Temporary Asset Threshold Rule Applies for Q1 2021 Call Reports

Another calendar quarter has ended which means Banks’ consolidated reports of condition and income for the first quarter ending March 31, 2021 were due by April 30.  Good news for some – the temporary asset thresholds allowed in an interim rule adopted last December is still applicable for certain institutions under $10 billion in assets.

The FDIC said the April 30 deadline applies to all institutions except some with foreign offices; an institution with more than one foreign office, other than a “shell” branch or an international banking facility, has until May 5 to file, according to the FDIC’s Financial Institution Letter (FIL-25-2021).

An interim final rule issued last December provides for temporary asset thresholds for financial institutions with less than $10 billion in assets as of Dec. 31, 2019. That interim final rule was issued to help mitigate temporary transition costs on banks related to the COVID-19 pandemic. The rule allows institutions that temporarily exceed the $10 billion total asset threshold to use the community bank leverage ratio (CBLR) framework in Call Report Schedule RC-R from Dec. 31, 2020 through Dec. 31, 2021, provided they satisfy the other qualifying criteria for this framework. For each of these report dates, the FIL notes, an institution would use the lesser of its total assets as of Dec. 31, 2019, or as of the current quarter-end report date to determine whether it has met the $10 billion total asset threshold.

NOTE: For the CBLR eligibility criteria - if a bank uses the December 31, 2019 total assets on line 32 of RC-R Part I, they need to be sure to use current reported assets from RC item 12 for the calculation of the limit for unfunded commitments at 25% or less of total assets and the trading assets and liabilities at 5% or less of current reported assets. 

The interim final rule also permits an institution to use the lesser of the total consolidated assets reported in its Call Report as of Dec. 31, 2019, or June 30, 2020, when determining whether the institution has crossed certain total asset thresholds to report additional data items in its call reports for report dates in calendar year 2021. These thresholds include the $5 billion threshold for the eligibility requirement to use the FFIEC 051 version of the Call Report, and the $100 million, $300 million, $1 billion, and $10 billion thresholds for reporting certain additional data items in the call reports, the letter states.

You can read the Financial Institution Letter by clicking here: FIL-25-2021.