Topic: Call Reports
-
We are a state member bank regulated by the Federal Reserve Board (FRB). Are we required to post the Annual Disclosure Statement Notice in our lobby? Or does that requirement apply only to FDIC and OCC regulated banks?
—
by
No, your bank is not required to post an Annual Disclosure Statement Notice. The FRB eliminated the requirement to notify the public about the availability of call reports in 1998, when the reports started being available online. The OCC also eliminated its notice requirement, effective April 1, 2017. Banks regulated by the FDIC, however, still…
-
We have made several 12-month, interest only line of credit loans secured by 1-4 family residential properties. The money from these lines of credit was used to make significant renovations to existing, occupied properties. Would these loans be classified as “construction loans” or “lines of credit” on our Call Report?
—
by
We believe that the Call Report classification for these loans depends on their purpose, which, based on the information you have provided, would be for construction. In general, a transaction secured by a 1 – 4 family residential property and structured as a line of credit should be included in Subitem 1.c(3) on a Call…
-
Following our recent purchase of two branches, we acquired goodwill and core deposit intangible assets. Does the legal lending limit calculation include goodwill and core deposit intangible assets?
—
by
No, the lending limit calculations do not include goodwill and core deposit intangible assets. Federal regulations limit loans to any one borrower to 15% of the bank’s capital and surplus. “Capital and surplus” means “a national bank’s . . . Tier 1 and Tier 2 capital calculated under the risk-based capital standards applicable to the…
-
I need assistance filling out FFIEC Call Report Schedule RC-C – Loans and Leases. Specifically, when asked to list maturity and repricing data for closed-end loans secured by first liens on 1-4 family residential properties (in the Memoranda for Part I), should I include commercial purpose loans secured by residential property? Are there any OCC bulletins that offer guidance on this question?
—
by
Yes, in the section you have identified, you should include data on all loans secured by a 1–4 family residential property, regardless of the loan purpose. You asked about Call Report Schedule RC-C (Loans and Leases). Specifically, you asked about question 2 on the Memoranda for Part I, which asks you to list the following: …
-
We would like to finance the sale of an OREO property to a buyer who cannot provide the required down payment to satisfy the initial investment required by the OREO accounting rules (10% in this case). Can the buyer satisfy the initial investment requirement by providing another property as collateral, or by making substantial improvements valued over 10%? What if we were to provide a bridge loan to the buyer for improvements before selling the property to the borrower? Our FDIC examiners are telling us that these approaches are acceptable for the full accrual accounting method, but our accounting firm disagrees.
—
by
We cannot provide guidance on whether any of these approaches would satisfy the criteria for full accrual accounting, and we recommend following the advice of your accounting firm. To ensure that you are on the same page with your FDIC examiners, we recommend reviewing the FFIEC Call Report Instructions and the relevant FASB Accounting Standards. …
-
If a real estate transaction for the purchase of a property includes additional funds for renovations/improvements, would the loan be considered “construction” for the purpose of the Call Report and/or Supervisory Loan-to-Value limits?
—
by
Call Report The FFIEC Call Report instructions do not specifically define “construction loan” in the glossary, but the instructions make clear that this type of loan should likely be reported as a construction loan. Under item 1.a (Construction, land development, and other land loans), the instructions state that “for purposes of this item, ‘construction’ includes…