83 FR 61637 - Proposed Agency Information Collection Activities; Comment Request

FEDERAL RESERVE SYSTEM

Federal Register Volume 83, Issue 231 (November 30, 2018)

The Board of Governors of the Federal Reserve System (Board) invites comment on a proposal to extend for three years, without revision, the Recordkeeping Provisions Associated with the Guidance on Sound Incentive Compensation Policies (FR 4027; OMB No. 7100-0327).

[Federal Register Volume 83, Number 231 (Friday, November 30, 2018)]
[Notices]
[Pages 61637-61638]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-26088]


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FEDERAL RESERVE SYSTEM


Proposed Agency Information Collection Activities; Comment 
Request

AGENCY: Board of Governors of the Federal Reserve System.

ACTION: Notice, request for comment.

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SUMMARY: The Board of Governors of the Federal Reserve System (Board) 
invites comment on a proposal to extend for three years, without 
revision, the Recordkeeping Provisions Associated with the Guidance on 
Sound Incentive Compensation Policies (FR 4027; OMB No. 7100-0327).

DATES: Comments must be submitted on or before January 29, 2019.

ADDRESSES: You may submit comments, identified by FR 4027, by any of 
the following methods:
     Agency website: http://www.federalreserve.gov. Follow the 
instructions for submitting comments at http://www.federalreserve.gov/
apps/foia/proposedregs.aspx.
     Email: [email protected]. Include OMB 
number in the subject line of the message.
     Fax: (202) 452-3819 or (202) 452-3102.
     Mail: Ann E. Misback, Secretary, Board of Governors of the 
Federal Reserve System, 20th Street and Constitution Avenue NW, 
Washington, DC 20551.
    All public comments are available from the Board's website at 
http://www.federalreserve.gov/apps/foia/proposedregs.aspx as submitted, 
unless modified for technical reasons. Accordingly, your comments will 
not be edited to remove any identifying or contact information. Public 
comments may also be viewed electronically or in paper form in Room 
3515, 1801 K Street NW (between 18th and 19th Streets NW), Washington, 
DC 20006 between 9 a.m. and 5 p.m. on weekdays. For security reasons, 
the Board requires that visitors make an appointment to inspect 
comments. You may do so by calling (202) 452-3684. Upon arrival, 
visitors will be required to present valid government-issued photo 
identification and to submit to security screening in order to inspect 
and photocopy comments.
    Additionally, commenters may send a copy of their comments to the 
OMB Desk Officer--Shagufta Ahmed--Office of Information and Regulatory 
Affairs, Office of Management and Budget, New Executive Office 
Building, Room 10235, 725 17th Street NW, Washington, DC 20503, or by 
fax to (202) 395-6974.

FOR FURTHER INFORMATION CONTACT: A copy of the PRA OMB submission, 
including the proposed reporting form and instructions, supporting 
statement, and other documentation will be placed into OMB's public 
docket files, if approved. These documents will also be made available 
on the Board's public website at http://www.federalreserve .gov/apps/
reportforms/review .aspx or may be requested from the agency clearance 
officer, whose name appears below.
    Federal Reserve Board Clearance Officer--Nuha Elmaghrabi--Office of 
the Chief Data Officer, Board of Governors of the Federal Reserve 
System, Washington, DC 20551, (202) 452-3829. Telecommunications Device 
for the Deaf (TDD) users may contact (202) 263-4869, Board of Governors 
of the Federal Reserve System, Washington, DC 20551.

SUPPLEMENTARY INFORMATION: On June 15, 1984, the Office of Management 
and Budget (OMB) delegated to the Board authority under the Paperwork 
Reduction Act (PRA) to approve and assign OMB control numbers to 
collection of information requests and requirements conducted or 
sponsored by the Board. In exercising this delegated authority, the 
Board is directed to take every reasonable step to solicit comment. In 
determining whether to approve a collection of information, the Board 
will consider all comments received from the public and other agencies.

Request for Comment on Information Collection Proposal

    The Board invites public comment on the following information 
collection, which is being reviewed under authority delegated by the 
OMB under the PRA. Comments are invited on the following:
    a. Whether the proposed collection of information is necessary for 
the proper performance of the Board's functions, including whether the 
information has practical utility;
    b. The accuracy of the Board's estimate of the burden of the 
proposed information collection, including the validity of the 
methodology and assumptions used;
    c. Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    d. Ways to minimize the burden of information collection on 
respondents, including through the use of automated collection 
techniques or other forms of information technology; and
    e. Estimates of capital or startup costs and costs of operation, 
maintenance,

[[Page 61638]]

and purchase of services to provide information.
    At the end of the comment period, the comments and recommendations 
received will be analyzed to determine the extent to which the Board 
should modify the proposal.

Proposal Under OMB Delegated Authority To Extend for Three Years, 
Without Revision, the Following Information Collection

    Report title: Recordkeeping Provisions Associated with the Guidance 
on Sound Incentive Compensation Policies.
    Agency form number: FR 4027.
    OMB control number: 7100-0327.
    Frequency: Annual.
    Respondents: Banking organizations.
    Estimated number of respondents: One-time implementation for large 
institutions: 1; one-time implementation for small institutions: 1; 
ongoing maintenance: 5,503.
    Estimated average hours per response: One-time implementation for 
large institutions: 480; one-time implementation for small 
institutions: 80; ongoing maintenance: 40.
    Estimated annual burden hours: 228,960.
    General description of report:

Compatibility With Effective Controls and Risk Management

    Pursuant to Principle 2 of the Guidance, a banking organization's 
risk-management processes and internal controls should reinforce and 
support the development and maintenance of balanced incentive 
compensation arrangements. Principle 2 states that banking 
organizations should create and maintain sufficient documentation to 
permit an audit of the organization's processes for establishing, 
modifying, and monitoring incentive compensation arrangements. 
Additionally, large banking organizations should maintain policies and 
procedures that (i) identify and describe the role(s) of the personnel, 
business units, and control units authorized to be involved in the 
design, implementation, and monitoring of incentive compensation 
arrangements; (ii) identify the source of significant risk-related 
inputs into these processes and establish appropriate controls 
governing the development and approval of these inputs to help ensure 
their integrity; and (iii) identify the individual(s) and control 
unit(s) whose approval is necessary for the establishment of new 
incentive compensation arrangements or modification of existing 
arrangements.

Strong Corporate Governance

    Pursuant to Principle 3 of the Guidance, banking organizations 
should have strong and effective corporate governance to help ensure 
sound compensation practices. The Guidance states that a banking 
organization's board of directors should approve and document any 
material exceptions or adjustments to the organization's incentive 
compensation arrangements established for senior executives.
    Legal authorization and confidentiality: The recordkeeping 
provisions of the Guidance are authorized pursuant to sections 9, 
11(a), 25, and 25A of the Federal Reserve Act (12 U.S.C. 248(a), 325, 
602, and 625); section 5 of the Bank Holding Company Act (12 U.S.C. 
1844); section 10(b)(2) of the Home Owners' Loan Act (12 U.S.C. 
1467a(b)(2)); section 7(c) of the International Banking Act (12 U.S.C. 
3105(c)); and section 39 of the Federal Deposit Insurance Act (12 
U.S.C. 1831p-1(c)).
    Because the recordkeeping provisions are contained within guidance, 
which is nonbinding, they are voluntary. There are no reporting forms 
associated with this information collection.
    Because the incentive compensation records would be maintained at 
each banking organization, the Freedom of Information Act (``FOIA'') 
would only be implicated if the Board obtained such records as part of 
the examination or supervision of a banking organization. In the event 
the records are obtained by the Board as part of an examination or 
supervision of a financial institution, this information is considered 
confidential pursuant to exemption 8 of the FOIA, which protects 
information contained in ``examination, operating, or condition 
reports'' obtained in the bank supervisory process (5 U.S.C. 
552(b)(8)). In addition, the information may also be kept confidential 
under exemption 4 for the FOIA, which protects commercial or financial 
information obtained from a person that is privileged or confidential 
(5 U.S.C. 552(b)(4)).
    Consultation outside the agency: The Board has consulted with the 
OCC and FDIC to confirm that there will be no revisions to the 
Guidance, and that the one-time implementation burden should be 
reduced, as these agencies do not expect any banking organizations to 
newly implement the recordkeeping requirements associated with the 
Guidance. Each agency may update their respective respondent count if 
needed.

    Board of Governors of the Federal Reserve System, November 27, 
2018.
Michele Taylor Fennell,
Assistant Secretary of the Board.
[FR Doc. 2018-26088 Filed 11-29-18; 8:45 am]
 BILLING CODE 6210-01-P