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Federal Register / Vol. 86, No. 23 / Friday, February 5, 2021 / Notices controlled subsidiary, where the entire amount of the deposit is covered by deposit insurance;
Memorandum item 1.h.4 for not fully insured, non-affiliate sweep deposits to capture sweep deposits that are not deposited in accordance with a contract between a customer or counterparty and the reporting institution, a controlled subsidiary of the reporting institution, or a company that is a controlled subsidiary of the same top-tier company of which the reporting institution is a controlled subsidiary, where less than the entire amount of the deposit is covered by deposit insurance;
Memorandum item 1.i for total sweep deposits that are not brokered due to a primary purpose exception, which corresponds to the 25 percent test exception above.
In addition, the following four data items would be added to Schedule RC
E, Deposit Liabilities, on the FFIEC 031
Call Report only and would be completed quarterly only by institutions with $100 billion or more in total assets.8
Memorandum item 1.h.1a to capture the portion of fully insured, affiliate sweep deposits reported in Memorandum item 1.h.1 that are deposited in accordance with a contract between a retail customer or counterparty and the reporting institution, a controlled subsidiary of the reporting institution, or a company that is a controlled subsidiary of the same top-tier company of which the reporting institution is a controlled subsidiary, where the entire amount of the deposit is covered by deposit insurance;
Memorandum item 1.h.2a to capture the portion of not fully insured, affiliate sweep deposits reported in Memorandum item 1.h.2 that are deposited in accordance with a contract between a retail customer or counterparty and the reporting institution, a controlled subsidiary of the reporting institution, or a company that is a controlled subsidiary of the same top-tier company of which the reporting institution is a controlled subsidiary, where less than the entire amount of the deposit is covered by deposit insurance;
Memorandum item 1.h.3a to capture the portion of fully insured, non-affiliate sweep deposits reported in Memorandum item 1.h.3 that are 8 The $100 billion asset-size test is based on the total assets reported as of June 30 each year to determine whether an institution not otherwise required to file the FFIEC 031 Call Report must file the FFIEC 031 report form beginning in March of the following year.

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deposited by a retail customer or counterparty and not in accordance with a contract between the retail customer or counterparty and the reporting institution, a controlled subsidiary of the reporting institution, or a company that is a controlled subsidiary of the same top-tier company of which the reporting institution is a controlled subsidiary, where the entire amount of the deposit is covered by deposit insurance; and Memorandum item 1.h.4a to capture the portion of not fully insured, non-affiliate sweep deposits reported in Memorandum item 1.h.4 that are deposited by a retail customer or counterparty and not in accordance with a contract between the retail customer or counterparty and the reporting institution, a controlled subsidiary of the reporting institution, or a company that is a controlled subsidiary of the same top-tier company of which the reporting institution is a controlled subsidiary, where less than the entire amount of the deposit is covered by deposit insurance.
On the FFIEC 002, the first five data items identified above would be added to Schedule O, Other Data for Deposit Insurance Assessments, as Memorandum items 8.a through 8.d and 9 and would be reported quarterly by insured U.S. branches of foreign banks of all sizes.
C. Definitions The agencies propose to revise the Call Report and FFIEC 002 instructions to add the following definition for sweep deposit: A sweep deposit means a deposit held at the reporting institution by a customer or counterparty through a contractual feature that automatically transfers to the reporting institution from another regulated financial company at the close of each business day amounts identified under the agreement governing the account from which the amount is being transferred.9 Note: This definition would be distinctly separate from the existing retail sweep arrangements and retail sweep programs definitions in the Glossary entry for Deposits in the Call Report and FFIEC 002
instructions.
Furthermore, consistent with the discussion of the data items proposed to be collected in the Call Report and the FFIEC 002 in section II.B. above, affiliate sweep deposits would be defined as sweep deposits that are 9 See 79 FR 61524 for the LCR Rules definition of brokered sweep deposit which was renamed to sweep deposit when the NSFR rule was finalized in October 2020. https www.fdic.gov/news/board/
2020/2020-10-20-notice-dis-b-fr.pdf.

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deposited in accordance with a contract between a customer or counterparty and a reporting institution, a reporting institutions consolidated subsidiary, or a company that is a consolidated subsidiary of the same top-tier company of which the reporting institution is a consolidated subsidiary. Non-affiliate sweep deposits would be defined as sweep deposits that are not deposited in accordance with a contract between a customer or counterparty and a reporting institution, a reporting institutions consolidated subsidiary, or a company that is a consolidated subsidiary of the same top-tier company of which the reporting institution is a consolidated subsidiary.
The agencies also propose to revise the Call Report instructions to add the LCR rules definition 10 of retail customer or counterparty, which reads, A retail customer or counterparty means a customer or counterparty that is:
1 An individual; or 2 A business customer, but solely if and to the extent that: i The reporting institution manages its transactions with the business customer, including deposits, unsecured funding, and credit facility and liquidity facility transactions, in the same way it manages its transactions with individuals; ii Transactions with the business customer have liquidity risk characteristics that are similar to comparable transactions with individuals; and iii The total aggregate funding raised from the business customer is less than $1.5 million.
In addition, the Call Report instructions would add the LCR rules definition of wholesale customer or counterparty, which reads, A
wholesale customer or counterparty means a customer or counterparty that is not a retail customer or counterparty. 11
Question 4: For institutions subject to the liquidity regulations, such rules delineate between retail and wholesale customers or counterparties. Is the proposal appropriate to require institutions with $100 billion or more in total assets that are not subject to the LCR or NSFR rule to report sweep deposits in the Call Report based on whether they are received from a retail or wholesale customer? Would it also be beneficial for institutions with less than $100 billion in total assets to report sweep deposits based on whether they are received from a retail or wholesale counterparty? Are these collections also appropriate for depository institutions 10 79
11 79

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FR 61439, 61527 Oct. 10, 2014.
FR 61439, 61528 Oct. 10, 2014.

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