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When high school football practices start every summer in Texas, the local TV station always goes out to cover the teams and interview the coaches. They always say the same thing, “We are going to concentrate on the fundamentals, basic blocking and tackling.” Before the plays can be run the players first have to master the basics.

Preparing the Call Report also calls for attention to the fundamentals. This means that the quality of the data and information used to prepare it should be accurate and well organized. In our practice we have seen some problem areas that, if addressed, will make a bank’s quarterly reporting more efficient and accurate.

The first fundamental is for a bank to ensure that subsidiary accounting ledgers, such as investment accounting reports and loan and deposit subsystem totals, are in balance with the general ledger. If the source of information used by the Call Report preparer does not match the general ledger, a lot of time...

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...

Without a doubt, Call Reports have become much more complex over the years.  Fortunately, most core data processing systems include at least some reporting modules designed to capture much of the data necessary to complete the Call Report.  Some of the most sophisticated core systems provide a means to map General Ledger and even individual loan and deposit accounts to the appropriate line items on the Call Report.  Of course, mapping the core system for Call Report purposes greatly enhances both accuracy and efficiency.

At this point you may ask yourself: My General Ledger, loan, and deposit accounts are all mapped and our Call Reports are routinely accepted for filing with the CDR so I can “Set it and Forget it,” right?  The answer is: Not always.

Even the most sophisticated mapping requires periodic reviews and updates.  Changes in banking laws, regulatory reporting rules, accounting pronouncements, glossary definitions, bank products, core...

Your Bank President and Board of Directors may only think about the Call Report briefly, like four times or so each year. This is as it should be, and this is how it is in many banks. The efficient, accurate, and timely preparation of the quarterly reports is something that just happens, and may even be taken for granted.

If the Call Report ever does get noticed, it is sometimes for the wrong reason. Unless you have a hand in preparing it, you may underestimate how difficult it can be to do it right. There are changing bank variables, changing accounting rules, changing instructions, and changing definitions and coverages. You have to work with all of the departments in the bank, and understand the underlying schedules that are reported up through those departments. And that is not even mentioning that staff turnover in those departments can leave you hanging when the deadline is looming. We also know that some banks have learned the hard way that there really is no such...

Well, 2020 certainly threw us a curve ball and gave us much to consider in our personal lives as well as our banking lives.  I don’t think anyone would consider 2020 a gift giving year….. or was it?

2020 actually was a significant year of gift giving from the regulators.  In late 2019 we learned that the eligibility threshold for filing the reduced Form 051 was raised to $5 billion.  Truly a gift for many institutions in 2020.  

We also were given the gift of the Community Bank Leverage Ratio (CBLR) in 2020 with the added benefit of the drop in the minimum leverage ratio to 8% in order to reduce the effect COVID-19 may bring upon a bank’s capital ratios. 

Even though these two areas are significant gifts from the regulators (in my opinion),  I recently read that only two-fifths of the institutions that became eligible for the 051 Form when the threshold was raised to $5 billion took advantage of the reduce...

Well, you are not alone.  Your Bank is likely feeling bloated after this unprecedented year of PPP loans and the excess liquidity that most banks have on their balance sheets.

To deal with the Bank’s bloating, the regulators have offered a solution. In acknowledgement of the bloating that has taken place this year,  your Bank has been offered a hall-pass on reporting requirements that kick into play upon a bank reaching a new asset-based Call Report threshold.  In addition,  the FDICIA audit and certification requirements are also subject to the hall-pass if your Bank’s asset size as of January 1, 2020 was below the impact threshold for Part 363 of the FDI Act.

Keep in mind, you only get the hall-pass if your Bank’s balance sheet is inflated due to funding PPP loans or the money market mutual funds purchased as a result of participating in the FRB of Boston’s Money Market Mutual Fund Liquidity program. 

To learn...