Fed to Automate Non-Merger-Related Adjustments to Capital Stock Subscriptions

In a move that would significantly reduce the annual reporting burden on banks, the Federal Reserve today proposed to automate non-merger-related adjustments to member banks’ subscriptions to Reserve Bank capital stock. Currently, banks are required under Regulation I to apply to adjust their stock “at least annually and sometimes quarterly,” which requires banks to manually calculate their required stock subscriptions based on information in their most recent Call Report.

The Fed noted that it is developing software that will enable it to automatically pull the information required for the calculation and automatically adjust a member bank’s stock subscription with each Call Report filed.

In addition, the Fed proposed to codify its existing practices of requiring a surviving member bank to apply to adjust its stock subscription prior to merging or consolidating with another bank. The Fed also proposed technical amendments to Reg I and the corresponding FR 2056 reporting form. Comments on the proposal will be due 60 days after publication in the Federal Register.