The Federal Reserve Board is seeking public input regarding a proposal automating non-merger-related adjustments to member banks’ subscriptions to Federal Reserve Bank capital stock.
The automation initiative would eliminate the process of member banks filing applications to adjust stock subscriptions, except in the context of mergers, officials indicated, adding the revision would significantly reduce annual reporting.
Regulation I presently requires a member bank to apply to adjust its stock subscription at least annually and sometimes quarterly, with authorities noting a member bank determines its required stock subscription based on its capital and surplus as reported in the member bank’s most recent Call Report.
Federal Reserve Banks are developing software automatically pulling information needed to calculate member banks’ required stock subscriptions from Call Reports – automating the stock adjustment process.
The proposed rule would specify which Reserve Banks are responsible for receiving membership applications from banks located in U.S. territories and dependencies and outline that a national bank seeking to convert into a state nonmember bank must promptly file with its Reserve Bank an application for cancellation of all its Reserve Bank stock.
Additionally, the Board is proposing a pair of technical amendments to Regulation I and conforming revisions to the FR 2056 reporting form. Officials said comments must be received within 60 days after publication in the Federal Register.
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