Notice: Federal Home Loan Bank Rating System Implementation

Federal Register / Vol. 72, No.
3 / Friday, January 5, 2007 / Notices 547
SUMMARY: The Export-Import Bank, as a Dated: December 27, 2006. governance cannot be over-emphasized,
part of its continuing effort to reduce Solomon Bush, our intent is not to weight the corporate
paperwork and respondent burden, Agency Clearance Officer. governance component more heavily
invites the general public and other [FR Doc. 06–9978 Filed 1–4–07; 8:45 am] than other components. Rather than
Federal Agencies to comment on the BILLING CODE 6690–01–M
giving special consideration to any one
proposed information collection as component, examiners will use
required by the Paperwork Reduction judgment and a case-by-case approach
Act of 1995. when assigning composite ratings. The
FEDERAL HOUSING FINANCE BOARD
Office of Supervision made no other
SUPPLEMENTARY INFORMATION: This [No. 2006–N–10] significant changes to the Rating System
notice is soliciting comments from the as proposed.
public concerning the proposed Examination Rating System for the
collection of information to (1) evaluate Federal Home Loan Banks and the II. The Federal Home Loan Bank Rating
whether the proposed collection is Office of Finance System
necessary for the paper performance of In 2005, the Office of Supervision
the functions of the agency, including AGENCY: Federal Housing Finance
began to provide an overall
whether the information will have Board.
conclusion—Satisfactory, Fair,
practical utility; (2) evaluate the ACTION: Notice. Marginal, or Unsatisfactory—as part of
accuracy of the agency’s estimate of the its Report of Examination. The Rating
SUMMARY: The Federal Housing Finance
burden of the proposed information System, which is the next step in
Board (Finance Board) is adopting an
collection of information; (3) enhance communicating exam results to the
examination rating system known as the
the quality, utility, and clarity of the Banks, is a risk-focused system under
Federal Home Loan Bank Rating System
information to be collected; and which each Bank and the OF is assigned
(Rating System).
minimize the burden of collection of a composite rating from ‘‘1’’ to ‘‘4’’
DATES: The Finance Board will use the
information on those who are to based on an evaluation of various
respond, including through the use of Rating System for all examinations that
aspects of their operations. The
appropriated automated collection begin after December 31, 2006.
composite rating of each Bank is based
techniques or other forms of information FOR FURTHER INFORMATION CONTACT: on an evaluation and rating of 5 key
technology, e.g., permitting electronic Anthony Cornyn, Associate Director, components: corporate governance,
submission of responses. Supervision and Examination, Office of market risk, credit risk, operational risk,
Supervision, cornyna@fhfb.gov or 202– and financial condition and
DATES: Written comments should be 408–2522, or Kari Walter, Associate
received on or before February 5, 2007 performance. The composite rating of
Director, Supervisory and Regulatory the OF is based primarily on an
to be assured of consideration. Policy, Office of Supervision, evaluation of 2 components: corporate
ADDRESSES: Direct all comments to walterk@fhfb.gov or 202–408–2829. You governance and operational risk. A ‘‘1’’
David Rostker, Office of Management can send regular mail to the Federal rating indicates the lowest degree of
and Budget, Office of Information and Housing Finance Board, 1625 Eye supervisory concern, while a ‘‘4’’ rating
Regulatory Affairs, NEOB, Room 10202, Street, NW., Washington DC 20006. indicates the highest degree of
Washington, DC 20503 (202) 395–3897. SUPPLEMENTARY INFORMATION: supervisory concern. The composite
Titles and Form Numbers: Export- I. Background rating is based on the ratings of the
Import Bank of the United States underlying components, which also are
In September 2006, the Finance Board rated on a scale of ‘‘1’’ to ‘‘4.’’ The
Application for Long-Term Loan or
published a proposed Rating System for composite rating is not an arithmetic
Guarantee, EIB 95–10.
the Federal Home Loan Banks (Banks) average of the component ratings.
OMB Number: 3048–0013. and the Office of Finance (OF) in the Instead, the relative importance of each
Type of Review: Extension of a Federal Register for public comment. component is determined case-by-case
currently approved collection. See 71 FR 55181 (Sept. 21, 2006) within the parameters established by the
Need and Use: The information (available at the Finance Board’s Web Rating System.
requested enables the applicant to site: http://www.fhfb.gov/ Under the Rating System, examiners
provide Ex-Im Bank, with the Default.aspx?Page=59& take administration of a Bank’s
information necessary to determine ListCategory=4#4). The 30-day comment affordable housing and community
eligibility for the loan and guarantee period closed on October 23, 2006. The investment activities into account in
programs. Finance Board received 7 comments assigning component ratings for
(the comments are available at the corporate governance and operational
Affected Public: Business or other for- Finance Board’s Web site: http:// risk. Given the importance of affordable
profit. www.fhfb.gov/ housing and community investment
Respondents: Entities involved in the Default.aspx?Page=93&Top=93). Based activities to the mission of the Bank
provision of financing or arranging of on the comments, the Office of System, the Office of Supervision may
financing for foreign buyers of U.S. Supervision revised the Introduction consider the need for a separate rating
exports. and Overview to clarify that the system or a separate ratings component
Estimated Annual Respondents: 86 composite rating will be based on the to evaluate and rate the affordable
(revised). relative importance of each component housing and community investment
as determined case-by-case within the programs of each Bank after gaining
Estimated Time Per Respondent: 2.0
parameters established by the Rating experience with the Rating System.
sroberts on PROD1PC70 with NOTICES
hours (revised).
System. The proposal stated that the The Rating System is intended to
Estimated Annual Burden: 172 hours. Finance Board would give special serve 2 purposes. First, it is designed to
Frequency of Response: When consideration to corporate governance reflect in a comprehensive, systematic,
applying for a long-time preliminary or in assigning a composite rating. and consistent fashion the overall
final commitment. Although the importance of corporate condition and performance of an
VerDate Aug<31>2005 17:29 Jan 04, 2007 Jkt 211001 PO 00000 Frm 00025 Fmt 4703 Sfmt 4703 E:\FR\FM\05JAN1.SGM 05JAN1
548 Federal Register / Vol. 72, No. 3 / Friday, January 5, 2007 / Notices
institution, taking into consideration all regarding the results of the examination The Federal Home Loan Bank Rating
significant financial, operational, and process. System is attached as an Exhibit to this
compliance factors addressed in the The ratings for individual Banks and Notice.
Finance Board’s examination. Second, the OF will not be made public or Dated: December 28, 2006.
the Rating System is meant to further released to other Banks, but will be
By the Federal Housing Finance Board.
enhance communication and supplied to the individual Banks and
the OF on a confidential basis as part of John P. Kennedy,
transparency between the Office of
the examination and supervisory General Counsel.
Supervision and each Bank and the OF
process. BILLING CODE 6725–01–P
Federal Register / Vol. 72, No. 3 / Friday, January 5, 2007 / Notices 549
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[FR Doc. 06–9984 Filed 1–4–07; 8:45 am]

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BILLING CODE 6725–01–C

Notice: Federal Home Loan Bank Rating System Implementation

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Notice: Federal Home Loan Bank Rating System Implementation

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Federal Register / Vol. 72, No.

3 / Friday, January 5, 2007 / Notices 547

[FR Doc. 06–9984 Filed 1–4–07; 8:45 am]

BILLING CODE 6725–01–C

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