjust less often than every five years.
5. Mortgages with coupons that were adjustable in the past, but where the coupon will remain fixed
for the remaining maturity.
6. Mortgages with rates that change over time by prespecified steps. For instance, a 2/1 buydown
with rates scheduled to be seven percent in year one, eight percent in year two, and 9 percent
thereafter.
7. Some call mortgages, as described below.
8. Combination construction-permanent mortgages for single-family dwellings where the permanent
financing interest rate has already been set.
Do not include:
1. Nonperforming mortgages. Report on CMR501.
2. Mortgage warehouse loans, loans collateralized by mortgage loans rather than liens directly on
real estate. Report as commercial loans on CMR326.
3. Mortgages you service for others. Report in the section dealing with mortgage servicing rights,
CMR401 through CMR450.
4. Second mortgages, secured home improvement loans, or home equity loans, regardless of
whether you also hold the first lien or whether there is a first lien. Report as second mortgages on
CMR312.
We collect all information described below according to coupon range and type of loan or security.
Coupon Range: Divide mortgages into the following coupon categories:
1. Less than 5 percent.
2. 5 to 5.99 percent.
3. 6 to 6.99 percent.
4. 7 to 7.99 percent.
5. 8 percent and greater.
Report each mortgage loan and participation in the coupon range that corresponds to its contract rate.
For loans serviced by others, be careful to report according to the contract rate of the loans. Do not
subtract the servicing fee.
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Report each mortgage security in the coupon range that corresponds to the pass-through rate of the
security. For example, you should report a FNMA security with a pass-through rate of 6.5 percent and
where the collateral has a WAC of 7.25 percent in the 6 to 6.99 percent coupon column.
Within each coupon range, divide mortgages into the following broad groups:
1. Thirty-year mortgage loans.
2. Securities backed by 30-year conventional mortgages.
3. Securities backed by 30-year FHA or VA mortgages.
4. Fifteen-year mortgages and mortgage securities.
5. Balloon mortgages and mortgage securities.
Information requested for the five groups differs somewhat; however, the following general information
applies, unless the instructions state differently.
1. Wherever there is a request for a balance use the following guidelines:
a. Report the outstanding principal balance, not the carrying value, of mortgage loans.
b. Report the pro rata share of the outstanding principal balance of participations in mortgages.
c. Report the outstanding principal balance of mortgage securities.
2. Wherever we request a WARM, refer to the calculation of the WARM in the general instructions to
Schedule CMR.
3. Wherever we request a weighted average WAC, refer to the calculation of the WAC in the
general instructions to Schedule CMR.
4. Wherever we request a weighted-average pass-through rate, refer to the calculation of the
weighted-average pass-through rate in the general instructions to Schedule CMR.
A detailed description of the information to report for each group follows.
Thirty-year Mortgages and MBS
CMR001 Through CMR020:
Mortgage Loans
Include all fully amortizing mortgage loans and participations in fully amortizing mortgage loans with an
original maturity of at least 25 years. Include combination construction-permanent mortgages that have
fixed rates for the entire term of the loan. Do not report mortgage loans with a biweekly payment feature.
Report outstanding balances, by coupon range, on CMR001 through CMR005. For each balance, report
the WARM and the WAC on the corresponding column of CMR006 through CMR010 and CMR011
through CMR015, respectively. Of the loan balances on CMR001 through CMR005, report the amount of
each that is FHA or VA guaranteed on CMR016 through CMR020, as appropriate.
CMR026 Through CMR040:
Securities Backed by Conventional Mortgages
Include FHLMC, FNMA, and privately issued mortgage securities backed by fully amortizing mortgage
loans with original maturity of at least 25 years. Do not report mortgage loans with a biweekly payment
feature.
Report the outstanding balances of securities on CMR026 through CMR030 according to the coupon
rates of the securities. For each balance, report the WARM on CMR031 through CMR035, and report the
weighted-average pass-through rate corresponding to each balance on CMR036 through CMR040.
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Securities Backed by FHA or VA Mortgages
Include all GNMA and other mortgage securities backed by fully amortizing FHA and VA mortgage loans
with an original maturity of at least 25 years. Do not report mortgage loans with a biweekly payment
feature.
On CMR046 through CMR050 report, by coupon range, outstanding balances of these mortgage
securities. For each balance entered CMR046 through CMR050, report the WARM on CMR051 through
CMR055 and the weighted-average pass-through rate on CMR056 through CMR060.
CMR066 Through CMR090:
Fifteen-year Mortgages and MBS
Include all fully amortizing mortgage loans with an original maturity of less than 25 years. Include
participations in such loans, and mortgage securities backed by such loans. Include biweekly payment
mortgages having an original maturity of 25 years or more. Include combination construction-permanent
mortgages that have fixed rates for the entire term of the loan.
On CMR066 through CMR070 report, by coupon range, the outstanding principal balances of such
mortgage loans and participations. On CMR071 through CMR075, report the WAC of each balance
reported on CMR066 through CMR070. Report the outstanding principal balance of mortgage securities
backed by loans of this type, by coupon range, on CMR076 through CMR080.
Place security balances into the coupon range corresponding to the pass-through rate of the security.
Report the weighted-average pass-through rate of the securities on CMR081 through CMR085. Report on
CMR086 through CMR090, by coupon range, the WARM of the loans and securities reported in each
coupon range.
CMR096 through CMR120: Balloon Mortgages and MBS
Report requested information about the following types of single-family first mortgage loans. Include
participations in such loans and securities backed by such loans.
Include:
1. Balloon payment mortgages. Fixed-rate balloon mortgages are fixed-rate mortgages with a
remaining maturity at least ten years shorter than the remaining time to full amortization. For
example, a fixed-rate mortgage that matures in four years and that would require 14 years to
amortize fully is a balloon mortgage.
2. Mortgages scheduled for a single rate adjustment, such as those that would qualify for the FNMA
Two-Step mortgage program.
3. ARMs whose coupons reset less frequently than every five years.
4. Some call loans, which we describe in the examples below. Call loans are those where you have
the option, on a particular date, to require repayment of the loan, or may roll it over into a loan
with potentially different terms. In particular, the interest rate of a call loan is subject to change on
the call date.
On CMR096 through CMR100 report, by coupon range, the outstanding principal balances of the above
listed types of mortgage loans and participations. On CMR101 through CMR105, report the WAC of each
balance on CMR096 through CMR100. Report the outstanding principal balance of mortgage securities
backed by loans of this type, by coupon range, on CMR106 through CMR110.
Place security balances into the coupon range corresponding to the pass-through rate on CMR101
through CMR105. Report the WAC of each balance on CMR096 through CMR100. Report the
outstanding principal balance of mortgage securities backed by loans of this type, by coupon range, on
CMR106 through CMR110. Place security balances into the coupon range corresponding to the passthrough rate of the security. Report the weighted-average pass-through rate of the securities on CMR111
through CMR115. Report on CMR116 through CMR120, by coupon range, the WARM of the loans and
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securities reported in each coupon range. Calculate the remaining maturity based on the number of
months remaining until the one of the following dates:
1. Date the balloon payment is due – for balloon mortgages.
2. Next scheduled payment reset date for mortgages with a single rate adjustment and mortgages
with interest rates that adjust less often than every 5 years.
3. Next call date for call mortgages.
If the terms of the mortgage change:
If the terms change following a scheduled rate reset or because you roll over the loan on its balloon due
date or call date, you should reclassify the mortgage as follows:
1. If the interest rate will remain fixed for the remaining term of the mortgage, report it as a singlefamily, 30-year, fixed-rate mortgage (CMR001 through CMR060) or a single-family, 15-year,
fixed-rate mortgage (CMR066 through CMR090). The term depends on the time between the
date of final principal repayment and the date the original mortgage was originated. If that period
is at least 25 years, report the mortgage with the 30-year fixed-rate mortgages; if less, report it
with the 15-year fixed-rate mortgages.
2. Report the mortgage as an ARM on CMR141 through CMR245, as appropriate, if it falls into
either of the following categories:
a. The interest rate resets at least every 5 five years during the remaining maturity of the
mortgage.
b. If the mortgage is subject to a series of calls no more than five years apart.
3. Otherwise, continue to report the loan as a balloon mortgage.
Examples:
1. A seven-year balloon mortgage amortizes according to a 30-year schedule.
a. During the seven years before the balloon payment date, you should report the mortgage as
a balloon mortgage. Its remaining maturity is equal to the number of months until the balloon
payment is due.
b. If, after seven years, you roll the mortgage over into a fully amortizing, fixed-rate mortgage
with 23 years remaining until maturity, you would report it as a 30-year fixed-rate mortgage
(CMR001 through CMR060). The time between origination and final maturity of the mortgage
in this example is 30 years [seven 7 years + 23 years]. This exceeds the 25-year criterion for
reporting in the 30-year fixed-rate category.
2. Assume instead of 30 years, the balloon mortgage in Example 1 had been amortizing according to a
20-year schedule. Then, after seven years, you rolled the mortgage over into a fully amortizing fixedrate loan with 13 years remaining maturity.
a. After you rolled the loan over, you would report the loan as a 15-year fixed-rate mortgage.
This is because its 20-year total maturity is less than the 25-year cutoff for inclusion in the 30year mortgage category.
3. A 30-year, two-step mortgage has a single interest rate reset after five years.
a. During the first five years of its life, you would report the mortgage as a balloon mortgage,
with its remaining maturity equal to the number of months until the rate reset date.
b. Following the rate reset, you would report the mortgage as a 30-year fixed-rate mortgage.
The remaining maturity would be equal to the number of months until the maturity date.
4. A 30-year fixed-rate mortgage that you may call after six years. The note does not stipulate any
further calls or rate resets.
a. Report the mortgage as a balloon for the first six 6 years of its life. Its remaining maturity is
equal to the number of months until the call date.
b. If you roll the mortgage over after six years, reporting would depend on the provisions written
into the new or amended note.
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5. A 30-year mortgage has a fixed rate of interest for six years, but the contract stipulates that the rate
will adjust annually thereafter.
a. For the first year of its life, report the mortgage as a balloon mortgage. Its remaining maturity
is equal to the number of months until the rate reset date.
b. After the first year, report it in the single family, ARM section, CMR141 through CMR245.
This is because, in the future, its interest rate will be subject to reset at least every five years,
as required for reporting in that section. The remaining maturity of the mortgage is equal to
the number of months until the final maturity date.
6. A 30-year fixed-rate mortgage that you may call after six years and is subject to annual calls
thereafter.
a. The reporting would be the same as in Example 5. We treat scheduled resets and calls the
same.
7. A 30-year mortgage is subject to rate resets, or calls, every five years.
a. Report it as an ARM, because the interest rate may potentially reset at least every five years
as required for reporting in the ARMs section.
CMR125: Total Fixed-Rate, Single-Family, First Mortgage Loans and
Mortgage-Backed Securities
The EFS software computes this line as the sum of: CMR001 through CMR005, CMR026 through
CMR030, CMR046 through CMR050, CMR066 through CMR070, CMR076 through CMR080, CMR096
through CMR100, and CMR106 through CMR110.
ADJUSTABLE-RATE, SINGLE-FAMILY, FIRST MORTGAGE LOANS
AND MORTGAGE-BACKED SECURITIES
Report requested information about performing adjustable-rate, single-family, first mortgage loans –
ARMs, participations in such loans, and pass-through securities backed by such loans.
Include:
1.
2.
3.
4.
5.
Adjustable-rate fully amortizing mortgages.
Adjustable-rate balloon payment mortgages.
Fixed-rate mortgages subject to call at contractually set intervals of at most every five years.
ARMs that you own, but do not service.
Combination construction-permanent mortgages for single-family dwellings with interest rates
meeting any of the above criteria, even if construction is not complete.
Do not include the following types of mortgages. Report instead with fixed-rate mortgages on CMR001
through CMR125:
1. Mortgages with a single rate adjustment. For instance, those that would qualify for the FNMA
Two-Step Mortgage program.
2. Mortgages with interest rates that adjust less often than every five years.
3. Mortgages with coupons that were adjustable in the past, but that do not have any further rate
adjustments scheduled during their remaining term.
4. Mortgages with rates that change over time by prespecified steps. For example, a 2/1 Buydown
with rates scheduled to be 7 percent in year one, 8 percent in year two, and 9 percent thereafter.
Also, do not include:
1. Nonperforming mortgages. Report on CMR501.
2. Mortgage warehouse loans (loans collateralized by mortgage loans rather than liens directly on
real estate). Report as commercial loans on CMR325.
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3. Mortgages you service for others. Report in the section dealing with mortgage servicing rights,
CMR401 through CMR450.
4. Second mortgages, even when you hold both the first and second liens. Report as second
mortgages on CMR311.
Group mortgages according to type of index – current market or lagging market – and frequency of
coupon reset, as described below. Report ARMs originated at introductory rates below the fully indexed
rate, teaser rates, and that remain at their introductory rates – have not yet reset – separately on
CMR141 through CMR150, and are not reported with other ARMs on CMR156 through CMR215. Do not
distinguish between convertible and nonconvertible ARMs.
Current Market Index ARMs
ARMs with indices that adjust quickly to changes in market interest rates are current market index ARMs.
Examples of current market indices include the following:
1. Rates on Treasury securities.
2. Prime rate.
3. London Interbank Offered Rate (LIBOR).
4. FHLB advance rate.
5. FHLMC sixty-day rate.
Indices that adjust to changes in market interest rates less quickly are lagging market indices. We group
ARMs using such indices separately. See Lagging Market Index ARMs below.
Divide current market index ARMs into three groups based on the frequency that their coupons reset.
Group ARM securities according to the frequency that their underlying loans reset, not on the coupon
reset frequency of the security. Report current market index ARMs with coupons that reset as follows:
1. Every six months or less — report in the Current Market Index column 6 Mo. or Less.
2. Less frequently than semiannually, but at least every two years —– report in the Current Market
Index column 7 Mo. to 2 Yrs.
3. Less often than every two years, but at least every five years — report in the 2+ Yrs. to 5 Yrs.
column.
Report ARMs with a reset frequency greater than five years with Fixed-Rate Balloon Mortgages. See
instructions above.
Group ARMs that have irregular adjustment periods according to the remaining time until the loan will
begin accruing at a new rate. For example, you would report an ARM with a rate that will reset for the first
time after 36 months and then annually thereafter in the 2+ Yrs. to 5 Yrs. column during the first 12
months of its life, and in the 7 Mo. to 2 Yrs. column thereafter.
Lagging Market Index ARMs
ARMs with indices that adjust to changes in market interest rates less quickly than current market indices
are lagging market index ARMs. Examples of lagging indices include the following:
1. Cost of funds (COF) indices. For instance, FHLB 11th District COF Index, Federal COF Index.
2. National Average Contract Rate for the Purchase of Previously Occupied Homes.
3. Indices that are more than three months old. For instance, a rate adjustment based on the oneyear Constant Maturity Treasury (CMT) yield six months before the adjustment date.
4. Indices based on portfolio rates, rather than current offered rates.
5. Rolling averages of indices using an index within the average that is more than three months old.
Divide information about lagging index ARMs into two groups based on the frequency that their accrual
rates reset. Group ARM securities based on the frequency that their underlying loans reset not the
coupon-reset frequency of the security. Report lagging market index ARMs with accrual rates that reset
as follows:
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1. Monthly or less — report in the Lagging Market Index column – 1 Month.
2. Less often than monthly, but at least every five years — report in the Lagging Market Index
column – 2 Mo. to 5 Yrs.
3. Lagging index ARMs that reset less often than every five years — report with Fixed-Rate Balloon
Mortgages. See instructions above. Report fixed-rate call mortgages that qualify for reporting as
ARMs in the Lagging Market Index column that best approximates the number of months
between call dates.
ARMs Not Indexed To Treasury, LIBOR, or COF
The OTS Model assumes you determine the coupons of ARMs by adding the reported margin to a
Treasury rate index for current market index ARMs or a COF index for lagging index ARMs. This
treatment may result in inaccurate interest rate exposure estimates for ARMs that do not have coupons
tied to a Treasury, LIBOR, or COF index. That means they do not have coupons tied to the interest rates
represented by codes 303 through 412, 811, 812, or 820 in Appendix A. Examples of ARMs not tied to
those indices include the following:
1. ARMs indexed to the prime rate or the National Average Contract Rate.
2. ARMs with no contractual index where you have discretion to set rates at each reset interval.
If you have ARMs whose coupons use something other than a Treasury, LIBOR, or COF index, you
should use the following reporting treatment:
After categorizing all ARM balances into the appropriate columns as described in the previous two
sections, calculate what percent of each column’s total balance consists of ARMs indexed to Treasury or
LIBOR for current marked indices or a COF index for lagging market indices. Include both teaser and
nonteaser ARMS. After categorizing all ARM balances into the appropriate columns as described in the
previous two sections, calculate what percent of each column’s total balance, both teaser and non-teaser,
consists of ARMs indexed to Treasury or LIBOR for current marked indices or a COF index for lagging
market indices.
If the ARM balances, both teaser and nonteaser, tied to a Treasury, LIBOR, or COF index are less than
fifty percent of the total balance in a given column, report an entry of 9999 in the margin cell for that
column – CMR161 through CMR165.
If the ARM balances, both teaser and nonteaser, tied to a Treasury, LIBOR, or COF index are fifty
percent or more of the total balance, calculate the margin for that column based on only the margins of
the nonteaser ARM balances that use a Treasury, LIBOR, or COF index.
Base all other ARM characteristics reported in the column – for instance, WAC, WARM, time until next
payment reset, rate caps and floors – on all ARM balances in the column.
Teaser ARMs
Teaser ARMs are adjustable-rate mortgages that you originated with a temporary, introductory interest
rate (teaser rate). Report an ARM as a Teaser ARM if it meets the following criteria:
1. The loan originated with an accrual rate that was below the fully indexed rate.
2. The loan had an introductory rate scheduled to reset 12 months or less after the first scheduled
payment.
3. The ARM’s first reset date has not yet passed.
Mortgages with interest rates fixed for a specified number of years and that subsequently adjust annually
(such as 3/1 or 5/1 ARMs) will rarely meet the above criteria for Teaser ARMs.
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CMR141 through CMR145:
MARCH 2010
Balances Currently Subject to Introductory
Rates
Report the outstanding balance of teaser ARM loans, participations, and securities currently subject to
teaser rates by type of index and reset frequency on CMR141 through CMR145.
CMR146 through CMR150:
Weighted-Average Coupon (WAC)
Report the WAC for each index and reset frequency category, in percentage points, on CMR146 through
CMR150. Calculate the WAC as described in the general instructions to Schedule CMR, using coupon
rates for mortgage loans and pass-through rates for mortgage securities. For loans serviced by others,
use the contract rate of the loans. Do not subtract the servicing fee.
Example: You have $100,000 in ARM loans currently paying 8 percent interest and $200,000 of ARM
securities with a pass-through rate of 7.40 percent. You would report a WAC of 7.60 percent for the
combined $300,000 balance.
WAC
=
$100,000 (8.00%) + $200,000 (7.40%)
$300,000
=
7.60%
Note that for one-month Cost of Funds Index (COFI) ARMs you should calculate the WAC using the
interest rate that the current payment uses, not the accrual rate.
Nonteaser ARMs
Report the following items by type of index and reset frequency for ARMs that are not subject to an
introductory teaser rate:
CMR156 Through CMR160:
Balances of All Nonteaser ARMs
Report the outstanding balance of loans, participations, and securities in each index and reset frequency
category on CMR156 through CMR160.
CMR161 through CMR165:
Weighted-Average Margin
Report the weighted-average margin of each ARM category, in basis points, on CMR161 through
CMR165. Calculate the weighted-average margin as described in the general instructions to Schedule
CMR.
In calculating the weighted-average margin, use the contractual margin, not the difference between the
current coupon and the index. The contractual margin is the amount added to the index to calculate the
fully indexed rate. The fully indexed rate may differ from the contractual margin when rate caps or floors
are binding. For ARM securities, use the net margin. Net margin is the gross margin of the underlying
loans less servicing and guarantee fees. For loans serviced by others, use the gross margin in the
calculation; do not subtract the servicing fee. For mortgages that have a fixed interest rate for a specified
number of years and that subsequently adjust annually (such as 3/1 or 5/1 ARMs), report the margin that
the mortgage will use when the annual adjustments begin.
If ARMs tied to a Treasury, LIBOR, or COF index are less than 50 percent of the balances in a given
column of the ARMs section, report an entry of 9999 in the margin cell.
CMR166 through CMR170:
Weighted-Average Coupon (WAC)
Report the WAC for each category, in percentage points, on CMR166 through CMR170. Calculate the
WAC as described in the general instructions to Schedule. Use coupon rates for mortgage loans and
pass-through rates for mortgage securities. For loans serviced by others, use the contract rate of the
loans. Do not subtract the servicing fee.
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Example: Suppose you have $100,000 of ARM loans currently paying 8 percent interest and $200,000
of ARM securities with a pass-through rate of 7.40 percent. You would report a WAC of 7.60 percent for
the combined $300,000 balance.
WAC
=
$100,000 (8.00%) + $200,000 (7.40%)
$300,000
=
7.60%
Note: For one-month COFI ARMs, calculate the WAC using the interest rate that the current payment
uses, not the accrual rate.
CMR171 through CMR175:
Weighted-Average Remaining Maturity
(WARM)
Report the WARM for each category on CMR171 through CMR175. Calculate the WARM as described in
the general instructions to Schedule CMR. For adjustable-rate balloon mortgages use the number of
months until the balloon payment is due. For combination construction-permanent mortgages use the
number of months until the permanent mortgage matures.
CMR176 through CMR180: Weighted-Average Time until Next Payment
Reset
Report the weighted-average number of months until the next payment reset for each category, in
months, on CMR176 through CMR180. The date of the next payment reset of an ARM is the date that the
new payment is due to you. Do not use the date the loan begins to accrue at the new interest rate.
Calculate this item in the same manner as the WARM described in the general instructions to Schedule.
Use the number of months until next payment reset for each loan or mortgage security instead of the
remaining maturity.
Example: You have two ARMs indexed to the one-year Constant Maturity Treasury (CMT) yield. One
has a balance of $50,000 and two months until next payment reset. The other has a balance of $150,000
with ten months until next payment reset. You would report eight months as the weighted-average time
until next payment reset on CMR177, in the 1-Year Reset column.
Weighted-Average Time Until Next Payment Reset =
=
$50,000 (2 mo.) + $150,000 (10 mo.)
$200,000
8 months
For ARMs with accrual rates and payments that reset at different frequencies (for example, one-month
COFI ARMs), be careful to use the months to next payment reset, not months to the next reset of the
accrual rate.
CMR185: Total Adjustable-Rate, Single-Family, First Mortgage Loans
and Mortgage-Backed Securities
Report on CMR185, the outstanding balance of all ARM loans, participations, and securities reported on
CMR141 through CMR145 and CMR156 through CMR160.
Memo Items for all ARMS (Reported at CMR185):
ARM Balances by Distance to Lifetime Cap
CMR186 through CMR215 collects information about the proximity of ARM coupons to their lifetime
interest rate caps. Group all ARM loans, participations, and securities reported on CMR185 by the
distance between the current coupon of each and its lifetime cap, as described below. For securities, use
the distance between the pass-through rate and its lifetime cap – the net lifetime cap. For one-month
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COFI ARMs, calculate the distance between the cap and the interest rate that the current payment uses,
not the accrual rate.
CMR186 through CMR190:
Balances with Coupon within 200 Basis Points of
Lifetime Cap
Report the outstanding balances of ARM loans, participations, and securities where the current coupon is
200 basis points or less below the lifetime cap.
CMR191 through CMR195:
Weighted-Average Distance from Lifetime Cap
Report, in basis points, the weighted-average distance between the coupons and lifetime caps of the
balances reported on CMR186 through CMR190. Calculate this item in the same manner as described for
the WAC in the general instructions to Schedule CMR. However, instead of the coupon rate of each loan
or security, use the number of basis points between the loan’s, or security’s, current coupon and lifetime
cap. For one-month COFI ARMs, calculate the distance between the cap and the interest rate that the
current payment uses, not the accrual rate.
CMR196 through CMR200:
Balances with Coupon 201 - 400 Basis Points
from Lifetime Cap
Report the outstanding balances of ARM loans, participations, and securities where the current coupon is
at least 201 basis points, but no more than 400 basis points below the lifetime cap.
CMR201 through CMR205:
Weighted-Average Distance from Lifetime Cap
Report, in basis points, the weighted-average distance between the coupons and lifetime caps of the
balances reported on CMR196 through CMR200. Calculate this item in the same manner as described for
CMR191 through CMR195.
CMR206 through CMR210:
Balances with Coupon Over 400 Basis Points
from Lifetime Cap
Report the outstanding balances of ARM loans, participations, and securities where the current coupon is
more than 400 basis points below the lifetime cap.
CMR216 through CMR220:
Weighted-Average Distance from Lifetime Cap
Report, in basis points, the weighted-average distance between the coupons and lifetime caps of the
balances reported on CMR206 through CMR210. Calculate this item in the same manner as described for
CMR191 through CMR195.
CMR211 through CMR215:
Balances without Lifetime Cap
Report the outstanding balances of ARM loans, participations, and securities that have no lifetime cap.
The EFS software computes CMR185 as the sum of CMR186 through CMR190, CMR196 through
CMR200, CMR206 through CMR210, and CMR211 through CMR215.
ARM Cap and Floor Detail
CMR221 through CMR240 collects information about ARM periodic interest rate caps, periodic floors, and
lifetime floors. Report the following items for all ARMs whose balances you report on CMR185:
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CMR221 through CMR225:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Balances Subject to Periodic Rate Caps
For ARM loans, participations, and securities that have periodic interest rate caps, report the outstanding
balances by index and reset frequency category on CMR221 through CMR225. Do not include on these
lines ARMs that have periodic payment caps, but that do not have rate caps.
CMR226 Through CMR230:
Weighted-Average Periodic Rate Cap (in basis
points)
For ARMs that have periodic interest-rate caps, report on CMR226 through CMR230 the weightedaverage of those caps for each category, in basis points. Except as noted below, express the periodic
rate cap as the maximum amount that the coupon may increase at each rate reset, in basis points; for
example, as 100 basis points. Calculate this item in the same manner as described for the WAC in the
general instructions to Schedule CMR. For each loan or security in a given cell of CMR221 through
CMR225, weight its periodic cap by the outstanding dollar balance of the loan or security as a proportion
of the total dollar balance in the cell.
Special Instructions for CMR230:
For ARMs whose coupons reset more than once a year, use the number of basis points that the coupon
may increase in one year, rather than at each reset, to calculate the weighted-average periodic rate cap
for CMR230. For example, for a lagging index ARM whose coupon resets every six months and that can
change by no more than 100 basis points at each reset, use 200 basis points in calculating the weightedaverage periodic rate cap.
CMR231 through CMR235:
Balances Subject to Periodic Rate Floors
Report the outstanding balance of ARM loans, participations, and securities that have periodic interest
rate floors, by index and reset frequency category, on CMR231 through CMR235.
CMR241 through CMR245:
MBS Included in ARM Balances
Report on CMR241 through CMR245 the balance of mortgage securities included in the total ARM
balances, both teaser and non-teaser, of each column. For example, use CMR241 to report the amount
of ARM securities included on CMR141, balances of six-month current index ARMs carrying teaser rates.
Also, use CMR241 to report the amount of ARM securities included on CMR156, balances of nonteaser
six-month current index ARMs.
MULTIFAMILY AND NONRESIDENTIAL MORTGAGE LOANS AND
SECURITIES
Report information on all performing first and second mortgage loans secured by multifamily, five or more
dwelling units, and nonresidential property, and all pass-through securities backed by multifamily and
nonresidential mortgages. Also, include fixed-rate combination construction-permanent mortgages for
such properties, if the loan has a fixed coupon for the entire term of the loan. We divided the reporting of
this information into two categories: balloon mortgages and fully amortizing mortgages. A balloon loan is
any loan with a term to maturity at least 120 months less than the number of months remaining until the
loan would fully amortize if not for the balloon payment.
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MULTIFAMILY AND NONRESIDENTIAL MORTGAGE LOANS AND
SECURITIES:
Adjustable-Rate
Report loans that were at one time adjustable-rate but are now fixed-rate for their remaining term as
fixed-rate loans. Report the following items for adjustable-rate multifamily and nonresidential mortgages:
CMR261 and CMR262: Balances
Report the following items:
1. Outstanding balance of loans.
2. Pro rata share of the outstanding balances of participations in multifamily and nonresidential
mortgage loans.
3. Outstanding balances of mortgage pool securities backed by adjustable-rate multifamily and
nonresidential mortgages.
Report outstanding balances of balloon mortgages on CMR261 and outstanding balances of fully
amortizing mortgages on CMR262.
CMR263 and CMR264: Weighted-Average Remaining Maturity (WARM)
Calculate the WARM for fully amortizing, adjustable-rate multifamily and nonresidential mortgages as
described in the general instructions to Schedule CMR; report on CMR264. For balloon mortgages, use
the number of months until payment of the balloon, and report the result on CMR263.
Example: You have two balloon mortgages, each with an outstanding balance of $100. The first
amortizes over 240 months but the entire remaining principal is due as a balloon in 60 months. The
second amortizes over 360 months, but has a balloon payment in 84 months. The WARM for your balloon
mortgages would be 72 months. [72 = ($100/$200) x 60 + ($100/$200) x 84].
CMR265:
Remaining Term to Full Amortization
For adjustable-rate balloon mortgages only, report the weighted-average number of months remaining
until the mortgage would fully amortize if not for the scheduled balloon payment, on CMR265. For
example, for the two loans in the example above that amortize over 240 months and 360 months,
respectively, you would report 300 months [300 = ($100/$200) X 240 + ($100/$200) X 360]. For interestonly loans – loans that do not amortize – use 360 months. Do not report this item for fully amortizing
loans.
CMR267 and CMR268: Rate Index Code
From the List of Interest Rate Index Codes in Appendix A, determine the rate index code that represents
the largest percentage of your adjustable-rate multifamily and nonresidential balances. For example, if 60
percent of your balances use the prime rate as an index and the remaining 40 percent use the one-year
Treasury rate as an index, you would report the code for the prime rate, 830. Report the index
representing the largest percentage of balloon mortgage balances on CMR267, and the index
representing the largest percentage of fully amortizing mortgage balances on CMR268.
CMR269 and CMR270: Margin
For all balloon loans tied to the index reported on CMR267, calculate the weighted-average margin, in
basis points, as described in the general instructions to Schedule CMR. Report the result on CMR269.
For all fully amortizing loans tied to the index reported on CMR268, calculate the weighted-average
margin and report the result on CMR270. In calculating the weighted-average margin on CMR269 and
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CMR270, only include loans that use indices reported on CMR267 and CMR268. For mortgage pool
securities, use the net margin. Do not include guarantee and servicing fees.
CMR271 and CMR272: Reset Frequency
For all balloon loans tied to the index reported on CMR267, report the coupon reset frequency, in months,
on CMR271. For all fully amortizing loans tied to the index on CMR268, report the reset frequency on
CMR272. For loans with accrual rates and payments that reset at different frequencies, report the reset
frequency of the accrual rate. If the loans that use the index reported on CMR267 or CMR268 reset with
varying frequencies, calculate a weighted-average reset frequency in the same manner as the WARM
described in the general instructions to Schedule CMR. Report on CMR271 and CMR272, respectively.
Memo: ARMs within 300 Basis Points of Lifetime Cap
CMR273 and CMR274:
Balances
Report the outstanding balances of all adjustable-rate multifamily and nonresidential mortgages with
lifetime interest rate caps and where the coupon is currently 300 basis points or less from the lifetime cap.
For mortgage pass-through securities, use the pass-through rate on the security and the net lifetime cap
in this determination. Report balances for balloon mortgages on CMR273, and balances for fully
amortizing mortgages on CMR274.
CMR275 and CMR276:
Weighted-Average Distance to Lifetime Cap (basis
points)
For balances on CMR273 and CMR274 only, calculate the weighted-average difference between the
current coupon and the lifetime cap, in basis points, in the same manner as described for the WAC in the
general instructions to Schedule CMR. The weighted-average distance to the cap must be between 0
and 300. Report the results for balloon mortgages on CMR275 and the results for fully amortizing
mortgages on CMR276.
Fixed-Rate
CMR281 through CMR282:
Balances
Report the following items:
1. The outstanding balance of fixed-rate multifamily and nonresidential mortgages.
2. The pro rata share of the outstanding balances of participations in fixed-rate multifamily and
nonresidential mortgages.
3. The outstanding balances of mortgage securities backed by fixed-rate multifamily or
nonresidential mortgages.
Report outstanding balances of balloon mortgages on CMR281, and outstanding balances of fully
amortizing mortgages on CMR282.
CMR283 and CMR284: Weighted-Average Remaining Maturity (WARM)
Calculate the WARM for fixed-rate multifamily and nonresidential loans as described in the general
instructions to Schedule CMR. Report on CMR283 and CMR284. For combination constructionpermanent mortgages, use the number of months until maturity for the permanent mortgage. For balloon
mortgages, use the number of months until payment of the balloon. Report the result on CMR283. For
fully amortizing mortgages, use the number of months until final maturity. Report the result on CMR284.
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CMR285:
MARCH 2010
Remaining Term to Full Amortization
For balloon mortgages only, on CMR285 report the weighted-average number of months until the
mortgage would fully amortize if not for the scheduled balloon payment. For interest-only loans – loans
that do not amortize – use 360 months. Do not report this item for fully amortizing loans.
CMR287 and CMR288: Weighted-Average Coupon (WAC)
Calculate the WAC as described in the general instructions to Schedule CMR. Report the WAC for
balloon mortgages on CMR287 and the WAC for fully amortizing mortgages on CMR288. For securities
backed by multifamily or nonresidential mortgages, use the coupon rate of the security, the pass-through
rate.
Supplemental Reporting
If you hold adjustable-rate multifamily and nonresidential mortgages tied to a variety of different indices,
you may wish to report those balances disaggregated by index type in the Supplemental Reporting
Section. In addition, you may report loans and securities separately for both fixed- and adjustable-rate
balances. The additional detail provided by such reporting improves the estimates produced by the OTS
Model. For more information, see the instructions for Supplemental Reporting for Assets and Liabilities.
CONSTRUCTION AND LAND LOANS
Report information on land loans and on the disbursed amount of construction loans secured by singlefamily dwelling units, multifamily dwelling units, or nonresidential property on CMR291 through CMR298.
Include combination construction-permanent mortgages where you have not set the interest rate on the
permanent financing. Report only the construction period in the WARM for these combination loans. Do
not include combination construction-permanent mortgages that have a fixed rate for the entire term of
the mortgage. Report instead with permanent mortgages in the relevant section of Schedule CMR.
Report construction LIP in the Off-Balance-Sheet section of Schedule CMR.
If the agreement contains a commitment to provide a mortgage loan upon completion of the construction,
report the mortgage commitment as an optional or firm, as appropriate, commitment to originate a
mortgage as an off-balance-sheet position.
Adjustable-Rate
Report the following items for performing adjustable-rate construction and land loans:
CMR291:
Balances
Report the outstanding balance of adjustable-rate construction and land loans.
CMR293:
Weighted-Average Remaining Maturity (WARM)
Report the WARM calculated as described in the general instructions to Schedule CMR for all adjustablerate construction and land loans. Calculate the WARM using the lesser of the remaining maturity or the
time to rate reset. For combination construction-permanent loans, use the number of months remaining
in the construction phase of the loan.
CMR295:
Rate Index Code
Report the rate index code which you can obtain from the List of Interest Rate Index Codes in Appendix
A. From the list of codes, determine the rate index code that represents the largest percentage of your
adjustable-rate construction and land loan balances. For example, if 60 percent of your balances use the
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prime rate as an index and the remaining 40 percent use the one-year Treasury rate as an index, you
would report the code for the prime rate, code 830.
CMR297:
Margin
For the adjustable-rate balances tied to the index on CMR295, calculate the weighted-average margin as
described in the general instructions to Schedule CMR. Report the result, in basis points. Do not include
adjustable-rate construction loans tied to indices other than the one on CMR295.
CMR299:
Reset Frequency
For the adjustable-rate construction and land loans tied to the index on CMR295, report the coupon reset
frequency, in months. For loans with payments and accrual rates that reset with different frequencies,
report the accrual rate reset frequency. If loans tied to the index on CMR295 reset with varying
frequencies, calculate the weighted-average reset frequency in the same manner as described for the
WARM in the general instructions to Schedule CMR.
Fixed-Rate
Report the following items for performing fixed-rate construction and land loans:
CMR292:
Balances
Report the outstanding balance of fixed-rate construction and land loans.
CMR294:
Weighted-Average Remaining Maturity (WARM)
Report the WARM, calculated as described in the general instructions to Schedule CMR, for all fixed-rate
construction and land loans. For combination construction-permanent loans, use the number of months
remaining in the construction phase of the loan.
CMR298:
Weighted-Average Coupon (WAC)
For the fixed-rate balances on CMR292, calculate the WAC as described in the general instructions to
Schedule CMR. Report the result, in percent.
Supplemental Reporting
If you hold adjustable-rate construction and land loans tied to a variety of different indices you may wish
to report those balances disaggregated by index type in the Supplemental Reporting Section. The
additional detail provided by such reporting improves the estimates produced by the OTS Model. For
more information, see the instructions for Supplemental Reporting for Assets and Liabilities.
SECOND MORTGAGE LOANS AND SECURITIES
Report information about performing second mortgage loans on single-family dwellings and pass-through
securities backed by such loans. Report all mortgages where you hold a junior lien, even if you also hold
the first lien. Include the outstanding balance of all secured, open-end revolving home equity loans and
lines of credit even if secured by a first lien.
Report loans that were once adjustable-rate but are now fixed-rate for their remaining term and ARMs
with coupons that are currently at their lifetime caps, as fixed-rate mortgages.
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Adjustable-Rate
Report the following items for performing adjustable-rate second mortgage loans and pass-through
securities backed by such loans. Report pay-through securities in Cash, Deposits, and Securities on
CMR461 through CMR481 or as code 121 in Supplemental Reporting of Market Value Estimates, as
appropriate.
CMR311:
Balances
Report the outstanding balance of the following items:
1. Adjustable-rate second mortgage loans.
2. The pro rata share of the outstanding balances of participations in adjustable-rate second
mortgage loans.
3. The outstanding balances of securities backed by adjustable-rate second mortgage loans.
CMR313:
Weighted-Average Remaining Maturity (WARM)
Calculate the WARM for adjustable-rate, second mortgage loans as described in the general instructions
to Schedule CMR.
For balloon mortgages, use the remaining time until payment of the balloon. For loans made under openend lines of credit, calculate maturity as if the borrower will repay the existing loan balance by making the
minimum payments required by the repayment schedule.
CMR315:
Rate Index Code
From the List of Interest Rate Index Codes in Appendix A, determine the rate index code that represents
the largest percentage of your adjustable-rate second mortgage balances. For example, if 60 percent of
your balances use the prime rate as an index and the remaining 40 percent use the one-year Treasury
rate as an index, you would report the code for the prime rate, code 830.
CMR317:
Margin
For the ARMs tied to the index on CMR315, calculate the weighted-average margin as described in the
general instructions to Schedule CMR. Report the result, in basis points. Do not include adjustable-rate
second mortgage loans tied to indices other than the one on CMR315. For second mortgage securities
included in the calculation, use the net margin in the calculation. Do not include guarantee or servicing
fees.
The following example illustrates how to calculate the weighted-average margin on a portfolio containing
an adjustable-rate second mortgage loan and an adjustable-rate second mortgage security.
Example: You have one adjustable-rate second mortgage loan indexed to the prime rate with a margin
of 150 basis points, and an outstanding balance of $100,000. You also have a mortgage security backed
by adjustable-rate second mortgage loans with an outstanding balance of $200,000. The loans underlying
the security also use the prime rate as an index and have a margin of 150. The servicer receives 50 basis
points. You receive a pass-through rate of prime plus 100 basis points. Calculate the weighted-average
margin as follows:
Weighted-Average Margin
=
$100,000 (150) + $200,000 (100)
$300,000
=
116.6
=
117 – rounded to nearest basis point
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CMR319:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Reset Frequency
For the adjustable-rate second mortgages tied to the index on CMR315, report the coupon reset
frequency, in months. For loans with payments and accrual rates that reset with different frequencies,
report the accrual rate reset frequency. If loans tied to the index on CMR315 reset with varying
frequencies, calculate a weighted-average reset frequency in the same manner as described for the
WARM in the general instructions to Schedule CMR.
Fixed-Rate
Report the following items for performing fixed-rate second mortgage loans and pass-through securities
backed by such loans. Report pay-through securities in Cash, Deposits, and Securities on CMR461
through CMR481 or as code 121 in Supplemental Reporting of Market Value Estimates, as appropriate.
CMR312:
Balances
Report the outstanding balance of the following items:
1. Fixed-rate, second mortgage loans.
2. The pro rata share of participations in fixed-rate, second mortgage loans.
3. Securities backed by fixed-rate, second mortgages.
CMR314:
Weighted-Average Remaining Maturity (WARM)
Calculate the WARM for fixed-rate, second mortgage loans as described in the general instructions to
Schedule CMR. For balloon mortgages, use the remaining time until payment of the balloon, not the
amortization period.
CMR318:
Weighted-Average Coupon (WAC)
Report the WAC calculated as described in the general instructions to Schedule CMR. For securities
backed by second mortgage loans, use the coupon rate of the security (the pass-through rate), not the
WAC of the collateral.
Supplemental Reporting
If you hold second mortgages tied to a variety of different indices you may wish to report those balances
disaggregated by index type in the Supplemental Reporting Section. The additional detail provided by
such reporting improves the estimates produced by the OTS Model. See the instructions for
Supplemental Reporting for information.
COMMERCIAL LOANS
Report on CMR325 through CMR330 information on all performing commercial loans and commercial
financing leases, of the types on SC32.
In addition, include:
1. Mortgage warehouse loans, loans collateralized by mortgage loans rather than liens directly on
the real estate, including those reported as Mortgage Loans on SC26. Also include mortgage
warehouse loans on CMR578.
2. Pass-through securities backed by commercial nonmortgage loans and leases, even though you
report these as securities in Schedule SC, rather than as loans.
Do not include:
SBA securities. Report on CMR473 through CMR475.
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MARCH 2010
Adjustable-Rate
Report the following items for performing, adjustable-rate, commercial loans and pass-through securities
backed by such loans. Report pay-through securities in Cash, Deposits, and Securities on CMR461
through CMR481 or as code 121 in Supplemental Reporting of Market Value Estimates, as appropriate.
CMR325:
Balances
Report the outstanding balance of adjustable-rate commercial loans.
CMR327:
Weighted-Average Remaining Maturity (WARM)
Report the WARM for all adjustable-rate commercial loans calculated as described in the general
instructions to Schedule CMR. For demand loans that pay interest only and have no definite maturity,
use one month when you calculate WARM.
CMR329:
Margin
For the balances tied to the index on CMR333, calculate the weighted-average margin as described in
the general instructions to Schedule CMR. Report the result, in basis points.
CMR331:
Reset Frequency
For the adjustable-rate commercial loans tied to the index on CMR333 below, report the coupon reset
frequency, in months. For loans with payments and accrual rates that reset with different frequencies,
report the accrual rate reset frequency. If loans tied to the index on CMR333 reset with varying
frequencies, calculate the weighted-average reset frequency in the same manner as described for the
WARM in the general instructions to Schedule CMR.
CMR333:
Rate Index Code
Report the rate index code that represents the largest percentage of your adjustable-rate commercial loan
balances from the List of Interest Rate Index Codes in Appendix A, determine. For example, if 60 percent
of your commercial loan balances use the prime rate as an index and the remaining 40 percent use the
one-year Treasury rate as an index, you would report the code for the prime rate, Code 830.
Fixed-Rate
Report the following items for performing, adjustable-rate, commercial loans and pass-through securities
backed by such loans. Report pay-through securities in Cash, Deposits, and Securities on CMR461
through CMR481 or as code 121 in Supplemental Reporting of Market Value Estimates, as appropriate.
CMR326:
Balances
Report the outstanding balance of fixed-rate commercial loans.
CMR328:
Weighted-Average Remaining Maturity (WARM)
Calculate the WARM for all fixed-rate commercial loans as described in the general instructions to
Schedule CMR. For demand loans that pay interest only and have no definite maturity, use one month
when you calculate the WARM.
CMR330:
Weighted-Average Coupon (WAC)
Report the WAC calculated as described in the general instructions to Schedule CMR.
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Supplemental Reporting
The OTS Model assumes that all adjustable-rate commercial loans use the index on CMR333. If you
hold adjustable-rate commercial loans tied to different indices you may wish to report those balances
disaggregated by index type in the Supplemental Reporting Section. The additional detail provided by
such reporting improves the estimates produced by the OTS Model. For information, see the instructions
for Supplemental Reporting for Assets and Liabilities.
CONSUMER LOANS
Report on CMR335 through CMR343 information on performing consumer loans and consumer financing
leases of the types on SC35. Also, include pass-through securities backed by consumer loans and
leases, even though you report these as securities in Schedule SC, rather than as loans.
Do not include:
1. Open-end revolving loans secured by single-family homes, such as home equity loans.
2. Home improvement loans secured by single-family homes.
You should report all such loans as Second Mortgages on CMR311 and CMR312.
When calculating the following items, do not include credit card balances expected to pay off within the
interest free grace period, reported on CMR590:
1. WARM.
2. WAC.
3. Margin (for adjustable-rate balances).
Adjustable-Rate
Report the following items for performing, adjustable-rate, consumer loans and pass-through securities
backed by such loans. Report pay-through securities in Cash, Deposits, and Securities on CMR461
through CMR481 or as code 121 in Supplemental Reporting of Market Value Estimates, as appropriate.
CMR335:
Balances
Report the outstanding balance of adjustable-rate consumer loans and the outstanding balances of assetbacked securities backed by adjustable-rate consumer loans.
CMR337:
Weighted-Average Remaining Maturity (WARM)
Calculate the WARM for adjustable-rate consumer loans as described in the general instructions to
Schedule CMR.
For loans made under open-end lines of credit, including credit cards, calculate maturity as if the borrower
will repay the existing loan balance by making the minimum payments required by the repayment
schedule. Do not include credit card balances expected to pay off within the interest free grace period.
See the section on calculating the WARM for fixed-rate consumer loans for an example.
CMR339:
Rate Index Code
From the List of Interest Rate Index Codes in Appendix A, determine the rate index code that represents
the largest percentage of your adjustable-rate consumer loans. For example, if you had a consumer loan
portfolio of 75 percent auto loans that use the prime rate as an index, and 25 percent mobile home loans
that use the six-month Treasury bill rate as an index, you would report the code for the prime rate, Code
830.
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CMR341:
MARCH 2010
Margin
For the adjustable-rate consumer loans tied to the index on CMR339, calculate the weighted-average
margin as described in the general instructions to Schedule CMR. Report the result, in basis points. Do
not include adjustable-rate consumer loans tied to indices other than the one reported on CMR339. If the
balances used by the margin are asset-backed securities, use the net margin (subtract the servicing
spread). If they are credit card balances, do not include balances expected to pay off within the interest
free grace period. See the calculation of the WAC for fixed-rate consumer loans for an example.
CMR343:
Reset Frequency
For the adjustable-rate consumer loans tied to the index on CMR339, report the coupon reset frequency,
in months. If the loans tied to the index on CMR339 reset with varying frequencies, calculate the
weighted-average reset frequency in the same manner as the WARM described in the general
instructions to Schedule CMR.
Fixed-rate
Report the following items for performing fixed-rate consumer loans and pass-through securities backed
by such loans. Report pay-through securities in Cash, Deposits, and Securities on CMR461 through
CMR481 or as code 121 in Supplemental Reporting of Market Value Estimates, as appropriate.
CMR336:
Balances
Report the outstanding balance of fixed-rate consumer loans and the outstanding balances of assetbacked securities backed by fixed-rate consumer loans.
CMR338:
Weighted-Average Remaining Maturity (WARM)
Calculate the WARM for all fixed-rate consumer loans and asset-backed securities as described in the
general instructions to Schedule CMR. Do not include credit card balances expected to pay off in the
interest-free grace period.
WARM
CMR342:
=
$100,000 (48) + $70,000 (60)
$170,000
=
=
52.94
53 months – rounded to the nearest month
Weighted-Average Coupon (WAC)
Calculate the WAC for all fixed-rate consumer loans as described in the general instructions to Schedule
CMR. For asset-backed securities, use the coupon of the security, the pass-through rate, not the coupon
of the collateral. Do not include credit card balances expected to pay off within the interest-free grace
period.
Example: You have $100,000 of fixed-rate credit card balances with a stated rate of 18 percent, and
$100,000 of auto loans with a coupon of 10 percent. You estimate that 30 percent of the credit card
balances typically pay off within the interest free grace period. Calculate the WAC for consumer loans as
follows.
WAC
=
=
$70,000 (18.0%) + $100,000 (10.0%)
$170,000
13.29%
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Supplemental Reporting
If you hold a variety of types of consumer loans – auto loans, credit cards, education loans – or
adjustable-rate consumer loans tied to a variety of different indices you may wish to report those balances
disaggregated by loan type or index type in the Supplemental Reporting Section. The additional detail
improves the estimates produced by the OTS Model. For information, see the instructions for
Supplemental Reporting for Assets and Liabilities.
MORTGAGE-DERIVATIVE SECURITIES — BOOK VALUE
Mortgage-derivative securities include the following items:
1. Collateralized mortgage obligation (CMO) tranches.
2. Stripped mortgage-backed securities (SMBS).
3. CMO residuals.
All mortgage derivatives must be self-valued and reported in the Supplemental Reporting of Market Value
Estimates Section. See the instructions for Supplemental Reporting of Market Value Estimates.
In the lines described below, report mortgage-derivative securities at the same amount that you reported
in Schedule SC. See general instructions for reporting Cash, Deposits, and Securities located
immediately before the instructions for SC11. Enter securities in the high risk or low risk columns based
on whether the following high-risk test would classify them as high risk or low risk:
A mortgage-derivative security is high risk if it meets any of the following criteria:
1. The expected remaining weighted-average life 3 of the security exceeds ten years.
2. The expected remaining weighted-average life of the security extends by more than four years for
an immediate and sustained parallel shift in the yield curve of plus 300 basis points.
3. The expected remaining weighted-average life of the security shortens by more than six years for
an immediate and sustained parallel shift in the yield curve of minus 300 basis points; or
4. The estimated change in the price of the security is more than 17 percent, due to an immediate
and sustained parallel shift in the yield curve of plus or minus 300 basis points.
Report all high-risk, mortgage-derivative securities in the appropriate cells in the column High Risk.
Report all mortgage-derivative securities that the test does not classify as high risk in the appropriate cells
of the column Low Risk.
Floating-rate tranches that use a conventional widely used index are only subject to item 4 above if the
current interest rate on the tranche is below the maximum contractual interest rate on the tranche, the cap
rate. Floating rate tranches tied to other indices, superfloaters, and inverse floaters are subject to the
entire test.
Once you have determined the appropriate risk class of your mortgage derivative, you will break down
balance and rate by the derivative security’s characteristics. These characteristics are set forth in the
following three sections: CMOs, CMO residuals, and stripped MBS.
3
Weighted Average Life (WAL) is a measure of the expected time until repayment of principal on a mortgage-backed security. WAL, in
years, is calculated as:
Where
1928
M
P1, P2, etc.
=
=
remaining number of months to maturity,
expected principal payments in each future month.
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MARCH 2010
Collateralized Mortgage Obligations (CMOs)
Report CMO tranches, excluding residuals, on CMR351 through CMR364 according to the characteristics
of the tranche as defined below. Do not include CMO swaps. Include the value of CMO swaps, based on
your estimates, on Supplemental Reporting of Market Value Estimates.
CMR351 and CMR352:
Floating Rate
Report the amount of all CMO tranches that pay an interest rate tied to a floating-rate index on CMR351
and CMR352, as appropriate.
CMR353 and CMR354:
Fixed Rate: Remaining Weighted-Average Life Not
Exceeding Five Years
Report the amount of fixed-rate CMO tranches with remaining weighted-average lives of less than or
equal to five years on CMR353 and CMR354, as appropriate. In general, report most support tranches,
also called companion bonds, for short-term Planned Amortization Class (PAC) and Targeted
Amortization Class (TAC) bonds on CMR353. Typically, report short-term PAC and TAC bonds and the
first tranche of a sequential CMO on CMR354.
CMR355 and CMR356:
Fixed Rate: Remaining Weighted-Average Life
Greater Than Five Years, But Not Exceeding Ten
Years
Report the amount of all fixed-rate CMO tranches with remaining weighted-average lives greater than five
years but less than or equal to ten years on CMR355 and CMR356, as appropriate. Report support
tranches for long-term PAC and TAC bonds and intermediate and long term sequential bonds on
CMR355. Report long-term PAC and TAC bonds with a weighted-average life up to 10 ten years and
second or third sequential bonds in a sequence on CMR356.
CMR357:
Fixed Rate: Remaining Weighted-Average Life Greater Than
Ten Years
Report the amount of all fixed-rate CMO tranches with remaining weighted-average lives in excess of ten
years on CMR357. Also report most Z-tranches (also called accrual bonds, or accretion bonds).
CMR359:
Superfloaters
Superfloaters are CMO tranches whose coupon adjusts in the same direction as, and by a multiple of a
specified index, such as LIBOR. For example, 2 x LIBOR - 3 percent. The high-risk test classifies most
superfloaters as high risk. Report the amount of high-risk superfloater tranches on CMR359. Report lowrisk superfloater tranches on CMR352.
CMR361:
Inverse Floaters and Super POs
An inverse floater has a coupon that adjusts in the opposite direction of an interest-rate index, such as
LIBOR. A super PO is a zero-coupon support tranche for PAC or TAC tranches in a CMO. The high risk
test will classify nearly all inverse floaters and super POs as high risk. Report the amount of high risk
inverse floaters and super POs on CMR361. However, if you can demonstrate that an inverse floater or
super PO tranche is low risk, report that tranche on CMR374.
CMR363 and CMR364: Other CMO Tranches
Report the amount of all other high-risk tranches on CMR363. This cell includes all other CMO products
that you cannot classify into one of the above cells, and that you have not determined to be low risk.
Report the amount of other low risk tranches on CMR364. This cell includes all other CMO products that
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you cannot classify into one of the above cells, and that you have not determined to be high risk
according to the high risk test.
CMO Residuals
Report CMO residuals on CMR365 through CMR368 as described below. Residuals – also called excess
cash flow or CMO equity – are instruments that represent a claim on excess cash flows remaining after
the holders of the other classes have been paid. Certain CMO and REMIC tranches that do not represent
claims on excess cash flows have been called residuals to satisfy the requirements in the Tax Reform Act
of 1986. Report such residuals on CMR351 through CMR364 above, as appropriate.
CMR365 and CMR366: Fixed-Rate Residuals
Fixed-rate residuals are residuals from CMOs that contain only fixed-rate tranches. Report the amount of
fixed-rate residuals on CMR365 and CMR366, as appropriate.
CMR367 and CMR368: Floating-Rate Residuals
Floating-rate residuals are residuals from CMOs that contain one or more floating-rate tranches. Report
the amount of floating-rate residuals on CMR367 and CMR368, as appropriate.
STRIPPED MORTGAGE-BACKED SECURITIES
Report stripped MBS on CMR369 through CMR376 as described below. Interest Only (IO) strips are
securities that receive only the interest payments from a pool of mortgages. Principal Only (PO) strips are
securities that receive only the payments of principal from a pool of mortgages. IO and PO tranches of
CMOs receive only interest payments and only principal payments, respectively, from part or all the
collateral in a CMO.
CMR369 and CMR370: Interest-Only MBS
Report the amount of IO strips and IO tranches of CMOs on CMR369 and CMR370, as appropriate. The
high risk test will classify most tranches as high risk and you should report them on CMR369. However, if
you can demonstrate that an IO is low risk, report that tranche on CMR370.
CMR371 and CMR372: Weighted-Average Coupon (WAC)
Report the WAC of the underlying collateral of the IO strips or IO CMO tranches on CMR371 and
CMR372, as appropriate.
CMR373 and CMR374: Principal-Only MBS
Report on CMR373 and CMR374 the amount of PO strips and PO tranches of CMOs that are not super
POs. The high-risk test will classify most POs as high risk. Report them in CMR373. However, if you can
demonstrate that a PO is low risk, you should report that tranche on CMR374.
CMR375 and CMR376: Weighted-Average Coupon (WAC)
Report on CMR375 and CMR376 the WAC of the underlying collateral of the PO strips or PO tranches
that are not super POs.
CMR377 and CMR378:
Total Mortgage-Derivative Securities
The EFS software computes CMR377 as the sum of CMR351, CMR353, CMR355, CMR357, CMR359,
CMR361, CMR363, CMR365, CMR367, CMR369, and CMR373. The EFS software computes CMR378
as the sum of CMR352, CMR354, CMR356, CMR364, CMR366, CMR368, CMR370, and CMR374.
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Reporting Estimated Market Values
Besides reporting book values as described above, all savings associations must also report the
estimated market values of their high- and low-risk mortgage-derivatives on Supplemental Reporting of
Market Value Estimates using asset code 123 in Appendix D. Specific instructions are described in the
section, Reporting of Estimated Market Values.
MORTGAGE LOANS SERVICED FOR OTHERS
Report information on all performing, single-family, adjustable- and fixed-rate first mortgage loans that
you service for others.
Include:
1. Mortgage loans you have sold to others but where you perform the servicing, even if you do not
receive an ongoing servicing fee.
2. The mortgage balances of mortgage servicing rights you purchased.
3. Securitized mortgages – for example, a FHLMC swap – if you continue to perform the servicing.
In this case, you own a mortgage security and the servicing rights on the mortgages underlying
the security. Report the outstanding balance of the mortgages underlying the mortgage security
both here and as a mortgage security, in the relevant lines of the fixed-rate or ARMs section.
4. Mortgage balances where you own the servicing right but someone else performs the servicing, if
you receive a net fee after you pay the subservicer.
5. Mortgage balances where you perform servicing on a contractual basis – you act as subservicer
– for another entity that owns the servicing rights and this arrangement will continue for the life of
those mortgages.
6. In cases where you own a share of a pool but service the entire pool, report only the share you do
not own.
Do not include:
1. Mortgage loans that a consolidated subsidiary services for you.
2. Loans being serviced other than single-family first mortgage loans.
3. Mortgage loans where you will perform servicing on a contractual basis – you act as subservicer
– for another entity for less than the life of the mortgages.
Use code 500 in Supplemental Reporting of Market Value Estimates to report your estimates of the
economic value of servicing rights described in items 2 and 3 under Do not include.
Fixed-Rate Mortgage Loan Servicing
CMR401 through CMR405:
Balances Serviced
Report the outstanding balances of fixed-rate mortgages that you service for others according to the five
following coupon ranges:
1.
2.
3.
4.
5.
Less than 5 percent.
5 percent to 5.99 percent.
6 percent to 6.99 percent.
7 percent to 7.99 percent.
8 percent and above.
SCHEDULE CMR
1931
DECEMBER 2010
CMR406 through CMR410:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Weighted-Average Remaining Maturity
(WARM)
For each coupon range, report the WARM of the mortgages on CMR401 through CMR405. Calculate the
WARM as described in the general instructions to Schedule CMR.
CMR411 through CMR415:
Weighted-Average Servicing Fee
For each coupon range, report the weighted-average net servicing fee you retain, in basis points. See the
example below for a description of the calculation. The mortgage servicing fee is the spread you retain.
This is the difference between the weighted-average note rate on the mortgages being serviced and the
rate of interest passed on to the owner of the mortgages, less any payments to third parties such
guarantors, master servicers, and subservicers.
The following example illustrates how to calculate the weighted-average servicing fee:
Example: You have a servicing portfolio consisting of the following three fixed-rate loans, each with a
current outstanding balance of $100,000.
1. You purchased the rights to service a GNMA security with a pass-through rate of 6 percent, and a
WAC on the underlying mortgages of 6.5 percent. Although the difference between the passthrough rate and the WAC is 50 basis points, GNMA receives six basis points for its guarantee
fee and you retain 44 basis points. You should use 44 basis points when you calculate the
weighted-average servicing fee.
2. You originated a mortgage with a coupon of 6.5 percent and sold it on the secondary market to
yield 5.5. You should include the full one hundred 100-basis point fee when you calculate the
weighted-average servicing spread.
3. You own the servicing rights on an 6.6 percent mortgage with a servicing fee of 45 basis points;
however, you contracted with a subservicer to service the loan for 30 basis points. You should
use the remaining 15-basis point fee you retain in calculating the weighted-average servicing
spread. Because another savings association subservices this loan, you should include it in the
number of loans on CMR423.
Calculate the weighted-average servicing fee for these three loans as follows:
Weighted-Average Servicing Fee
=
44($100,000) + 100($100,000) + 15($100,000)
$300,000
=
53 basis points
You would report this as 53 on CMR413.
CMR421:
Total Number of Fixed-Rate Loans Serviced That Are
Conventional Loans
Report on CMR421 the number of conventional loans in the balances on CMR401 through CMR405.
CMR422:
Total Number of Fixed-Rate Loans Serviced That Are FHA/VA
Loans
Report on CMR422 the number of FHA and VA loans in the balances on CMR401 through CMR405.
CMR423:
Total Number of Fixed-Rate Loans Serviced That Are
Subserviced by Others
Report the total number of fixed-rate mortgage loans included on CMR421 through CMR422 where you
own the right to service for others but have contracted the servicing out to a subservicer.
1932
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
Adjustable-Rate Mortgage Loan Servicing
CMR431 through CMR432:
Balances Serviced
Report the outstanding balances of ARMs serviced for others that reset based on current market indices
on CMR431 and those that reset based on lagging market indices on CMR432. See the instructions for
adjustable-rate single-family mortgages for a definition of current market versus lagging indices.
CMR433 through CMR434:
Weighted-Average Remaining Maturity
(WARM)
Report the WARM of ARMs of each index type on CMR433 and CMR434. Calculate the WARM as
described in the general instructions to Schedule CMR.
CMR435 and CMR436: Weighted-Average Servicing Fee
Report the weighted-average net servicing fee that you retain in basis points for current market index
ARMs on CMR435 and for lagging market index ARMs on CMR436. See example above for description
of its calculation. The mortgage servicing fee is the spread you retain. This is the difference between the
weighted-average note rate on the mortgages being serviced and the rate of interest passed on to the
owner of the mortgages, less any payments to third parties such as guarantors, master servicers, and
subservicers.
CMR441:
Total Number of Adjustable-Rate Loans Serviced
On CMR441 report the total number of adjustable-rate loans in the balances on CMR431 and CMR432.
CMR442:
Of Which, Number Subserviced by Others
On CMR442 report the total number of ARM loans in CMR441 where you own the right to service for
others but have contracted the servicing out to a subservicer.
CMR450: Total Balances of Mortgage Loans Serviced for Others
The EFS software automatically computes this line as the sum of the balances on CMR401 through
CMR405, CMR431, and CMR432.
CASH, DEPOSITS, AND SECURITIES
We collect information about most of the financial instruments on SC11, Cash, Deposits, and Investment
Securities, in this section. We do not include mortgage-derivative securities. General instructions to
Schedule CMR that apply to this section are:
1. Report outstanding principal balances, not carrying values, unless explicitly instructed otherwise.
Do not deduct or add discounts and premiums or valuation allowances.
2. Report coupon rates, not effective rates, unless explicitly instructed otherwise.
3. In calculating the WARM, observe the following:
a. For a security that will repay principal periodically over its life, such as through scheduled
sinking fund repayments, you should treat each repayment as a separate instrument when
calculating the WARM.
b. For variable-rate instruments, calculate the WARM using the months to the next repricing as
the remaining months to maturity.
SCHEDULE CMR
1933
DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
CMR461: Cash, Non-Interest-Earning Demand Deposits, Overnight
Fed Funds, Overnight Repurchase Agreements
Report on CMR461 the outstanding balance of cash, cash items, non-interest-earning demand deposits,
overnight Federal funds sold, securities purchased under overnight repurchase agreements, and
investments in money market mutual funds. Also, include accrued interest or dividends receivable on
deposits and investment securities that you report on CMR461 through CMR481 or as code 121 in
Supplemental Reporting of Market Value Estimates, as appropriate.
CMR464: Equity Securities (Including Mutual Funds) Subject to
SFAS No. 115
Report the fair market value of investments in equity securities subject to FASB Statement No. 115 and
the fair value of investments in mutual funds. Include limited partnership investment funds subject to
FASB
Statement No. 115. Include investments in perpetual preferred stock or preferred stock convertible to
common stock where such preferred stock has a readily determinable fair value.
Do not include:
1. Investments in money market mutual funds. Report on CMR461.
2. Preferred and common stock where there is no readily determinable fair value. Report on
CMR530.
CMR470 through CMR472: Zero-Coupon Securities
On CMR 470 report the recorded investment of zero-coupon securities, including Treasury bills. Do not
include Z-tranches or accrual bonds of CMOs or REMICs. You should report those on CMR357. On
CMR471, instead of a WAC, report the internal rate of return of these securities regardless of whether
you report them at historic cost or fair value. Report the WARM on CMR472. Do not include securities
that you could consider complex securities such as callable zero-coupon securities. Thrifts with complex
securities, including structured securities, are required to self-value these instruments on the section,
Supplemental Reporting of Market Value Estimates using asset code 121 in Appendix D. We define
both complex securities and structured securities in Thrift Bulletin 13a, Appendix D.
CMR473 through CMR475: Government and Agency Securities
Report debt instruments issued by the US government and nonmortgage debt issued by federal
agencies.
Include:
1. US Treasury securities, except Treasury bills on CMR470.
2. Nonmortgage debt issued by FNMA, FHLMC, GNMA, the FHLB System, and other government
sponsored agencies.
3. FICO bonds.
4. SBA securities.
Do not include:
1. Mortgage-backed instruments or derivatives issued or guaranteed by FNMA, FHLMC, or GNMA.
Report with Mortgage-Backed or Mortgage-Derivative Securities as appropriate.
2. Complex securities, including structured securities, as described in Thrift Bulletin 13a, Appendix
D.
3. Stripped securities. Report on CMR470.
4. Stock of Federal agencies.
1934
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
5. Securities issued by state or local governments.
6. Securities purchased under overnight repurchase agreements.
On CMR473 report the outstanding principal balance of the relevant instruments. Report the WAC of
those balances on CMR474 and their WARM on CMR475. The general instructions to Schedule CMR
describe how to calculate both of these items.
Supplemental Reporting
If the balance reported on CMR473 includes adjustable-rate or inverse floating-rate securities, report that
balance at a greater level of detail in the Supplemental Reporting Section. The additional detail provided
by such reporting improves the estimates produced by the OTS Model. For information, see the
instructions for Supplemental Reporting for Assets and Liabilities.
CMR476 through CMR478: Term Fed Funds, Term Repurchase
Agreements, and Interest-Earning
Deposits
Include any Fed funds sold and securities purchased under repurchase agreements that you did not
report on CMR461. Also, include interest-earning nonmaturity deposits and all time deposits held with
banks and other depository institutions, including FHLBs. Report the outstanding principal balance on
CMR476, the WAC of those balances on CMR477, and their WARM on CMR478. For deposits that have
no contractual maturity, use one month when you calculate the WARM.
CMR479 through CMR481: Other (Munis, Mortgage-Backed Bonds,
Corporate Securities, Commercial Paper,
Etc.)
This section includes a broad range of securities:
1. Debt securities issued by state and local governments.
2. Commercial paper and other corporate debt securities, except for structured securities as
described in Appendix D of Thrift Bulletin 13a.
3. Mortgage-backed bonds.
4. Promissory notes.
5. Limited life preferred stock.
Do not include:
Callable and other structured securities of these types. Report the market value estimates of these
on Supplemental Reporting of Market Value Estimates using asset code 121 found in Appendix D.
Report the outstanding principal balance of these securities on CMR479, their WAC on CMR480, and
their WARM on CMR481. In calculating the WAC use the tax-equivalent yield for state, county, and
municipal securities. Use the dividend yield for preferred stock.
Supplemental Reporting
If the balance reported on CMR479 includes adjustable-rate or inverse floating-rate securities, you may
report that balance at a greater level of detail in the Supplemental Reporting Section. The additional detail
provided by such reporting improves the estimates produced by the OTS Model. For information, see the
instructions for Supplemental Reporting for Assets and Liabilities.
SCHEDULE CMR
1935
DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Outstanding Balance of Complex Securities (Not including Mortgage
Derivative Securities)
Thrifts with complex securities, including structured securities, are required to self-value these
instruments in the section Supplemental Reporting of Market Value Estimates using asset code 121 in
Appendix D. We define both complex securities and structured securities in Thrift Bulletin 13a, Appendix
D. Do not include mortgage derivative securities.
CMR490: Total Cash, Deposits, and Securities
The EFS software automatically computes this line as the sum of the balances on CMR461, CMR464,
CMR470, CMR473, CMR476, and CMR479. For all editing and output data uses, our data systems will
add the balance for complex securities reported as code 121 in the section for Supplemental Reporting of
Market Value Estimates to this line.
ADDITIONAL ITEMS
You report in this section certain additional items needed for the OTS Model. The definitions and
instructions for these items are the same as on Schedule SC.
Items Related to Mortgage Loans and Securities
The following items pertain to asset balances on CMR125, CMR185, CMR261, CMR262, CMR281,
CMR282, CMR291, CMR292, CMR311, and CMR312.
CMR501:
Nonperforming Loans
Report the outstanding balance of nonperforming mortgage loans and securities. Nonperforming loans
are nonaccrual loans plus loans that are at least 90 days past due but still accruing interest. Outstanding
balance is defined in the general instructions to Schedule CMR.
Include:
1. Nonperforming mortgage warehouse loans that you reported as mortgage loans on Schedule SC.
2. Delinquent mortgage loans previously securitized with Ginnie Mae, where either (a) you have an
unconditional repurchase option, or (b) you have repurchased the loans under such an option.
Also, with respect to (a) report the related liability on CMR786, Other Liabilities I.
CMR502:
Accrued Interest Receivable
Report amounts for the types on SC228, Accrued Interest Receivable on Mortgage-Backed Securities,
and SC272, Accrued Interest Receivable on Mortgage Loans.
Include:
Interest receivables on mortgage warehouse loans that you reported as mortgage loans on Schedule
SC.
CMR503:
Advances for Taxes and Insurance
Report amounts paid on behalf of borrowers for taxes and insurance of the types reported on SC275,
Advances for Taxes and Insurance.
Include:
Advances related to mortgage warehouse loans that you reported as mortgage loans on Schedule
SC.
1936
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
CMR504:
MARCH 2010
Less: Unamortized Yield Adjustments
Report the net amount of unamortized premiums and discounts related to balances on CMR125,
CMR185, CMR261, CMR262, CMR281, CMR282, CMR291, CMR292, CMR311, CMR312, and CMR501.
Include:
Premiums or discounts related to mortgage warehouse loans that you reported as mortgage loans on
Schedule SC.
CMR507:
Less: Valuation Allowances
Report general and specific valuation allowances established to recognize credit losses.
Include:
Allowances related to mortgage warehouse loans that you reported as mortgage loans on Schedule
SC.
CMR508:
Unrealized Gains (Losses)
Report, on a consolidated basis, gross unrealized gains (losses) on loans held for sale, available-for-sale
securities, and trading securities. Also report the unamortized deferred gains and losses on hedging
transactions closed prior to adoption of FASB Statement No. 133, and the accumulated gain or loss
(change in fair value) on the asset attributable to the designated risk being hedged on a qualifying fair
value hedge under FASB statement No. 133.
Include:
Unrealized gains or losses related to mortgage warehouse loans that you reported as mortgage loans
on Schedule SC.
Items Related to Nonmortgage Loans and Securities
The following items pertain to asset balances on CMR325, CMR326, CMR335, and CMR336.
CMR511:
Nonperforming Loans
Report the outstanding balance of nonperforming nonmortgage loans. Nonperforming loans are
nonaccrual loans plus loans that are at least 90 days past due but still accruing interest. Outstanding
balance is defined in the general instructions to Schedule CMR.
Do not include:
Nonperforming mortgage warehouse loans that you reported as mortgage loans on Schedule SC.
CMR512:
Accrued Interest Receivable
Report amounts of the types on SC348, Accrued Interest Receivable on Nonmortgage Loans.
Do not include:
Interest receivables on mortgage warehouse loans that you reported as mortgage loans on Schedule
SC.
CMR513:
Less: Unamortized Yield Adjustments
Report the net amount of unamortized premiums and discounts related to balances on CMR325,
CMR326, CMR335, CMR336, and CMR511.
Do not include:
SCHEDULE CMR
1937
DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Premiums or discounts related to mortgage warehouse loans that you reported as mortgage loans on
Schedule SC.
CMR516:
Less: Valuation Allowances
Report general and specific valuation allowances established to recognize credit losses.
Do not include:
1. Allowances related to mortgage warehouse loans that you reported as mortgage loans on
Schedule SC.
2. Valuation allowances established to recognize decreases in the value of real estate held for
investment or repossessed assets. See instructions for CMR520 and CMR525 for proper
treatment of such valuation allowances.
CMR517:
Unrealized Gains (Losses)
Report unrealized gains (losses) on loans held for sale, available-for-sale securities, and trading
securities. Also report the unamortized deferred gains and losses on hedging transactions closed prior to
adoption of FASB Statement No. 133, and the accumulated gain or loss, change in fair value, on the
asset attributable to the designated risk being hedged on a qualifying fair value hedge under FASB
Statement No. 133.
Do not include:
Unrealized gains or losses related to mortgage warehouse loans that you reported as mortgage loans
on Schedule SC.
CMR520: Real Estate Held for Investment
Report assets of the types on SC45. Report those amounts net of any appropriate valuation allowances.
CMR520 should equal SC45.
CMR525: Repossessed Assets
Report repossessed assets of the types on SC405 through SC430. Report those amounts net of any
appropriate valuation allowances. CMR525 should equal SC40.
CMR530: Equity Investments Not Subject to FASB Statement No. 115
(Excluding FHLB Stock)
Report equity investments of the type on SC540, net of any appropriate valuation allowances. Do not
include Federal Home Loan Bank stock reported on SC510; report FHLB stock on CMR543, Other
Assets, Miscellaneous I. Also do not include any loans made to subordinate organizations; report such
loans with commercial loans on CMR325 or CMR326. Reclassify any investments accounted for by the
equity method with a negative balance to CMR786, Miscellaneous Liabilities I.
CMR535: Office Premises and Equipment
Report assets of the types on SC55. CMR535 should equal SC55.
Items Related to Certain Investment Securities
CMR538:
Unrealized Gains (Losses)
Report gross unrealized gains (losses) on any available-for-sale securities and trading securities on
CMR461, CMR473, CMR476, and CMR479 or as code 121 in Supplemental Reporting of Market Value
1938
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
Estimates. Also report the unamortized deferred gains and losses on hedging transactions closed prior to
adoption of FASB Statement No. 133, and the accumulated gain or loss, change in fair value, on the
asset attributable to the designated risk being hedged on a qualifying fair value hedge under FASB
Statement No. 133.
Do not include:
1. Unrealized gains (losses) related to equity securities reported on CMR464.
2. Unrealized gains (losses) related to zero-coupon securities reported on CMR470.
Both CMR464 and CMR470 are reported at recorded investment and, thus, already include unrealized
gains or losses.
CMR539:
Less: Unamortized Yield Adjustments
Report the net amount of unamortized premiums and discounts on securities whose balances you report
on CMR461, CMR473, CMR476, and CMR479 or as code 121 in Supplemental Reporting of Market
Value Estimates.
Do not include:
1. Unamortized yield adjustments related to equity securities reported on CMR464.
2. Unamortized yield adjustments related to zero-coupon securities reported on CMR470.
Both CMR464 and CMR470 are reported at recorded investment and, thus, already include premiums
and discounts.
CMR540:
Less: Valuation Allowances
Report all valuation allowances related to securities whose balances you report on CMR377, CMR378,
CMR461, CMR464, CMR470, CMR473, CMR476, and CMR479 or as code 121 in Supplemental
Reporting of Market Value Estimates.
Other Assets
CMR541:
Servicing Assets, Interest-Only Strip Receivables, and Certain
Other Instruments
Report assets of the types reported on SC642, Servicing Assets on Mortgage Loans, SC644, Servicing
Assets on Nonmortgage Loans, and SC665, Interest-Only Strip Receivables and Certain Other
Instruments. CMR541 should equal the sum of SC642, SC644, and SC665.
CMR543:
Miscellaneous I
Report assets of the types included on line SC689, Other Assets, except for the following items:
1. Unamortized options fees, Other Assets Code 16.
2. Deferred net losses (gains) on asset hedges, Other Assets Code 17.
3. Derivative instruments in a gain position at fair value, Other Assets Code 20.
Include:
1. Assets of the types included on SC615 and SC625, Bank-Owned Life Insurance.
2. Federal Home Loan Bank Stock reported on SC510.
Report amounts on CMR543 net of specific valuation allowances. Deduct all general valuation allowances
on SC699 from this line. The sum of CMR543 and CMR544 should equal SC510, SC615, SC625, SC660
plus SC689, minus SC699.
SCHEDULE CMR
1939
DECEMBER 2010
CMR544:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Miscellaneous II
Report assets of the types included on line SC660, Goodwill and Other Intangibles.
Include the following items included on SC689, Other Assets:
1. Unamortized options fees .
2. Fair value of all derivative instruments reportable as assets under FASB Statement No. 133
(Code 20).
The sum of CMR543 and CMR544 should equal SC510, SC615, SC625, SC660 plus SC689, minus
SC699.
CMR550: Total Assets
The EFS software automatically computes this line as the sum of the following line items:
CMR125
CMR282
CMR325
CMR378
CMR508
CMR525
CMR543
CMR185
CMR291
CMR326
CMR490
CMR511
CMR530
CMR544
CMR261
CMR292
CMR335
CMR501
CMR512
CMR535
CMR262
CMR311
CMR336
CMR502
CMR517
CMR538
CMR281
CMR312
CMR377
CMR503
CMR520
CMR541
CMR513
CMR516
CMR539
Less the following items:
CMR504
CMR507
CMR540
CMR550 plus the balance for Complex Securities reported as code 121 on the section for Supplemental
Reporting of Market Value Estimates should equal SC60, Total Assets. For all editing and output data
uses, our data systems will add the balance for complex securities reported as code 121 in the section for
Supplemental Reporting of Market Value Estimates to this line.
Memoranda Items
CMR578:
Mortgage Warehouse Loans Reported as Mortgage Loans at
SC26
Report the outstanding balance of performing loans included on SC26, Mortgage Loans, collateralized by
mortgage loans rather than liens directly on real estate.
CMR580:
Loans Secured by Real Estate Reported as Nonmortgage Loans
at SC31
Report the outstanding balance for the following types of performing loans on SC31 (Nonmortgage
Loans):
1. Any timeshare loans on CMR125 or CMR185.
2. Loans to finance small businesses that are primarily secured by single-family residences, where
you have classified the loans as commercial nonmortgage loans.
1940
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
Market Value of Equity Securities and Mutual Funds Reported at CMR464:
Report on CMR582 and CMR584 the current market value of the assets whose recorded investment you
report on CMR464. The sum of CMR582 and CMR584 should equal CMR464.
CMR582:
Equity Securities and Nonmortgage--Related Mutual Funds
Report on CMR582 the current market value of all investments in common stock, except FHLB stock, and
in mutual funds that invest entirely in nonmortgage-related instruments.
CMR584:
Mortgage-Related Mutual Funds
Report on CMR584 the current market value of all investments in mutual funds, including limited
partnership investment funds, that have any investments in mortgages, mortgage securities, mortgagederivative securities, mortgage servicing rights, or other mortgage-related instruments.
At your option, you may use code 129 to report your estimate of mortgage-related mutual funds in each of
the seven interest rate scenarios listed on the Supplemental Reporting of Market Value Estimates.
Mortgage Loans Serviced by Others
CMR586:
Fixed-Rate Mortgage Loans Serviced by Others
Report on CMR586 the outstanding balance of all performing fixed-rate mortgages that you hold but
others service.
CMR587: Weighted-Average Servicing Fee
Report on CMR587, in basis points, the weighted-average servicing fee paid to others to service the
fixed-rate mortgage balances on CMR586. Calculate the weighted-average servicing fee in the same
manner as described for the WAC in the general instructions to Schedule CMR.
CMR588:
Adjustable-Rate Mortgage Loans Serviced by Others
Report on CMR588 the outstanding balance of all performing ARM balances that you hold but others
service.
CMR589: Weighted-Average Servicing Fee:
Report on CMR589, in basis points, the weighted-average servicing fee paid to others to service the ARM
balances on CMR588. Calculate the weighted-average servicing fee in the same manner as described for
the WAC in the general instructions to Schedule CMR.
CMR590:
Credit Card Balances Expected to Pay Off in Grace Period
Report on CMR590 the amount of the outstanding credit card balances expected to pay off within an
interest-free grace period and, thus, not incur interest charges.
Example: You have $100,000 in outstanding fixed- and adjustable-rate credit card balances scheduled
to pay off over 60 months. You estimate that customers will repay 30 percent of those balances within the
grace period. You would report $30,000 on CMR590.
SCHEDULE CMR
1941
DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
LIABILITIES
Annual Percentage Yields
Unless otherwise stated in the reporting instructions, report the interest rates for all liabilities as annual
percentage yields (APYs). The rates and balances used in calculating the APY should be those as of the
reporting date, unless otherwise stated in the reporting instructions. If the APY is equal to zero, report .01,
one basis point.
In general, APY reflects the relationship between a given principal balance and the amount of interest that
it would earn for a three hundred sixty-five day year. Calculate the APY using the following general
formula:
APY = 100 [(1 + Interest/Principal)(365/Days in Term) - 1]
Where:
Principal
=
The amount of funds on deposit as of the reporting date.
Interest
=
The total dollar amount of interest that you will pay on the Principal over
the remaining term of the account.
Days in Term
=
The actual number of days remaining to maturity. You can use the above
formula to compute the APY for instruments of any maturity.
We base the following examples on balances and rates as of the reporting date:
Example:
You will pay $30.37 in interest on a $1,000 certificate of deposit with six months remaining to maturity,
where the six month period contains 182 days. Calculate the APY as follows:
APY
=
=
100 [(1 + 30.37/1,000)(365/182) - 1]
6.18%
Suppose now that you will pay $133.13 in interest on a $1,000 certificate of deposit with two years
remaining to maturity, where the two-year period contains 730 days. Calculate the APY as follows:
APY
=
=
100 [(1 + 133.13/1,000)(365/730) - 1]
6.45%
Use Days in Term equal to 365 for accounts without a stated maturity. For example, you pay $61.68 in
interest for $1,000 deposited in a NOW account for 365 days, assuming the depositor makes no further
withdrawals or deposits during that time. Calculate the APY as follows:
APY
=
=
100 (61.68/1,000)
6.17%
Reporting of Deposit Information
Schedule CMR collects information on early withdrawals during the quarter for CDs and the balances
deposited in new accounts during the quarter for CDs and nonmaturity deposits. We use this information
to develop core deposit attrition rate estimates. The OTS Net Portfolio Value Model uses attrition rate
estimates to estimate the interest rate sensitivity of your core deposits. Refer to the instructions for the
specific line items for definitions of early withdrawals and new accounts.
Reporting the information on early withdrawals and balances deposited in new accounts is optional for
only those institutions with total assets (SC60) of less than $300 million.
1942
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
FIXED-RATE, FIXED-MATURITY DEPOSITS
CMR601-CMR603, CMR615-CMR617,
CMR631-CMR632, and CMR641:
Balances
Report each outstanding CD balance in the cell corresponding to its remaining maturity and original
maturity.
Include:
1. CDs.
2. Notice accounts.
3. Consecutive monthly payment accounts – for example, Christmas Club accounts.
Do not include:
Variable-rate, fixed-maturity deposits. Use code 200 to report these deposits in Supplemental
Reporting for Assets and Liabilities.
Note: We include notice accounts in the maturity/repricing column that corresponds to the remaining term
of the notice period. We include consecutive monthly payment accounts in the maturity/repricing column
that corresponds to the remaining term required to qualify for the bonus rate.
CMR605-CMR607, CMR619-CMR621,
CMR634-CMR635, and CMR643:
Weighted-Average Coupon (WAC)
Report the weighted-average APY of the CD balances reported in each of the nine cells listed above.
Calculate the weighted-average APY in the same way as described for the WAC in the general
instructions to Schedule CMR.
CMR608-CMR610, CMR622-CMR624,
CMR636-CMR637, and CMR644:
Weighted-Average Remaining
Maturity (WARM)
Report the WARM, in months, of the CD balances reported in each of the nine cells listed above. We
describe how to calculate the WARM in the general instructions to Schedule CMR.
CMR604, CMR618, CMR633, and CMR642: Early Withdrawals during
Quarter
Report CDs (or portions of CDs) that meet both of the following criteria:
1. Were subject to early withdrawal penalties.
2. Were withdrawn during the quarter before their contractual maturity.
Report balances withdrawn before maturity in the maturity bucket corresponding to what the remaining
maturity of those balances would have been at the quarter’s end had they not been withdrawn.
CMR645: Total Fixed-Rate, Fixed-Maturity Deposits (CDs)
The EFS software automatically computes this line as the sum of CMR601 through CMR603, CMR615
through CMR617, CMR631, CMR632, and CMR641.
SCHEDULE CMR
1943
DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MEMO: FIXED-RATE, FIXED-MATURITY DEPOSIT DETAIL:
CMR650 through CMR652: Balances in Brokered Deposits
For the total CD balances reported in each original maturity column, determine the portion that are
brokered deposits. Report these balances for each original maturity. The term brokered deposit, defined
in 12 CFR § 337.6, refers to funds obtained, directly or indirectly, by or through any deposit broker.
Example: You report $125,000 on CMR602, $225,000 on CMR616, and $250,000 on CMR631. Of the
three balances, $50,000, $25,000, and $35,000, respectively, are in brokered accounts. You would
report $110,000 (= $50,000 + $25,000 + $35,000) on CMR651.
Deposits with Early-withdrawal Penalties Stated in Terms of Months
of Forgone Interest:
CMR653 through CMR655:
Balances Subject to Penalty
For the balances reported in each original maturity column, determine the portion subject to early
withdrawal penalties (EWPs) stated in months of forgone interest. Report these balances for each original
maturity column. Do not include CDs having EWPs stated differently (flat penalty, market-related penalty).
Example: You report $125,000 on CMR602, $225,000 on CMR616, and $250,000 on CMR631. Of the
$125,000 balance, $100,000 are CDs with an EWP of 1.12 month’s interest. Of the $225,000 and
$250,000 balances, a total of $450,000 are CDs with an EWP requiring forfeiture of 1.98 months’ interest.
You would report $550,000 (= $100,000+$450,000) on CMR654.
CMR656 through CMR658:
Penalty in Months of Forgone Interest
For the balances reported in each original maturity column, and totaled on CMR653 through CMR655,
report the weighted-average EWP in months of foregone interest for each year (or fraction of a year) of
contractual maturity. Report to two decimal places. Report these for each original maturity column.
Example: You report $125,000 on CMR602, $225,000 on CMR616, and $250,000 on CMR631. Of the
$125,000 balance, $100,000 are CDs with an EWP of 1.12 month’s interest. 4 Both the $225,000 and
$250,000 aggregate balances are CDs with an EWP requiring forfeiture of 1.98 months’ interest. You
would calculate the weighted-average EWP on CMR657 as follows:
EWP
=
=
(100,000 x 1.12) + (475,000 x 1.98)
(100,000 + 475,000)
1.83 months
CMR659 through CMR661: Balances in New Accounts
New accounts are those where a customer, who did not previously have a fixed-rate, fixed-maturity
deposit, acquires one, or where the contract terms have changed on an existing account. For purposes
of CMR, a new account where the contract terms have changed is one in which:
•
There has been a change in the name of the account (including additional or dropped owners), or
•
The maturity of the new CD is for a different term than the matured CD (that is, it would fall into a
different maturity bucket).
4 The early withdrawal penalties are in months of forgone interest for each year (or fraction of a year) of remaining maturity.
(Penalty in $)
EWP=
($ Interest paid over remaining maturity)
1944
SCHEDULE CMR
* 12 months per year
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
For rollovers, if there has been no change in the ownership of the account and the maturity of the new CD
is within the same maturity bucket, the new CD is not considered a new account even if new funds are
added to the CD.
For example, a three-month CD issued during the quarter would not be a new account if the account
holder had a CD with original maturity of 12 months or less that matured during the quarter. A CD would
be a new account if it were a 3-month CD rolled over from a CD with an original maturity of more than 12
months or if a three-month CD were rolled over to a 24-month CD. In both of these cases the maturity
bucket has changed.
Also include as new accounts:
1. Accounts where there has been a name added or deleted.
2. Deposits acquired from an acquisition of a depository institution or its branches or from other bulk
purchase of deposits.
•
On CMR659, report the portion of balances on CMR601 and CMR615 that are new CD balances
with original maturities of 12 months or less.
•
On CMR660, report the portion of balances on CMR616 and CMR631 that are new CD balances
with original maturities of 13 to 36 months.
•
On CMR661, report the portion of balances on CMR632 and CMR641 that are new CD balances
with original maturities of 37 or more months.
FIXED-RATE, FIXED-MATURITY FHLB ADVANCES, OTHER
BORROWINGS, REDEEMABLE PREFERRED STOCK, AND
SUBORDINATED DEBT
CMR675-CMR677, CMR679-CMR681, CMR683-CMR685, CMR687CMR689, CMR691-CMR693, CMR695-CMR697, CMR699-CMR701,
CMR703-CMR705:
Balances
Report each outstanding balance of fixed-rate, fixed-maturity borrowings in the cell corresponding to its
coupon class and remaining maturity. The coupon classes are: under 3.00%; 3.00% to 3.99%; 4.00% to
4.99%; 5.00% to 5.99%; 6.00% to 6.99%; 7.00% to 7.99%; 8.00% to 8.99%; and 9.00% and above.
Include:
1.
2.
3.
4.
5.
6.
7.
8.
FHLB advances.
Commercial bank loans.
Repurchase agreements.
Retail repurchase agreements.
Commercial paper issued.
Subordinated debt.
Redeemable preferred stock.
All other borrowings.
Do not include:
1. Notice accounts. Report on CMR601 to CMR661.
2. Consecutive monthly payments accounts. Report on CMR601 to CMR661.
3. Collateralized mortgage securities issued. Report on CMR785.
SCHEDULE CMR
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DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
4. Structured borrowings. Report on Supplemental Reporting of Market Value Estimates, see
below.
5. Variable-rate, fixed maturity borrowings. Report on Supplemental Reporting for Assets and
Liabilities.
Distribute amortizing instruments across remaining maturity columns, in the appropriate coupon class,
according to their contractual principal repayment schedules. For example, a $120,000 note, with an APY
of 9.5 percent and remaining maturity of ten years, amortizes as follows:
1. $3,000 in the next three months.
2. $33,000 in months four through 36.
3. $84,000 in the last 84 months.
You would report the note on CMR695, CMR696, and CMR697 as $3,000, $33,000, and $84,000,
respectively.
Structured Borrowings
For the purpose of these instructions, structured borrowings include borrowings or FHLB advances with
embedded options or derivative-like features where the borrowings’ coupon, average life, or redemption
value is dependent on a reference rate, and index, or a formula. The term structured borrowings
includes, but is not limited to, putable or callable borrowings, variable-rate borrowings with embedded
caps, floors or collars, step-up variable rate borrowings, or amortizing borrowings.
OTS requires all institutions to report the market value of each structured borrowing in Supplemental
Reporting of Market Value Estimates. Refer to the Supplemental Reporting of Market Value Estimates
sections of these instructions for guidance on reporting market value estimates.
CMR678, CMR682, CMR686, CMR690,
CMR694, CMR698, CMR702, CMR706:
WAC
Report the weighted-average coupon (WAC) of the balances reported in each coupon class. To
calculate the WAC, first determine the APYs of borrowings that you report in each coupon class. For
instance, for the 5.00 to 5.99 percent class, determine the APYs of borrowings reported on CMR679
through CMR681. Second, for each coupon class, use these yields to calculate the WAC, as described in
the general instructions to Schedule CMR.
CMR711 through CMR713: WARM
Report the weighted average remaining maturity (WARM) for each remaining maturity column. To
calculate the WARM, first determine the remaining maturity of each of the borrowings that you report in
each remaining maturity class. For example, for the 0 to 3 months column, determine the remaining
maturity of borrowings on CMR675, CMR679, CMR683, CMR687, CMR691, CMR695, CMR699, and
CMR703. Second, for each remaining maturity class, use these remaining maturities to calculate the
WARM, as described in the general instructions to Schedule CMR.
CMR715: Total Fixed-Rate, Fixed-Maturity Borrowings
The EFS software automatically computes this line as the sum of CMR675 through CMR677, CMR679
through CMR681, CMR683 through CMR685, CMR687 through CMR689, CMR691 through CMR693,
CMR695 through CMR697, CMR699 through CMR701, and CMR703 through CMR705.
1946
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
Memo:
CMR755:
Book Value of Redeemable Preferred Stock
Report the book value of redeemable preferred stock of the type reported on SC800.
NONMATURITY DEPOSITS
CMR762 through CMR763: Transaction Accounts
12 CFR § 561.29 defines transaction accounts and they include NOW, Super NOW, and other interestbearing transaction accounts. Report total balances of all interest-bearing transaction accounts on
CMR762.
Report the WAC for total interest-bearing transaction account balances on CMR763. Determine the APYs
of balances on CMR762. Use these to calculate the weighted-average APY in the same manner as the
WAC computation described in the general instructions to Schedule CMR, and report it on CMR763.
CMR764:
Balances in New Accounts
Balances in New Accounts are end-of-quarter balances in accounts where holders had no transaction accounts
with you at the end of the prior quarter.
Also include as new accounts:
1.
2.
Accounts where there has been a name added or deleted.
Deposits acquired from an acquisition of a depository institution or its branches or from other bulk
purchase of deposits.
CMR765 through CMR766:
Money Market Deposit Accounts
12 CFR § 561.28 or applicable state law defines money market deposit accounts (MMDAs). Report total
balances of MMDAs on CMR765.
Report the WAC for MMDA balances on CMR766. Determine the APYs of balances on CMR765. Use these to
calculate the weighted-average APY, in the same manner as the WAC computation described in the general
instructions to Schedule CMR. Report the result on CMR766.
CMR767:
Balances in New Accounts
Balances in New Accounts are end-of-quarter balances in accounts whose holders had no MMDA with you at
the end of the prior quarter.
Also include as new accounts:
1.
2.
Accounts where there has been a name added or deleted.
Deposits acquired from an acquisition of a depository institution or its branches or from other bulk
purchase of deposits.
CMR768 through CMR769:
Passbook Accounts
Passbook accounts consist of all nonmaturity deposits not on CMR762, CMR765, and CMR771. Report total
balances of Passbook Accounts on CMR768.
Report the WAC for passbook accounts balances on CMR769. Determine the APYs of balances on CMR768.
Use these to calculate the weighted-average APY, in the same manner as the WAC computation described in
the general instructions to Schedule CMR. Report the result on CMR769.
SCHEDULE CMR
1947
DECEMBER 2010
CMR770:
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Balances in New Accounts
Balances in New Accounts are end-of-quarter balances in accounts where holders had no passbook accounts
with you at the end of the prior quarter.
Also include as new accounts:
1.
2.
Accounts where there has been a name added or deleted.
Deposits acquired from an acquisition of a depository institution or its branches or from other bulk
purchase of deposits.
CMR771: Noninterest-Bearing Nonmaturity Deposits
Report balances of all nonmaturity deposit accounts that are permanently non-interest-bearing on
CMR771. Do not include balances in nonmaturity deposits, transaction accounts or MMDAs, that do not
currently earn interest because they are below the contracted minimum balance required to earn interest.
CMR773:
Balances in New Accounts
Balances in new accounts are end-of-quarter balances in accounts where holders had no noninterestbearing nonmaturity deposits with you at the end of the prior quarter.
Also include as new accounts:
3. Accounts where there has been a name added or deleted.
4. Deposits acquired from an acquisition of a depository institution or its branches or from other bulk
purchase of deposits.
ESCROW ACCOUNTS
Escrow accounts include the types of accounts on SC712 that you report in Schedule CMR as follows:
•
Report balances of escrow accounts associated with single-family first mortgages that you own
on CMR775.
•
Report balances of tax and insurance escrows associated with single-family first mortgages
serviced for others on CMR777.
•
Report balances of principal and interest escrows established pursuant to loan servicing
agreements, including those in custodial accounts, on CMR786, Miscellaneous Liabilities I.
•
On CMR779, report balances of all escrow accounts not on CMR775, CMR777, and CMR786.
•
Report escrow accounts associated with mortgages that you partially own according to the
percentage of ownership.
Example: You sell an 80 percent participating interest in a pool of mortgages and retain the servicing.
You have $60,000 in tax and insurance escrow accounts and $40,000 in principal and interest escrow
accounts associated with the pool of mortgages. You would report the following amounts: on CMR775,
$12,000 (= $60,000 x .20); on CMR777, $48,000 (= $60,000 x .80); and on CMR786, $40,000.
Report the WAC of escrows on CMR775, CMR777, and CMR779 on CMR776, CMR778, and CMR780,
respectively. Calculate the WAC as described in the general instructions to Schedule CMR. If the WAC is
zero, report 0.01, one basis point.
CMR781: Total Nonmaturity Deposits and Escrow Accounts
The EFS software automatically computes this line as the sum of CMR762, CMR765, CMR768, CMR771,
CMR775, CMR777, and CMR779.
1948
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
CMR782: UNAMORTIZED YIELD ADJUSTMENTS ON DEPOSITS
Report on CMR782 unamortized yield adjustments of the type on SC715. Also include the component of
the carrying value of deposit liabilities that consists of accumulated gains and losses, the change in fair
value on the deposits, attributable to the designated risk being hedged on a qualifying fair value hedge
under FASB Statement No. 133.
CMR784: UNAMORTIZED YIELD ADJUSTMENTS ON BORROWINGS
Report on CMR784 unamortized yield adjustments applicable to liabilities of the types on the following
line items:
1. SC720 (Advances from FHLBank).
2. SC730 (Federal Funds Purchased and Securities Sold Under Agreements to Repurchase).
3. SC736(Subordinated Debentures, Including Mandatory Convertible Securities and Limited-Life
Preferred Stock).
4. SC740 (CMOs, Including REMICs).
5. SC745 (Other Mortgage Collateralized Securities Issued).
6. SC760 (Other Borrowings).
Add to this amount any unamortized yield adjustments related to redeemable preferred stock of the type
on SC800. Also include the component of the carrying value of borrowings that consists of accumulated
gains and losses (the change in fair value on the borrowings) attributable to the designated risk being
hedged on a qualifying fair value hedge under FASB Statement No. 133.
OTHER LIABILITIES
CMR785: Collateralized Mortgage Securities Issued
Report the carrying value of collateralized mortgage securities issued that you do not record as sales in
accordance with GAAP. See FASB Statement No. 77, Reporting by Transferors of Receivables with
Recourse and FASB Technical Bulletin 85-2, Accounting for Collateralized Mortgage Obligations. Include
CMOs and other collateralized mortgage securities issued.
CMR786: Miscellaneous Liabilities I
Report amounts of the types included on SC763, Accrued Interest Payable on Deposits, SC766, Accrued
Interest Payable on Other Liabilities, SC776, Accrued Taxes, and SC780, Accounts Payable.
Include amounts of the types on line SC796, Other Liabilities and Deferred Income, except for the
following:
1. Financial option fees received.
2. Deferred net gains (losses) on liability hedges.
3. Negative goodwill.
4. Derivative instruments in a loss position at fair value.
For definitions of these items, see the instructions for line SC796, code numbers 02, 03, 12, and 20,
respectively.
Also include:
1. Balances in principal and interest escrow accounts established pursuant to loan servicing
agreements.
SCHEDULE CMR
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DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
2. The liability associated with delinquent mortgage loans previously securitized with Ginnie Mae,
where you have an unconditional repurchase option. The related loans are reported on CMR501,
Nonperforming Loans.
CMR787: Miscellaneous Liabilities II
Report amounts of the types included on line SC790, Deferred Income Taxes. Also include financial
option fees received, negative goodwill, and derivative instruments in a loss position at fair value. For
definitions of these items, see the instructions for line SC796, code numbers 02, 03, 12, and 20,
respectively.
CMR790: Total Liabilities (Incl. Redeemable Preferred Stock)
The EFS software automatically computes this line as the sum of CMR645, CMR715, CMR781, and
CMR782 through CMR787. For all editing and output data uses, our data systems will add the following
balances to this line:
1. Variable-rate, fixed-maturity liabilities reported as codes 200, 220, and 299 in Supplemental
Reporting for Assets and Liabilities.
2. Structured borrowings reported as codes 280 through 290 in Supplemental Reporting of
Market Value Estimates.
CMR793: NONCONTROLLING INTEREST IN CONSOLIDATED
SUBSIDIARIES
Report amounts accounted for as noncontrolling interest in consolidated subsidiaries and included in
SC800, with the following exceptions:
•
Also include on CMR793, REIT preferred stock even if it is not included in SC800, but rather you
have elected to report it as a liability on SC760, Other Borrowings.
•
Do not include redeemable preferred stock even though you reported it in SC800. Report all
redeemable preferred stock on CMR755, Book Value of Redeemable Preferred Stock.
CMR796: EQUITY CAPITAL
Report on CMR796 the amount on SC80, Total Equity Capital.
CMR800: Total Liabilities, Noncontrolling Interest, and Capital
The EFS software automatically computes this line as the sum of CMR790, CMR793, and CMR796. For
all editing and output data uses, our data systems will add the following balances to this line:
1. Variable-Rate, Fixed-Maturity Liabilities reported as codes 200, 220, and 299 in the section for
Supplemental Reporting for Assets/Liabilities.
2. Structured Borrowings reported as codes 280 through 290 in the section for Supplemental
Reporting of Market Value Estimates.
1950
SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
FINANCIAL DERIVATIVES AND OFF-BALANCE-SHEET
POSITIONS
INTRODUCTION
Divide financial derivatives and off-balance-sheet (OBS) contracts into the following ten general types of
contracts for reporting on Schedule CMR:
1. Optional commitments to originate mortgages.
2. Firm commitments to purchase, sell, or originate mortgages.
3. Optional commitments to purchase or sell mortgages.
4. Commitments to purchase, originate, or sell nonmortgage financial assets and liabilities.
5. Interest-rate swaps.
6. Interest-rate caps.
7. Interest-rate floors.
8. Futures.
9. Options on futures.
10. Construction LIP.
Note: Report information about financial derivatives and OBS contracts on Schedule CMR even though
under FASB Statement No. 133 you report derivative instruments in Schedule SC on SC689, Other
Assets, or SC796, Other Liabilities.
Report OBS contract positions on CMR801 through CMR880. To report an OBS contract position, report
the contract code described below that corresponds to the position in the column Contract Code. Enter
the notional principal amount of the position in the column Notional Amount. Report information in the
other columns according to the instructions for each type of contract. We provide examples of how to
report various positions for each type of contract in the individual sections.
Reporting More Than 16 Financial Derivatives and OBS Positions
CMR801 through CMR880 accommodate the reporting of 16 financial derivatives and OBS positions. If
you have more than 16 positions, you must report the remaining positions by one of the following two
methods:
1. Report the remaining positions on the continuation sheet Supplemental Reporting for Financial
Derivatives and Off-Balance-Sheet Positions in the same manner as the initial 16 positions.
Number each position sequentially in the column Entry #, beginning with the number 1 for the first
position reported. Use as many continuation sheets as necessary to report the remaining
positions. On CMR902, report the number lines that you report in this manner.
2. You may provide your own estimate of the market values of the remaining positions in each of the
seven interest-rate scenarios on Supplemental Reporting of Market Value Estimates. To report
under this method, see Supplemental Reporting for Derivatives and OBS Contracts in the section
Supplemental Reporting of Market Value Estimates. On CMR903, report the number of lines that
you report by this method.
If you choose this method, you must report all positions of Optional Commitments to Originate
Mortgages, discussed below, as part of the 16 positions on CMR801 through CMR880.
Contract Code
Identify all OBS contract positions by a contract code. We provide a list of codes for each type of contract
in Appendices B and D. The first two digits of the four-digit contract codes designate the general type of
contract. For example, all codes for optional commitments to originate mortgages begin with the digits 10.
The last two digits of the code designate the specific type of OBS contract within the general type. For
SCHEDULE CMR
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DECEMBER 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
example, we designate optional commitments to originate 30-year fixed-rate mortgages by the code
1014.
Reporting Instructions
We provide instructions below for each of the ten general types of financial derivatives and OBS
contracts. Each section begins by defining the contracts covered in that section. We also provide
guidance on how to combine or aggregate contracts for reporting purposes. We specify what to report in
each of the five columns, CMR801 through CMR880, and provide examples.
Report all rates as a percent to two decimal places. For example, to report a coupon rate of 7.5 percent,
report 7.50. Report all prices as a percentage of par to two decimal places. For example, to report a price
of 102 percent of par, report 102.00. Report a price of par as 100.00.
Optional Commitments to Originate Mortgages
An optional commitment to originate a mortgage is an obligation to originate a mortgage loan at a
specified interest rate, fixed or adjustable, where the potential borrower faces no substantial penalty for
failing to take the loan. Report only those optional commitments to originate where you have in effect or
have offered a specified interest rate, a rate lock, that is currently subject to the borrower’s acceptance.
Commitments to originate are firm when both the borrower and the lender are obligated to close the loan
at the interest rate specified. We provide instructions for reporting firm commitments below.
Aggregation
Report all commitments having the same contract code as a single position. See Appendix B for codes.
For example, report all commitments on one-month COFI ARMs (code 1002) as a single position, report
all commitments on six-month and one-year COFI ARMs (code 1004) as a single position, and so forth.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report the dollar amount of commitments outstanding in Column 2. For rate locked loans that have yet to
receive credit approval, deduct an amount representing expected credit denials. Do not adjust the
reported amount for fallout of approved loans.
Column 3: Maturity or Fees
Report in Column 3 the dollar amount in thousands of loan origination and loan discount fees that you
would collect if each loan closed. These fees should include compensation for buy-ups or buy-downs. Do
not include any other fees collected in the loan origination process, such as application, appraisal, credit,
and title fees.
Column 4: Price/Rate #1
Report in Column 4 the WAC of outstanding commitments. Refer to the calculation of the WAC in the
general instructions to Schedule CMR.
Column 5: Price/Rate #2 (Optional)
Reporting this information is optional. Report in Column 5 the percentage of optional commitments, by
dollar balances, outstanding as of the end of the previous quarter that closed during the quarter.
Example: You report $120 million of optional commitments on 30-year, fixed-rate mortgages as of June
30. Of the $100 million of optional commitments that you reported in the previous quarter’s report, the
report for the quarter ending March 31, $75 million closed during the quarter. You would report 75.00
[equal to ($75 million/$100 million) x 100] in Column 5 for the quarter ending June 30.
We intend to use this information to develop fallout rate estimates for savings associations that report this
data. The OTS Model uses these estimates to estimate the interest rate sensitivity of your mortgage
pipelines.
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THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
If you choose not to report this information, you should leave this cell blank. The OTS Model will use
national fallout rate estimates to estimate the market value of your mortgage pipelines.
Examples:
Position 1: You have $25 million of optional commitments to originate 30-year fixed-rate mortgages.
The WAC for these commitments is 8.67 percent. You would collect loan origination and loan discount
fees of $560,000 if all the loans in this position closed. Sixty-five percent of the optional commitments
outstanding at the end of the prior quarter closed.
Position 2: You have $5 million and $10 million of optional commitments to originate six-month and oneyear COFI ARMs, respectively. Combine these positions for reporting purposes because you report them
under the same contract code. The respective WACs on these commitments are 7.10 percent and 7.40
percent, and loan origination and loan discount fees you will collect total $420,000. You choose not to
report in column 5.
You would report these positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
[3]
Maturity or
Fees
[4]
Price/Rate
#1
Position 1
1014
25 000
560
8.67
Position 2
1004
15 000
420
7.30
[5]
Price/Rate
#2
65.00
Firm Commitments to Purchase, Sell, or Originate Mortgages
Firm commitments to purchase or sell mortgages are agreements to purchase or sell mortgage loans,
MBS, or mortgage derivative products at a specified price on a specified date. Firm commitments to
originate mortgages are binding obligations to provide a specified amount of a mortgage loan at a
specified interest rate, fixed or adjustable. You should consider commitments to originate mortgages firm
only if the borrower is obligated to pay you a substantial penalty if the borrower fails to take the loan. The
penalty should approximate the difference between the value of the loan at the commitment rate and the
value of the same loan at the subsequent lower mortgage rate.
Aggregation
Report all commitments having the same contract code as a single position. See Appendix B for codes.
For example, report all firm commitments to purchase one-month COFI ARM loans on a servicing
retained basis as a single position (code 2002), report all firm commitments to sell six-month or one-year
Treasury ARM MBS as a single position (code 2066), and so forth.
Report commitments to purchase or sell mortgage loans and commitments to purchase or sell MBS
separately because the contract codes are different.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report the dollar amount of commitments outstanding in Column 2.
Column 3: Maturity or Fees
Report in Column 3 the dollar amount (in thousands) of fees, if any, associated with the position. Report
fees you will pay as a negative value.
For commitments to originate mortgages include loan origination and loan discount fees that you would
collect if each loan closed. These fees should include compensation for buy-ups or buy-downs, but not
other fees collected in the loan origination process, such as application, appraisal, credit, and title fees.
For commitments to purchase or sell mortgages, report any additional fees, net of costs.
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Column 4: Price/Rate #1
Report in Column 4 the weighted-average interest rate specified in the commitments. Refer to the
calculation of the WAC in the general instructions to Schedule CMR. Leave this column blank for
commitments to purchase or sell mortgage derivative products.
Column 5: Price/Rate #2
Report in Column 5 the weighted-average price as a percentage of par, to two decimal places, that you
will pay or receive on the commitments. For commitments to originate mortgages, report a price of par –
for instance, 100.00. Leave this column blank for commitments to purchase or sell mortgage derivative
products.
Examples:
Position 1: You have a mandatory delivery commitment with FNMA to sell, on a servicing retained basis,
$25 million of one-year Treasury ARM loans with a required net yield of 7.5 percent at par. The required
net yields for mandatory forward sales quoted by FNMA and FHLMC are net of the servicing fee. The
contract code assigned to these commitments is 2026. You would use the code 2126 if the commitment
to sell included the servicing of the loan.
Position 2: You have a commitment to purchase $15 million three-year Treasury ARM MBS with a passthrough rate of 7.70 percent at par. You also have a commitment to purchase $5 million five-year
Treasury ARM MBS with a pass-through rate of 8.00 percent for 98.00, percent of par. You should
combine these positions and report them as a single position because they have the same contract code.
Report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
Position 1
2026
25 000
Position 2
2048
20 000
[3]
Maturity or
Fees
[4]
Price/Rate
#1
[5]
Price/Rate
#2
0
7.50
100.00
0
7.78
99.50
Optional Commitments to Purchase or Sell Mortgages or MBS
Optional commitments to purchase mortgages or MBS are contracts that grant the buyer of the option the
right, but not the obligation, to buy a specified type and amount of mortgages or MBS, with a specified
WAC for mortgages or pass-through rate for MBS, at a specified price, called the strike price, on a
specified date, called the expiration date.
You can hold either a long position in an optional commitment to purchase or sell, having bought the
option, or hold a short position in an optional commitment to purchase or sell, having sold the option. A
savings association can have any of four types of positions listed below in an optional commitment on
mortgages or MBS:
1. Long the option to purchase the mortgages or MBS.
2. Long the option to sell the mortgages or MBS.
3. Short the option to purchase the mortgages or MBS.
4. Short the option to sell the mortgages or MBS.
If the contract does not specify both a price and a pass-through rate, you should not report it on Schedule
CMR. For example, FNMA issues optional delivery commitments where it does not specify the required
net yield. You should not report such commitments on Schedule CMR.
Aggregation
Report each optional commitment to purchase or sell mortgages or MBS as a single position.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
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Column 2: Notional Amount
Report the notional principal amount of the commitment in Column 2.
Column 3: Maturity or Fees
Report the number of days until the commitment expires in Column 3.
Column 4: Price/Rate #1
Report the coupon rate or the pass-through rate in Column 4.
Column 5: Price/Rate #2
Report the strike price as a percentage of par in Column 5.
Examples:
Position 1: You have purchased an optional commitment to sell $10 million of five-year balloon
mortgages with a coupon of seven percent at a price of 98.00, percent of par. The commitment expires in
45 days.
Position 2: You have sold an optional commitment to purchase $25 million of 8.5 percent coupon 15year fixed-rate mortgages for par in 20 days.
Report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
[3]
Maturity or
Fees
[4]
Price/Rate
#1
[5]
Price/Rate
#2
Position 1
3030
10 000
45
7.00
98.00
Position 2
3052
25 000
20
8.50
100.00
Commitments to Purchase, Originate, or Sell Nonmortgage Financial
Assets and Liabilities
Commitments to purchase, originate, or sell nonmortgage financial assets and liabilities are agreements
to purchase or sell financial assets and liabilities other than mortgages or MBS, for a specified fixed price,
on a specified date. You should report commitments to purchase, originate, or sell mortgages or MBS
according to the instructions for those commitments above.
You should not report repurchase and resell agreements as OBS contracts. You should report such
agreements as the underlying on-balance-sheet asset or liability that they represent. Report on CMR461
or CMR476 through CMR478, and CMR675 through CMR715, respectively.
Aggregation
Report commitments to purchase or sell nonmortgage financial assets and liabilities that you can combine
under the same contract code as a single position. See Appendix B for codes. For example, report all
commitments to purchase nonmortgage financial assets (code 4002) as a single position, report all
commitments to sell core deposits (code 4024) as a single position, and so forth.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report the dollar amount of the commitments outstanding in Column 2.
Column 3: Maturity or Fees
If the position consists of commitments on nonmortgage financial assets, report the weighted-average
maturity (WAM) of the assets in months in Column 3. If the position consists of commitments on core
deposits, leave Column 3 blank. If the position consists of commitments on other liabilities, report the
WAM in months in Column 3. Refer to the calculation of the WARM in the general instructions to
Schedule CMR.
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Column 4: Price/Rate #1
If the position consists of commitments on nonmortgage financial assets, report the WAC of the assets in
Column 4. If the position consists of commitments on either core deposits or other liabilities, report the
weighted-average interest rate paid on the liabilities in Column 4. Refer to the calculation of the WAC in
the general instructions to Schedule CMR.
Column 5: Price/Rate #2
Report in Column 5 the weighted-average price as a percentage of par you will receive on the
instruments underlying the commitment. Refer to the calculation of the WAC in the general instructions to
Schedule CMR.
Examples:
Position 1: You have agreed to sell $500,000 of ten-year Treasury securities with a WAC of 9.23
percent at a weighted-average price of 95.39, percent of par.
Positions 2 and 3: You have agreed to sell four branches and the liabilities maintained at those
branches. The branches contain $16 million in core deposits that pay a weighted-average rate of 6.4
percent, and $44 million in other liabilities that pay a WAC of 7.5 percent and have a WARM of 26
months. The agreed upon premium is 2 percent, net of any assets that will change hands in this
transaction. The seller pays $58.8 million, or 98 percent of par, to the buyer for assuming $60 million of
liabilities.
Report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
Position 1
4022
500
Position 2
4024
16 000
Position 3
4026
44 000
[3]
Maturity or
Fees
[4]
Price/Rate
#1
120
9.23
95.39
6.40
98.00
7.50
98.00
26
[5]
Price/Rate
#2
Interest-Rate Swaps
Interest-rate swaps are agreements to exchange streams of coupon payments based on a notional
principal amount. One or both of the coupon payment streams varies with a specified interest rate index.
Aggregation
Report each swap as a separate position.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report the notional principal amount of the swap in Column 2.
Column 3: Maturity or Fees
Report maturity information for both current and forward swaps in Column 3 using the same format. First,
report the effective date of the swap, the date that interest for the first payment of the swap agreement
begins to accrue, in YYMM format. Second, report the maturity date, the date of the last payment of the
swap agreement, also in YYMM format.
For example, for a current swap effective February 21, 1991, and maturing February 21, 2002, report
91020202 in Column 3. For a forward swap effective February 21, 2000, and maturing February 21, 2010,
report 00021002 in Column 3.
For a mortgage swap, report the maturity date of the underlying pool of mortgages, not the date the
agreement terminates.
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Column 4: Price/Rate #1
For fixed-for-floating swaps, report in Column 4 the fixed rate that you either receive or pay.
For basis swaps, report in Column 4 the margin added to, or subtracted from, the index being received as
a positive or negative number, respectively. If there is no margin, leave Column 4 blank.
For mortgage swaps, report in Column 4 the mortgage coupon rate or the pass-through rate that you
either receive or pay.
Column 5: Price/Rate #2
For fixed-for-floating swaps, report in Column 5 the margin added to or subtracted from the index as a
positive or negative number, respectively. If there is no margin, leave Column 5 blank.
For basis swaps, report in Column 5 the margin added to or subtracted from the index being paid as a
positive or negative number, respectively. If there is no margin, leave Column 5 blank.
For mortgage swaps, in Column 5 report the margin as a positive number if it is added to the index that
you receive. Report the margin as a negative number if it is added to the index that you pay.
Examples:
Position 1: You pay a fixed rate of 9.20 percent and receive three-month LIBOR on a $25 million swap
that went into effect in March 1990 and expires in March 2002.
Position 2: You will pay a fixed rate of 9.00 percent and receive six-month LIBOR on a $10 million
forward swap that begins in December 1994 and ends in December 2003.
Position 3: You purchased a $25 million swaption that would begin, if exercised, in June 1993 and
mature in June 2004. The swaption grants the right to pay a fixed rate of 9.5 percent and receive threemonth LIBOR.
Position 4: You pay one-month LIBOR and receive COFI on a $15 million swap that went into effect in
December 1993 and expires in June 2005.
Position 5: You pay one-month LIBOR plus 0.30 percent and receive a mortgage coupon of 10 percent
under a mortgage swap that went into effect September 1990. The notional principal amount of the swap
is $8,235,000 as of the report date. The underlying pool of mortgages matures in September 2015.
You would report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
[3]
Maturity or
Fees
[4]
Price/Rate
#1
Position 1
5004
25 000
90030203
9.20
Position 2
5006
10 000
94120312
9.00
Position 3
5104
25 000
93060406
9.50
Position 4
5062
15 000
93120506
Position 5
5072
8 235
90091509
10.00
[5]
Price/Rate
#2
0.30
Interest-Rate Caps
An interest-rate cap is an option contract that compensates the holder of the cap when a specified
interest-rate index increases above a specified rate (called the cap rate or strike rate). The party that has
purchased the cap is long the cap; while the party that has sold the cap is short the cap.
An interest-rate corridor is an agreement that combines a short position in an interest-rate cap and a long
position in an interest-rate cap. To report corridors, report the two component cap positions separately.
SCHEDULE CMR
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THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
An interest-rate collar is an agreement that combines an interest-rate cap position and an interest-rate
floor position. To report collars, report the component cap and floor positions separately. The instructions
for reporting interest-rate floors, as well as an example of reporting a collar, are below.
Aggregation
Report each interest-rate cap as a separate position.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report the notional principal amount of the cap in Column 2.
Column 3: Maturity or Fees
Report maturity information for both current and forward caps in Column 3 using the same format. First,
report the effective date of the cap (the first exercise date of the cap) in YYMM format. Second, report the
maturity date (the month of the last payment date of the cap), also in YYMM format.
For example, for a cap with its first exercise date on February 21, 1991, and with its last payment date on
February 21, 2001, report 91020102 in Column 3. For a forward cap with first exercise date on February
21, 2000, and last payment date on February 21, 2010, report 00021002 in Column 3.
Column 4: Price/Rate #1
Report the cap rate, or strike rate, in Column 4.
Column 5: Price/Rate #2
Leave Column 5 blank.
Examples:
Position 1: You are long a $10 million cap based on six-month LIBOR with a cap rate of 8.25 percent.
The first exercise date was in November 1993, and it expires in November 1998.
Position 2: You are long a $25 million forward cap based on COFI with a cap rate of 8.5 percent. The
cap’s first exercise date will be in February 1995, and it expires in February 1999.
You would report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
[3]
Maturity or
Fees
[4]
Price/Rate
#1
Position 1
6006
10 000
93119811
8.25
Position 2
6020
25 000
95029902
8.50
[5]
Price/Rate
#2
Interest-Rate Floors
An interest-rate floor is an option contract that compensates the holder of the floor when a specified
interest-rate index decreases below a specified rate – called the floor rate or strike rate. The party that
purchased the floor is long the floor, while the party that sold the floor is short the floor.
Interest-rate collars are agreements that combine interest-rate floor and interest-rate cap positions. The
instructions for reporting interest-rate caps are above. To report collars, report the component cap and
floor positions separately. For an illustration, see the second example below.
Aggregation
Report each interest-rate floor as a separate position.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
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Column 2: Notional Amount
Report the notional principal amount of the floor in Column 2.
Column 3: Maturity or Fees
Report maturity information for both current and forward floors in Column 3 using the same format. First,
report the effective date of the floor (the first exercise date of the floor) in YYMM format. Second, report
the maturity date (the month of the last payment date of the floor), also in YYMM format.
For example, for a floor with its first exercise date on February 21, 1991, and with its last payment date on
February 21, 2001, report 91020102 in Column 3. For a forward floor with first exercise date on February
21, 2000, and last payment date on February 21, 2010, report 00021002 in column 3.
Column 4: Price/Rate #1
Report the floor rate, or strike rate, in Column 4.
Column 5: Price/Rate #2
Leave Column 5 blank.
Examples:
Position 1: You are short (sold) a $10 million floor based on the three-month Treasury rate with a floor
rate of 6 percent. The first exercise date was in October 1993 and it expires in October 1998.
Positions 2 and 3: You entered into a $25 million interest-rate collar where you are long a three-month
LIBOR cap at a strike rate of 8 percent and short a three-month LIBOR floor at a strike rate of five
percent. The first exercise date was in September 1989 and it expires in September 1999. Report the
cap and floor components of the collar separately in positions 2 and 3 below.
You would report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
[3]
Maturity or
Fees
[4]
Price/Rate
#1
Position 1
7038
10 000
93109810
6.00
Position 2
6004
25 000
89099909
8.00
Position 3
7034
25 000
89099909
5.00
[5]
Price/Rate
#2
Futures
A futures contract is an agreement to buy or sell a specified commodity or financial instrument for a
specified price on a specified date. The party that agrees to purchase the instrument is long the futures
contract and the party that agrees to sell the instrument is short the contract.
Futures are exchange-traded contracts. You should not report forward contracts, traded over-the-counter,
as futures. Estimate the market value of the forward contracts in the seven interest rate scenarios
described in the section Reporting of Market Value Estimates as code 500 in Supplemental Reporting
of Market Value Estimates.
Aggregation
Report futures positions with the same contract code and same delivery date as a single position. See
Appendix B for codes. For example, report short positions in Eurodollar futures (code 8046) deliverable in
March separately from those with a June delivery date.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report the notional principal amount of the futures position in Column 2.
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Column 3: Maturity or Fees
Report the delivery date for the futures position in Column 3 in YYMM format.
Column 4: Price/Rate #1
Leave Column 4 blank.
Column 5: Price/Rate #2
Leave Column 5 blank.
Example:
You have the following short futures positions:
1. Eurodollar futures contracts – $1 million notional principal per contract, expiring in March 1996.
2. Eurodollar futures contracts expiring in June 1996.
3. Three-month Treasury bill contracts – $1 million notional principal per contract, expiring in March
1996.
You would report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
[3]
Maturity or
Fees
Position 1
8046
10 000
9603
Position 2
8046
15 000
9606
Position 3
8034
12 000
9603
[4]
Price/Rate
#1
[5]
Price/Rate
#2
Options on Futures
A call option on a futures contract is a contract that grants the buyer of the option the right, but not the
obligation, to acquire a long position in a futures contract at a specified price, the strike price, on a
specified date, the expiration date.
A put option on a futures contract is a contract that grants the buyer the right, but not the obligation, to
acquire a short position in a futures contract at a specified price on a specified date.
You can hold either a long position in a call option or a put option, having bought the option, or a short
position in a call option or a put option, having sold the option. Therefore, you can have any of four
positions in an option on a futures contract:
1.
2.
3.
4.
Long a call option.
Long a put option.
Short a call option.
Short a put option.
Aggregation
Report as a single position all options on futures contracts with the same contract code, strike price, and
expiration date. You must report options on futures positions separately if they have different expiration
dates.
Column 1: Contract Code
Report the contract code for the position in Column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report the notional principal amount of the option position in Column 2.
Column 3: Maturity or Fees
Report the expiration date of the option position in Column 3 in YYMM format.
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Column 4: Price/Rate #1
Report the strike price of the option position in Column 4.
Column 5: Price/Rate #2
Leave Column 5 blank.
Examples:
Positions 1 and 2: You are long 10 put options on Eurodollar futures, $1 million notional principal value
per option contract, at a strike price of 93.00 expiring in March 1995 and 15 put options on Eurodollar
futures contracts, also at a strike price of 93.00, expiring in June 1995.
Position 3: You are short 50 call options on Treasury bond futures contracts, $100,000 notional principal
value per contract, at a strike price of 102.00 expiring in March 1996.
You would report the positions as follows:
[1]
Contract
Code
[2]
Notional
Amount
[3]
Maturity or
Fees
[4]
Price/Rate
#1
Position 1
9040
10 000
9503
93.00
Position 2
9040
15 000
9506
93.00
Position 3
9060
5 000
9603
102.00
[5]
Price/Rate
#2
Construction Loans-in-Process (LIP)
Construction LIP includes the portion of construction loans that you have closed but have not yet
disbursed the proceeds. The funded portion of construction loans is included in the relevant on-balancesheet asset section. Report the undisbursed LIP for both loans reported as construction-only loans and
construction-permanent loans reported as single-family, multifamily, or nonresidential loans.
Report construction LIP where you have specified an interest rate. Include fixed-rate loans and all
adjustable-rate loans that reprice less often than monthly. You should not report agreements where you
determine the rate at the time when you disburse the funds.
If the agreement contains a commitment to provide a mortgage loan upon completion of the construction,
report the mortgage commitment as an optional or firm, as appropriate, commitment to originate a
mortgage in the corresponding sections above. For construction-permanent loans where the permanent
rate has been set, use the construction phase as the WARM for the LIP. Report a firm commitment to
originate a fixed-rate mortgage for the permanent portion of the loan.
Aggregation
Report fixed-rate construction LIP separately from adjustable-rate construction LIP.
Column 1: Contract Code
Enter the contract code for the position in column 1. Refer to Appendix B for the list of codes.
Column 2: Notional Amount
Report in Column 2 the amount of undisbursed funds, that portion of the commitments that have not been
drawn down.
Column 3: Maturity or Fees
For fixed-rate construction-only LIP, report an estimate of the weighted-average term to maturity, in
months. For construction-permanent loans, report an estimate of the term to completion of the
construction phase only; do not include the maturity of the mortgage. For adjustable-rate loans,
use the number of months until the next reset to calculate the WARM. (Note: loans that reset more often
than monthly do not need to be reported on this line).
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Column 4: Price/Rate #1
Report the weighted-average interest rate on the loans in Column 4. Refer to the calculation of the WAC
in the general instructions to Schedule CMR.
Column 5: Price/Rate #2
Leave Column 5 blank.
Example:
You have two fixed-rate construction loan commitments outstanding. On the first commitment, a $1 million
loan with a one-year term that you expect to disburse in approximately four months, for a term to maturity
of 16 months, at an interest rate of 10 percent. On the second, a $2 million loan with an 18-month term
you expect to disburse in approximately two months, for a term to maturity of 20 months, at an interest
rate of 11 percent.
You would report the position as follows:
[1]
Contract
Code
Position 1
9502
[2]
Notional
Amount
[3]
Maturity or
Fees
3 000
19
[4]
Price/Rate
#1
[5]
Price/Rate
#2
10.67
SUPPLEMENTAL REPORTING FOR ASSETS AND
LIABILITIES
INTRODUCTION
This section allows you to report selected assets and liabilities at a more disaggregate level than you
report in the Assets and Liabilities sections of Schedule CMR. For example, if you have adjustable-rate
second mortgage loans tied to different indices, you may report the balances tied to each rate index
separately. We will derive the interest rate risk exposure estimates using this detailed information instead
of the more aggregated data reported for those assets in the other sections. This results in more accurate
market value estimates for the instruments on the supplemental form.
Supplemental reporting is available for the following:
Assets (Optional Reporting)
1. Certain types of loans.
2. Other investment securities of the types on CMR473 and CMR479.
Liabilities (Required Reporting)
1. VRFM liabilities.
Supplemental reporting is also available for OBS positions, as described below.
Each line on the supplemental reporting form for assets and liabilities consists of a balance with a given
asset or liability code, a rate index code, and information describing those balances – margin, coupon,
remaining maturity, etc. Number all lines used to report supplemental information sequentially, with the
first line on the form receiving the number 1 in the column titled Entry #. We describe all other entries in
detail below. If there are insufficient lines on the Supplemental Reporting page to report the different
combinations of instrument and index codes, use as many continuation pages as necessary.
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THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
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SUPPLEMENTAL REPORTING FOR ASSETS (OPTIONAL)
You may report three broad classes of assets on the Supplemental Reporting form:
1. The following types of loans:
a. Adjustable- and fixed-rate multifamily and nonresidential mortgage loans and securities.
b. Adjustable-rate construction and land loans.
c. Adjustable-rate second mortgages.
d. Adjustable-rate commercial loans.
e. Adjustable- and fixed-rate consumer loans.
2. Investments in securities of the types on CMR479, Municipal securities, mortgage-backed bonds,
corporate securities, commercial paper.
Besides a column for the entry number, there are nine input columns on the Supplemental Reporting
form. You will not always use all nine columns, depending on the asset. Below we describe the reporting
for each column for each of the three classes of assets.
Loans
Column 1: Asset Code
Loans where OTS permits supplemental reporting are in Appendix C by Schedule CMR cell number. For
each CMR cell number, you may use one or more codes to represent types of loans in that cell. For
example, CMR335 and CMR336, Adjustable-rate and Fixed-rate Consumer Loans, respectively, may
each be disaggregated into seven asset codes that correspond to different types of consumer loans. For
example, you can report auto loans by entering asset code 183 in column 1 of the first line; education
loans by entering asset code 182 on the next line; etc. Other CMR cell numbers – construction and land
loans, second mortgages, and commercial loans – have only one code each. For those assets, balances
cannot be disaggregated further by loan type, only by index code. See the description of column 2 below.
Column 2: Rate Index Code
From the list of Interest Rate Index Codes in Appendix A, report the code representing the index the
reported loan uses. For example, you could report adjustable-rate auto loans tied to the prime rate with
an asset code of 183 in column 1 and an index code of 830 in column 2. You could report auto loans tied
to the one-year Treasury rate on a separate line with an asset code of 183 and an index code of 312.
Column 3: Balance
Report the outstanding balance of the loan in column 3.
Balances reported for asset codes within a given CMR cell number must sum to the balance reported in
that cell in the Assets sections of Schedule CMR. For example, balances on the Supplemental Reporting
form with asset codes 180 through 189, various types of consumer loans, and index codes designating
adjustable-rate loans, must sum to the balance reported for total adjustable-rate consumer loans on
CMR335. Likewise, the balances with asset codes 180 through 189 and an index code designating fixedrate loans, must sum to CMR336, total fixed-rate consumer loans.
Column 4: Margin/WAC
If the entry represents an adjustable-rate loan, report the weighted-average margin, in basis points, in
column 4. If it is a fixed-rate loan, report the WAC, in basis points, in column 4. Note that this differs from
treatment in the Assets section of Schedule CMR, where the WAC is in percentage points. Report the
net margin or the pass-through rate for adjustable-rate and fixed-rate securities, respectively. We
describe how to calculate the weighted-average margin and the WAC in the general instructions to
Schedule CMR.
Column 5: Rate Reset Frequency
If the loan is adjustable-rate, report the weighted-average frequency where the coupon rate resets, in
months, in column 5. You should calculate the weighted-average frequency of the coupon reset in the
same manner as the WARM, as described in the general instructions to Schedule CMR. However,
SCHEDULE CMR
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THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
instead of months to maturity, use months between coupon reset dates. If the loan is fixed-rate, leave
column 5 blank.
Column 6: Months to Full Amortization
Leave this column blank for all assets except multifamily and nonresidential balloon mortgage loans and
securities – asset codes 100, 105, 106, 107, 108, and 109. For those assets, report the weighted-average
number of months remaining until the balloon mortgage would fully amortize. Calculate this item in the
same manner as described for WARM, in the general instructions to Schedule CMR. However, instead of
months to maturity, use months to full amortization.
Column 7: Remaining Maturity
Report the WARM, in months, in column 7. Calculate the WARM as described in the general instructions
to Schedule CMR. For balloon mortgages, use the number of months until payment of the balloon.
Column 8: Distance to Lifetime Cap
Use this column only for adjustable-rate multifamily and nonresidential mortgage loans and securities,
asset codes 100 through 119. For all other types of loans, leave it blank.
For each asset code, calculate the difference between the WAC and the weighted-average lifetime cap
for the loans or securities in that category. Report the result in column 8, in basis points. For example, for
a WAC of 10 percent and a cap of 12 percent, report a value of 200 basis points. Calculate the WAC as
described in the general instructions to Schedule CMR. Calculate the weighted-average lifetime cap the
same way. For loans and securities that have no lifetime caps, report 9999 in this column.
Column 9: Distance to Lifetime Floor
Use this column only for adjustable-rate multifamily and nonresidential mortgage loans and securities,
asset codes 100 through 119. For all other types of loans, leave it blank.
For each asset code, calculate the difference between the current WAC and the weighted-average
lifetime floor for the loans in that category. Report the result in column 9, in basis points. For example, for
a WAC of 10 percent and a floor of 8 percent, report a value of 200 basis points. For loans and securities
that have no lifetime floor, report 9999 in this column.
Other Investment Securities
You can provide additional information about securities on CMR473 and CMR479. You may distinguish
three different types of instruments – fixed coupon, floating-rate, and inverse floating-rate securities –
using the codes listed in the appropriate sections of Appendix C.
Column 1: Asset Code
Asset codes for reporting supplemental information are in Appendix C. For CMR473, Government and
Agency Securities including SBA securities, applicable asset codes are 300 through 304. For CMR479,
Other Securities – Munis, Mortgage-Backed Bonds, Corporate Securities, Commercial Paper, Etc. –
applicable codes are 120, 122, and 124.
Column 2: Rate Index Code
From the list of Interest Rate Index Codes in Appendix A, report the code representing the index the
security uses. Use code 900 if the security has a fixed coupon.
Column 3: Balance
For each type of security, report the outstanding balance of all securities of that type on CMR473 or
CMR479. The total outstanding balance on the Supplemental Reporting section with asset codes 300
through 304 must equal the amount on CMR473. In addition, the total balance with asset codes 120, 122,
and 124 must equal the amount on CMR479.
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Column 4: Margin/WAC
If the entry represents a floating-rate security, report the margin, in basis points, in column 4. If the
security is a fixed-coupon security, report the coupon, in basis points, in column 4. Note that this differs
from treatment in the Assets section of Schedule CMR, where the coupon is in percentage points.
Column 5: Rate Reset Frequency
If the balance reported in column 3 is floating-rate or inverse floating-rate, report the frequency that the
coupon rate resets, in months, in column 5. If the balance reported in column 3 is fixed-coupon, leave
column 5 blank.
Column 6:
Leave this column blank.
Column 7: Remaining Maturity
Report the remaining maturity, in months, in column 7.
Column 8:
Use this column only for reporting the benchmark rate (in basis points) of inverse floating-rate securities.
For example, if you derive the coupon of such a security using the formula 17.5 minus six-month LIBOR,
the benchmark rate is 17.5, and you should report it as 1750 basis points in column 8. For all other types
of securities, leave this column blank.
Column 9:
Leave this column blank.
SUPPLEMENTAL REPORTING FOR LIABILITIES (REQUIRED)
Report variable-rate, fixed-maturity liabilities in the section, Supplemental Reporting for Assets and
Liabilities.
Include liabilities of the following types that have contractually stated maturities and indexed rates:
1.
2.
3.
4.
5.
6.
7.
8.
9.
Certificates of deposit.
FHLB advances.
Commercial bank loans.
Repurchase agreements.
Retail repurchase agreements.
Commercial paper issued.
Subordinated debt.
Redeemable preferred stock.
All other borrowings.
Do not include:
1. Mortgage collateralized securities. Report on Supplemental Reporting of Market Value Estimates.
2. Structured borrowings. Report on Supplemental Reporting of Market Value Estimates.
General Instructions:
Report information about your VRFM liabilities as follows:
Assign liability and index codes to each VRFM liability that you issue, using the lists of codes in
Appendix D and Appendix A, respectively. For example, each variable-rate FHLB advance indexed to
the Fed Funds rate would have the liability code 220, the code for FHLB advances, and the index
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code 800 (the code that shows that the interest rate on the advances uses the Fed Funds rate as an
index). Report each VRFM liability you issue using either one of two ways:
A. Individually – This option produces a very accurate valuation, but it might require the
reporting of a large amount of data.
B. Aggregated with similar liabilities – This option produces somewhat less accurate
valuations, but it requires the reporting of a smaller amount of data.
1. If you choose the individual option, supply the required information – liability code, index code,
balance, margin, rate reset frequency, months to reset, and remaining maturity – for each VRFM
liability issued that you report individually. For example, you would report each FHLB advance
described in the example above individually.
2. If you choose the aggregated option, report VRFM liabilities on the Supplemental Reporting Form
aggregated by liability and index code. Thus, you would report all VRFM liabilities that have the same
liability and index code aggregated as a single position. For example, you would report all FHLB
advances described in the preceding example together as a single position regardless of differences
in margin, rate reset frequency, months to next reset, or remaining maturity.
Entry Number
Number all lines used to report supplemental information, starting with the number 1.
Column 1: Liability Code
The liability code is a three-digit code that denotes the type of liability reported. The codes are included in
Appendix D – List of Codes Used for Supplemental Reporting.
Column 2: Rate Index Code
The index code is a three-digit code that describes the index of the VRFM liability reported. The codes
are in Appendix A, List of Interest Rate Index Codes.
Column 3: Balance
If you choose option A, report the outstanding balance of each individual VRFM liability. If you choose
option B, report the total outstanding balance of that position. In either case, do not report the carrying
values.
Column 4: Margin in Basis Points
The margin of a variable rate liability is the amount added to the index rate to derive the coupon rate. If
you choose option A, report the margin, in basis points, of each individual VRFM liability.
If you choose option B, report the weighted-average margin for each position. See the general
instructions to Schedule CMR.
Column 5: Rate Reset Frequency
If you choose option A, report the index rate reset frequency, in months, of each individual VRFM liability.
If you choose option B, calculate the weighted-average rate reset frequency for each position by
multiplying the reset frequency of each liability expressed in months by the ratio of that liability’s balance
to the position’s total balance. Calculate the weighted-average rate reset frequency for each position. See
the general instructions to Schedule CMR.
Column 6: Months to Next Reset
If you choose option A, report the number of months until the next index rate reset for each individual
VRFM liability.
If you choose option B, calculate the weighted-average months to next reset for each position. To do this,
multiply the number of months until next reset for each liability by the ratio of that liability’s balance to the
position’s total balance. Calculate the weighted-average months to next reset for each position. See the
general instructions to Schedule CMR. Round the weighted-average months to next reset to the nearest
month.
Column 7: Remaining Maturity
If you choose option A, report the remaining maturity, in months, of each individual VRFM liability.
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If you choose option B, calculate the WARM for each position. To do this, multiply the remaining maturity
of each liability expressed in months by the ratio of that liability’s balance to the position’s total balance.
Calculate the weighted-average remaining term for each position. See the general instructions to
Schedule CMR.
Column 8:
Leave this column blank for all VRFM liabilities.
Column 9:
Leave this column blank for all VRFM liabilities.
SUPPLEMENTAL REPORTING OF MARKET VALUE
ESTIMATES
To calculate the market value of some of the assets, liabilities, and financial derivatives and OBS
instruments that you hold, we need more information than is feasible to collect on Schedule CMR. This
section of Schedule CMR collects your own estimates of the market values of certain instruments in each
of the seven interest rate scenarios shown in the Interest Rate Risk Exposure Report that we produce
each quarter. We combine the estimates you report with the market value estimates calculated by the
OTS Model to evaluate your exposure to interest rate changes.
You must report market value estimates if you have the following types of financial instruments:
1. Financial derivatives and OBS contracts that you cannot identify by a contract code. For instance,
CMO swaps.
2. Mortgage-derivative securities.
3. Complex securities. If you have complex securities, you must report market value estimates for those
securities. Common types of complex securities include structured securities, such as step-up bonds,
index-amortizing notes, dual index notes, de-leveraged bonds, range bonds, and inverse floaters.
4. Structured Borrowings.
Moreover, you have the option to report market value estimates for collateralized mortgage securities you
issue and for mortgage-related mutual funds.
If you report your own estimates for a given type of instrument, you should do so consistently across
quarters. If you do not report market value estimates, you should leave the cells blank.
Reporting Guidelines
When estimating the market values for this section, you should use the same methodology you use in
your TB 13a analyses. First, calculate the base case market value of each instrument in the current
interest rate environment. Then calculate market value estimates in the six shocked interest rate
scenarios – the plus and minus 100, 200, and 300 basis point shocks described in TB 13a – by assuming
parallel shifts in the term structure of interest rates. In periods of low interest rates, it is possible that the
simulation of the - 300 interest rate scenario could result in negative interest rates. To avoid this
possibility, you should set a floor of ten basis points for all interest rates when performing your own
simulations.
Assumptions used in the calculations must be reasonable and consistent with the analysis you perform to
satisfy TB 13a. Your prepayment assumptions should relate reasonably to market consensus in the
current interest rate scenario. In the six shocked scenarios, prepayment assumptions should reflect
changes likely to occur in prepayment rates under each interest rate shock. If you perform the valuation
by estimating the present value of future cash flows, both the discount rates and expected future cash
flows should reflect the current yield curve or that or similar instruments in the current rate scenario. In the
shocked scenarios, discount rates and expected future cash flows should reflect likely changes that would
occur under each shock.
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To evaluate an institution’s market value estimates, OTS examiners will, at a minimum, determine
whether the institution:
1. Uses zero-coupon (spot) rates of the appropriate maturities to discount cash flows.
2. Uses implied forward interest rates to model variable rate cash flows.
3. Values embedded options using appropriate option valuation methodology, e.g., Black-Scholes
type formulas, Monte-Carlo simulations, lattice methods, etc.
Examiners may determine an institution should use more sophisticated measurement techniques to
address specific supervisory concerns (e.g., high volume and price sensitivity of a group of structured
advances; the institution’s results may materially misstate the level of risk; a combination of low Postshock NPV Ratio and high Sensitivity Measure; etc.). In any case, the institution should be very familiar
with the details of the assumptions, term structure, and logic used in performing the measurements.
Measures obtained from either a third party or from an FHLB originating a structured FHLB advance may,
therefore, not always be adequate.
Report the following type of instruments on the Supplemental Reporting of Market Value Estimates.
Market Value Estimates of Financial Derivatives and Off-BalanceSheet Contracts
Report an estimate of the market value of financial derivatives and OBS contracts according to the
instructions for either case 1 or case 2 below.
Case 1: You hold financial derivatives and OBS contract(s) that do not have contract codes listed in the
instructions. In such instances, report market value estimates for those contracts, in each of the seven
interest rate scenarios listed, using contract code 500, from Appendix D, on the Supplemental Reporting
of Market Value Estimates.
Case 2: You have more than 16 financial derivatives and OBS contract positions and have chosen to
provide your own market value estimates of the additional positions instead of reporting them in the
section, Supplemental Reporting for Financial Derivatives and OBS Positions. See Reporting More Than
16 OBS Positions in the section Off-Balance-Sheet Contracts. In such instances, you must report the
estimated aggregate market value of the additional positions in each of the seven interest rate scenarios
listed on the Supplemental Reporting of Market Value Estimates using contract code 500 from Appendix
D.
You may also include estimates of the market value of loan servicing rights other than single-family first
mortgages; for instance, servicing of commercial real estate, second mortgages, home equity loans, auto
loans, credit cards, etc.
Market Value Estimates of Mortgage Derivative Securities
Reporting Information: Report the estimated aggregate market value of mortgage-derivative securities
in each of the seven interest rate scenarios. This is in addition to the general requirement that you report
the recorded investment of these securities on CMR351 through CMR376 as described in MortgageDerivative Securities in the Assets section.
You must report the market value of all CMOs, residuals, stripped MBS, and CMO swaps under the seven
interest rate scenarios on the Supplemental Reporting of Market Value Estimates using asset code 123
found in Appendix D. In valuing floating-rate CMOs, on CMR351 and CMR352, you should use a
methodology that accomplishes the following:
1. Values the cap and floor of the floater.
2. Discounts cash flows using the zero-coupon Treasury curve and a spread to the curve.
CEO Memo 55, dated April 30, 1996 contains a detailed description of a methodology that incorporates
these two requirements. The memo is available on OTS’s web site, www.ots.treas.gov.
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Use of Information:
When calculating your Interest Rate Risk Report, the OTS Model will use market
value estimates of mortgage derivatives if you report them. If you have such derivatives but do not report
market value estimates, the OTS Model will estimate market values using values of similar instruments as
proxies.
Market Value Estimates of Complex Securities
Reporting Information: If you report any complex securities you must report the estimated aggregate
market value of those securities in each of the seven interest rate scenarios using contract code 121 from
Appendix D.
Use of Information: When producing your Interest Rate Risk Exposure Report, the OTS Model will
include in NPV the market value estimates of these securities.
Market Value Estimates of Structured Borrowings
For the purpose of these instructions, structured borrowings include borrowings and Federal Home Loan
Bank (FHLB) advances with embedded options or derivative-like features where the advance’s coupon,
average life, and redemption value are dependent on a reference rate, an index, or a formula. Structured
borrowings include, but are not limited to, putable and callable advances, variable rate advances with
embedded caps, floors, or collars, step-up variable rate advances and amortizing advances. The amounts
you enter in the rate shock scenarios are the estimated market values of the contract after the rate
change. See Appendix D, codes 280 through 290, for a detailed description of structured borrowings
whose market value estimates you report on Supplemental Reporting of Market Value Estimates.
The important contractual terms used in classifying these positions are 1) who owns (has the right to
exercise) the option, and 2) the type of option. The type of option is classified using standard option
terminology, i.e., the owner of a call has the right to buy at the exercise price, and the owner of a put has
the right to sell at the exercise price. Standard option terminology is not always consistent with the
terminology used in marketing these instruments.
For example, with a putable advance, an FBLB effectively purchases a put option from the borrowing
member. This put option provides the FHLB with the right to terminate the advance and offer alternative
credit on new terms if interest rates increase. An advance with these terms would have position code 280.
The terminology on these products may be an issue since some FHLBs call putable advances putable
advances, and other FHLBs call them callable advances. From the perspective of standard option
terminology callable is not the proper term for this instrument, since the FHLB has the right to sell (put)
the advance back to the member when interest rates increase and the value of the debt has fallen.
A callable advance in standard option terminology allows the member to prepay the advance. The
position code for this contract is 282. If the advance allowed the FHLB to convert the advance from fixed
to floating rate, the advance would be termed a convertible advance and would have position code 281.
A similar, but more complicated advance is the periodic floating rate advance. In this advance the interest
rate floats by being periodically reset to LIBOR. However, the member effectively sells a floor to the
FHLB, which limits the reduction in interest payments when LIBOR decreases. The position code for this
advance is 283.
Market Value Estimates of Mortgage-Related Mutual Funds (Optional)
Reporting Information: If you report mortgage-related mutual funds on CMR584, you may use code
129 from Appendix D to report the estimated aggregate market value estimates of those mutual funds in
each of the seven interest rate scenarios.
Use of Information: When producing your Interest Rate Exposure Report, the OTS NPV model will use
the market value estimate you provide for these mutual funds.
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Market Value Estimates of Collateralized Mortgage Securities Issued
(Optional)
Reporting Information: Report only those collateralized mortgage securities issued that you do not
record as sales in accordance with FASB Statement No. 140, Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities. Report information on collateralized mortgage
securities issued in two places: one mandatory, the other optional:
1. Report the book value of CMOs and other collateralized mortgage securities issued on CMR785.
Balances on CMR785 should not be on CMR678 through CMR706.
2. At your option, you may use code 210 to report your estimate of the value of the collateralized
mortgage securities issued, in each of seven interest rate scenarios listed on the Supplemental
Reporting of Market Value Estimates.
Reporting Guidelines
Report positions in the Supplemental Reporting of Market Value Estimates as follows:
Column 1: Entry Number
Number all lines used to report supplemental market value information, starting with the number 1.
Column 2: Position Code
The position code is a 3-digit code that denotes the type of instrument reported. The codes are included
in Appendix D.
Column 3: Balance
Report the outstanding balance for each position whose market value estimates are reported in Column 3
through Column 9. For zero-coupon instruments, report the recorded investment, which is the amortized
value of the investment.
Column 4 through Column 10: Estimated Market Value After Specified Rate Shock
Report the estimate of the market value in each of the following interest rates scenarios: -300 basis
points, -200bp, -100bp, No Change, +100bp, +200bp, +300bp, respectively.
SUPPLEMENTAL REPORTING FOR DERIVATIVES AND OFFBALANCE-SHEET POSITIONS
In this section, you may report supplemental information about OBS contracts as described in Reporting
More Than 16 OBS Positions in the section Off-Balance-Sheet Contracts. If you have more than 16 OBS
positions, you may report those positions in the same manner that you reported the initial 16 positions on
the continuation page Supplemental Reporting for Financial Derivatives and OBS Positions.
To report positions using supplemental pages, number the positions sequentially in the column Entry #,
beginning with number 1 for the first position on the first supplemental page. The same instructions in the
section Off-Balance-Sheet Contracts used to report the initial 16 positions apply. Use as many
continuation pages as necessary to report the remaining positions.
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APPENDIX A
LIST OF INTEREST RATE INDEX CODES
Code Index
303
306
312
324
336
360
370
380
3-month Treasury security
6-month Treasury security
1-year Constant Maturity Treasury
2-year Constant Maturity Treasury
3-year Constant Maturity Treasury
5-year Constant Maturity Treasury
7-year Constant Maturity Treasury
10-year Constant Maturity Treasury
401
403
406
412
431
1-month London Interbank Offered Rate (LIBOR)
3-month London Interbank Offered Rate (LIBOR)
6-month London Interbank Offered Rate (LIBOR)
1-year London Interbank Offered Rate (LIBOR)
FannieMae LAMA Index (to be used for liabilities only)
503
506
512
524
536
548
560
3-month FHLB advance rate
6-month FHLB advance rate
1-year FHLB advance rate
2-year FHLB advance rate
3-year FHLB advance rate
4-year FHLB advance rate
5-year FHLB advance rate
603
606
612
660
3-month fixed-rate CD rate
6-month fixed-rate CD rate
1-year fixed-rate CD rate
5-year fixed-rate CD rate
710
720
FHLMC/FNMA 30-year, fixed-rate mortgage commitment rate
National Average Contract Rate for the Purchase of Previously
Occupied Homes
800
811
812
820
830
Federal funds rate
11th District FHLB Cost-of-Funds Index (COFI)
Lender’s own Cost-of-Funds
Federal Cost-of-Funds Index
Prime rate
900
910
911
Fixed-rate
Rate adjusted at lender’s discretion
Any other index
APPENDIX A - SCHEDULE CMR
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APPENDIX B
LIST OF CONTRACT CODES FOR OBS CONTRACTS
You should use the following list of codes to report OBS contracts.
Contract Codes for Optional Commitments to Originate Mortgages
1002
1004
1006
1008
1010
1012
1014
1016
1-month COFI ARMs
6-month or 1-year COFI ARMs
6-month or 1-year Treasury or LIBOR ARMs
3-year or 5-year Treasury ARMs
5-year or 7-year Balloon or 2-step mortgages
10-year, 15-year, or 20-year FRMs
25-year or 30-year FRMs
all other mortgages
Contract Codes for Firm Commitments to Purchase, Sell, or Originate Mortgages
Firm Commitments to Purchase or Sell Mortgage Loans, Servicing Retained
If the commitment is transacted on a servicing retained basis – the seller will continue to be responsible
for servicing the loans following the sale – use the following contract codes. Note that typically
commitments to purchase or sell mortgages, including mandatory forward sales are transacted on a
servicing retained basis, not on a servicing released basis.
2002
2004
2006
2008
2010
2012
2014
2016
2022
2024
2026
2028
2030
2032
2034
2036
purchase 1-month COFI ARM loans, servicing retained
purchase 6-month or 1-year COFI ARM loans, servicing retained
purchase 6-month or 1-year Treasury or LIBOR ARM loans, servicing retained
purchase 3-year or 5-year Treasury ARM loans, servicing retained
purchase 5-year or 7-year Balloon or 2-step mortgage loans, servicing retained
purchase 10-year, 15-year, or 20-year FRM loans, servicing retained
purchase 25-year or 30-year FRM loans, servicing retained
purchase all other mortgage loans, servicing retained
sell 1-month COFI ARM loans, servicing retained
sell 6-month or 1-year COFI ARM loans, servicing retained
sell 6-month or 1-year Treasury or LIBOR ARM loans, servicing retained
sell 3-year or 5-year Treasury ARM loans, servicing retained
sell 5-year or 7-year Balloon or 2-step mortgage loans, servicing retained
sell 10-year, 15-year, or 20-year FRM loans, servicing retained
sell 25-year or 30-year FRM loans, servicing retained
sell all other mortgage loans, servicing retained
Firm Commitments to Purchase or Sell Mortgage Loans, Servicing Released
If the commitment is transacted on a servicing released basis – the purchaser will be responsible for
servicing the loans – use the following contract codes:
2102
2104
2106
2108
2110
purchase 1-month COFI ARM loans, servicing released
purchase 6-month or 1-year COFI ARM loans, servicing released
purchase 6-month or 1-year Treasury or LIBOR ARM loans, servicing released
purchase 3-year or 5-year Treasury ARM loans, servicing released
purchase 5-year or 7-year Balloon or 2-Step mortgage loans, servicing released
APPENDIX B - SCHEDULE CMR
2003
MARCH 2010
2112
2114
2116
2122
2124
2126
2128
2130
2132
2134
2136
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
purchase 10-year, 15-year, or 20-year FRM loans, servicing released
purchase 25-year or 30-year FRM loans, servicing released
purchase all other mortgage loans, servicing released
sell 1-month COFI ARM loans, servicing released
sell 6-month or 1-year COFI ARM loans, servicing released
sell 6-month or 1-year Treasury or LIBOR ARM loans, servicing released
sell 3-year or 5-year Treasury ARM loans, servicing released
sell 5-year or 7-year Balloon or 2-Step mortgage loans, servicing released
sell 10-year, 15-year, or 20-year FRM loans, servicing released
sell 25-year or 30-year FRM loans, servicing released
sell all other mortgage loans, servicing released
Firm Commitments to Purchase or Sell MBS
2042
2044
2046
2048
2050
2052
2054
2056
2062
2064
2066
2068
2070
2072
2074
2076
purchase 1-month COFI ARM MBS
purchase 6-month or 1-year COFI ARM MBS
purchase 6-month or 1-year Treasury or LIBOR ARM MBS
purchase 3-year or 5-year Treasury ARM MBS
purchase 5-year or 7-year Balloon or 2-step MBS
purchase 10-year, 15-year, or 20-year FRM MBS
purchase 25-year or 30-year FRM MBS
purchase all other MBS
sell 1-month COFI ARM MBS
sell 6-month or 1-year COFI ARM MBS
sell 6-month or 1-year Treasury or LIBOR ARM MBS
sell 3-year or 5-year Treasury ARM MBS
sell 5-year or 7-year Balloon or 2-step MBS
sell 10-year, 15-year, or 20-year FRM MBS
sell 25-year or 30-year FRM MBS
sell all other MBS
Firm Commitments to Originate Mortgage Loans
2202
2204
2206
2208
2210
2212
2214
2216
originate 1-month COFI ARM loans
originate 6-month or 1-year COFI ARM loans
originate 6-month or 1-year Treasury or LIBOR ARM loans
originate 3-year or 5-year Treasury ARM loans
originate 5-year or 7-year Balloon or 2-Step mortgage loans
originate 10-year, 15-year, or 20-year FRM loans
originate 25-year or 30-year FRM loans
originate all other mortgage loans
Firm Commitments to Purchase or Sell Mortgage Derivative Products (MDPs)
2081
2082
2083
2084
2086
2088
purchase low-risk floating-rate MDPs
purchase low-risk fixed-rate MDPs
sell low-risk floating-rate MDPs
sell low-risk fixed-rate MDPs
purchase high-risk MDPs
sell high-risk MDPs
Contract Codes for Optional Commitments to Purchase or Sell Mortgages and
MBS
Long Options to Purchase Mortgages and MBS (Long Calls)
3002
2004
long the option to purchase 1-month COFI ARMs
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3004
3006
3008
3010
3012
3014
3016
MARCH 2010
long the option to purchase 6-month or 1-year COFI ARMs
long the option to purchase 6-month or 1-year Treasury or LIBOR ARMs
long the option to purchase 3-year or 5-year Treasury ARMs
long the option to purchase 5-year or 7-year Balloon or 2-step mortgages
long the option to purchase 10-year, 15-year, or 20-year FRMs
long the option to purchase 25-year or 30-year FRMs
long the option to purchase all other mortgages
Long Options to Sell Mortgages and MBS (Long Puts)
3022
3024
3026
3028
3030
3032
3034
3036
long the option to sell 1-month COFI ARMs
long the option to sell 6-month or 1-year COFI ARMs
long the option to sell 6-month or 1-year Treasury or LIBOR ARMs
long the option to sell 3-year or 5-year Treasury ARMs
long the option to sell 5-year or 7-year Balloon or 2-step mortgages
long the option to sell 10-year, 15-year, or 20-year FRMs
long the option to sell 25-year or 30-year FRMs
long the option to sell all other mortgages
Short Options to Purchase Mortgages and MBS (Short Calls)
3042
3044
3046
3048
3050
3052
3054
3056
short the option to purchase 1-month COFI ARMs
short the option to purchase 6-month or 1-year COFI ARMs
short the option to purchase 6-month or 1-year Treasury or LIBOR ARMs
short the option to purchase 3-year or 5-year Treasury ARMs
short the option to purchase 5-year or 7-year Balloon or 2-step mortgages
short the option to purchase 10-year, 15-year, or 20-year FRMs
short the option to purchase 25-year or 30-year FRMs
short the option to purchase all other mortgages
Short Options to Sell Mortgages and MBS (Short Puts)
3062
3064
3066
3068
3070
3072
3074
3076
short the option to sell 1-month COFI ARMs
short the option to sell 6-month or 1-year COFI ARMs
short the option to sell 6-month or 1-year Treasury or LIBOR ARMs
short the option to sell 3-year or 5-year Treasury ARMs
short the option to sell 5-year or 7-year Balloon or 2-step mortgages
short the option to sell 10-year, 15-year, or 20-year FRMs
short the option to sell 25-year or 30-year FRMs
short the option to sell all other mortgages
APPENDIX B - SCHEDULE CMR
2005
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Contract Codes for Commitments to Purchase, Originate or Sell Nonmortgage
Financial Assets and Liabilities
For purposes of reporting, core deposits are defined as transaction accounts, money market deposit
accounts, passbook accounts, and non-interest-bearing demand deposits.
4002
4004
4006
4022
4024
4026
purchase or originate nonmortgage financial assets
purchase core deposits
purchase all other liabilities
sell nonmortgage financial assets
sell core deposits
sell all other liabilities
Contract Codes for Interest-Rate Swaps
We have divided the codes for swaps into three groups: fixed-for-floating swaps, basis swaps, and
mortgage swaps. We have not listed codes for LIBOR-for-COFI basis swaps because the value of this
type of swap does not change substantially when the yield curve changes in a parallel fashion. Special
reporting instructions for swaptions and amortizing swaps appear below the list of codes.
CMO swaps are reported with Mortgage Derivative Securities. See Mortgage Derivative Securities in
Section II, Assets.
If the institution holds a type of interest rate swap that is not contained in this list, the contract should be
reported on Supplemental Reporting of Market Value Estimates, using code 500 from Appendix D.
See Market Value Estimates of OBS Contracts in Section V, Reporting of Market Value Estimates, for
reporting instructions.
Fixed-for-Floating Swaps
5002
5004
5006
5008
5010
5012
5014
5016
5018
5020
5022
5024
5026
5028
5030
5032
5034
5036
5038
5040
5042
5044
pay fixed, receive 1-month LIBOR
pay fixed, receive 3-month LIBOR
pay fixed, receive 6-month LIBOR
pay fixed, receive COFI
pay fixed, receive 3-month Treasury
pay fixed, receive 1-Year Treasury
pay fixed, receive 3-year Treasury
pay fixed, receive 5-year Treasury
pay fixed, receive 7-year Treasury
pay fixed, receive 10-year Treasury
pay fixed, receive the prime rate
pay 1-month LIBOR, receive fixed
pay 3-month LIBOR, receive fixed
pay 6-month LIBOR, receive fixed
pay COFI, receive fixed
pay 3-month Treasury, receive fixed
pay 1-Year Treasury, receive fixed
pay 3-year Treasury, receive fixed
pay 5-year Treasury, receive fixed
pay 7-year Treasury, receive fixed
pay 10-year Treasury, receive fixed
pay the prime rate, receive fixed
Basis Swaps
5052
5054
5056
5058
2006
pay COFI, receive 1-month LIBOR
pay COFI, receive 3-month LIBOR
pay COFI, receive 6-month LIBOR
pay COFI, receive 3-month Treasury
APPENDIX B - SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
5060
5062
5064
5066
5068
5069
MARCH 2010
pay 1-month LIBOR, receive 1-year Treasury
pay 1-month LIBOR, receive COFI
pay 3-month LIBOR, receive COFI
pay 6-month LIBOR, receive COFI
pay 3-month Treasury, receive COFI
pay 1-year Treasury, receive 1-month LIBOR
Mortgage Swaps
5572
pay 1-month LIBOR, receive MBS coupon
5574
pay 3-month LIBOR, receive MBS coupon
5576
pay 6-month LIBOR, receive MBS coupon
5582
pay MBS coupon, receive 1-month LIBOR
5584
pay MBS coupon, receive 3-month LIBOR
5586
pay MBS coupon, receive 6-month LIBOR
A swaption is an option on a swap. Swaptions are reported in the following manner: replace the first two
digits of the contract codes listed above with 51 for a long position in the swaption – the institution has
purchased the swaption – or 52 for a short position in the swaption – the institution has sold the swaption.
For example, the contract code for a long swaption position where the institution would pay a fixed rate
and receive 3-month LIBOR is 5104.
The OTS model only values swaptions on fixed-for-LIBOR, 1-, 3-, and 6-month indices, fixed-for-COFI,
and fixed-for-3-month Treasury coupons. These swaptions correspond to codes 5102 through 5110, 5124
through 5132, 5202 through 5210, and 5224 through 5232. If you hold a swaption that is not contained in
this list, you should report the on Supplemental Reporting of Market Value Estimates. See Market
Value Estimates of OBS Contracts in Section V, Reporting of Market Value Estimates, for reporting
instructions.
An amortizing swap is a swap on which the notional amount amortizes over time. You report amortizing
swaps by replacing the first two digits of the contract codes listed above with 55. For example, the
contract code for an amortizing swap where the institution pays COFI and receives 1-month LIBOR is
5552. Because mortgage swaps are amortizing swaps, their contract codes begin with 55.
Contract Codes for Interest-Rate Caps
6002
6004
6006
6008
6010
6012
6014
6016
6018
6020
6022
6032
6034
6036
6038
6040
6042
6044
6046
6048
6050
6052
long a cap on 1-month LIBOR
long a cap on 3-month LIBOR
long a cap on 6-month LIBOR
long a cap on the 3-month Treasury
long a cap on the 1-year Treasury
long a cap on the 3-year Treasury
long a cap on the 5-year Treasury
long a cap on the 7-year Treasury
long a cap on the 10-year Treasury
long a cap on COFI
long a cap on the prime rate
short a cap on 1-month LIBOR
short a cap on 3-month LIBOR
short a cap on 6-month LIBOR
short a cap on the 3-month Treasury
short a cap on the 1-year Treasury
short a cap on the 3-year Treasury
short a cap on the 5-year Treasury
short a cap on the 7-year Treasury
short a cap on the 10-year Treasury
short a cap on COFI
short a cap on the prime rate
APPENDIX B - SCHEDULE CMR
2007
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
If you hold a cap on which the notional amount is amortizing, an amortizing cap, you should report the
contract on Supplemental Reporting of Market Value Estimates. See Market Value Estimates of
OBS Contracts in Section V, Reporting of Market Value Estimates, for reporting instructions.
Contract Codes for Interest-Rate Floors
7002
long a floor on 1-month LIBOR
7004
long a floor on 3-month LIBOR
7006
long a floor on 6-month LIBOR
7008
long a floor on the 3-month Treasury
7010
long a floor on the 1-year Treasury
7012
long a floor on the 3-year Treasury
7014
long a floor on the 5-year Treasury
7016
long a floor on the 7-year Treasury
7018
long a floor on the 10-year Treasury
7020
long a floor on COFI
7022
long a floor on the prime rate
7032
short a floor on 1-month LIBOR
7034
short a floor on 3-month LIBOR
7036
short a floor on 6-month LIBOR
7038
short a floor on the 3-month Treasury
7040
short a floor on the 1-year Treasury
7042
short a floor on the 3-year Treasury
7044
short a floor on the 5-year Treasury
7046
short a floor on the 7-year Treasury
7048
short a floor on the 10-year Treasury
7050
short a floor on COFI
7052
short a floor on the prime rate
If the institution holds a floor on which the notional amount is amortizing, an amortizing floor, you should
report the contract should be reported on Supplemental Reporting of Market Value Estimates. See
Market Value Estimates of OBS Contracts in Section V, Reporting of Market Value Estimates, for
reporting instructions.
Contract Codes for Futures
8002
8004
8006
8008
8010
8012
8014
8016
8018
8020
8032
8034
8036
8038
8040
8042
8044
8046
8048
8050
2008
long 30-day interest rate
long 3-month Treasury bill
long 2-year Treasury note
long 5-year Treasury note
long 10-year Treasury note
long Treasury bond
long 1-month LIBOR
long 3-month Eurodollar
long 3-year Swap
long 5-year Swap
short 30-day interest rate
short 3-month Treasury bill
short 2-year Treasury note
short 5-year Treasury note
short 10-year Treasury note
short Treasury bond
short 1-month LIBOR
short 3-month Eurodollar
short 3-year Swap (Self-value using code 500)
short 5-year Swap (Self-value using code 500)
APPENDIX B - SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
Contract Codes for Options on Futures
Long Call Options
9002
9004
9006
9008
9010
9012
9014
9016
long call, 30-day interest rate futures
long call, 3-month Treasury bill futures
long call, 2-year Treasury note futures
long call, 5-year Treasury note futures
long call, 10-year Treasury note futures
long call, Treasury bond futures
long call, 1-month LIBOR futures
long call, 3-month Eurodollar futures
Long Put Options
9026
9028
9030
9032
9034
9036
9038
9040
long put, 30-day interest rate futures
long put, 3-month Treasury bill futures
long put, 2-year Treasury note futures
long put, 5-year Treasury note futures
long put, 10-year Treasury note futures
long put, Treasury bond futures
long put, 1-month LIBOR futures
long put, 3-month Eurodollar futures
Short Call Options
9050
9053
9054
9056
9058
9060
9062
9064
short call, 30-day interest rate futures
short call, 3-month Treasury bill futures
short call, 2-year Treasury note futures
short call, 5-year Treasury note futures
short call, 10-year Treasury note futures
short call, Treasury bond futures
short call, 1-month LIBOR futures
short call, 3-month Eurodollar futures
Short Put Options
9074
9076
9078
9080
9082
9084
9086
9088
short put, 30-day interest rate futures
short put, 3-month Treasury bill futures
short put, 2-year Treasury note futures
short put, 5-year Treasury note futures
short put, 10-year Treasury note futures
short put, Treasury bond futures
short put, 1-month LIBOR futures
short put, 3-month Eurodollar futures
Contract Codes for Construction LIP
9502
9512
fixed-rate
adjustable-rate
APPENDIX B - SCHEDULE CMR
2009
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MARCH 2010
APPENDIX C
LIST OF ASSET CODES FOR SUPPLEMENTAL REPORTING
CMR
Line
Asset
Asset Type Code
Multifamily and Nonresidential Mortgage Loans and Securities
Adjustable-Rate
CMR261
CMR262
Balloon Mortgage Loans
Coupon Within 300 bp of Lifetime Cap
Coupon More Than 300 bp From Lifetime Cap
With No Lifetime Cap
Balloon Mortgage Securities
Coupon Within 300 bp of Lifetime Cap
Coupon More Than 300 bp From Lifetime Cap
With No Lifetime Cap
Fully Amortizing Mortgage Loans
Coupon Within 300 bp of Lifetime Cap
Coupon More Than 300 bp From Lifetime
With No Lifetime Cap
Fully Amortizing Mortgage Securities
Coupon Within 300 bp of Lifetime Cap
Coupon More Than 300 bp From Lifetime Cap
With No Lifetime Cap
100
105
106
107
108
109
110
115
116
117
118
119
Fixed-Rate
CMR281
Balloon Mortgage Loans
Balloon Mortgage Securities
125
126
CMR282
Fully Amortizing Mortgage Loans
Fully Amortizing Mortgage Securities
127
128
CMR291
Construction & Land Loans – adjustable-rate
130
CMR311
Second Mortgage – adjustable-rate
140
APPENDIX C - SCHEDULE CMR
2011
MARCH 2010
CMR
Line
Asset Type Code
CMR325
Commercial Loans – adjustable-rate
150
CMR335
or
CMR336
Consumer Loans – fixed- or adjustable-rate:
Loans on Deposits
Unsecured Home Improvement Loans
Education Loans
Auto Loans and Leases
Mobile Home Loans
Credit Cards
Recreational Vehicle Loans
Other Type of Consumer Loans
180
181
182
183
184
185
187
189
CMR473
Government & Agency Securities:
Fixed-Coupon Securities
Floating-Rate Securities
Inverse Floating-Rate Securities
300
302
304
Other Investment Securities:
Fixed-Coupon Securities
Floating-Rate Securities
Inverse Floating-Rate Securities
120
122
124
CMR479
2012
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Asset
APPENDIX C - SCHEDULE CMR
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
APPENDIX D
LIST OF CODES FOR SUPPLEMENTAL REPORTING
Code
Position
1211
Market value estimates of complex securities, other than mortgage derivative securities
1231
Market value estimates of mortgage derivatives
1291
Market value estimates of mortgage-related mutual funds
2002
Terms and conditions of variable-rate, fixed-maturity certificates of deposit
2101
Market value estimates of collateralized mortgage obligations issued
2202
Terms and conditions of variable-rate, fixed-maturity FHLB advances, other than those
reported below
2801
Market value estimates of FHLB putable advance. Putable advances are advances
that the issuing FHLB, at its discretion, may terminate and require the borrowing
institution to repay at predetermined dates prior to the stated maturity date of the
advance.
2811
Market value estimates of FHLB convertible advance. With a convertible advance, the
issuing FHLB has the option to convert the advance to an adjustable rate advance after
a predetermined lock-out period and periodically thereafter.
2821
Market value estimates of FHLB callable advance. With a callable advance, the
borrower has the option to return the funds to the FHLB that issued the advance,
without a prepayment fee, at designated prepayment or put dates and periodically
thereafter.
Market value estimates of FHLB periodic floor floating rate advance. The rate on the
advance resets periodically to LIBOR, and the interest rate decline is limited to the
periodic floor
283 1
1
2
2891
Market value estimates of other FHLB structured advances
2901
Market value estimates of other structured borrowings
299 2
Terms and conditions of other variable-rate, fixed-maturity borrowings
5001
Market value estimates of either: (1) other financial derivatives and OBS positions
without a contract code; or (2) the aggregate value of OBS positions in excess of the
16 positions reported on the Financial Derivatives and Off-Balance-Sheet Positions.
Use these codes in the Supplemental Reporting of Market Value Estimates
Use these codes in the Supplemental Reporting of Assets and Liabilities
APPENDIX D - SCHEDULE CMR
2013
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MARCH 2010
GLOSSARY
Throughout these instructions, you and your refers to the reporting savings association and its
consolidated subsidiaries; we and our refers to the Office of Thrift Supervision.
We use this glossary to explain terms that we use in connection with the Thrift Financial Report. We have
neither officially approved nor sanctioned the definitions. They are not legal definitions and you should
not use them to interpret or define provisions of our regulations or other official documents. A more
extensive glossary of financial terms is available on the OTS web site. Also refer to the glossary in the
OTS Trust and Asset Management Handbook.
a
Above Par (Value)
A higher dollar amount than the face value, or par, of a security. Above par occurs when a security sells
at a premium – for more than par or face value. The premium is the difference between the face value
and the market price.
Accelerated Mortgage Amortization
(1) The restructuring of an existing mortgage loan by increasing the monthly payment to pay off the loan
in a shorter time than the original maturity. (2) Prepayment of loan principal.
Acceleration Clause
A clause commonly included in mortgages and bonds, it gives the holder the right to demand that the
borrower pay the entire outstanding balance in the event of default or other breach of contract.
Accounting Principles Board (APB)
A principle-making body of the American Institute of CPAs (AICPA) established in 1959. Membership of
the Accounting Principles Board included representatives from public accounting, the industry, and
academia. The APB issued thirty-one opinions known as APB Opinions during its existence until it was
terminated in 1972 and replaced by the Financial Accounting Standards Board (FASB).
Accounting Research Bulletins (ARB)
Pronouncements issued by the Committee on Accounting Procedure of the American Institute of CPAs
(AICPA) during the period 1939 through 1959, at which time the Accounting Principles Board replaced the
Committee. Fifty-one ARBs were issued, formally establishing accounting principles on a variety of
issues.
Accounts Payable
Short-term liabilities incurred and amounts recorded on the books of a company or individual that are
owed to a creditor for previously purchased merchandise or services rendered.
GLOSSARY
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Accounts Receivable
Amounts recorded as assets on the books of a company or individual that are due for merchandise sold
or services rendered.
Accretion
Addition to income resulting from gradual, periodic reduction of deferred income.
Accrual Basis
(1) The basis of accounting under which revenues are recorded when earned and expenditures are
recorded as soon as they result in liabilities for benefit received, notwithstanding that the receipt of the
revenue or the payment of the expenditure may take place, in whole or in part, in another accounting
period. (2) Opposite of cash basis accounting. The accrual basis of accounting must be used in the
preparation of the Thrift Financial Report.
Accrued Dividend
A dividend declared by the Board of Directors and considered to be earned and payable but not yet paid
on stock or other instruments of ownership of a business.
Accrued Expense
Costs incurred during an accounting period but not paid.
Accrued Interest
Interest earned, but not received or credited, for the period of time that has elapsed since interest was
last received.
Actual Thrift Investment Percentage (ATIP)
A ratio whose numerator is housing-related investments, called qualified thrift investments, and whose
denominator is portfolio assets. The ratio is used to determine whether a savings association meets the
qualified thrift lender (QTL) test. Savings associations may elect to use the Internal Revenue Service tax
code Domestic Building and Loan Association (DBLA) test rather than the QTL test.
ADC
Acquisition, development, and/or construction.
Add-on Interest
The amount of interest the borrower will pay during the term of the loan that is added to the principal of
the loan to determine the face amount of the note. The borrower signs a note promising to repay the face
amount (principal plus interest), although only the principal is disbursed to the borrower. Since the
interest is not yet earned at the date of closing, a contra-account to the loan is set up representing the
unearned interest. This contra-account is reduced monthly and credited to interest income until at the
time of maturity the contra-account is zero and the full principal is due. Report loans with add-on interest
net of the unearned interest in Schedule SC in accordance with APB Opinion No. 21. See Discount Loan.
Adjustable Rate
An asset or liability repriced (rate adjusted) periodically during its life according to a predetermined
formula or index. The interest rate is automatically adjusted at stated intervals. See Adjustable-Rate
Mortgage, Floating-Rate Securities, and Floating-Rate Tranches.
Adjustable-Rate Mortgage (ARM)
A loan with an interest rate that is periodically adjusted, moving higher or lower in the same ratio as a
preselected index, such as Treasury bill rates. ARM loans may limit interest rate increases, caps, within a
given time period and over the life of the loan, and may limit the frequency of interest rate adjustments.
ARM loans may initially have below-market interest rates, teaser rates, in return for the borrower sharing
the risk that interest rates may rise during the course of the loan.
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Adjusted Basis
Equals cost at which an asset is acquired and adjusted for certain occurrences since the day of
acquisition. For example, the adjusted basis of real property is generally the purchase price plus capital
improvements to the property less any depreciation taken. Adjusted basis is used in calculating gains
and losses on the sale of an asset.
Adjusting Entries
Bookkeeping entries made after the trial balance is prepared but before the closing entries. The adjusting
entries are necessary to make the income and expense accounts consistent with the accrual method of
accounting.
Advances
Loans the Federal Home Loan Banks issue to member savings associations.
Affiliated Company
(1) A company that exercises control over another company either directly or indirectly. (2) A company
that has common ownership with another company.
Affiliated Person
(1) A director, officer, or controlling person of a savings association or its holding company. (2) A member
of the immediate family residing in the same household as a director, officer, or controlling person of a
savings association.
Agencies
Securities issued by an agency or government-sponsored enterprise of the federal government, for
example, Fannie Mae, Ginnie Mae, etc.
AICPA
American Institute of Certified Public Accountants.
ALLL
Allowance for loan and lease losses.
Allowance
A reserve set aside for bad debts or for depreciation. See Allowance for Loan and Lease Losses (ALLL)
and Valuation Allowances.
Allowance for Loan and Lease Losses (ALLL)
Valuation allowances established to absorb unidentified losses inherent in a savings association’s overall
loan and lease portfolio. See General Valuation Allowances and Specific Valuation Allowances.
Alternative Mortgage Instruments
Mortgage plans that differ from conventional fixed rate, fixed term, fixed monthly payment, fully amortized
mortgages.
Amortization
(1) The gradual reduction of an asset or liability by means of periodic charges to reduce income or to
increase expense. (2) The repayment of a loan calculated so that the principal will be paid in full through
monthly payments of principal and interest for a predetermined period of time.
Amortized Cost
Equals the face value net of unamortized discounts and premiums less write-offs. See Book Value, Face
Value, and Recorded Investment.
Annual Percentage Rate (APR)
A requirement of Truth in Lending laws designed to show consumers the total cost of credit, including the
effective interest rate plus certain finance and service charges, points.
GLOSSARY
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Annual Percentage Yield (APY)
The effective annual rate of income expressed as a percentage of the price originally paid. This
calculation assumes that interest earned is reinvested.
Annuity
(1) A series of equal payments at fixed intervals, such as monthly or annually. (2) An investment yielding
fixed payments during the holder’s lifetime or for a stated number of years.
Anticipatory Hedge
(1) A long anticipatory hedge is initiated by buying futures contracts to protect against a rise in the price of
an asset to be purchased at a later date. (2) A short anticipatory hedge is initiated by selling futures
contracts to protect against the decline in price of an asset to be sold at a future date, or to protect
against a rise in interest rates of a fixed-rate liability or a future repricing on a variable-rate liability.
APB
Accounting Principles Board.
Appraisal
An estimate of the market value of an asset by a qualified appraiser.
Appreciation
The increase in value of an asset, specifically the increase in market value of real estate.
APR
Annual Percentage Rate.
APY
Annual Percentage Yield.
ARB
Accounting Research Bulletins.
Arbitrage
A transaction that involves buying a commodity in one market and simultaneously selling it in another
market to profit from a disparity in prices between two markets. In a true arbitrage, the timing of the
transactions must be simultaneous, thus imposing no risk to the investor.
Arm’s-Length Transaction
(1) A transaction negotiated by unrelated parties, each acting in his or her own best interest. (2) The
basis for a fair market value determination.
Arrears
A payment not made when due. Frequently used in connection with installment notes, mortgages, rent,
and other obligations due and payable on a certain specified date.
Asked Price
The price at which a security is offered for sale.
Assessment
(1) An estimate of the value of real property for levying taxes; also called assessed valuation. (2) A
charge against real property levied by a public governing body for a local improvement, such as a sewer
repair or street paving.
Asset
Anything owned by an individual or company that has commercial usefulness or value if sold. An asset
may be physical property, enforceable claims against others, including loans and accounts receivable,
and deferred expenses. An asset may be tangible or intangible.
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Asset/Liability Management
A planning and control process, the key concept of which is the integrated approach to matching the mix
and maturities of assets and liabilities to achieve a favorable and even flow of “net interest margin.”
Assisted Merger
The takeover of a troubled savings association by another depository institution with financial assistance
provided from a federal deposit insurance fund.
ATIP
Actual Thrift Investment Percentage.
ATM
Automated teller machine.
At-the-Money Option
An option with a strike price equal to the current market price of the underlying cash or futures contract.
In this instance, the intrinsic value is zero and the value of the option reflects a premium paid for: (1) the
time the holder has to decide whether or not to exercise the option, and (2) the expected price volatility.
The value of this premium declines over time.
Automated Teller Machine (ATM)
A machine that permits customers to gain access to their accounts through the use of a magnetically
encoded plastic card and by pushing appropriate buttons on a computer terminal. ATMs dispense cash,
accept deposits, transfer funds from one account to another, and perform other functions. Generally,
ATMs are available 24 hours a day.
Average Rate of Return
The return of an investment calculated by totaling the cash flow over the years divided by the amount of
the investment, and dividing that amount by the number of years (or months) that the investment is
outstanding.
b
Bad Debt Reserve
A valuation allowance that savings associations maintain for income tax purposes to offset losses from
foreclosed or uncollectable loans.
Balloon Loan
A loan that does not fully amortize during the loan term, and at maturity the unpaid principal is due in a
lump sum. Periodic payments may be for principal and interest, or for interest only.
Bank Check
A check that a bank draws on itself then has it signed by an authorized bank officer. See Cashier’s
Checks and Official Checks.
Bank Insurance Fund (BIF)
A fund, administered by the FDIC, that insures deposits of member banks (primarily commercial banks)
up to $100,000 per depositor. BIF was merged into the Deposit Insurance Fund in 2006 pursuant to the
Federal Deposit Reform Act of 2005. See Deposit Insurance Fund.
Bank Investment Contract (BIC)
Investment contract issued by a bank where interest is guaranteed by the bank in a portfolio over a
specific time frame with a specific yield. Unlike guaranteed investment contracts (GICs), BICs do not
include annuity provisions.
GLOSSARY
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Banker’s Acceptance
A draft drawn on a depository institution by another, which when accepted by the depository institution,
obligates the depository institution to pay specific obligations of the draft writer when due. Acceptance
converts a depositor’s “order to pay” into an unconditional “promise to pay” by the accepting depository
institution. Bankers acceptances are effectively a guaranty of payment for a purchase and are generally
used in financing the import, export, transfer or storage of goods.
Banking Act of 1933
Legislation that (1) created the Federal Deposit Insurance Corporation to provide insurance of deposits
for member banks; (2) provided for the regulation of banks; and (3) limited branch banking. Also known
as the Glass-Steagall Act.
Basis Point
A measurement of yields or changes in prices or yields for securities. One basis point equals one onehundredth of one percent. One hundred basis points equal one percent.
Bear Market
(1) A period of falling prices. (2) A condition of a stock market characterized by a selling trend and
declining prices. (3) Opposite of a bull market.
Bearer Bond
A bond that does not have the owner’s name registered on the books of the issuing agency or company,
and is payable to whomever holds the bond.
Before-Tax Income
Gross income less all expenses except for income tax expense.
Below Market
A price that is lower than the prevailing level at which a security is currently quoted or traded.
Below-Market Interest Rate
A lower interest rate than the current rate for conventional financing in a given geographical area.
Programs with below-market rates may be used to assist low or moderate income buyers.
Below Par
A price lower than par or face value. The difference between the price and the face value is the discount.
BIC
Bank Investment Contract.
Bid
(1) The price that a potential buyer is willing to pay for a security. (2) An offer to purchase something.
BIF
Bank Insurance Fund.
BIF HOLA Savings Association
A BIF-insured, OTS-regulated savings association.
Blanket Mortgage Loan
A loan made to developers or contractors to purchase one or more tracts of land with the intention of
dividing the land into smaller parcels for resale or development.
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Bond
A certificate that evidences a debt. The debt is initiated when the issuer sells the bond to the holder for a
specific amount of cash. The issuer is obligated to pay the holder of the bond a fixed sum (the bond’s
face value) at a stated future date and to pay interest (usually twice a year) at a specified rate during the
life of the bond. Corporations, the federal government, and state and local governments may issue bonds
as a means of raising funds in the capital markets. Bonds may be issued in registered form, in which the
name of the holder is on record with the issuer, or in bearer form, in which the name of the owner is not
registered and the bond is payable to whomever bears or presents the bond to the issuer for redemption.
Bond Discount
The difference between the purchase price and face value of a bond when the face value exceeds the
purchase price. Normally a bond sells at a discount when the stated interest rate of the bond is less than
the current market interest rate. The discount is accreted to interest income over the life of the bond,
increasing the stated interest rate of the bond to the market interest rate at the time of purchase.
Bond Equivalent
A yield based on a 365-day year with two semiannual coupon payments.
Bond Premium
The difference between the purchase price and the face value of a bond when a bond sells above par.
Normally a bond sells at a premium when the stated interest rate is greater than the current market
interest rate. The premium is amortized to interest income over the life of the bond, decreasing the stated
interest rate of the bond to the market interest rate at the time of purchase.
Bond, Debenture
A bond for which there is no specific security, collateral, set aside or allocated for repayment of the
principal.
Bond, Interim
Sometimes used before the issuance of permanent bonds to raise funds needed only temporarily.
Synonymous with temporary bond.
Bond, Junk
Bonds rated lower than investment grade that yield higher rates of interest than the current investmentgrade bond market.
Bond, Par
A bond selling at par, whose interest rate is in line with prevailing market interest rates.
Bond, Stripped
Bonds whose coupons have been clipped off. The principal and interest (coupons) are sold to separate
groups of investors. Those seeking current income buy the strip of coupons, and those wanting a lump
sum at maturity buy the principal or “corpus” portion. Because each portion is worth less than its whole,
both are sold at a deep discount from their face values.
Bond, Treasury
A U.S. Government long-term security sold to the public with a maturity longer than five years.
Bond, Zero-Coupon
A security sold at a deep discount from its face value and redeemed at the full amount at maturity. The
difference between the cost of the bond and its value when redeemed is the investor’s return. These
notes provide no interest payments to holders.
Book Value
(1) The amount at which a business carries an asset on the accounting books. (2) Book value is equal to
face value less unamortized discounts, plus unamortized premiums, plus accrued interest, less
depreciation, valuation allowances, and write-offs. (3) Equivalent to Carrying Value.
GLOSSARY
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Branch Office
An office of a savings association physically separate from the home office that offers the same kinds of
deposit and most loan services conducted at the home office.
Broker
An agent or middleman who does not actually own the securities or property he sells or buys. A broker,
as opposed to a dealer, is always acting on behalf of another individual.
Broker-Originated Deposit
Any deposit placed in a savings association by or through a deposit broker.
Brokerage Fee
A fee, usually referred to as a commission fee, charged by a broker for execution of a transaction. The
broker may base the fee on an amount per transaction or a percentage of the total value of the
transaction.
Bull Market
(1) A period of rising prices. (2) Opposite of bear market.
Buy-Back Agreement
A provision in a sales contract stating that the seller will repurchase the asset sold within a specified
period of time, usually for the selling price, if certain stated conditions exist. See Repurchase Agreement
and Recourse.
Buying Hedge
Buying futures contracts to protect against possible increased cost of commodities or financial
instruments that will be needed in the future. Also referred to as a long hedge.
Buying Long
Buying stocks, bonds, or commodities outright with the expectation of holding them for a rise in price and
then selling.
c
Call
(1) An option to buy a specific security at a specified price within a designated period. (2) A demand by a
lender for payment of a loan because of the failure of the borrower to comply with the terms of the loan.
(3) A demand by the issuer of the redemption of stocks or bonds. See Put Option.
Call Option
An option that gives the option buyer the right to purchase – go long – the underlying futures contract at
the strike price on or before the expiration date.
Call Price
The price at which a callable bond is redeemable. It is used in connection with preferred stocks and debt
securities having a fixed claim. It is the price that an issuer must pay to voluntarily retire such securities.
This often exceeds the par or liquidating price to compensate the holder of the called security for his or
her loss of income and investment position resulting from the call.
Callable Bond
A bond that is redeemable by the issuer prior to maturity; for example, most Treasury bonds are callable
five years before maturity at a specific price.
C and D
Cease and Desist Order.
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Cap
(1) The maximum rate to which an ARM may adjust, also referred to as a ceiling. (2) A contractual
agreement, akin to an insurance policy, in which a third party limits the interest that will be received or
paid if interest rates increase by a predetermined number of percentage points, also referred to as an
interest-rate cap.
Capital
Generally represents the owners’ interest in the company’s net assets. It is also called equity capital,
stockholders’ equity, and net worth. The capital of a company includes capital contributed by the owners’
plus the retention of earnings over time.
Capital Asset
(1) An asset with an expected life of over one year and one that is not bought and sold in the normal
course of business. (2) A fixed asset.
Capital Expenditure
Money spent for additions or improvements to structures or equipment used to carry on the activities of
an organization or individual.
Capital Gain or Loss
The gain or loss incurred from the sale or disposition of assets other than inventory, such as investment
securities, and real estate.
Capitalize
The treatment of large expenses as part of a firm’s assets. Thus, rather than treating an expenditure as a
deduction from the income statement, it is treated as an asset.
Capitalized Interest
Interest not expensed, but added to the carrying value of an asset. The purpose of capitalizing interest is
to obtain a measure of acquisition cost that reflects the total investment in the asset. Interest is typically
capitalized for assets that are constructed for a business’s own use or for assets intended for sale or
lease that are constructed as a discrete project. Refer to FASB Statement No. 34, Capitalization of
Interest Costs.
Capitalized Loan
A loan to which all amounts due are added to the balance of the loan and all payments received are
deducted from the balance of the loan. For example, each month as interest is earned and escrow
payments become due, these amounts are added to the loan balance; when payment is received it is
deducted from the loan balance. Any unpaid amounts become part of the loan principal.
Captive Insurance Company
An insurance company in which an association is required to purchase stock in order to receive
insurance. Because the sale of the stock of a captive insurance company is restricted by contract and
typically must be redeemed by the issuer, these investments are not subject to FASB Statement No. 115,
Accounting for Certain Investments in Debt and Equity Securities.
Carrying Amount of Loan
Recorded investment in the loan minus valuation allowances.
Carrying Value
(1) The amount at which an asset is carried on the books of a business. (2) Amortized cost – face value
adjusted for unamortized discounts and premiums, accrued interest, depreciation, valuation allowances,
and write-offs. (3) Equivalent to Book Value.
Cash Basis Accounting
(1) A method of accounting in which income and expense items are recorded and recognized when cash
is received or disbursed. (2) Opposite of accrual basis accounting. The accrual basis of accounting must
be used in the preparation of the Thrift Financial Report.
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Cash Market
A market in which securities are traded for immediate delivery for a cash payment.
Cash Price
The price that a specific financial instrument is presently selling in the open market.
Cashier Checks
A check drawn by a financial institution on itself, signed by an institution’s authorized officer and payable
to a third party named by a customer making the withdrawal. See Official Checks.
CD
Certificate of Deposit.
Cease and Desist Order (C & D)
A demand from the courts or government agency that an entity cease an activity.
CEBA
Competitive Equality Banking Act of 1987.
Chattel Mortgage
A mortgage on personal property, such as an automobile or furniture, that is given as security to pay an
obligation.
Certain Nonsecurity Financial Instruments (CNFI)
Unsecuritized financial instruments accounted for under FASB Statement No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities. CNFIs include interestonly strip receivables, loans receivable, other receivables, or retained interests in securitizations that can
be contractually prepaid or otherwise settled in such a way that the holder would not recover substantially
all of its recorded investment.
Certificate of Deposit (CD)
A written document a financial institution issues to a depositor as evidence of its deposit. It includes the
institution’s promise to return the deposit at a specified future date with earnings at a specified rate of
interest. It may be negotiable (transferable to another party) or nonnegotiable. The interest specified
may adjust periodically according to a predetermined formula or index or may be fixed for the term of the
deposit.
Certificate of Deposit (demand)
A negotiable or transferable receipt issued for funds deposited with a financial institution and payable on
demand to the holder. These receipts normally do not bear interest and are used principally by
contractors and others as a guarantee of performance of a contract or as evidence of good faith when
submitting a bid. They may also be used as collateral.
Charge-Off
The amount of loss to an asset that, when recorded, directly reduces the balance of an asset.
Consequently, the loss is not established separately as a valuation allowance. See Write-off.
CIF
Collective Investment Fund.
Classified Assets
Assets, generally loans, whose value may not be recoverable. Such assets are classified as
substandard, doubtful, or loss. Refer to OTS Regulation § 560.160.
Clear Title
A title to real or personal property that has no liens recorded against it and that is transferable to another
party. Synonymous with good title, just title, and marketable title.
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Close of Business
The time established by the reporting institution as the cut-off time for receipt of work for posting
transactions to its general ledger accounts for that day. The time designated as the close of business
should be reasonable and applied consistently. The posting of a transaction to the general ledger means
that both debit and credit entries are recorded as of the same date.
Closed Position
Forward or futures contracts offset in full are closed because the obligations cancel each other out.
Closed-End Credit
A loan where the entire amount is disbursed to the borrower. Overdraft privileges, credit cards, most
home equity loans, and lines of credit are open-end rather than closed-end loans because, although they
have a fixed ceiling, the association will not necessarily disburse the full amount of the line of credit.
Closed-End Mortgage
A mortgage with a prohibition against additional borrowing using the same lien. The prohibition against
additional borrowing protects the existing creditors from having the security diluted.
Closing
Consummating a financial transaction. In mortgage lending, closing is the process of the delivery of a
deed, the signing of loan documents, and the advancing of funds by the lender.
Closing Price
The price at which transactions are made just before the end of trading on a given day.
Closing Transaction
(1) The final transaction for a particular security during a trading day. (2) An option order that will
eliminate or decrease the size of an existing option position.
CMO
Collateralized mortgage obligation.
CNFI
Certain nonsecurity financial instruments.
Collar
A maximum and minimum rate of interest that will be paid on the par value of a floating-rate note. See
Interest-Rate Collar.
Collateral
Something of value pledged as security for a loan. The lender can repossess the collateral if the loan is
not repaid.
Collateral Loan
A loan for which the borrower deposits certain property with the lender as a pledge of payment. The
lender usually has the right to sell the property to pay off the debt if the borrower does not pay according
to its term.
Collateral Mortgage
A document used with a loan that effects a lien on real estate, where the loan is not a purchase-money
mortgage.
Collateralized Mortgage Obligation (CMO)
A multiclass, mortgage-backed security. An underlying pool of mortgages held by the issuer serves as
collateral for the debt obligation, and principal and interest payments from the pool of mortgages are used
to retire the CMOs. Typically, a single issue of CMOs contains three or more classes, tranches, of bonds
having fixed or floating interest rates, and different lengths of maturity for each class of bond that provides
a form of call protection to the holder of a CMO.
GLOSSARY
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Collateral Trust Notes
Bonds secured by the deposit of other bonds or stocks, usually issued by holding companies, investment
trusts, and railroads.
Collective Investment Fund (CIF)
The collective investment of fiduciary accounts. Generally includes accounts held by a trustee, executor,
administrator or guardian. Used primarily to describe the collective investment of tax-qualified retirement
plans. Also referred to as Group Trusts. See Common Trust Fund.
Combined Construction-Permanent Loan
Loans used to finance construction and that are converted to permanent loans upon completion of
construction. Typically, the borrower makes no principal payments during the construction period, and
upon conversion to a permanent loan begins to make both interest and principal payments.
Commercial Letter of Credit
An instrument by which a financial institution lends its credit to a customer to enable him to finance the
purchase of goods. Addressed to the seller, the letter authorizes him to draw drafts on the financial
institution under the terms stated.
Commercial Loan
Loans made to businesses for the financing of inventory purchases and operating expenses, as
distinguished from personal loans or consumer credit loans. Commercial loans are typically short-term
loans or acceptances.
Commercial Mortgage
A loan secured by real estate that is used, zoned, or intended for business purposes or multi-unit
dwellings, or is part of a real estate investment portfolio.
Commercial Paper
An unsecured debt instrument issued by a corporation with a fixed maturity, typically for a short-term
period (30, 45, 60, or 90 days). It is generally priced at a discount from par and is redeemable at par on
the maturity date. Individual and corporate investors buy, sell, and trade commercial paper. .
Commissions
(1) A fee for services rendered. (2) The fees that a broker charges a customer for executing a trade.
Commitment
An advance agreement to perform in the future, such as to provide funds for a mortgage loan or to buy or
sell securities. Commitments may be at a fixed interest rate or price determined on the commitment date
or at a rate or price to be determined at closing date. Commitments may be in the form of a commitment
letter or may be verbal.
Commitment Fee
(1) A fee paid by a borrower to a lender for the lender’s promise to loan money at a future date. (2) In the
secondary market, a commitment fee is a payment by a financial institution to a mortgage buyer, such as
Freddie Mac, Fannie Mae, etc., for the buyer’s promise to buy loans at a future date.
Common Stock
Securities that are evidence of proportionate equity or ownership of a corporation. They give the holder
an unlimited proportionate interest in the corporation’s earnings and assets after satisfaction of claims
from creditors and the holders of preferred stock.
Common Trust Fund
The collective investment of fiduciary accounts. Generally includes accounts held by a trustee, executor,
administrator or guardian. See Collective Investment Fund.
Community Reinvestment Act of 1977 (CRA)
Legislation that requires financial institutions to meet the credit needs of all segments of their
communities, including low- and moderate-income neighborhoods.
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Compensating Balance
A dollar amount equal to the lowest percentage of a line of credit that the customer of a financial
institution is expected to maintain, usually in a demand deposit account, as a condition for being granted
a line of credit.
Competitive Equality Banking Act of 1987 (CEBA)
Legislation passed by the U.S. Congress in 1987 that resulted in the following:
•
Established the adoption of generally accepted accounting principles (GAAP) in financial
reporting.
•
Established classification of impaired assets.
•
Changed appraisal standards.
•
Affected minimum capital requirement provisions.
•
Established capital forbearance.
•
Mandated Troubled Debt Restructuring (TDR) disclosure.
•
Gave the thrift industry the Qualified Thrift Lender test (QTL).
Compliance Exam
An examination of a savings institution to determine how well it is complying with federal law and
regulations, particularly those dealing with consumer protection and nondiscrimination.
Compound Interest
The interest that accrues when earnings for a specified period of time are added to the principal, so that
interest during subsequent periods is computed on the principal plus all accumulated interest.
Comprehensive income
Defined pursuant to FASB Statement No. 130 in FASB Concepts Statement 6 as “the change in equity of
a business enterprise during a period from transactions and other events and circumstances from
nonowner sources. It includes all changes in equity during a period except those resulting from
investments by owners and distributions to owners.”
Condominium
(1) A single dwelling unit in a multi-unit structure in which each unit is individually owned. (2) A form of
real estate ownership in which the purchaser receives title to a particular unit in a project and
proportionate interest in common areas.
Conforming Loan
A mortgage loan that conforms to specified limits such as loan-to-value ratio, term, interest rates, or other
characteristics. Typically these conform to guidelines established by Freddie Mac, Fannie Mae, or Ginnie
Mae.
Conservator/Conservatorship
An individual or institution the Court or the FDIC appoints to protect and conserve the assets of a troubled
financial institution to facilitate liquidation, merger, or replacement of management. A conservatorship
affects the control and operation of an institution or company but does not alter its ownership. See
Receivership.
Consolidation
The results obtained when the accounts of a parent company and its majority-owned subordinate
organizations are combined to reflect the financial position and results of operations of the group as if
operated as a single entity. This involves intercompany eliminations and noncontrolling interest
adjustments. See FASB Statement No. 94, APB Opinion No. 18, and ARB No. 51.
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Consolidation Loan
A loan that combines several debts into one loan, usually to reduce the annual percentage rate or dollar
amount of payments made each month, by extending them over a longer period of time.
Constant Prepayment Rate (CPR)
The percentage of principal amount of a pool of mortgages that have been or are expected to be prepaid
on an annual basis over the life of a pool.
Construction Loan
A short-term interim loan for financing the cost of construction. The lender makes payments to the builder
at periodic intervals upon completion of certain phases of construction as provided in the loan contract.
See Loans in Process.
Consumer Credit
See Consumer Loan.
Consumer Loan
Loans to individuals or families where the proceeds are used for consumer purposes, versus business or
investment.
Contingency Fund
Assets or other resources placed aside for unexpected expenditures, or for anticipated expenditures of an
uncertain amount.
Contra Account
An account offset against another account. A contra account to an asset, contra-asset, has a credit
balance and a contra account to a liability, contra-liability, has a debit balance. A contra account has no
value in its own right and can only be stated in terms of the asset or liability to which it applies. Examples
of contra-assets are discounts, deferred loan fees, and accumulated depreciation. An example of a
contra-liability is a discount paid for deposits.
Contract Month
The month in which the futures contract may be fulfilled by making or taking delivery. Most interest rate
futures contracts are liquidated prior to the contract month.
Conventional Mortgage
A mortgage originated by a financial institution without government insurance or guarantee.
Cooperative
A system of indirect ownership of a single unit in a multi-unit structure. The individual owns shares in a
nonprofit corporation that holds title to the building. In turn, the corporation gives the owner a long-term
proprietary lease on the unit. Also called a co-op.
Core Capital
One of three capital standards established for savings associations in 1989. Also known as Tier 1
Capital.
Core Deposits
The base of deposits a savings association expects to retain over relatively long periods. In the
application of purchase accounting in a merger, a dollar amount is allocated to the value of retaining the
core deposits and this amount is established as an intangible asset known as a core deposit intangible
(CDI).
Correspondent Bank
A bank that is the depository for another depository institution, typically located in another city or
marketing area. The correspondent bank provides services such as accepting deposits and collection of
loan payments for the other depository institution.
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Cost of Capital
The rate of interest that an association must pay to a third party to borrow money or raise equity capital.
Cost of Funds
The interest paid or accrued on savings and borrowings, expressed as a percent of the average total
savings and borrowings during a given accounting period.
Coupon
A tab attached to a bond, which can be torn off and presented to collect an interest payment at a given
date.
Coupon Rate
The rate of interest paid on a particular security. For mortgage-backed securities, the word coupon is
customarily used to describe the stated contract interest rate.
Coupon Strips
Ordinary bonds, typically, U.S. Treasury bonds, purchased and then repackaged so that the rights to
interest and principal payments are sold separately. The effect is to transform a regular interest-paying
security into zero-coupon securities. See Bond, Strip.
Covered Interest Arbitrage
Investing dollars in an instrument denominated in a foreign currency and hedging the resulting foreign
exchange risk by selling the proceeds of the investment forward for dollars.
CRA
Community Reinvestment Act of 1977.
Credit
Any amount that, when posted, will increase the balance of a liability, income, or capital account or
decrease the balance of an asset or expense account. Liability, capital, and income accounts normally
have credit balances, and asset and expense accounts normally have debit balances.
Credit Loss
Loan losses that arise from a contractual relationship between a creditor and a borrower.
Credit losses may result from the creditor’s own underwriting, processing, servicing, or administrative
activities along with the borrower’s failure to pay according to the terms of the loan agreement. While the
creditor’s personnel, systems, policies, or procedures may affect the timing or magnitude of a credit loss,
they do not change its character from credit to operational.
Credit Risk
The potential for a borrower to default on all or part of a loan and, consequently, the potential for the
value of the loan held by a savings association to decrease.
Cross-Hedge
A hedge transaction whereby the correlation between the two items being hedged is similar but not
perfect. For example, hedging a commercial loan with a Ginnie Mae futures contract.
d
DBLA
Domestic Building and Loan Association.
Dealer Reserve Accounts
Refundable amounts held as collateral in the purchase of installment notes from a dealer. For example, a
savings association purchases $100,000 in installment notes from a dealer for the full face amount for
which it pays $90,000 to the dealer and holds the remaining $10,000 as collateral. The $10,000 held as
collateral is a dealer reserve account.
GLOSSARY
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Debenture
A debt instrument secured only by the general credit of the issuer. A corporate obligation sold as an
investment.
Debit
Any amount that, when posted, will increase the balance of an asset or expense account and decrease
the balance of a liability, income, or capital account. Asset and expense accounts normally have debit
balances; and liability, capital, and income accounts normally have credit balances.
Debt
Money owed by one person or entity to another.
Debt Securities
A security representing borrowed funds that must be repaid. Examples of debt securities include bonds,
certificates of deposit, commercial paper, and debentures.
Deed
A written agreement in proper legal form that conveys title to, or an interest in, real property.
Deed in Lieu
A deed given by a borrower to a lender to repay a mortgage loan and avoid foreclosure. A deed given in
lieu of foreclosure.
Default
Failure to do what the law requires or to carry out the terms of a contract.
Defer
To delay payment to a future time.
Deferred Expense
An expense paid before the corresponding benefit is fully received, such as a prepaid insurance premium.
For accounting purposes, the expense is recorded as an asset until benefit is obtained, and may be
prorated over a number of subsequent accounting periods.
Deferred Income
Any income received before it is due or before it is earned. Rent paid in advance is an example of
deferred income received during one accounting period but earned in a later accounting period. Deferred
income is generally recorded as a liability until it is earned, at which time it is taken into income. Interest
received in advance is also deferred income; however, instead of being recorded as a liability, interest
received in advance offsets the balance of the loan to which it applies.
Deferred Loan Fee
A loan fee, also referred to as points, typically received at loan closing. Deferred loan fees are
considered interest paid in advance. Once the loan is disbursed, the deferred loan fee is reported on the
balance sheet as a contra-asset to the loan and is accreted to interest income. See FASB Statement No.
91.
Deficiency Judgment
A court order that authorizes the collection from the debtor of the part of the debt remaining unsatisfied
after foreclosure and sale of collateral.
Delinquency
Failure to make payment on a debt when due.
Demand Deposit Account
A non-interest-bearing account from which a depositor may withdraw funds immediately without prior
notice. Since funds may be withdrawn on demand in person or by presentation of a check, the account
has many of the liquid characteristics of circulating currency. See FDIC Regulations §§ 329.1, 329.101,
and 329.102.
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De Novo Association
A newly chartered savings association.
Deposit
Money placed in a depository institution for safekeeping. Includes demand – usually checking –
accounts, savings – passbook – accounts, time deposits, negotiable certificates of deposit, money market
accounts, etc. Most deposits are interest bearing.
Deposit Broker
A person or entity engaged in the business of placing funds or facilitating the placement of funds of third
parties in accounts issued by a depository institution.
Deposit Insurance Fund (DIF)
A fund, administered by the FDIC, insuring deposits of member banks and savings associations. DIF was
established by the Federal Deposit Reform Act of 2005 to replace BIF and SAIF as the insurer of banks
and savings associations.
Depository Institution
A financial intermediary that accepts savings and demand deposits from the general public.
Depreciation
The gradual decline in the value of a property over its useful life. Depreciation is recognized through a
systematic charge-off of the cost less salvage value over the estimated useful life. It is a bookkeeping
entry that does not involve any cash outlay.
DIF
Deposit Insurance Fund.
Direct Investment
Investment by savings associations directly in the equity of a venture, as opposed to investment in a debt
instrument. With direct investment, an association actually owns all or part of a venture, rather than
loaning money to finance the venture.
Discharge of Lien
The recorded release of a lien when debt has been repaid.
Discount
The difference between the purchase price and face value of a security when the face value exceeds the
purchase price. Normally a security sells at a discount when the stated interest rate of the security is less
than the current market interest rate. The discount is accreted to interest income over the life of the
security, increasing the stated interest rate of the security to the market interest rate at the time of
purchase.
Discount Bond
See Bond Discount.
Discount Loan
A loan on which the amount disbursed at closing equals the face amount of the loan less interest that will
be earned over the life of the loan, and sometimes miscellaneous charges. The borrower must repay the
full face amount of the loan. See Add-on Interest.
Discount Paper
Short-term non-interest-bearing securities issued at a price below par. The difference between the
purchase price and the amount redeemed at maturity is accreted to interest income over the life of the
security.
Discount Rate
(1) The rate representing the amount of money deducted from the face value of a note. (2) The add-on
rate of interest charged to Federal Reserve System member banks for borrowing at the discount window.
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Discount Securities
Short-term non-interest-bearing debt instruments issued at a price below par and redeemed at maturity
for full face value; usually short-term such as Treasury bills.
Discount Window
A “window” available to Federal Reserve System members that allows them to borrow against collateral.
Discounted Cash Flows
Anticipated net cash receipts from an investment discounted to present value under the theory that cash
received in the future has a lesser value than the same amount of cash received today. Several
assumptions must be made in this calculation: estimated cash flows, timing of the cash flows, and the
discount rate used.
Dividend
A portion of the net profits the Board of Directors officially declares for distribution to the shareholders. A
dividend is paid at a certain rate for each share of stock held by each stockholder, such as, at ten cents
per share.
Dividend, Extra
Distribution of excess profits over and above the regular dividend.
Dividend, Scrip
A promissory dividend payable in the future. The directors vote to withhold actual cash dividend until a
certain future event has taken place.
Dividend, Stock
A payment of stock in lieu of a cash dividend on a pro rata basis according to the amount of stock held by
each stockholder.
Docket Number
A five-digit number the OTS assigns to each savings association it regulates. The number is used to file
and retrieve all financial, organizational, and regulatory data regarding that institution.
Dollar Reverse Repurchase Agreement
A financial transaction similar to a reverse repurchase agreement in which a dealer loans money by
buying a security and agreeing to sell it back to the customer at a higher price at a later date. In a dollar
reverse repurchase agreement (dollar reverse repo) the dealer does not sell back the exact same security
but another, substantially identical security. See Repurchase Agreement.
Domestic Building and Loan Association (DBLA)
Defined in the IRS Tax Code as a domestic or federal savings and loan association whose principal
business is acquiring savings deposits from the public and investing in loans. Savings associations may
substitute the IRS DBLA test for the Qualified Thrift Lender (QTL) test.
Doubtful Assets
(1) Those assets that will probably not bring full value upon liquidation. (2) A classification of assets under
OTS Regulations. See Classified Assets.
Duration
(1) The number of years required to receive the present value of future payments, both interest and
principal, from a bond. To determine duration, calculate the present value of the principal and each
coupon, and then multiply each result by the period of time before payment is to occur. (2) The concept
of duration relates the sensitivity of bond price changes to changes in interest rates.
Dwelling Unit
(1) A unified combination of rooms, whether existing or under construction, designed for residence by one
family. (2) Living quarters consisting of contiguous rooms providing complete independent facilities for
living, eating, cooking, sleeping, and sanitation.
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Dwelling Units, One- to Four(1) Single-family dwellings in detached or semidetached structures including manufactured housing. (2)
Permanently financed units in a condominium or cooperative arrangement, where the owner of each unit
has an undivided proportional interest in the underlying real estate and common elements of the
structure. (3) Structures consisting of two- to four-dwelling units.
Dwelling Units, Five or More
A structure, or structures, containing five or more dwelling units; also referred to as multi-family residential
property. This mortgage classification includes:
•
A single mortgage secured by five or more dwelling units in one structure, or in semi-detached or
detached structures.
•
The construction financing of condominium or cooperative apartments until the construction
phase is complete because the units are in structures containing five or more units and are
covered by one mortgage.
•
Fraternity/sorority houses offering sleeping accommodations, living accommodations for students
or staff of a college or hospital, and retirement homes with sleeping and eating accommodations
that are not condominiums or cooperatives. In these cases, the number of bedrooms in the
structure will be the number of dwelling units.
•
Mobile home parks.
This category does not include the construction of single-family dwellings in one project, even though it
may involve only one construction loan. In this case, the future use of the property as single-family
dwellings and the fact that the dwellings are in detached or semi-detached structures determines the
classification.
e
Education Loan
An advance of funds for the purpose of financing a college or vocational education.
Effective Rate
The actual yield of interest as opposed to the stated rate. For deposits, the effective rate of interest is
based on the accounting method used to compute interest and the frequency of compounding. For loans,
the effective rate is the stated interest rate plus fees and charges prorated over the life of the mortgage.
EITF
Emerging Issues Task Force of the Financial Accounting Standards Board (FASB).
Employee Stock Option Plan (ESOP)
An employee benefit where employees receive as compensation equity shares (stock) of the employer.
Stock acquired for this purpose by a loan or guarantee of the employer is transferred to a trust. The loan
is then typically paid off through dividends received on the stock and through additional contributions from
the employer.
Equity Investment
Investment in the ownership of property or a business where the investor’s profit depends on the profit of
the underlying investment. The investor may receive a specified rate of return dependent on the profit of
the underlying investment.
Equity Kicker
Added to a stated rate of return, the investor participates in the profits of the underlying investment.
Equity Loan
A loan that uses the borrower’s equity in real property as collateral; also called a home equity loan. The
loan may be for a variety of purposes. It is typically an open-ended second or junior mortgage loan.
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Equity Method
A method of accounting for an equity investment in another company or joint venture. The carrying value
of the investment reflects a share of the acquired firm’s increases (or decreases) in retained earnings.
Example: If association A purchases 20% of association B’s stock and association B earns $3 million
after taxes during the next year, association A will increase the carrying value of its investment by 20% of
$3 million, or $600,000. If association B pays half of its earnings in cash dividends, association A will
decrease its investment by $300,000. See APB Opinion No. 18, The Equity Method of Accounting for
Investments in Common Stock.
Equity to Assets Ratio
Total equity divided by total assets. This ratio provides information on the proportion of total assets
provided by shareholders, owners, on any given date. A high equity ratio may indicate the existence of a
protective buffer in the event the company suffers a loss.
Equity to Liabilities Ratio
Total equity divided by total liabilities.
Escrow
A written agreement under which funds transferred from one party to another are placed with a third
person or entity, usually a depository institution, acting as custodian. The custodian completes the
transfer to the second party only upon the fulfillment of certain specified conditions. For purposes of the
calculation of deposit insurance premiums, escrows are included as deposits.
ESOP
Employee stock ownership plan.
Eurobond
A bond issued for release by a U.S. or other non-European company or government for sale in Western
Europe. In that market, corporations and governments normally issue medium-term securities with
maturities of 10 to 15 years.
Eurodollars
Deposits denominated in U.S. dollars at banks and other financial institutions outside the United States.
Although this name originated because of the large amounts of such deposits held at banks in Western
Europe, similar deposits in other parts of the world are also called Eurodollars.
EWP
Early withdrawal penalty. A penalty for withdrawing funds from a time savings account prior to a stated
date.
Excess Loan Servicing
(1) An asset established prior to FASB Statement No. 125 when loans were sold to yield a different rate
than their contractual rate and the seller retained servicing. (2) The present value of the difference
between the amount to be collected from the borrower and the amount to be paid to the purchaser of the
loans. (The point spread differential less normal servicing costs represents the excess servicing amount
that is recorded at the time of sale, increasing the gain or decreasing the loss on the sale.) Refer to
FASB Statement No. 65, Accounting for Certain Mortgage Banking Activities, FASB Statement No. 140
Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, FASB
Technical Bulletin 87-3, and EITF Consensus 86-38.
Exercise
To execute the right granted under the terms of a contract. To exercise a call, holders exchange the call
option position for a long futures position. To exercise a put, holders exchange the put option position for
a short position in T-Bond futures.
Exercise Price
See Strike Price.
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Expense
The costs of resources used to create, or intended to create, revenues.
f
Face Value
The sum of money denoted on the principal or “face” side of a financial instrument representing: (1) the
amount of money the issuer promises to pay at maturity and (2) the amount on which interest is
computed. Synonymous with par value.
Fair Market Value
The price at which property transfers from a willing seller to a willing buyer, each of whom has a
reasonable knowledge of all pertinent facts concerning the property in question and similar properties on
the market, and neither being under any compulsion to buy or sell.
Fannie Mae
Federal National Mortgage Association (FNMA). A U.S. government sponsored enterprise.
Fannie Mae/Freddie Mac Pool
Mortgage-backed security that represents a proportional undivided ownership interest in a pool of
mortgage loans where the full and timely payment of principal and interest is guaranteed by Fannie
Mae/Freddie Mac.
Farmers Home Administration (FmHA)
A federal government agency that finances and insures loans to farmers and other qualified borrowers for
rural housing and other purposes.
FASB
Financial Accounting Standards Board.
FDIC
Federal Deposit Insurance Corporation.
Federal Deposit Insurance Corporation (FDIC)
A government corporation that insures deposits in savings associations and commercial banks through
the Deposit Insurance Fund.
Federal Funds
Overnight, unsecured loans of funds between banks. Generally considered as funds that are immediately
available and invested only for one business day, they are typically treated as cash equivalents. Federal
funds bought and sold for longer periods ranging up to 90 days are referred to as term federal funds.
Federal Housing Administration (FHA)
The FHA is a division of the Department of Housing and Urban Development whose activities include
insuring residential mortgage loans under a nationwide system. This enables lenders to loan a higher
percentage of the value of the underlying property. FHA loans generally require a down payment of not
less than five percent of the original amount of the loan.
Federal Home Loan Banks (FHLBs)
Twelve regional banks of the Federal Home Loan Bank System that provide credit to member savings
associations.
Federal Home Loan Bank Board (FHLBB)
A former independent agency in the executive branch of the federal government that regulated and
supervised the savings and loan industry, the Federal Home Loan Banks, the Federal Savings and Loan
Insurance Corporation, and the Federal Home Loan Mortgage Corporation. In 1989, FIRREA abolished
the FHLBB and transferred its functions to other agencies, including the Office of Thrift Supervision.
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Federal Home Loan Bank System
The group made up of the Federal Housing Finance Board and the twelve regional Federal Home Loan
Banks. The fundamental purpose of the System is to serve as a central credit facility for member
associations.
Federal Home Loan Mortgage Corporation (Freddie Mac)
A government-sponsored but privately owned corporation, Freddie Mac is a secondary market facility
under the supervision of the Office of Federal Housing Enterprise Oversight. Freddie Mac is authorized to
buy conventional whole mortgage loans and sell participation certificates secured by pools of these
conventional mortgage loans.
Federal Housing Finance Board (FHFB)
An independent agency in the executive branch of the federal government that replaced the FHLBB in its
authority to govern the Federal Home Loan Bank System. Its duties are:
•
To supervise the Federal Home Loan Banks.
•
To ensure the Federal Home Loan Banks carry out their housing finance mission.
•
To ensure the Federal Home Loan Banks remain adequately capitalized and able to raise funds
in the capital markets.
•
To ensure the Federal Home Loan Banks operate in a safe and sound manner.
Federal National Mortgage Association (Fannie Mae)
A government-sponsored but privately owned corporation, Fannie Mae is a secondary market facility
under the supervision of the Office of Federal Housing Enterprise Oversight. Fannie Mae supplements
private mortgage funds by buying FHA, VA, and conventional loans and issuing mortgage-backed
securities.
Federal Reserve Board
The seven governing members of the Federal Reserve System who are appointed by the President of the
U.S. for 14-year terms. Board members play an important role in determining the country’s monetary
policy, which, in turn, strongly influences economic activity.
Federal Reserve System
The system of independent central banks that influences the United States’ money supply and credit
through its control of bank reserves. Federal Reserve actions impact security prices. For example,
restriction of bank reserves and lending ability in an attempt to restrain inflation tends to drive up interest
rates and drive down security prices over the short run. Also called the Fed.
Federal Savings & Loan Insurance Corporation (FSLIC)
A government corporation the National Housing Act established in 1934 that insured deposit accounts in
federal savings associations, federally chartered national savings banks, and state-chartered savings
associations that were members of the Federal Home Loan Bank System. Under the Financial
Institutions Reform, Recovery, and Enforcement Act (FIRREA) of 1989, the Savings Association
Insurance Fund, SAIF, replaced the FSLIC as an insurer. All assets and liabilities of FSLIC were
transferred to the FSLIC Resolution Fund.
FHA/HUD
Federal Housing Administration/Housing and Urban Development
FHLB or FHLBank
One of the twelve district banks of the Federal Home Loan Bank System.
FHLBB
Federal Home Loan Bank Board.
FHLMC
Federal Home Loan Mortgage Corporation. Also known as Freddie Mac.
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Fiduciary
Someone who is entrusted with the care of another person's money, property or other items of value.
Acting in a fiduciary capacity generally includes acting as a trustee, executor, administrator, registrar of
stocks and bonds, transfer agent, assignee, receiver, guardian or conservator of the estate of a minor or
incompetent, investment adviser, any capacity in which you possess investment discretion on behalf of
another, or any other similar capacity.
Finance Subsidiary
A savings association’s subsidiary whose sole purpose is to issue securities, typically preferred stock or
mortgage-backed securities, that the parent itself is authorized to issue directly – or, if the parent is a
mutual association, is authorized to issue if it converted to the stock form – and to remit the net proceeds
of such securities to its parent association.
Financial Accounting Standards Board (FASB)
An accounting organization established in 1973 that is responsible for establishing generally accepted
account principles (GAAP). FASB is a self-regulated organization whose impact affects accounting firms
and practitioners.
Financial Asset
A financial asset represents Cash, evidence of an ownership interest in an entity, or a contract that
conveys to a second entity a contractual right (a) to receive cash or another financial instrument from a
first entity or (b) to exchange other financial instruments on potentially favorable terms with the first entity
Financial Futures
A futures contract based on financial instruments or indices.
Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA)
An act of Congress to reform, recapitalize, and consolidate the federal deposit insurance system, and to
enhance the regulatory and enforcement powers of federal financial institutions’ regulatory agencies.
FIRREA established the Office of Thrift Supervision (OTS), the Federal Housing Finance Board, the
FSLIC Resolution Fund, the Resolution Trust Corporation, and the Resolution Funding Corporation.
FIRREA dissolved the Federal Home Loan Bank Board (FHLBB) and Federal Savings and Loan
Insurance Corporation (FSLIC).
FIRREA
Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
First Mortgage
A mortgage that creates a lien against real property. A first mortgage has first priority against other
claims in the event of foreclosure. Also called a senior or first lien.
Fiscal Year
Any consecutive 12 months designated as the time frame for financial reporting and preparation of
balance sheets, profit and loss statements, and other financial summations.
Fixed Assets
Those tangible assets, such as office buildings, furniture, fixtures, and equipment, used in the operation
of a business that are not intended to be sold in the normal process of the business.
Fixed-Rate Mortgage
A mortgage in which the interest rate and the amount of each interest and principal payment remain
constant throughout the life of the loan.
Floating-Rate Securities
A security whose interest rate varies or floats in relation to a specific index or benchmark, such as the rate
on Treasury securities, LIBOR, etc.
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Floating-Rate Tranches
CMO tranches that have rates that adjust in the same direction, and by the same amount, as an index
such as LIBOR.
Floor Planning
Commercial loans that finance automobile or mobile home floor stock (dealer inventory).
FmHA
Farmers Home Administration.
FNMA
Federal National Mortgage Association or Fannie Mae.
Forbearance Agreement
A verbal or written agreement providing that the savings association will delay exercising its rights in the
case of a mortgage loan foreclosure as long as the borrower performs certain agreed-upon actions.
Foreclosure
Legal process protecting the mortgagee should the mortgagor default on the mortgage, whereby the
mortgagee obtains title to the collateral.
Foreign Exchange Rate
The price of one currency denominated in another currency such as the value of British pounds
expressed in U.S. dollars.
Forward Commitment or Forward Commitment Contract
Agreement between a buyer and seller to purchase or sell a specified amount of mortgages or securities
at an agreed-upon price, and at a specified future date. Sometimes called a forward delivery contract or
forward coverage.
Forward Delivery
Delivery of loans or securities to be made at a future date.
Freddie Mac
FHLMC, Federal Home Loan Mortgage Corporation.
Freddie Mac Participation Certificate (PC)
A mortgage-backed security, guaranteed by the Federal Home Loan Mortgage Corporation as to the
timely payment of interest at the certificate rate and the ultimate collection of principal, which represents a
proportional undivided ownership interest in a pool of mortgage loans. Generally, each PC group
contains fixed-rate equal installment conventional residential mortgage loans with original terms to
maturity of between 10 and 30 years.
FRR
SEC Financial Reporting Release.
FSLIC
Federal Savings and Loan Insurance Corporation.
FSLIC Resolution Fund
A fund FIRREA established to assume all the assets and liabilities of FSLIC. The RTC managed the
FSLIC Resolution Fund. The RTC was dissolved in December 1995, upon the satisfaction of all debt and
liabilities and the sale of all assets assumed by it.
Funded Debt
Debt that is usually long-term, for which certain assets have been set aside to satisfy the debt.
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Futures Call Option
An option contract that gives the buyer the right to assume a long T-Bond futures position at a fixed strike
price any time prior to the contract’s expiration date. When assigned, a call option seller automatically
assumes a short futures position.
Futures Contract
An agreement to take (by the buyer) or make (by the seller) delivery of a specific commodity on a
particular date. The commodities and contracts are standardized so that an active resale, secondary,
market will exist. Futures contracts are available for a variety of items including grains, metals, and
foreign currencies.
Futures Price
The price of a contract for delivery of a specific dollar amount of a standardized financial instrument in a
designated future month.
Futures Put Option
An option contract that gives the buyer the right to assume a short T-Bond futures position, at a fixed
strike price, any time prior to the contract’s expiration date. When assigned, a put option writer
automatically assumes a long futures position.
g
GAAP
Generally accepted accounting principles.
Gap
The imbalance between the maturities (or repricing) of assets and liabilities of a financial institution; a
measure of that imbalance. Gap refers to a specific time interval, such as a 30-day gap, which is the
degree to which assets repricing within 30 days exceed or fall short of liabilities repricing in 30 days. See
Net Portfolio Value Model.
General Valuation Allowance
A contra-asset established against receivables and investments based on the amount expected to be
collected. General valuation allowances are established for the purpose of covering probable but not
specifically identifiable credit losses. See Allowance for Loan and Lease Losses and Specific Valuation
Allowance.
Generally Accepted Accounting Principles (GAAP)
The basic principles of accounting promulgated either through authoritative sources such as the Financial
Accounting Standards Board (FASB), the American Institute of Certified Public Accountants (AICPA), or,
if no written standards exist, through widespread common practices.
GIC
Guaranteed Investment Contract. See Bank Investment Contract (BIC).
Government National Mortgage Association (Ginnie Mae)
A wholly owned U.S. government corporation, known as Ginnie Mae, which is part of the Department of
Housing and Urban Development (HUD). Ginnie Mae guarantees the timely payment of principal and
interest on mortgage-backed securities that represent an interest in a pool of mortgages insured by VA or
FHA, and are backed by the full faith and credit of the United States government.
Ginnie Mae Certificates
Mortgage pass-through securities with the full and timely payment of principal and interest guaranteed by
Ginnie Mae. A Ginnie Mae certificate represents a proportional, undivided ownership interest in a pool of
fixed-rate mortgage loans. Also known as Ginnie Mae Pools.
Ginnie Mae Pool
See Ginnie Mae Certificates.
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Goodwill
The premium exceeding fair value of net identifiable assets of an acquired association in a purchase
business combination.
Government Sponsored Enterprise (GSE)
Privately owned corporations chartered and supervised by the U. S. Government. GSEs include Fannie
Mae and Freddie Mac who are supervised by the Office of Federal Housing Enterprise Oversight
(OFHEO), a part of HUD. Federal Home Loan Banks are also GSEs and are supervised by the Federal
Housing Finance Board.
Graduated-Payment Adjustable Mortgage Loan (GPAML)
A graduated payment mortgage that has a variable interest rate. The initial scheduled payment is
insufficient to pay all the interest due. The unpaid interest increases the principal of the loan and the
scheduled payments increase over the term of the loan so the loan will fully amortize at maturity.
Graduated-Payment Mortgage (GPM)
A graduated payment mortgage with a fixed interest rate. The initial payment is lower than that on a
standard fixed-rate mortgage and is insufficient to pay all the interest due. The unpaid interest increases
the principal of the loan and the scheduled payments increase over the term of the loan so the loan will
fully amortize at maturity.
Grandfather Clause
Any condition that ties existing rights or privileges to previous or remote conditions or acts. More
popularly used when a new regulation goes into effect, to exempt associations already engaged in the
activity being regulated.
Gross
The total amount before any deductions.
Gross Income
Total income before deducting expenses.
Gross Margin
See Net Interest Margin.
GSE
Government Sponsored Enterprise.
Guaranteed Student Loans
Education loans primarily made by banks, savings and loan associations, and credit unions, and some
colleges, payment of which is guaranteed by the federal or state government.
h
Hedging
The matching of assets to liabilities of a similar nature; the assumption of one risk calculated to offset
another. The buying or selling of offsetting positions to protect against an adverse change in price or
interest rates. In mortgage banking, the purchase or sale of mortgage futures contracts to offset cash
market transactions to be made at a later date.
HMDA
Home Mortgage Disclosure Act.
Holding Company
A corporation or other entity that owns a majority of voting stock or securities of another corporation, thus
obtaining control of the other corporation. Section 1730a of the National Housing Act (NHA) defines a
savings and loan holding company as follows: “savings and loan holding company means any company
which directly or indirectly controls an insured institution or controls any other company which is a savings
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and loan holding company by virtue of this subsection”. NHA defines control as owning 25 percent or
more of the voting stock. Also referred to as Thrift Holding Company.
Home Equity Loan
Revolving, open-end loans secured by a one- to four-family property and extended under lines of credit.
Although residential property secures home equity loans, in some cases they may not have an appraisal
meeting OTS standards, or may not have a sufficient loan-to-value level and, thus, are classified as a
nonmortgage loan.
Home Improvement Loan
A loan usually not secured by a recorded lien on the property and usually short-term, made to a property
owner for such improvements as maintenance and repair, additions and alterations, or replacement of
equipment or structural elements.
Home Loan
A residential mortgage loan secured by a one- to four-family property.
Home Mortgage Disclosure Act (HMDA)
A law that requires the annual disclosure of mortgage loan data by depository institutions, service
corporations, and mortgage banking subsidiaries located in metropolitan statistical areas. Institutions
subject to the Act are required to disclose data on all mortgage loans and home improvement loans that
they originate and purchase each year.
Hypothecated Deposit
Deposits accumulated until the sum of the payments equals the entire amount of principal and interest on
the contract, at which time the loan is considered paid in full. Typically state law determines the handling
of hypothecated deposits. In reporting Schedule SC, you should net hypothecated deposits against the
related loans.
i
Income
Money or its equivalent, earned or accrued, arising from the sale of goods or services.
Income Tax
A tax on annual earnings and profits of a person, corporation, or organization. Traditionally, there are
federal, state, and city taxes, although not all states and not all cities tax income.
Index
A price indicator such as LIBOR or T-Bill rates. The repricing of the interest rate on an adjustable rate
mortgage is typically governed by an index rate. Rate movements of the mortgage are adjusted to
correspond to movements in the index. The index rate generally is a published interest-rate series that is
readily verifiable by the borrower and not under the control of the lender.
Individual Retirement Account (IRA)
Special accounts where you can save and invest, where the taxes generally are deferred until money is
withdrawn. These plans are defined by statute and are subject to frequent changes by Congress.
Withdrawals of tax-deferred contributions are generally taxed as income, including the capital gains from
such accounts. Withdrawal prior to a specified retirement age or for purposes other than those specified
by law may be subject to a tax penalty. Types of IRAs include Keogh Plans, Roth IRAs, and Education
IRAs.
Initial Margin
The amount of deposit a broker initially requires to purchase securities on behalf of an investor. See
Margin.
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Insolvent
(1) A condition in which the value of liabilities exceeds the value of assets according to some accounting
standard such as generally accepted accounting principles (GAAP). That is, net worth, or capital, is
negative. (2) The state of being unable to pay debts when demanded by creditors at maturity.
Installment
The regular, periodic payment to repay a debt that a borrower agrees to pay. .
In-Substance Foreclosure
A situation in which the lender considers the collateral underlying a loan repossessed in substance by the
lender and accounts for it at its fair value, consistent with generally accepted accounting principles
(GAAP). In-substance foreclosure occurs when the debtor formally or effectively abandons control of the
collateral to the creditor.
Interest
A fee paid for using money that belongs to another, usually expressed as an annual percentage of the
amount used. A financial institution makes periodic payments of interest to savers for the use of their
deposited funds. A borrower pays interest on a loan to the financial institution for the use of its funds.
Interest-Only (I/O) Strip
The interest portion of a security (debt security or mortgage security). The owner of an IO strip receives
only the interest payments of the security. The owner of an IO strip of a mortgage pool security receives
only the interest payments on the cash flow of the underlying mortgages.
Interest-Rate Cap
See Cap.
Interest-Rate Collar
(1) A contractual agreement that limits the interest paid or received if the interest rates increase or
decrease by a predetermined number of percentage points. (2) A two-sided cap.
Interest-Rate Swaps
A transaction that involves two parties exchanging their interest payment obligations – no principal is
exchanged – on two different kinds of debt instruments, one bearing a fixed interest rate and the other a
floating interest rate. If a savings association has fixed-rate assets and floating-rate liabilities, it typically
will swap its floating rate payment for a fixed-rate payment to match liability repricing to asset repricing.
In-the-Money
An option with a favorable price opportunity. The strike price is less than market for a call and above the
market for a put.
Intrinsic Value
The amount by which an option is in-the-money. For call options, it is the current T-Bond futures price
minus the strike price if the difference is a positive number. For put options, it is the strike price minus the
current price of T-Bond futures if the difference is a positive number. See Swap.
Inverse Floater
An asset that adjusts in the opposite direction of the movement of interest rates. Generally the inverse
floater adjusts by a multiple of an interest-rate index. It is usually repriced based on a formula containing
a multiple of the LIBOR rate. For example, if an inverse floater adjusts at an inverse of 1.25 times LIBOR,
a decrease of two basis points in LIBOR would result in an increase in the rate of the inverse floater of 2.5
(2 x 1.25) basis points.
Inverse-Floating Rate Tranches
CMO tranches that have adjustable rates that adjust in the opposite direction as an index such as LIBOR.
Frequently, the rate adjusts by a multiple of the change in the index.
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Investment
The use of capital to create more money, either through income-producing vehicles or through more riskoriented ventures designed to result in longer term capital gains.
Investment Accounts
Accounts that range from short-term, highly liquid securities, such as U.S. Treasury Bills, to long-term
railroad equipment trust certificates that are not always liquid. In between, there are debentures, floaters,
notes, put bonds, and cushion bonds, along with a broad array of short-term money market instruments.
Investment accounts may be trading accounts, available-for-sale, or held-to-maturity.
I/O
Interest Only.
I/O Strip
Interest-only strip. The interest portion of a security (debt security or mortgage security). See Interestonly Strip.
IRA
Individual Retirement Account.
Issuer
One who issues securities to others.
j
Joint Venture
Any joint undertaking between two or more parties in such legal form as joint tenancy, tenancy in
common, partnership, or a corporation.
Judgment
A formal decision given by a court. A judgment against a property is generally a lien against the property.
See Lien.
Junior Lien
A lien that is subordinate to the claims of prior lien(s) or mortgage(s). See Second Mortgage.
Junk Bonds
Bonds issued by companies without long track records of sales and earnings. These bonds are more
volatile and pay higher yields than investment-grade bonds.
l
Land Loan
Loan for unimproved land, developed building lots, and the acquisition and development of land.
Letter of Credit
A document issued by a financial institution on behalf of its customer authorizing a third party, or in some
cases the customer, to draw drafts on the institution up to a stipulated amount and with specified terms
and conditions. The letter of credit is a conditional commitment, except when prepaid by the customer,
on the part of the institution to provide payment on drafts drawn in accordance with the terms of the
document.
Liabilities
Debts incurred but not paid. For savings associations, liabilities consist of deposits, borrowings including
long-term debentures, and other liabilities.
LIBOR
London Interbank Offered Rate. An international interest-rate index, similar to the federal funds rate of
banks in the United States. It is commonly used as a repricing index for various financial instruments
such as ARMs, CMO tranches, and interest-rate swaps.
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Lien
A claim by one person or entity on the specific property of another and that serves as security for a debt.
The security interest in real estate created by a mortgage. A lien is typically recorded in the legal
jurisdiction (county) in which the property is located.
Line of Credit
A pre-established loan authorization with a specified borrowing limit extended by a lending institution to
an individual or business. Most lines of credit are unsecured; however, certain lines of credit, such as
home equity loans, are secured by the borrower’s equity in property. A line of credit allows borrowers to
obtain a number of loans without re-applying each time as long as the total of borrowed funds does not
exceed the pre-established credit limit.
LIP
Loans-in-process.
Liquidation
Closing a savings association by paying the claims of insured depositors and other secured creditors.
Liquidation may be a voluntary decision made by the board of directors, or may be mandated and
executed by the FDIC.
Liquidity
The amount an entity holds in cash and other assets quickly convertible into cash without significant loss.
Loan
Money advanced by one entity to another to be repaid within a specified time, typically with a specified
rate of interest, as set forth in a note or other evidence of indebtedness. Loans may be unsecured or
secured by real or personal property but do not represent an equity interest in the underlying security for
the lender. See Mortgage Loan.
Loan Loss Reserve
A contra-asset set up to compensate for anticipated losses from loans. See Allowance for Loan and
Lease Losses. See FASB Statement No. 114.
Loan Origination
The steps a lending institution takes to obtain a borrower and underwrite a loan up to the time a loan is
booked, including soliciting, processing applications, appraising, and closing.
Loan Origination Fee
The initial service charge that a lending institution imposes on a borrower for underwriting a loan. See
Origination.
Loan Participation
(1) The purchase of portions of outstanding loans by investors, who then participate on a pro rata basis in
interest and principal payments; (2) a loan or package of loans in which two or more lenders share
ownership. See Participation Loan.
Loan Portfolio
The total loans held by a financial institution or other lender, at a given time.
Loans-in-Process
Loans that an association closed, but the full principal of which has yet to be disbursed. Generally, these
are construction loans that are typically disbursed in stages as construction is completed. The full
amount of a loan is recorded on the savings association’s books at closing, with the undisbursed portion
recorded in the contra-asset account called loans-in-process. Report loans on the TFR net of loans-inprocess.
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Loans to Facilitate
A mortgage loan in which the lender provides a borrower with funds at a high loan-to-value ratio and/or
below-market interest rates to facilitate the borrower’s acquisition of a piece of property owned by the
lender.
LOCOM
Lower of cost or market.
Long
(1) As a noun, one who has bought futures contracts and has not yet offset that position. (2) As an
adverb, going long, the action of taking a position in which one has bought futures contracts without
taking the offsetting action. The long protects against declining rates of interest.
Long-Term, Fixed-Rate Tranches
CMO tranches that have fixed rates and are expected to mature in five years or more.
Long-Term Planned Amortization Classes (PACs)
CMO tranches that have fixed rates, a prioritized repayment schedule within certain prepayment speeds,
and expected maturity of more than five years. Targeted Amortization Classes (TACs) are considered to
be substantially similar to PACs for reporting purposes.
Long-Term PAC Support Tranches
CMO tranches that have fixed rates, expected maturity of more than five years, and are part of a CMO
structure that contains a PAC or TAC tranche(s).
Loss
(1) The amount of all expenses exceeding revenues for a period or for a transaction. (2) A classification
of assets under OTS regulations where recovery is unlikely. See Specific Valuation Allowance, Classified
Assets.
Lower-of-Cost-or-Market (LOCOM)
An accounting method used to establish the amount at which certain assets are recorded. The amount
established is the lower of the cost of the asset or the current market value. Under this method, assets
must be written down if the market value falls below amortized cost but the asset may never be written up
to a market value above amortized cost.
LTV
Loan-to-value. The ratio of a loan to the appraised value of the property securing the loan.
m
Maintenance Margin
Additional assets required by a broker on a margin account due to decreases in the market value of the
securities that guarantee the margin account. See Margin.
Majority Stockholders
Stockholders whose share of voting stock is so large that they can exercise control over the corporation.
. Generally, an ownership of 20% or more is deemed to constitute control.
Majority-Owned Subsidiary
A subsidiary whose parent company, or parent’s majority-owned subsidiaries, owns more than 50 percent
of the outstanding voting capital stock.
Mandatory Convertible Securities
Subordinated debt instruments that are eventually transformed into common or perpetual preferred stock
within a specified period of time. Generally, there are two types: (1) equity contract notes - securities that
oblige the holder to take common or perpetual preferred stock of the issuer in lieu of cash for repayment
of principal; and (2) equity commitment notes - securities that are redeemable only with the proceeds from
the sale of common or preferred stock.
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Mandatory Delivery
A lender’s commitment to deliver loans or securities or pay a penalty.
Margin
(1) The amount of deposit money that a securities broker requires from an investor to purchase securities
on credit. (2) An amount of money or securities deposited by buyers and sellers of futures contracts and
short options to ensure performance of the contract terms, such as, the commitment to make or take
delivery of the commodity or the cancellation of the position by a subsequent offsetting trade at such price
as can be attained. Margin in commodities is not a payment of equity or down payment on the
commodity itself, but rather is in the nature of a performance bond or security deposit. See Initial Margin
and Maintenance Margin.
Mark-to-Market
An accounting procedure by which assets are recorded at current market value, which may be higher or
lower than their purchase price or book value. Examples of the use of mark-to-market accounting are:
purchase accounting, pushdown accounting, and accounting for certain securities. See FSAS No. 115,
Accounting for Certain Investments in Debt and Equity Securities.
Market Value
(1) The price established in a competitive market where buyers and sellers meet to buy and sell similar
products. (2) A price determined by supply and demand factors rather than by management. (3) The
price at which an owner is prepared to sell and an unrelated buyer is willing to buy.
Marketable Title
Title to property that is free from a claim, lien, charge or defect and that will not be subject to legal
objection. Also known as perfect title, clear title, and good title.
Maturity
The date on which the principal balance of a debt becomes due and payable. The date when a debt is
paid in full.
Maturity Mix
The variety of assets found in an investment portfolio that vary in terms of length, such as 90-day
Treasury bills, 20-year corporate bonds, etc.
MBS
Mortgage-backed security.
MCD
Mandatory Convertible Debt.
Merger
The combining of two or more entities either through one purchasing the assets and liabilities of the
other(s) or the pooling or combining of two or more entities into one new entity.
Noncontrolling Interest
The portion of net worth of a subsidiary relating to shares not owned by the controlling company or other
members of the combined group. Example 1: A parent owns 75% of the controlling interest in Company
B; therefore, there is a 25% noncontrolling interest in Company B. Example 2: A parent owns 50% of the
voting stock of Company B and 100% of Company C; Company C owns 25% of Company B. Therefore,
the parent effectively controls 75% of Company B and there is a 25% noncontrolling interest in Company
B.
MMDA
Money Market Deposit Accounts.
Mobile Home
A movable, portable dwelling without permanent foundation, designed for year-round living.
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Mobile Home Certificates
Variations of the Ginnie Mae certificate. Fully guaranteed, pass-through securities that are collateralized
by mobile home loans.
Mobile Home Loan
A loan to finance the purchase of a mobile home, secured by the lender’s claim on the mobile home. The
loan may include funds for associated costs such as transportation of the mobile home and setup on a
new site.
Monetary Policy
Federal Reserve Board policy that pertains to the control of credit availability, and thus interest rate
levels.
Money Market Deposit Accounts (MMDA)
A savings account offered by Federal savings associations in accordance with 12 U.S.C. §1464(b)(1) and
by state-chartered savings associations in accordance with applicable state law on which market rates of
interest may be paid if issued subject to certain limitations. Limitations include: (1) Minimum of seven
days' notice required prior to withdrawal or transfer. (2) Transfers limited to no more than six per calendar
month.
Money Market Fund
The combined money of many individuals jointly invested in high yield financial instruments such as U.S.
government securities, certificates of deposits, and commercial paper. A money market fund is a mutual
fund that strives to make a profit by buying and selling various forms of money rather than buying and
selling shares of ownership in corporations.
Mortgage-Backed Bonds
Bonds secured by mortgages. Unlike mortgage-backed pass-through securities, mortgage-backed bonds
do not convey ownership of any portion of the underlying pool mortgages. However, mortgage-backed
bonds do offer a more predictable maturity and thus offer a form of call protection.
Mortgage-Backed Security (MBS)
A security backed by mortgages, the owners of which participate in receiving payments of principal and/or
interest. See Mortgage Derivative and Mortgage Pool Security.
Mortgage Banker
(1) A firm or individual who, acting as a broker, originates loans and then sells them to investors. A
mortgage banker may retain the servicing rights to the loans it originates, but does not retain the loans as
an investment (all loans held by a mortgage banker are held for sale).
(2) A firm or individual who brings a borrower and lender together, receiving a commission if a loan is
made.
Mortgage Derivative
Any variety of mortgage-backed securities of complex structures whose payments to investors are
derived from the cash flows of mortgages, but in which the cash flows from the mortgages are not passed
through proportionately to the holders of the securities.
Mortgage Loan
An advance of funds from a lender, the mortgagee, to a borrower, the mortgagor, secured by real
property and evidenced by a document called a mortgage. The mortgage sets forth the conditions of the
loan, the manner and duration of repayment, and the rights of the mortgagee to repossess the pledged
property if the mortgagor defaults.
Mortgage Loans Outstanding
The total amount of money that is owed by mortgagors (borrowers).
Mortgage Origination
The making of a new mortgage. See Loan Origination.
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Mortgage Participation
The division of a mortgage or pool of mortgages into units owned by one or more investors, who
participate in receiving payments of principal and interest. See Loan Participation.
Mortgage Pool Security
A number of mortgages combined and issued as a single security. Repayments from the mortgages in
the pool are passed through to the investor(s) proportionate to ownership interest and with the same
timing with which they are received. The security provides each investor with a proportional ownership
interest in the underlying collateral.
Mortgage Portfolio
All mortgage loans or obligations held as assets by a financial institution or other lender.
Mortgagee
The financial institution, group, or individual that lends money secured by real estate. The lender.
Mortgagor
Real estate owner who pledges real estate as security for a loan. The borrower.
Multifamily Residential Property
Property containing five or more dwelling units. An apartment building, a residence hall for students or
employees, a retirement complex, etc. See Dwelling Units, 5 or More.
Municipal Bond
A tax exempt debt obligation issued by a state or local government agency to raise funds for the public
good, such as for building low-income housing, improving streets, or building bridges. The bonds are
redeemed with interest and are backed by the government’s taxing authority. Municipal bonds are
generally exempt from Federal income taxes.
Municipal Deposits
Deposits of state and local government funds, which, under the laws of certain jurisdictions, are secured
by the pledge of acceptable securities or by a surety contract (depository bond) to directly protect these
funds. See Preferred Deposits.
Mutual Association
A savings association that issues no capital stock, but is owned and controlled solely by its savings
depositors, who are called members. Members do not share in profits, but they exercise other ownership
rights such as electing the board of directors.
Mutual Fund
A mutual fund pools the funds of many investors and provides professional management in investing
those funds. Also called an open-end investment company. See Proprietary Mutual Funds.
n
National Bank
A commercial bank organized with the consent and approval of the Office of the Comptroller of the
Currency and operated under the supervision of the Federal government. National banks are required to
be members of the Federal Reserve System and must purchase stock in the Federal Reserve Bank in
their district.
Negative Amortization
Any increase in the loan balance arising from a mortgage payment being too small to pay all the interest
due that month. The lender effectively makes the borrower an additional loan at the mortgage rate for the
amount of unpaid interest. This additional loan must be repaid over the remaining term of the mortgage.
Negotiable Order of Withdrawal (NOW) Account
A savings account with characteristics of a checking account. An account holder can withdraw funds by
writing a negotiable order of withdrawal payable to a third party. NOW accounts may earn interest.
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Net
That which remains after making certain designated deductions from the gross amount.
Net Assets
The assets of an individual or entity remaining after all obligations have been met. Assets minus
liabilities. The owners’ equity.
Net Income
Gross income less expenses, including taxes, but before dividends.
Net Interest Margin
Interest income less interest expense, before the inclusion of noninterest income and deduction of
noninterest expense. This is the gross margin for financial institutions.
Net Loss
The excess of expenses and losses over revenues and gains during a specified period of time. A
negative net income.
Net Operating Income
Net interest margin less provision for losses and operating expenses plus noninterest income.
Net Operating Loss (NOL)
A loss for tax purposes that can be applied against net income from prior periods (NOL carry-back) or
subsequent periods (NOL carry-forward) to reduce the tax liability of those periods.
Net Portfolio Value Model
A model used by the OTS to measure each association’s exposure to interest rate risk by estimating how
a change in interest rates affects the market value of its assets, liabilities, and off-balance-sheet.
Net Present Value
Sum of the future cash flows (positives and negatives) discounted to present value under the theory that
money received today is worth more than the same amount received in the future.
Net Profit
See Net Income.
Net Realizable Value (NRV)
The estimated sales price from a property, reduced by the sum of:
(1) Direct selling expenses such as sales commissions, cost of title policy, etc.
(2) Costs of completion or improvement necessary for sale.
(3) Direct holding costs, net of rental or other income, including taxes, maintenance, insurance, and cost
of all capital, debt and equity, during the period held for sale.
Net Undistributed Income
Profit earned but not distributed to stockholders.
Net Worth
The owner’s equity. Assets less liabilities, deferred income, redeemable preferred stock, and
noncontrolling interest. Also called net assets, equity, stockholders’ equity, and equity capital. See
Capital.
NOL
Net operating loss.
Nominal Interest Rate
The stated or contractual interest rate in a loan agreement, bond, or other security, which may differ from
the effective interest rate.
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Nonconforming Loans
A real estate mortgage loan is nonconforming if the unpaid principal balance or unexpired term exceeds
lending limits set by purchasers or guarantors of mortgages in the secondary market – Freddie Mac, Fannie
Mae, etc.
Nonmortgage Loan
An advance of funds not secured by a lien on real estate. See Loan.
Nonperformance
The failure of a contracting party to provide goods or services according to an agreement.
Nonperforming Assets
Assets that do not earn income, including those originally acquired to earn income (delinquent loans) and those
not intended to earn income (fixed assets). Typically assets originally acquired to earn income are deemed
nonperforming when (1) full payment of interest or principal is no longer anticipated, or (2) the principal or
interest that is due at a regularly scheduled payment date or the maturity date is 90 days or more delinquent
even if the asset is still in accrual status. Nonperforming loans that are restructured continue to be considered
nonperforming until a cash payment from the borrower brings the loan current under its restructured terms; for
instance, a loan cannot be taken out of the nonperforming category simply by restructuring the loan.
Nonresidential Mortgage Loan
A mortgage loan secured by nonresidential property such as an office building, store, factory, church, or vacant
land.
Note
An instrument that bears the recognized legal evidence of debt. A note is signed by the maker (borrower) and
promises to pay a specified sum of money to the lender at a certain future date and place.
Notice of Default
A notice to a borrower with property as security under a mortgage or deed of trust that he/she is overdue in
payments. If the amount owed, plus costs of preparing the legal papers for the default, are not paid within a
certain time, foreclosure proceedings may be brought against the property. The filing of a notice of default is
the initial step in the process of foreclosure.
Notional Principal
The amount of principal underlying an interest rate swap transaction, and upon which the swap payment
calculation is based. See Interest-rate Swaps.
NRV
Net Realizable Value.
o
Oakar
An "Oakar" savings association is a savings association (OTS-regulated institution) that was a member of one
insurance fund, generally the Savings Association Insurance Fund (SAIF), and acquired deposits insured by a
secondary insurance fund, generally the Bank Insurance Fund (BIF), by means of a so-called "Oakar
transaction." The most common Oakar transaction occured when a SAIF-member acquired deposits from a
BIF-member, either by means of a whole-institution acquisition or through a branch acquisition. The reverse,
an acquisition of SAIF-insured deposits by an OTS-regulated, BIF-member (“BIF HOLA” savings association),
was also considered an “Oakar transaction.” BIF and SAIF were merged into the Deposit Insurance Fund in
April 2006 pursuant to the Federal Deposit Reform Act of 2005.
OBS
Off-balance-sheet.
Occupancy Rate
The percentage of space or units that are leased or occupied. The inverse of the vacancy rate.
OFHEO
Office of Federal Housing Enterprise Oversight.
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Off-Balance-Sheet
An asset or obligation that in accordance with GAAP you do not report on the balance sheet. Such as
commitments to originate loans, undisbursed loan balances, unused letters of credit, etc.
Offer
An expression of willingness to sell something at a given price; opposite of bid.
Offering
An issue of securities or bonds presented for sale. An offering may be public (open to anyone wishing to
buy) or private (predetermined buyers or market).
Office of Federal Housing Enterprise Oversight (OFHEO)
A government agency responsible for ensuring the financial safety and soundness of the nation's two
largest players in the secondary mortgage market, the Federal National Mortgage Association (Fannie
Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). OFHEO is an independent office
of the Department of Housing and Urban Development, and was established by the Federal Housing
Enterprises Financial Safety and Soundness Act of 1992.
Office of Thrift Supervision (OTS)
An office of the Treasury Department of the Federal government. The OTS was established in 1989 by
FIRREA to succeed the Federal Home Loan Bank Board for chartering and regulating federal savings
associations.
Official Checks
A financial institution’s check drawn on its own account for paying its operating expenses and other debts.
See Cashier’s Checks.
Offset
The process used to close an open futures option; for instance, to sell after having previously purchased,
or to buy after having previously sold.
Open Position
An outstanding position in a futures contract, which has not been offset. If not covered prior to maturity,
the trader is liable for taking or delivering the underlying commodities.
Open Repo
A repo with no definite term that can be terminated by either party. The rate paid is typically higher than
that paid on overnight repos and is subject to adjustment on a day-to-day basis.
Open-End Credit
An unsecured line of credit that may be used repeatedly up to an established overall limit. Commonly
known as revolving credit or a line of credit, in which the customer may pay in full or in installments. A
finance charge is assessed on the unpaid balance. The term does not include negotiated advances
under an open-end real estate mortgage or a letter of credit. See Line of Credit.
Open-End Mortgage
A mortgage that by mutual agreement may have the balance or maturity extended to provide additional
funds to the mortgagor. See Home Equity Loan.
Operating Assets
Those assets that contribute to the regular income from business operations, such as loans and
investments; the opposite of which are nonoperating assets, such as real estate held for future use and
non-income-producing intangibles such as goodwill. Nonperforming assets that were acquired with the
intent to produce operating income are included in operating assets.
Operating Capital
Funds available for use in financing daily business activities.
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Operating Expense
Any expense incurred in the normal operation of a business. This is distinguished from capital
expenditures, which are disbursements that are capitalized and depreciated over a period of years.
Operating Income
Income generated in the ordinary course of business. For savings associations, income generated by the
customary lending and deposit-taking business.
Operational Loss
Loan losses that arise outside of a relationship between a creditor and a borrower. Losses incurred in the
normal operation of a business.
For example, an independent third party created credit cards through the use of an illegal credit card machine
and stole the identification and credit card numbers of various individuals. The subsequent charges on these
credit cards and losses incurred by the bank would be an operational loss, because the bank did not issue
these credit cards and did not have a contractual relationship with a borrower.
Option
A right to buy or sell specific securities or properties at a specified price within a specified time. (1) Call option:
The right but not the obligation to purchase a specific amount of a specific commodity or security at a specified
price before a specified date. The seller (writer) grants such right to the buyer of the call. (2) Put option: The
right to sell a specific amount of a commodity or security to the writer of the put at a specific price on or before
a specific date. The buyer of a call or put pays to the seller (writer) a “premium” for being granted the right.
There are options on actual securities or commodities as well as options on futures contracts.
Option ARM
It is an adjustable rate mortgage on which the interest rate adjusts monthly and the payment adjusts annually,
with borrowers offered options on how large a payment they will make. Payment options include fully
amortizing, interest-only, and a "minimum" payment that may be less than the interest-only payment. The
minimum payment option results in a growing loan balance, or negative amortization.
Option Buyer (Holder)
A person who holds the rights granted by the option contract.
Option Seller (Writer)
A person who, in exchange for receiving the premium, agrees to assume the opposite side of an option
contract at a fixed price any time prior to the contract’s expiration date.
Originate a Loan
To make or issue a loan; the process whereby a lender qualifies a borrower, appraises the collateral,
processes all documents, advances funds, and places the loan on its books.
Origination Fee
A charge imposed by a lender for evaluating, preparing, and processing loan applications.
OTS
Office of Thrift Supervision.
Out-of-The-Money
An option where the strike price exceeds market for a call and is less than market for a put.
Over-Collateralization
Providing collateral in excess of what is needed to support the principal amount of secured debt. It is viewed
as using two separate loan pools. One pool provides sufficient cash flow to support the debt; the other pool
subsidizes cash flow shortfalls for loans with losses or delinquencies.
Overdraft
A draft or check written for an amount that exceeds the funds in the account on which the check is drawn. An
overdraft, if not covered immediately by the writer of the check, essentially becomes a borrowing.
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Overnight Money
(1) Any money that is replaced daily. (2) Funds loaned by one financial institution to another overnight,
including but not limited to the federal funds market. A means for firms to earn interest on undrawn funds
in their operating account at the end of the business day.
p
P&I
Abbreviation for principal and interest. This is customarily used to describe the regular monthly checks
that the servicer pays to the registered owner of the mortgage-backed securities.
P/O
Principal-only.
P/O Strip
Principal-only strip.
PAC
Planned Amortization Class.
Paid-In-Capital
The amount of capital in excess of the par value of common stock contributed to a corporation by its
owners.
Paper Gain Or Loss
An expression for unrealized gains or losses on securities in a portfolio, based on comparison of current
market quotations and the original costs.
Par Value
(1) The value assigned to a share of stock by the issuer at the time the stock is first offered for sale. The
par value may be more or less than the market value. (2) The value of a bond or note at maturity. (3)
The face value of a security.
Partially Amortizing Loan
A loan in which the periodic payments cover all of the interest charges but only part of the principal,
therefore an unpaid balance is left when the loan matures. See Balloon Loan.
Participation
(1) Ownership by two or more lenders or investors of all or a portion of a single mortgage or a package of
mortgages. (2) The cooperative origination by two or more lenders of a single, usually large, mortgage
loan. See Loan Participation.
Participation Certificate (PC)
A document that describes a package of loans and the portion that is being bought or sold. See Freddie
Mac Participation Certificate.
Participation Loan
(1) A loan made by one lender, known as the lead lender, in which one or more other lenders, known as
participants, own a part interest. (2) A loan originated by two or more lenders. (3) A loan having two or
more banks as creditors. See Loan Participation.
Pass-Through
This term, as used for mortgage-backed securities, signifies that the interest and principal payments due
and/or paid on the underlying mortgages are passed through to the holders of the securities on a pro rata
basis.
Pass-Through Securities
Securities that convey ownership of a fraction of each mortgage in a pool of mortgages backing the
security. Each security owner shares proportionally the interest and principal payments generated by the
underlying pool of mortgages.
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Passbook Account
A savings account that normally requires no minimum balance, or a nominal minimum balance of perhaps
$50 to $100, no minimum term, no specified frequency of deposits, and no notice or penalty for
withdrawals. A periodic statement mailed to the depositor has generally replaced the actual passbook, in
which transactions are recorded.
Passbook Loan
A loan secured by funds in a savings account on deposit with the same association originating the loan.
The pledged funds may not be withdrawn during the life of the loan. See Share Loan.
Past Due
An account on which payment has not been made according to the terms of the loan document.
Delinquent.
Payables
A bookkeeping term for any accounts or notes payable.
Payoff
The complete repayment of loan principal, interest, and any other sums due. Payoffs result from either
installment payments over the full term of the loan or lump sum payments, including payments made on
the sale of the underlying collateral.
PC
Participation Certificate.
PCCR
Purchased credit card relationship.
Pension Fund
A fund set up to collect regular premiums from employees and/or their employers, invest those premiums
safely and profitably, and pay out a monthly income to employees who retire after reaching a specific age
and length of service.
Permanent Mortgage Loan
A mortgage that is not a construction loan. Typically permanent mortgage loans are fully amortized for a
period of 20 years or more. However, this classification also includes balloon mortgages and short-term
mortgage loans that are not construction loans.
Permanent, Reserve, or Guaranty Stock
Par value of common stock outstanding. See Common Stock.
Personal Check
A check drawn on a depository institution by an individual against the individual’s own funds, as opposed
to a check drawn against a business account.
Planned Amortization Class (PAC)
The PAC feature of a security creates a reserve or sinking fund that attempts to ensure the planned
maturity for the bond or CMO tranche. Therefore, the payments on a PAC security are virtually insulated
from prepayment risk. See Short-term Planned Amortization Classes and Long-term Planned
Amortization Classes.
Pledged Assets
Assets pledged as collateral security against liabilities.
Pledged Deposits
Deposits to which a security interest has been attached or perfected by a creditor. Also called loans on
deposits and share loans.
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PMI
Private mortgage insurance.
Point
An amount equal to one percent of the principal amount of an investment or note. Loan discount points
are a one-time charge assessed at closing by the lender to increase the yield on the mortgage loan to a
competitive position with other types of investments.
Pool
A large group of mortgages which back a mortgage security. See Mortgage Pool Security.
Pooling-of-Interest Method
A method of accounting for business combinations. The criteria for using the pooling method are
discussed in APB Opinion No. 16. The application of FASB Statement No. 141 eliminated the use of the
pooling method for most banking institutions.
In the pooling-of-interest method, assets, liabilities, and capital of the combining associations are added
together on a line-by-line basis without any adjustments for current market value. The current carrying
value (typically, historical costs adjusted for amortization of premiums and depreciation and accretion of
discounts) of each asset, liability, and capital account of the disappearing association is added to the
corresponding account of the surviving association.
In the reporting period in which the merger occurs, income and expense is reported as though the entities
had been combined for the entire period. See Purchase Method.
Portfolio
Holdings of securities by an individual or entity. A portfolio may contain any marketable or potentially
marketable investment such as bonds, mortgages, debt securities, equity securities, etc.
Position
Having a position in a futures contract means to have bought or sold a contract that has not been offset.
See Open Position.
Positive Gap
An excess of assets repricing during a period of time over liabilities repricing during the same period; an
asset sensitive position. See Gap.
Preferred Deposits
Deposits of states and political subdivisions in the U.S. that are secured or collateralized as required
under state law. See Municipal Deposits.
Preferred Stock
Capital stock with preferences or special rights attached. For example, a stockholder may have a
preferred position to receive dividends and/or proceeds in liquidation. Preferred stock typically yields a
stated rate of interest, dividends, that may be cumulative or noncumulative. Preferred stock may be
redeemable by the holder or nonredeemable.
Premium
(1) The amount, often stated as a percentage, paid in addition to the face value of a note or bond to
adjust the yield to market. (2) A fee charged for the granting of a loan – points. (3) The price paid for an
insurance contract. (4) A product given free or sold at discount, offered as an inducement to the public to
open or add to a savings account, or to purchase other specified products or services. (5) The price paid
by the buyer of an option contract. See Discount.
Prepayment
A payment made before its due date. For example, a 30-year mortgage may be prepaid after ten years if
the mortgagor sells the property and the purchaser does not assume the mortgage. Borrowers typically
prepay loans when interest rates fall and they can obtain cheaper financing.
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Prepayment Clause
A provision in a promissory note stating the amount a borrower may repay ahead of schedule without
incurring a penalty.
Prepayment Penalty
A fee assessed by a lender on a borrower who repays all or part of the loan principal before it is due. The
prepayment penalty compensates the lender for the loss of interest that would have been earned had the
loan remained in effect for its full term.
Present Value
The discounted value of a certain sum to be paid in the future, based on the theory that cash received
today is worth more than the same amount of cash received in the future. See Net Present Value.
Price
The amount of money a seller receives for goods or services sold. Price is the amount of money actually
received by the seller, not necessarily the amount originally asked for or the face value. In the buying and
selling of bonds and mortgages, price is stated as a percentage of the face value of that instrument. For
example, if sold at par, the price is 100 percent of the face value; a premium price could be 105 percent;
and a discount price could be 95 percent of face value. See Premium, definition 1, and Discount.
Prime Rate
The interest rate charged by leading banks to their most secure customers. The prime rate tends to be a
yardstick for general trends in interest rates. The interest on adjustable rate loans is sometimes stated in
terms of the prime rate. For example, the rate of an adjustable rate loan may be stated as fifty basis
points (0.5%) over prime.
Principal
(1) The amount of funds borrowed. (2) At closing, the face amount of a loan. (3) The amount of debt,
exclusive of accrued interest, remaining on a loan.
Principal-Only
An account that does not charge interest on the remaining balance, so that payments are credited to
principal only.
Principal-Only Strip (P/O)
A security from which the interest coupons have been separated. The owner of a P/O strip of a mortgage
pool receives only the principal payments on the cash flow of the underlying mortgages. See InterestOnly Strip.
Private Mortgage Insurance (PMI)
Insurance policies written by private companies insuring lenders against loss resulting from defaults on
mortgages. Generally, OTS will recognize only those insurance companies whose PMI is accepted by
Fannie Mae or Freddie Mac, for purposes such as calculating high LTV and the risk weighting of a loan.
Profit
The excess income after all costs and expenses are paid. Net income.
Profit and Loss Statement
A summary listing a firm’s total revenues and expenses within a specified period of time. Also called a
statement of operations or an income statement.
Profitability
A firm’s ability to earn a profit and its potential for future earnings.
Promissory Note
A written promise to pay a specific sum of money to a specified party under conditions mutually agreed
upon. Also called a note, promise, or bond.
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Proprietary Mutual Funds
Those funds where the savings association, its affiliates, or its subsidiaries act as investment advisor to
the fund.
Prospectus
A written offer to sell property or a security that provides a detailed description of what is being sold,
including its characteristics and quality.
Prospectus Supplement
A document supplementing the Prospectus, disclosing pertinent information relating to the specific series
of securities that are being issued. It includes stated maturities, repayment periods under different
scenarios, specific financial assumptions as to the composition of the underlying collateral, the
capitalizations of the issuer, and other terms relevant to the series.
Provision for Loan Losses
A charge to expense for loan losses. See Valuation Allowance, Allowance for Loan and Lease Losses,
Specific Valuation Allowances, Charge-off, Write-off.
Purchase Method
A method of accounting for a business combination as the acquisition of one enterprise by another. The
criteria for using the purchase method are discussed in FASB Statement No. 141.
In an acquisition accounted for under the purchase method, the assets and liabilities of the disappearing
association must be recorded on the books of the surviving entity at fair value. The fair value of an asset
is generally its market or appraised value. The fair value of liabilities is generally their present value using
an appropriate discount rate. The carrying values of the capital accounts of the disappearing association
are not carried forward onto the books of the surviving association. To the extent possible, the cost of the
acquisition must be allocated to each identifiable asset or liability being acquired. Identifiable assets can
be tangible (such as securities or mortgage loans) or intangible (such as core deposit base). Any excess
of the cost of the acquisition over the fair value of the identifiable assets and liabilities is recorded as
goodwill.
The adjustments to record purchased assets at fair value due to interest rate fluctuations are reported as
a direct adjustment to assets. Adjustments to purchased deposits are reported on SC715, Unamortized
Yield Adjustments on Deposits; adjustments to any other liability are reported as a direct adjustment to
the liability.
Purchase-Money Mortgage
A mortgage where the purpose of the loan is to purchase the property securing the loan.
Purchased Credit Card Relationships
The premium paid to acquire established credit card accounts from a financial institution. Buyers pay a
premium over the dollar value of the credit card accounts themselves in order to acquire the customer
loyalty in an established line of business.
Push-Down Accounting
A method of accounting used when an entity changes ownership. The purchase cost to the new owner is
pushed down to the entity, thereby marking all assets and liabilities to market. This is also known as
new-basis accounting. At the date of acquisition, the purchased entity is given a new basis, which is
valued at market.
Put Option
A buyer acquires the right to sell a specific security, at a specified strike price, at any time before the
expiration of the option.
Q
QTL
Qualified Thrift Lender.
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Qualified Thrift Lender (QTL)
A savings institution that qualifies for low cost advances from its Federal Home Loan Bank by virtue of
having at least a certain percentage of its assets in housing-related investments. Institutions may use the
HOLA QTL test or the Internal Revenue Service tax code Domestic Building and Loan Association
(DBLA) test.
r
Rate of Return
The measure of income from or profitability of an investment.
See Return on Investment and Yield.
Rate-Sensitive Asset
An asset that will experience a change in its market value over some specific time period due to changing
interest rates in the market.
Rate-Sensitive Liability
A liability that will experience a change in its market value over some specific time period due to changing
interest rates in the market.
Real Estate
Land and all physical property attached to the land. Includes all physical substances below, upon, or
attached to land; thus houses, trees, and fences are classified as real estate. All else is personal
property.
Real Estate Investment Trust (REIT)
An organization, usually corporate, established for the accumulation of funds for investing in real estate
holdings, or the extension of credit to others engaged in real estate construction. These funds are usually
accumulated by the sale of shares of ownership in the trust.
Real Estate Loan
A loan fully secured by real estate, regardless of how the proceeds will be used.
Real Estate Mortgage Investment Conduit (REMIC)
A mortgage securities vehicle authorized by The Tax Reform Act of 1986. The REMIC rules authorize a
new entity (a REMIC) to hold commercial or residential mortgages and issue securities representing
interests in those mortgages. The REMIC itself generally is exempt from Federal income tax, and the
income from the mortgages held by the REMIC is taxed to the holders of the REMIC regular and residual
interests.
Real Estate Owned (REO)
A term frequently used by lending institutions to describe ownership of real property, generally acquired
as a result of foreclosure.
Receivables
Accounts receivable owned by a business. These may be pledged as collateral for a loan secured from a
bank or other financial institution, known as factored receivables, and classified as a secured commercial
loan.
Receiver/Receivership
A party appointed by a court or the FDIC to manage property subject to litigation, or the property and
affairs of a bankrupt financial institution. The receiver maintains and manages the property in the interest
of lenders or creditors until a final disposition of the property is made. A receivership ends the corporate
existence of an institution; it removes the institution from its owners, who lose their equity interest. See
Conservator.
Recorded Investment in a Loan
The principal balance of the loan less direct write-downs, adjusted for related discounts or premiums and
other yield adjustments. Carrying value before deducting valuation allowances. See Schedule SC,
Mortgage Loans.
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Recourse
The rights of a holder in due course of a negotiable instrument to force prior endorsers to meet their legal
obligations by making good the payment of the instrument if dishonored by the maker or acceptor. The
holder in due course must meet the legal requirements of presenting and delivering the instrument to the
maker of a note or acceptor of a draft, and must find that this legal entity is in default. See Residual.
Recovery
The collection of money on a loan that you previously charged-off.
Refinancing
The repayment of a loan with funds from a new loan secured by the same property as the first loan. The
new loan may be secured from the same lending institution or a different one, and typically has a modified
interest rate or maturity date. See Restructured Debt.
Registration Statement
A document containing a prospectus and other information required by the SEC in transactions involving
public offerings, such as the issuance of CMOs. The registration statement enables a series or, in the
case of a shelf registration, several series of securities to be offered.
REIT
Real Estate Investment Trust.
Release
(1) The discharge of property from a mortgage lien. (2) A written statement that an obligation has been
satisfied.
REMIC
Real Estate Mortgage Investment Conduit.
Rent
Income received from leasing property.
REO
Real estate owned.
REPO
Repurchase Agreement.
Reporting Period
The period for reporting the statement of operations and activity of an entity. This may be any number of
days or months, normally one, three, six, or twelve months. The reporting period for the TFR is three
months. The reporting period for Cost of Funds is one month.
Repossession
The reclaiming or taking back of items purchased on an installment sales contract on which the buyer has
fallen behind in payments and consequently defaulted.
Repriced at Maturity
An asset or liability that carries a fixed interest rate during its term and, therefore, cannot reprice until
maturity.
Repricing
A feature of some specific assets and liabilities, where the interest rates (and possibly other associated
features) change, based on predetermined terms and schedules. This feature may occur periodically or
only once.
Repurchase Agreement (REPO)
A financial transaction in which an organization borrows money by selling securities and simultaneously
agreeing to buy them back later at a higher price, generally less than 30 days. Repurchase agreements
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are commonly called “repos”, and they function similarly to a secured loan with the securities serving as
collateral. In a resale agreement, the organization, in effect, loans money by buying securities and
agreeing to sell them back to the borrower later at a higher price. In either case, the difference between
the bought and sold price of the securities constitutes the yield on the transaction. See Resale
Agreement.
Resale Agreement
A financial transaction in which an organization lends short-term money by buying securities and
simultaneously agreeing to sell them back later at a higher price. See Repurchase Agreement.
Reserve
(1) A valuation allowance. (2) A portion of retained earnings that has been set aside for the purpose of
assuming liabilities. (3) Cash set aside to absorb losses or contingencies that have not yet occurred but
are foreseen. See Valuation Allowances.
Reserve For Bad Debts
See Bad Debt Reserve.
Reserve Requirements
The portion of deposits in transaction accounts that member banks are required to maintain with a
Federal Reserve Bank.
Residential Mortgage
A loan extended with residential real estate as collateral.
Residual
(1) Defined in 12 CFR Part 567.1 as any balance sheet asset that represents an interest, including a
beneficial interest, created by a transfer of financial assets that qualifies as a sale under GAAP and that
exposes the institution to a credit risk that exceeds a pro rata share of the institution’s claim on the
transferred assets. The transfer of assets may be through securitization or otherwise; the credit risk may
be directly or indirectly associated with the transferred assets; and the exposure to credit risk may be
through either subordination provisions or other credit enhancement techniques.
(2) Purchased or retained beneficial interests in securitized financial assets.
(3) The tranche of a CMO that represents the difference between the cash flows received on the
mortgages collateralizing the CMO and the required interest payments to holders of all other tranches.
The residual tranche represents an equity interest in the CMO.
Restructured Debt
Debt that has been restructured by adding to the outstanding principal balance or by modifying the terms
of the debt. Restructured debt involves debt of borrowers who may or may not be experiencing financial
difficulty. See Troubled Debt Restructuring.
Retained Earnings
An equity capital account comprised of accumulated unallocated profits from the current and all prior
reporting periods. Retained earnings are the profits that are neither paid out in cash dividends to
stockholders nor used to increase other equity accounts.
Return on Assets
A financial measurement of how efficient a business is in using its assets. Return on assets is the ratio of
net income divided by average total assets.
Return on Equity
A measure of how effective a business has been in investing its net worth. Return on equity is expressed
as a ratio, calculated by dividing net income by average equity.
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Return On Investment
The rate, usually expressed on a bond equivalent basis, needed to equate the present value of future
cash flows with a given purchase price for that issue. It assumes that periodic cash distributions can be
reinvested at the same rate.
Revenue
All earnings received from selling a firm’s product or service during a given period.
Revenue Bonds
Issued by state and local governments whereby the revenues from a project, such as a toll bridge, repay
the borrowing. In contrast to a general obligation bond backed by the taxing power of an issuer.
Reverse Repurchase Agreement
See Repurchase Agreement.
Revolving Credit
A line of credit extended to customers to use as often as desired up to a certain dollar limit. The line of
credit may be paid in full upon receipt of a monthly statement or paid off in several installments, in which
case an interest charge is added.
Risk
The possibility that a loss will occur if a debt is not paid.
Risk-Controlled Arbitrage
A method used to fund long-term assets with short-term liabilities, using a hedge to reduce interest-rate
risk. For example, using repurchase agreements (short-term) to purchase mortgage-backed securities
(long-term) and using a futures contract to hedge against rising interest rates.
Rollover
The practice of reinvesting capital and interest of one investment into a substantially identical new
investment.
s
Safety Factor
The difference between net income from collateral and the payment of interest on a funded debt. See
Spread.
SAIF
Savings Association Insurance Fund.
Sale and Servicing Agreement
In secondary market transactions, a contract under which the seller/servicer agrees to supply, and the
buyer to purchase, loans from time to time. The contract sets forth the conditions for the transactions and
the rights and responsibilities of both parties.
Sale-Leaseback
The sale of property that is then leased back to the seller. See FASB Statement No. 28, Accounting for
Sales with Leasebacks.
Sales Draft
An instrument that arises from using a bankcard that obligates the cardholder to pay money to the card
issuer.
Sallie Mae (SLMA)
Student Loan Marketing Association.
Salvage
An attempt to recover some portion of a loan that has been written off the bank’s books.
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SAM
Shared-Appreciation Mortgage.
Sasser
A SAIF-insured institution that has a bank charter and, therefore, that OTS does not regulate.
Satisfaction of Judgment
The legal procedure followed when a debtor pays the amount due as determined by the court in a
judgment.
Savings
The amount of income that is not consumed.
Savings Account
Money that is deposited in a depository institution, normally not subject to withdrawal by check. Savings
accounts usually bear interest. Also called passbook accounts.
Savings Association Insurance Fund (SAIF)
A fund, administered by the FDIC, insuring deposits of member savings associations up to $100,000 per
depositor. SAIF was established by FIRREA in 1989 to replace the FSLIC as the insurer of savings
associations. SAIF was merged into the Deposit Insurance Fund in 2006 pursuant to the Federal Deposit
Reform Act of 2005. See Deposit Insurance Fund.
Savings Certificate
Evidence of the ownership of a savings account typically representing a fixed amount of funds deposited
for a fixed term at a specified rate of interest. See Certificate of Deposit.
Savings Liability
The aggregate amount of an association’s deposits, including earnings credited to such accounts, less
redemptions or withdrawals.
SBA
Small Business Administration.
Seasoned Loan
A loan that has been on the association’s books long enough to demonstrate that the borrower’s credit is
sound.
SEC
Securities and Exchange Commission.
Second Lien
A lien subordinate to the first. See Junior Lien, Second Mortgage.
Second Mortgage
A mortgage that has rights subordinate to the first mortgage (the proceeds from a foreclosure sale must
pay the first mortgage before any funds can go to repay the second).
Secondary Market
The market for reselling outstanding securities, opposite of primary market in which newly created
securities are sold. See Freddie Mac, Fannie Mae, and Ginnie Mae.
Secured Creditor
A creditor whose obligation is backed by collateral.
Secured Debt
Any debt for which some form of acceptable collateral has been pledged.
Securities
Any documents that identify legal ownership of a physical commodity or legal claims to another’s wealth.
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Securitize
To put in the form of a security. For example, Freddie Mac securitizes a savings association’s loans
when they pool the loans into a participation certificate.
Security
(1) The collateral given, deposited, or pledged to secure the fulfillment obligation or payment of a debt.
(2) An instrument that provides evidence of debt or of rights to share in earnings or distribution of
property.
Security Ratings
Ratings placed on securities according to the degree of investment risk incurred by the purchaser.
Segregated Account
Funds set aside to meet specific obligations. Usually applies to cash set aside to meet drafts drawn
under a letter of credit issued by the savings association; may also apply to funds set aside to honor
checks certified by the savings association.
Self-Liquidating
Describes an asset that can be converted into cash or subject to the total recovery of invested money
over a period of time.
Selling Hedges
See Short Hedge.
Senior Lien
Opposite of Junior Lien. See First Mortgage.
Sensitivity Analysis
Another term for gap analysis, an evaluation of an association’s make-up, revealing the areas in which it
is exposed to the risk of changing interest rates. See Gap.
Serial Bond Issue
Bonds of a single issue that mature on staggered dates rather than all at once. The purpose of a serial
bond issue is to help the issuer retire the bonds in small quantities over a long period.
Service Charge
A fee for services rendered or to be rendered.
Service Corporation
A corporation previously defined in OTS regulations as being owned by one or more savings associations
and performing services and engaging in certain activities for its owners, such as originating, holding,
selling, and servicing mortgages; performing appraisal, brokerage, clerical, escrow, research, and other
services; and acquiring, developing, or renovating and holding real estate for investment purposes. This
term became obsolete with the issuance of the Subsidiary and Equity Investment Rule, effective January
1, 1997.
Servicing Assets
Benefits recognized by an entity undertaking a contract to service loans and other financial assets.
Servicing includes collecting principal, interest, and escrow payments from the borrowers; paying taxes
and insurance from escrowed funds; monitoring delinquencies; executing foreclosure, if necessary;
temporarily investing funds pending distribution; remitting fees to guarantors, trustees, and others
providing services; and accounting for and remitting principal and interest payments to the holders of
beneficial interests in the financial assets.
SFAC
Statement of Financial Accounting Concepts issued by the Financial Accounting Standards Board.
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SFAS
Statement of Financial Accounting Standards issued by the Financial Accounting Standards Board. Also
called FASB Statements. See Financial Accounting Standards Board.
Share Loan
A loan secured by funds on deposit at a financial institution. One purpose of a share loan is to preserve
interest due on deposits by not withdrawing the funds until the date on which the interest payment is due
or the account matures. See Passbook Loan
Shared-Appreciation Mortgage (SAM)
A home-financing technique where the borrower receives a mortgage rate that is lower than the prevailing
rates. The borrower must agree to give the lender a share of the profits from the eventual sale of the
property. A SAM has payments that are based on a normal (typically 30- year) amortization schedule, but
the loan becomes due and payable at an earlier date (typically not later than at the end of 10 years). A
SAM has an interest rate below that on a conventional mortgage and a contingent interest feature, where
at either the sale or transfer of the property or the refinancing or maturity of the loan, the borrower must
pay the lender a share of the appreciation of the property securing the loan.
Shareholder
The owner of shares of equity in an organization. The owners of a corporation.
Shelf Registration
A type of Registration Statement, pursuant to Rule 415 of the SEC, that authorizes a certain principal
amount of securities to be issued, in whole or in parts, in the future, thereby spreading the issuance dates
over a period of time.
Short
(1) The sale of a futures contract. (2) A trader who has a short position in a commodity.
Short Hedge
A hedge transaction in which futures contracts are sold and then purchased; a short hedge protects the
hedger against interest rate increases, the major risk faced by financial institutions.
Short-Term Debt
An obligation that is usually due within one year.
Short-Term Fixed-Rate Tranches
CMO tranches that have fixed rates and expected maturity of five years or less.
Short-Term Planned Amortization Classes (PACs)
CMO tranches that have fixed rates, a prioritized repayment schedule within certain prepayment speeds,
and expected maturity of five years or less. Targeted Amortization Classes (TACs) are considered to be
substantially similar to PACs for reporting purposes.
Short-Term PAC Support Tranches
CMO tranches that have fixed rates, expected maturity of five years or less, and are part of a CMO
structure that contains a PAC or TAC tranche(s).
Single-Family Dwelling
A housing unit designed for occupancy by one individual or family. See Dwelling Units, 1-4.
Sinking Fund
The obligation to retire debt instruments according to a predetermined schedule.
Special Redemption
Special redemptions are designed to allow the issuer to retire a security earlier than scheduled,
precluding interest from accruing during the remaining period. The amount of principal redeemed is
limited to the amount that would have been retired at the next scheduled payment date.
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Specific Valuation Allowance
A valuation allowance representing an amount classified as a loss on specific assets. In the TFR, assets
are reported net of specific valuation allowances. See Valuation Allowance.
Spread
(1) The difference between interest income and interest expense. (2) The simultaneous purchase of one
futures contract and sale of another, either different contract months or underlying instruments. One does
this to try to profit from differing rates of change in different contract months or contracts, often due to
changing market factors, such as, rising or falling rates, shifts in yield curve.
Standard Prepayment Assumption
A commonly used prepayment model based on an assumed monthly rate of prepayment of the then
current principal balance of a pool of new mortgage loans.
Standby Letter of Credit
A letter of credit that can only be drawn against if a specified business transaction is not performed.
Standbys
Non-binding commitments to make or take delivery of securities, commonly used in the mortgage market
when dealing with Fannie Mae.
Stock Dividend
See Dividend, Stock.
Strike Price
The price at which the holder of the call or put may exercise his right to purchase or sell the underlying
futures contract. Synonymous with exercise price.
Strip
A hedge transaction which involves selling or buying the same futures contract across several delivery
months, such as, selling T-Bills for June, September, and December at the same time. The objective is to
lengthen the effective hedging period.
Strip Certificate
A certificate showing ownership of a fractional share of stock that can be converted into a full share when
presented in amounts equal to a full share.
Strip Hedge
The selling of a series of futures contracts with different maturities. The purpose is to lock in interest
costs that vary based on the contract settlement date.
Structured Securities
Debt securities with derivative-like characteristics that are issued by corporations and governmentsponsored enterprises (GSEs), including Freddie Mac, Fannie Mae, and the Federal Home Loan Banks.
Structured notes take various forms and often contain complex rate-adjustment formulas and embedded
options, such as, calls, caps, and collars.
Student Loan Marketing Association (Sallie Mae)
A government-sponsored private corporation created to increase the flow of funds into loans by facilitating
the purchase of student loans in the secondary market.
Subordinate Organization
Any corporation, partnership, business trust, association, joint venture, pool, syndicate, or other similar
business organization in which a savings association has a direct or indirect ownership interest. There is
an exception when that ownership interest qualifies as a pass-through investment pursuant to 12 C.F.R. §
560.32 and the savings association designates it as such.
Subordinated Debt
Obligations whose liquidation preference is inferior to that of other debt.
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Subprime Lending
Credit extended to borrowers exhibiting higher (frequently much higher) risk of default characteristics than
traditional bank lending customers. Risk of default may be measured by traditional credit risk measures
(credit/repayment history, debt-to-income levels, etc.) or by alternative measures such as credit scores.
Subprime borrowers represent a broad spectrum of debtors ranging from those who have exhibited
repayment problems due to an adverse event, such as job loss or medical emergency, to those who
persistently mismanage their finances and debt obligations. Subprime lending does not include loans to
borrowers who have had minor, temporary credit difficulties but are now current.
Subsidiary
Any organization controlled by another organization. The OTS Subsidiary and Equity Investment Rule
defines subsidiary as a consolidated subsidiary and refers generically to organizations under the control
of a parent organization as subordinate organizations. See Consolidation.
Substandard
Describing conditions making a risk less desirable than normal for its class. A classification of assets
under OTS Regulations. See Classified Assets.
Super-Floater
An asset that has a variable rate that adjusts by a multiple of a change in an interest-rate index. Thus if
the super-floater adjusts at 1.25 times the change in LIBOR, a decrease of two basis points in LIBOR
would cause a decrease of 2.5 (2 x 1.25) basis points in the super-floater. Super-floater is most
commonly used to describe CMO tranches that reprice based on a formula containing a multiple of the
three-month LIBOR rate.
Super Floating Rate Tranches
CMO tranches that have rates adjusting at some multiple of, and in the same direction as, an index such
as LIBOR.
Super Principal Only (P/O) Tranche
A long-term zero coupon, deep discount PAC that is the only support tranche of a PAC or TAC CMO.
Supervisory Authority
The official or officials authorized by law to ensure that associations comply with the governing charter,
statutes, and by-laws.
Supervisory Merger
The takeover of one savings association – typically an insolvent association – by another with our
oversight.
Suspense Account
A general ledger account used to hold over unposted items so the business day can balance at closing.
Swap
An agreement between two parties to exchange a series of cash flows, one representing a fixed rate and
the other a floating rate. In a currency swap, two parties contract to exchange the cash flows - of equal
net present value of specific assets or liabilities that are expressed in different currencies.
In the classic – widely known as plain vanilla – interest-rate swap, two parties contract to exchange
interest service payments, and sometimes principal service payments, on the same amount of
indebtedness of the same maturity with the same payment dates - one providing fixed interest-rate
payments in return for variable-rate payments from the other and vice versa. Basis swaps – floating rate
swaps based on different indices, such as prime against LIBOR – and combined interest rate and
currency swaps, circus swaps, are also common. There are numerous variations involving many
counterparts that result in highly complex swap transactions.
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t
T-Bill
Treasury Bill.
TAC
Targeted Amortization Class.
Tangible Capital
Our capital regulations define tangible capital as equity in accordance with GAAP, adjusted for unrealized
gains and losses on certain available-for-sale securities, less investments in nonincludable subsidiaries,
less goodwill and other intangible assets, less certain nonqualifying equity instruments, plus
noncontrolling interest in includable consolidated subsidiaries, plus nonwithdrawable deposits of mutual
associations. Our capital rule requires savings associations to hold a ratio of 1.5% tangible capital to
tangible assets.
Tangible Net Worth
GAAP net worth less goodwill and other intangible assets.
TBA
Abbreviation for future pools to be announced which are bought and sold for future settlement. To be
announced refers to interest rates and due dates which are determined at a later date. Trading in these
securities is done on a yield basis.
TDR
Troubled Debt Restructuring.
Teaser Rate
The initial below-market interest rate offered on an adjustable-rate mortgage in return for the borrower
sharing the risk of rising rates during the course of the loan.
Term Federal Funds
Federal funds with a term of more than one business day.
TFR
Thrift Financial Report.
Threshold Rate
Represents the rate established by management policy for a fixed-rate asset category above which new
assets may be added and below which lower yielding assets will be sold. Should be tied to policies
related to dollar volume and maturity limits.
Thrift Financial Report
The financial report that we require of all savings associations under our jurisdiction; OTS Form 1313.
Thrift Holding Company
See Holding Company.
Tick
Refers to a change in price, either up or down. Synonymous with minimum fluctuation.
Time Deposit
An interest-bearing deposit that will mature on a specific date.
Time-Share Loan
A loan that enables a buyer to take part in a form of real property ownership that grants each of several
owners the exclusive right to occupy a housing unit during a specified time period each year. These
loans are reported as nonmortgage loans on the TFR.
GLOSSARY
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Time Value
A portion of an option premium unrelated to buying and selling at a more favorable price.
Trade
A term that indicates the consummation of a security transaction, either a purchase or a sale.
Trade Date
The date a security transaction is actually executed.
Trading Account
Securities that you intend to hold principally for the purpose of selling them in the near term. Trading
activity includes frequent buying and selling of securities for the purpose of generating profits from price
fluctuations. Securities in a trading account must be listed on financial reports at market value.
Tranche
Also called a class. CMOs generally have several bond classes; each bond is considered a separate
tranche or class, each with different maturities and/or interest rates and accrual structures.
Troubled Debt Restructuring
A troubled debt restructuring occurs when the financial institution provides the borrower certain
concessions that it would not normally consider. The concessions must be in light of the borrower’s
financial difficulty, and the objective must be to maximize recovery of the institution’s investment.
Troubled debt restructures are often, but not always, the result of legal proceedings or negotiations
between the parties.
Troubled debt restructures include situations in which the reporting association accepts any one of the
following:
•
A note, secured or unsecured, from a third party in payment of its receivable from the borrower.
•
The underlying collateral in payment of the loan, either through foreclosure, other transfer of title, or
in-substance foreclosure.
•
Other assets in payment of the loan.
•
An equity interest in the borrower or its assets in lieu of its receivable.
•
A modification of the terms of the debt including, but not limited to any of the following:
o
Reduction in stated interest rate.
o
Extension of maturity at an interest rate below market.
o
Reduction in the face amount of the debt.
o
Reduction in the accrued interest.
A foreclosure or other asset received in payment of a loan is TDR only if a loss is incurred. In calculating
whether or not a loss occurred, the fair value of the foreclosed property is compared to the recorded
investment in the receivable without deducting valuation allowances or charge-offs.
Any restructuring of loan terms must be accounted for in accordance with GAAP as principally prescribed
in FASB Statement Nos. 114, 118, 15 and 5. Foreclosed assets are reported at fair value less cost to
sell.
Treasury Bill
A U.S. government short-term security sold to the public each week at a discount, maturing in 91 to 182
days.
Treasury Bond
See Bond, Treasury.
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Treasury Note
A U.S. government long-term security, sold to the public, maturing in one to five years.
Treasury Stock
Stock reacquired by the same company that issued it with the intention of subsequent resale or transfer,
such as an Employee Stock Option Plan.
uv
Unlimited Mortgage
An open-end mortgage; a mortgage not limited to a fixed amount.
Unrealized Gain or Loss
A loss that you have not yet realized because the related asset has not yet been sold or disposed of.
VA
(1) Valuation Allowance. (2) Veterans’ Administration.
Valuation Allowance
A contra-asset established against receivables and investments based on the amount expected to be
collected. Valuation allowances are established for covering probable and estimably credit losses. Refer
to FASB Statement No. 5. See Allowance for Loan and Lease Losses, Allowance, Specific Valuation
Allowance, and General Valuation Allowance.
Variable Rate
An interest rate on an asset or liability that can be repriced periodically when market interest rates
change, without regard to maturity. Also called “floating rate”. See Adjustable Rate Mortgage.
Variation Margin
See Maintenance Margin.
Voting Stock
Stock for which the holder has the right to vote in the election of directors, the appointment of auditors,
and other matters brought up at the annual stockholders’ meeting. Most common stock is voting stock;
most preferred stock is nonvoting stock.
wxyz
Warehouse Loan
A short-term line of credit used by mortgage bankers to fund loans prior to sale. Financial institutions that
hold loans as collateral until collateral is delivered to the investor usually provide this type of credit.
Warehousing
Inventory financing. See Warehouse Loan.
Weighted Average Coupon (WAC)
The WAC is calculated as a weighted-average of the underlying mortgage interest rates as of the issue
date, using the balance of each mortgage as the weighting factor. A WAC is needed only when the
underlying mortgages have varying interest rates.
Weighted Average Maturity (WAM)
The weighted average is the remaining term to maturity of the underlying mortgages at the issue date,
using the balance of each mortgage as the weighting factor.
Weighted Average Remaining Term
The remaining term to maturity over time as the security ages. This number can be calculated at any
point in time. Sometimes weighted average remaining term is mistaken for the weighted average
maturity, which is the remaining term at the issue date. The weighted average remaining term must be
recalculated each month and is impacted by prepayments.
GLOSSARY
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Whole Loans
Mortgages that are not divided into participation units or pooled to back securities or participation
certificates.
Whole Pools
A mortgage certificate where ownership is represented by an entire pool of mortgage loans, as opposed
to a fractional interest in a pool.
With Recourse
An agreement where the seller assumes a stated level of risk for the performance of the asset sold; the
purchaser has the right to endorse a claim against the seller for sustained damages in the case of
nonperformance. See Recourse.
Without Recourse
An agreement where the purchaser accepts all risks in the transaction, and gives up rights to any
recourse. See Recourse.
Wraparound Mortgages
A second mortgage that wraps around, or exists in addition to, a first or other mortgage(s). The lender
assumes the existing mortgage(s) thus continues to pay the monthly installments at the original lower
interest rate(s), and also loans the purchaser additional money to meet the higher purchase price
specified in the contract. The rate charged to the purchaser on the total mortgage amounts is higher than
the original rate. This type of mortgage allows the terms of the original mortgage to be satisfied,
compensates the seller for the sale of his or her investment, and allows the buyer to purchase a home.
The wraparound lender benefits from the below-market rates of the existing mortgage that the lender has
assumed while charging the purchaser a higher rate on the full loan.
Wraparound mortgages are also used as a method of obtaining refinancing when an owner wants to
increase the amount of mortgage outstanding. In this case the lender assumes the existing mortgage
and the borrower enters into a loan in an amount covering both the old mortgage and the additional funds
disbursed.
Write-Off
An asset or portion of an asset charged off as a loss because it is determined to be uncollectable. See
Charge-off.
Write-Up
Increasing an asset’s book value by adjusting the value of an asset to correspond to an appraisal or
market value. Unrealized gains.
Year-End Adjustment
A ledger account modification entered at the close of a fiscal period. The modification might be the result
of an accrual, prepayment, physical inventory, reclassification, policy change, audit adjustment, or other
entry.
Yield
The effective annual rate of income being accrued on an investment, expressed as a percentage of the
original price.
Yield Adjustment
A portion of the purchase price of an asset that is an adjustment to interest over a specified period,
typically over the life of the asset. A yield adjustment is set up in a separate account from the asset and
is accreted to income at a rate similar to interest. Examples: Discounts and premiums, loan fees, prepaid
interest, etc.
Yield to Maturity
The rate of return earned by a debt instrument held to maturity. The rate of return calculates interest
payments reinvested at the coupon rate, and factors in capital gains or losses.
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YTD
Year-to-date. Generally designates that income figures are for the year up to a given date, rather than for
a shorter period such as a month or a quarter.
Zero Rate
A type of asset or liability that bears no interest.
cash.
Examples: Commercial checking accounts and vault
Zero-Coupon Bond
See Bond, Zero Coupon.
GLOSSARY
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2158
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MARCH 2010
INDEX
A
Accountants
Change of .................................................................1102
Codes for type of work performed ...........................1101
Accounting fees ..............................................................312
Accounting principles
Retroactive changes to..............................................1008
Accounts Payable............................................................229
Accounts receivable........................................................222
Accrual basis of accounting ............................................301
Accrued interest receivable
Nonmortgage loans.....................................................216
Accrued interest receivable
Mortgage loans...........................................................212
Mortgage-backed securities........................................206
Securities ....................................................................204
Advertising expenses ......................................................312
Affiliates
Transactions with ...........................................1009, 1010
AICPA SOP No. 93-6.....................................................228
Allowances for loan and lease losses
Mortgage loans...........................................................212
nonmortgage...............................................................216
Tier 2 Capital............................................................1611
Amended reports.............................................103, 301, 316
ANNUAL MORTGAGE LOANS DISBURSED FOR
PERMANENT LOANS ...........................................1803
APB No. 16
Discounts and premiums ............................................226
Schedule SC, Goodwill ..............................................221
Asset codes
Schedule CMR .........................................................2011
Asset-backed securities...................................................204
Assets
Average ....................................................................1012
Contingent ..................................................................706
Audit codes ...................................................................1101
Available-for-sale securities ...........................................202
Gain or loss in regulatory capital..............................1606
B
Balance sheet
Classified, defined ....................................................1407
Bank accounts
Zero balance ...............................................................224
Bank-owned life insurance
Income........................................................................310
Schedule SC ...............................................................220
Bilateral netting agreement
Risk weighting..........................................................1629
Borrowed money
Interest expense ..........................................................304
Schedule SC ...............................................................227
Borrowings
Average ....................................................................1014
Discounts and premiums ............................................227
Interest Payable.......................................................... 229
Branch office
Sale of ........................................................................ 309
Broker
Fee income................................................................. 307
Receivables ................................................................ 222
Broker payables.............................................................. 230
Brokered deposits........................................................... 901
Building lots................................................................... 211
C
Capital
In excess of par value............................. 232, 1403, 1410
Reconciliation of...................................................... 1006
Regulatory ....................................See Regulatory capital
Capitalized interest......................................................... 305
Cash
Risk weighting ......................................................... 1615
Schedule SC............................................................... 202
Cash flow ....................................................................... 801
Cash Flow Hedges
Gains(Losses) in Schedule SC ............... 233, 1404, 1411
Cash items
Risk weighting ......................................................... 1618
Schedule SC............................................................... 202
Charge-offs..................................................................... 401
Charitable contributions ................................................. 314
Charter Conversion ........................................................ 103
Checks
In process of collection .............................................. 202
Classified assets ............................................................. 416
CMOs
Interest expense ......................................................... 304
CNFIs............................................................................. 221
Available-for-Sale.................................................... 1002
Income from............................................................... 310
Collective investment fund........................................... 1303
Commercial loans
Nonmortgage in Schedule SC .................................... 213
Sales/Purchases.......................................................... 806
Commercial paper
Liability ..................................................................... 228
Commercial Paper.......................................................... 204
Commitment fees
Amortization .............................................................. 307
nonrefundable ............................................................ 230
Refundable................................................................. 226
Commitments
Risk weighting ......................................................... 1625
Schedule CC .............................................................. 701
Common stock ........................................... 232, 1403, 1410
Issuance costs adjusting retained earnings ............... 1009
Common trust fund ...................................................... 1303
Computer software
Amortization .............................................................. 313
Schedule SC............................................................... 221
Consolidation ............................................... 201, 301, 1802
INDEX
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Regulatory capital.....................................................1602
Schedule SO ...............................................................301
Construction loans
Balances in Schedule SC ............................................208
Churches.....................................................................209
Combination land/construction loan...........................209
Combined with permanent loan..................................209
Condominiums ...........................................................209
Conversion to permanent loans ..................................802
Dormitories ................................................................209
LIP..............................................................................701
Mobile home parks.....................................................209
Multifamily, Schedule SC ..........................................209
Nonresidential, Schedule SC ......................................209
Retirement homes.......................................................209
Risk weighting, qualifying .......................................1622
Single-family developments.......................................208
Undisbursed commitment...........................................701
Unsecured...................................................................214
Consumer loans
Sales/Purchases ..........................................................806
Schedule SC ...............................................................214
Unused line of credit ..................................................704
Contributed capital...................................... 232, 1403, 1410
Convertible securities
Issuance costs .............................................................222
Cooperative buildings
Loans on units in ........................................................208
Core capital.........................................................1602, 1603
Core deposit intangibles
Amortization ......................................................221, 313
Corporate Debt Securities ...............................................204
Credit card lines
Risk weighting..........................................................1625
Credit cards
Overpayments.............................................................225
Schedule SC ...............................................................215
Servicing income........................................................307
Unused line of credit ..................................................704
Credit-enhancing interest-only strips
Defined.....................................................................1004
Custodial services .........................................................1302
D
Data Processing Services
Income from ...............................................................310
Deferred income .............................................................229
Deferred loan fees...........................................................207
Deferred Policy Acquisition Costs................................1406
Deferred tax assets
Regulatory capital.....................................................1605
Cash items.......................................................................223
Delinquent loans .............................................................501
Deposit Insurance Fund ................................................2117
Deposit insurance premiums
Expensed ....................................................................314
Prepaid .......................................................................222
Deposits
Average ....................................................................1013
Broker-originated .......................................................901
Definition of ...............................................................223
2202
INDEX
Demand, defined........................................................ 907
Discounts and Premiums............................................ 226
Escrows...................................................................... 225
Interest expense ......................................................... 304
Interest payable.......................................................... 229
Jumbo ................................................................ 902, 903
MMDA ...................................................................... 905
Overdrafts, consumer................................................. 216
Passbook .................................................................... 906
Penalties for early withdrawals .................................. 304
Preferred .................................................................... 904
public funds – Schedule SC ....................................... 223
Reciprocal balances ................................................... 224
Risk weighting ......................................................... 1617
Schedule DI ............................................................... 901
Time........................................................................... 906
Transaction ................................................................ 905
Transaction account fees............................................ 307
Types of accounts ...................................................... 905
Unamortized brokers fees .......................................... 226
Uninsured................................................................... 904
Zero coupon ............................................................... 223
Derivatives
Fair value in assets..................................................... 222
DIF ....................................................................... 223, 2117
Direct credit substitutes.................................................. 704
Directors' fees and expenses........................................... 311
Dividend income ............................................................ 302
Dividends
Capital reconciliation............................................... 1007
Other than cash ........................................................ 1008
Payable....................................................................... 230
Dwelling unit
Defined .................................................................... 1906
E
EITF Consensus No. 85-41 ............................................ 233
Electronic Filing............................................................. 103
Electronic Filing System (EFS)...................................... 101
Employee benefits .......................................................... 311
Employees
Number of................................................................ 1001
Equity capital
Reconciliation of...................................................... 1006
Equity instruments
Inc. in Tier 2 Capital ................................................ 1611
Equity investments
in regulatory capital ................................................. 1602
Regulatory capital, deduction from.......................... 1612
Equity securities
Defined in capital..................................................... 1612
Gains incl. in Tier 2 capital...................................... 1611
Schedule SC............................................................... 204
Escrows .......................................................................... 225
Interest expense ......................................................... 304
Tax and insurance ...................................................... 225
ESOPs
Debt ........................................................................... 228
Employer contributions to.......................................... 311
Unearned shares......................................................... 233
Examination fees............................................................ 314
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Excess servicing....................................See Servicing assets
Extraordinary items
Gains and losses .........................................................316
F
Fannie Mae
Stock...........................................................................204
FASB Statement No. 34
Schedule SC, Real estate investments ........................218
Schedule SO ...............................................................305
FASB Statement No. 109
Schedule SC ...............................................................222
FASB Statement No. 115
Unrealized gains and losses in equity ..... 232, 1404, 1411
FASB Statement No. 115
Equity investments not subject to...............................219
Equity Securities ........................................................204
Schedule SC ...............................................................202
Schedule SC, Mortgage-backed securities..................205
Schedule SC, Servicing assets ....................................221
FASB Statement No. 133
Borrowings.................................................................227
Deposits......................................................................226
Fair value of derivative instruments ...........................230
FASB Statement No. 133
Mortgage Loans..........................................................207
Nonmortgage Loans ...................................................213
Servicing assets ..........................................................220
FASB Statement No. 140
Repurchase agreements ..............................................227
FASB Statement No. 140
Schedule SC, CNFIs...................................................221
Schedule SC, Servicing assets ....................................220
FASB Statement No. 141
Goodwill Amortization...............................................313
Schedule SC, Goodwill ..............................................221
FASB Statement No. 142................................................313
FASB Statement No. 66
Schedule SC, Sale of real estate .................................230
Schedule SO ...............................................................309
FASB Statement No. 72
Amortization ..............................................................313
FASB Statement No. 77
Schedule SC, Sale of Loans........................................228
FASB Statement No. 87
Pension Intangibles.....................................................221
Federal Funds
Sold ............................................................................203
Term ...........................................................................203
Federal funds purchased
Interest expense ..........................................................304
Federal Funds purchased ................................................227
Federal funds sold
Risk weighting..........................................................1618
Federal Home Loan Bank
Accrued dividends......................................................222
Advances ....................................................................227
Commitment fees .......................................................227
Deposits......................................................................202
Dividends ...................................................................303
Prepayment fees .........................................................316
MARCH 2010
Prepayment penalties ................................................. 304
Reverse repurchase agreements ................................. 227
Securities ................................................................... 203
Stock, Risk weighting .............................................. 1617
Fee Income..................................................................... 307
FHA/VA Loans
Schedule LD .............................................................. 601
FHLMC
Participation certificates............................................. 206
Securities ................................................................... 203
FICO bonds .................................................................... 203
Fiduciary services
Income ..................................................................... 1307
Managed accounts.................................................... 1303
Nonmanaged accounts ............................................. 1304
Settlements and losses.............................................. 1315
Fiduciary Services........................................................ 1301
Filing
Filing Deadline .......................................................... 102
Financing leases
Commercial................................................................ 214
Fiscal year end.............................................................. 1101
Holding company..................................................... 1402
FNMA
Mortgage securities, risk weighting ......................... 1617
Pools .......................................................................... 206
Securities ................................................................... 203
Foreclosed assets............................................................ 216
Deed in lieu of ........................................................... 415
During the quarter...................................................... 415
Gain or loss from sale ................................................ 308
Held over 5 years ....................................................... 218
Income from operations ............................................. 308
In-substance ............................................................... 216
Junior liens................................................................. 217
Provision for loss ....................................................... 313
Troubled debt restructured................................. 217, 415
Valuation allowances................................................. 403
Writing down to market ..................................... 216, 305
Foreign currency translation....................... 233, 1404, 1411
Forward agreements
Risk weighting ......................................................... 1627
Fraud expense ................................................................ 314
Freddie Mac
Stock .......................................................................... 204
Futures.......................................................................... 1102
Contract codes, Schedule CMR ............................... 2008
G
GAAP
Use of in the TFR......................104, 201, 224, 301, 1802
General Instructions ....................................................... 101
General valuation allowances
Foreclosed assets........................................................ 218
Other assets................................................................ 223
Generally accepted accounting principles .... 201, 301, 1802
GNMA securities
Repurchase option liability ........................................ 228
Risk weighting ......................................................... 1616
GNMA Securities
Pools .......................................................................... 206
INDEX
2203
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Goodwill
Amortization ..............................................................313
Schedule SC ...............................................................221
Write-downs ...............................................................313
H
Held-for-sale assets.......................................................1002
Held-to-maturity securities .............................................202
High loan-to-value mortgages.........................................601
Holding company
GAAP.......................................................................1401
Schedule HC.............................................................1401
Schedule SC .....................................................201, 1802
Home Equity Conversion Mortgage Loan ....................1802
Home Equity Conversion Mortgage Loans.........1802, 1803
Home equity loans
Disbursements ............................................................802
Nonmortgages ............................................................215
Risk weighting lines-of-credit ..................................1625
Schedule SC ...............................................................210
Unused line of credit ..................................................703
Hypothecated deposits ....................................................207
I
Intangible assets
Deducted from Tier 1 ...............................................1604
Schedule SC ...............................................................221
Intercompany payables ...................................................230
Interest Expense..............................................................303
Interest income ...............................................................301
Yield adjustments .......................................................302
Interest payable...............................................................229
Interest rate caps
Contract codes, Schedule CMR................................2007
Interest rate floors
Contract codes, Schedule CMR................................2008
Interest rate index codes
Schedule CMR .........................................................2001
Interest rate swaps
Contract codes, Schedule CMR................................2006
Payables......................................................................230
Receivables ................................................................222
Risk weighting...................................... 1618, 1622, 1627
Internet web address .....................................................1102
HOLDING COMPANY...........................................1402
Investment securities
Commitment to purchase............................................703
Commitment to sell ....................................................703
Investments
Income........................................................................302
L
Land
Office buildings..........................................................219
Land loans.......................................................................211
Leases
Deferred gains on sale and leaseback .........................230
Net income from.........................................................310
2204
INDEX
Office buildings and equipment ................................. 219
Property leased to others............................................ 222
Legal expenses ............................................................... 311
Letters of credit
Commercial - defined ................................................ 704
Prepaid, in Schedule SC............................................. 224
Risk weighting ......................................................... 1626
Standby - defined ....................................................... 704
Undrawn amount ....................................................... 704
Leverage capital ........................................................... 1602
Liabilities
Contingent ................................................................. 706
Off-balance-sheet credit losses .................................. 230
Liability for credit loss
ALLL, included with ............................................... 1611
Life insurance
Adjustment of CSV.................................................... 311
BOLI.......................................................................... 220
Key Person................................................................. 220
Lines of credit
Commercial, unsecured.............................................. 214
Risk weighting ......................................................... 1625
Unused amount .......................................................... 703
Litigation reserves .......................................................... 230
Loan fees
Deferred ..................................................................... 207
Loan origination expense ............................................... 314
Loan payments
Unapplied................................................................... 230
Loan servicing
Credit card fee income ............................................... 307
Escrows...................................................................... 225
Fee expense................................................................ 312
Liability ..................................................................... 230
Receivables (taxes, ins., princ. & interest) ................. 222
Recourse, risk weighting.......................................... 1626
Loans
Agricultural.............................................................. 1202
Airplanes.................................................................... 216
Auto, consumer.......................................................... 215
Average.................................................................... 1013
Boats .......................................................................... 216
Commercial, Secured................................................. 213
Commitment to purchase ........................................... 702
Commitment to sell.................................................... 702
Delinquent ................................................................. 501
Deposit....................................................................... 214
Education ................................................................... 215
Farm......................................................................... 1202
Farm, nonmortgage.................................................... 213
Floor-planning ........................................................... 213
Gains and losses on sale............................................. 309
Held for sale............................................................. 1002
Home equity............................................................... 215
Home improvement ................................................... 215
Insured by FmHA, AID, SBA.................................... 213
Mobile home, consumer............................................. 215
Modified .................................................................... 414
Motorcycles ............................................................... 216
Nonaccrual................................................................. 503
Nonmortgage ............................................................. 212
Officers, directors and shareholders......................... 1005
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Originated for sale ....................................................1002
Overdraft Lines ..........................................................216
Personal ......................................................................215
Purchased ...................................................................804
Serviced for others....................................................1003
Share, risk weighting................................................1618
Small business ..........................................................1201
Sold ............................................................................805
Sold with recourse, financings....................................228
Time-share..................................................................215
Loans-in-process
Commitments in Schedule CC ...................................701
Disbursements ............................................................802
Mortgage Loans, in Schedule SC ...............................207
Risk weighting..........................................................1624
LOCOM adjustment
Valuation allowance ...................................................402
LOCOM adjustments
Income statement........................................................308
LTV ratio
Calculation .................................................................602
M
Management services......................................................312
Mandatorily convertible securities..................................228
Manufactured housing
Construction loans on.................................................208
Market research expenses ...............................................312
Money orders..................................................................225
Mortgage
Office premises ..........................................................228
Mortgage loans
Accrued Interest Receivable.......................................212
Allowance for loan and lease losses ...........................212
Apartment buildings ...................................................210
Average ....................................................................1013
Churches.....................................................................211
Commercial ................................................................211
Commitments .............................................................701
Co-op units .................................................................208
Co-op units, risk weighting ......................................1619
Defined.......................................................................207
Discounts and premiums ............................................207
Dormitories ................................................................210
Farms..........................................................................211
First Liens on 1-4 Dwelling Units ..............................210
Held for investment ....................................................207
High loan-to-value......................................................601
Home equity loans......................................................210
Junior liens .................................................................208
Junior Liens on 1-4 Dwelling Units............................210
Land ...........................................................................211
Mixed use property.....................................................207
Mobile Home Parks....................................................211
Multifamily ................................................................210
Multifamily, risk weighting......................................1620
Negative amortization as disbursements.....................802
Nonresidential ............................................................211
Nursing homes............................................................211
Originated for Sale .....................................................207
Origination commitments...........................................702
MARCH 2010
Participating interests................................................. 208
Participating interests, income ................................... 302
Participations purchased ............................................ 804
Participations sold...................................................... 805
Permanent loans on 1-4 dwelling units ...................... 210
Real estate investments .............................................. 218
Refinancing activity................................................... 701
Refinancing, in Schedule SC ..................................... 210
Retirement homes ...................................................... 211
Second mortgages ...................................................... 208
Small business ........................................................... 213
Sold with recourse, risk weighting........................... 1626
Unearned interest ....................................................... 207
Wrap-around .............................................................. 228
Wrap-around, in assets............................................... 208
Wrap-around, income from........................................ 302
Mortgage Loans
Origination disbursements ......................................... 802
Mortgage pool securities
Defined, Schedule SC ................................................ 205
Private issues ............................................................. 206
Mortgage-backed Bonds ................................................ 204
Mortgage-backed securities
Commitment to purchase ........................................... 703
Commitment to sell.................................................... 703
Document custodian services................................... 1302
Purchase/sale activity................................................. 801
Risk weighting ............................................... 1617, 1621
Mortgage-Backed Securities
Interest Income .......................................................... 302
Municipal securities
Risk weighting ......................................................... 1617
Mutual funds .................................................................. 204
Proprietary ............................................................... 1303
Regulatory capital .................................................... 1602
Risk weighting ......................................................... 1615
Unremitted funds ....................................................... 226
N
Net deferred tax assets
Schedule SC............................................................... 222
Net Portfolio Value Model ........................................... 1901
New basis accounting................................................... 1008
Nonaccrual loans............................................................ 503
Noncontrolling shareholders
Net income allocated to ............................................. 301
Net loss allocated to................................................... 310
Nonincludable subsidiaries
Consolidation, exception to GAAP.......................... 1602
Defined .................................................................... 1604
Noninterest expense ....................................................... 311
Noninterest income ........................................................ 306
Non-interest-earning Deposits
Schedule SC............................................................... 202
Nonmortgage loans
Interest Income .......................................................... 302
Origination commitments .......................................... 702
Sales/Purchases.......................................................... 806
Schedule SC............................................................... 212
Nonperforming assets
Risk weighting ......................................................... 1615
INDEX
2205
MARCH 2010
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Nonsecuritized financial instruments..............................221
Schedule CC...............................................................704
O
Off-balance-sheet items
Contract codes, Schedule CMR................................2003
Risk weighting..........................................................1624
Office
Data center fees ..........................................................312
Equipment rental ........................................................312
Leasehold improvements............................................219
Leasehold improvements, amortization......................312
Office buildings ..............................................................219
Construction of...........................................................219
Depreciation ...............................................................219
Depreciation expense .................................................312
Leasing income ..........................................................310
Office supplies expense ..................................................314
Options
Schedule CMR .........................................................1954
Standby fees received.................................................230
Organization cost
Expense ......................................................................314
Other assets.....................................................................222
Other Comprehensive Income
Accumulated ..............................................................232
Reconciliation...........................................................1008
Other liabilities ...............................................................230
OTS assessments
Complexity component ............................................1307
Expensed ....................................................................314
Outstanding checks
Cashiers checks ..........................................................224
Overdrafts .......................................................................228
Customer accounts .....................................................216
P
Paid-in Capital ............................................ 232, 1403, 1410
Pass-through investment
Income........................................................................303
Net income from.........................................................310
Past-due assets
Risk weighting..........................................................1615
Past-due loans
Defined.......................................................................501
Troubled debt restructured .........................................505
Pension
Expense ......................................................................311
Pension Asset intangibles
Amortization ..............................................................313
Schedule SC ...............................................................221
Pension liability
Minimum................................................ 233, 1404, 1411
Personnel expenses .........................................................311
Postretirement benefit
Liability ......................................................................230
Preferred stock
Convertible............................................. 231, 1403, 1410
Cumulative ............................................. 231, 1403, 1410
Issuance costs ......................................... 231, 1403, 1410
2206
INDEX
Issued by Subsidiaries................................................ 234
Issued by subsidiary................................................... 228
Noncumulative....................................... 231, 1403, 1410
Perpetual (nonredeemable) .................... 231, 1403, 1409
Redeemable, in Tier 2 capital .................................. 1611
Redeemable, Issuance costs ....................................... 222
REIT .......................................................................... 228
Prepaid expenses
Schedule SC............................................................... 222
Prior period
Corrections to............................................................. 301
Prior period corrections.................................................. 310
Promissory Notes ........................................................... 204
Proprietary (Non-HECM) Reverse Mortgage Loans... 1802,
1803
Provision for loss
Calculation................................................................. 402
Public relations expense ................................................. 312
Purchased credit card relationships
in regulatory capital ................................................. 1604
Purchased servicing.............................. See Servicing assets
Push-down accounting
Adjustments to retained earnings ............................. 1008
Q
Qualified Thrift Lender ................................................ 1004
Questions
Common questions .................................................... 101
R
Real estate
Sale of ........................................................................ 309
Sale of, deferred gains................................................ 230
Real estate held for investment
Net income from. ....................................................... 310
Real estate investments .................................................. 218
Real estate taxes
Payable....................................................................... 229
Receivables
Intercompany ............................................................. 222
Noninterest bearing.................................................... 222
Record Retention............................................................ 103
Recorded investment
Defined .............................................................. 207, 415
Recourse
Low level risk weighting ............................... 1614, 1629
Recourse obligations ...................................................... 704
Recourse Obligations ..................................................... 230
Recovery
Defined ...................................................................... 402
Of assets..................................................................... 408
Refinancings
Multifamily ................................................................ 210
Regulation O
Definitions ............................................................... 1005
Regulatory capital
Adjustments to GAAP ............................................. 1603
ALLL ....................................................................... 1611
Assets required to be deducted................................. 1612
Deferred tax assets ................................................... 1605
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Gains on equity securities.........................................1611
IMCR .......................................................................1609
Individual minimum capital requirement .................1609
Mutual funds ............................................................1602
Nonincludable subsidiaries.......................................1603
Purchased credit card relationships ..........................1604
Reciprocal holdings..................................................1612
Risk weighting rules.................................................1614
Servicing assets ........................................................1605
Standards ..................................................................1601
Tier 2 capital ............................................................1609
REIT preferred stock ......................................................228
Dividends ...................................................................304
Replacement cost
Defined.....................................................................1627
Reporting Basis...............................................................103
Repossessed assets......................216, See Foreclosed assets
Repurchase agreements...................................................227
Residual interests
Defined.....................................................................1003
Schedule CC...............................................................705
Residual interests in financial assets sold .......................222
Retained earnings........................................ 233, 1404, 1411
Adjustments to..........................................................1008
Retirement accounts
IRA/Keogh .................................................................903
Reviewing the TFR.........................................................105
Risk weighting
Depository inst., claims on .......................................1617
Exchange-rate contracts............................................1628
Federal Reserve, claims on.......................................1616
FHLB, claims on ......................................................1617
General rules ............................................................1614
Interest-rate contracts ...............................................1627
LIP............................................................................1624
Low-level recourse ...................................................1629
Multifamily mortgages .............................................1620
Off-balance-sheet items............................................1624
Residual interests......................................................1629
Revenue bonds .........................................................1622
Single-family mortgages ..........................................1619
Super risk weighting.................................................1629
U.S. Government, claims on.....................................1616
U.S. Treasury securities............................................1616
Risk-based capital.........................................................1602
Rounding ........................................................................104
S
SBA pools
Risk weighting..........................................................1616
SBA Securities
Nonmortgage..............................................................203
Schedule CMR
ARMs, frequent reset ...............................................1918
Balances reported .....................................................1902
Balloon Mortgages, defined .....................................1907
Balloon mortgages, fixed rate...................................1910
Brokered deposits .....................................................1944
Buydowns.................................................................1908
Call loans, defined....................................................1907
Cash, deposits and securities ....................................1933
MARCH 2010
CMOs ...................................................................... 1929
Issued................................................................... 1949
CMOs, Residuals ..................................................... 1930
Commercial loans .................................................... 1924
Commitments, Nonmortg. fin. assets....................... 1955
Compared to Schedule SC ....................................... 1905
Consolidation........................................................... 1902
Construction LIP...................................................... 1961
Construction loans ................................................... 1921
Construction loans, defined ..................................... 1907
Consumer loans ....................................................... 1926
Credit cards.............................................................. 1941
Debt securities ......................................................... 1935
Deposits ................................................................... 1942
Deposits, Nonmaturity ............................................. 1947
Escrows.................................................................... 1948
Exemption from filing................................................ 104
FASB Statement No. 133......................................... 1938
FASB Statement No. 133......................................... 1951
Federal funds sold.................................................... 1935
Fixed-rate mortgage loans and securities ................. 1908
Format...................................................................... 1902
Futures ..................................................................... 1959
Home equity loans ................................................... 1940
Interest rate caps ...................................................... 1957
Interest rate floors .................................................... 1958
Interest rate swaps.................................................... 1956
Inverse floaters......................................................... 1929
Land loans................................................................ 1921
Land loans. defined.................................................. 1907
Liabilities ................................................................. 1942
Liabilities,Fixed rate ................................................ 1945
Loans serviced by others.......................................... 1941
Market value estimates ...............1901, 1902, 1931, 1967
Mortgage pool securities, multifamily ..................... 1918
Mortgage-derivative securities................................. 1928
Multifamily mortgage loans..................................... 1918
Multifamily mortgage loans, defined....................... 1907
Mutual funds, Mortgage-related .............................. 1941
Noncontrolling interest ............................................ 1950
Nonmortgage loans,Securitized ............................... 1924
Nonperforming assets .............................................. 1936
Nonperforming loans ............................................... 1907
Nonperforming loans defined .................................. 1902
Nonresidential Mortgage loans, defined .................. 1907
Off-balance-sheet items ................................. 1951, 1970
Options on futures.................................................... 1960
Other assets.............................................................. 1939
Pass-through rate ..................................................... 1903
Pass-through securities, defined............................... 1907
Pay-through securities, defined................................ 1908
Preferred stock, Redeemable.................................... 1947
Repurchase agreements............................................ 1935
Second mortgages .................................................... 1922
Servicing, Mortgage................................................. 1931
Single-family mortgage loans, defined .................... 1906
Stripped MBS .......................................................... 1930
Superfloaters ............................................................ 1929
Supplemental Reporting........................................... 1962
Teaser ARMs ........................................................... 1914
Teaser ARMs, defined ............................................. 1907
TimeshareTime loans............................................... 1940
INDEX
2207
MARCH 2010
Unrealized gains and losses......................................1938
Use of estimates .......................................................1902
WAC defined............................................................1903
Warehouse loans ............................................1924, 1940
WARM.....................................................................1904
Weighted average margin.........................................1904
Weighted averages ...................................................1903
Zero-coupon securities .............................................1934
SCHEDULE RM ..........................................................1801
Schedule SC....................................................................201
SEC file number ...........................................................1402
Securities
Accrued interest and dividends receivable .................204
Asset-backed ..............................................................204
Auto loans ..................................................................204
Available-for-sale balances ......................................1002
Credit cards ................................................................204
Gains and losses on sale .............................................308
Income........................................................................302
Mortgage Derivatives .................................................206
Mortgage pass-through...............................................205
Mortgage-backed........................................................205
Pledged on margin accounts.......................................203
Schedule SC ...............................................................202
U.S. Government and Agency, Schedule SC..............203
Unrealized gain or loss ........................... 232, 1404, 1411
Service corporations .............See Subordinate organizations
Servicing
Loans serviced for others..........................................1003
Servicing assets...............................................................220
Regulatory capital adjustments.................................1605
Sale of ........................................................................309
Severance pay .................................................................311
SFAC No. 6
Borrowings.................................................................227
Share loans......................................................................214
Risk weighting..........................................................1618
Sinking fund mortgages ..................................................224
Small business loans .............................................213, 1201
Specific valuation allowances.........................................201
Provisions and transfers in Schedule VA ...................410
State and Municipal Obligations
in Schedule SC ...........................................................204
Stock
Issued .......................................................................1007
Retired......................................................................1008
Subscriptions ..............................................................226
Stock exchange ticker symbol ......................................1402
Stock subscriptions .........................................................230
Structured borrowings
Schedule CMR defined ............................................1946
Subordinate organizations
Definition ...................................................................104
Investment in ..............................................................219
Negative equity investment ........................................230
Net income from.........................................................310
Subordinated debentures.................................................228
in Tier 2 capital ........................................................1611
Interest expense ..........................................................304
Issuance costs .............................................................222
Subordinated securities
Schedule CC...............................................................705
2208
INDEX
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
Subsidiary
Defined for regulatory capital .................................. 1602
GAAP consolidated ................................................... 104
Lower-tier, defined .................................................. 1603
Nonincludable, defined ............................................ 1604
Sale of ........................................................................ 309
Supplementary capital ...............................See Tier 2 capital
T
Tangible capital............................................................ 1602
Tax and insurance escrows
Advances for.............................................................. 212
Taxes
Deferred ..................................................................... 229
Income tax expense.................................................... 315
Interest income from refunds ..................................... 310
Payable....................................................................... 229
Receivable ................................................................. 222
Telephone expense ......................................................... 314
Temporary employee expense........................................ 311
TFR
Copies of Forms and Instructions .............................. 101
TFR Schedules
List of......................................................................... 101
Tier 1 capital ................................................................ 1603
Requirement............................................................. 1609
Tier 1 risk-based capital ............................................... 1602
Tier 2 capital
Allowable in total regulatory capital........................ 1612
Defined .................................................................... 1609
Time-share loans ............................................................ 215
Construction loans ..................................................... 209
Trading securities ........................................................... 202
Defined .................................................................... 1001
Transmission .................................................. 101, 102, 103
Travelers’ checks
Risk weighting ......................................................... 1618
Treasury stock ............................................ 233, 1405, 1411
Treasury tax and loan accounts ...................................... 224
Troubled debt restructured
Defined ...................................................................... 414
Nonaccrual status....................................................... 503
Schedule PD............................................................... 505
Trust Services............................................................... 1301
Trusts............................................................................ 1304
Fee income................................................................. 307
Uninvested funds ....................................................... 225
U
U.S. government and agency securities......................... 203
IO and PO Strips ........................................................ 203
U.S. Savings Bonds
Redeemed .................................................................. 202
U.S. Treasury bills.......................................................... 203
U.S. Treasury securities
Risk weighting ......................................................... 1616
U.S. Treasury tax and loan accounts .............................. 230
Unapplied loan disbursements........................................ 222
Unposted credits............................................................. 223
Utility deposits ............................................................... 222
THRIFT FINANCIAL REPORT INSTRUCTION MANUAL
MARCH 2010
V
W
Valuation allowances
Elimination in sales ....................................................403
Provision for loss........................................................305
Provision for loss on noninterest bearing assets .........313
Purchased assets .........................................................404
Reconciliation.............................................................401
Web site expense............................................................ 314
Who must file................................................................. 103
Who to call ..................................................................... 101
Withholding taxes
Employees’ share....................................................... 226
From deposits............................................................. 226
Payable, employer's share .......................................... 229
INDEX
2209
| File Type | application/pdf |
| File Title | Table of Contents |
| Author | Gertrude Reeves |
| File Modified | 2009-12-28 |
| File Created | 2009-12-28 |