SEC revisiting decades-old bank disclosure guide

The proposed rules would update the disclosures investors receive and eliminate disclosures that overlap with Commission rules, U.S. Generally Accepted Accounting Principles, and International Financial Reporting Standards. Further, the proposal would replace Industry Guide 3, “Statistical Disclosure by Bank Holding Companies,” with updated disclosure in a new subpart of Regulation S-K.

“Guide 3 has not been substantively updated for more than 30 years” said SEC Chairman Jay Clayton. “Today’s proposals are another example of how thoughtful reviews can improve disclosures for the benefit of investors and public companies.”

The Commission’s proposed rules reflect the significant financial reporting changes, including the issuance of new accounting standards, that have taken place for banking registrants since the Commission last updated Industry Guide 3. The proposed rules are also part of an initiative by the Division of Corporation Finance to review disclosure requirements applicable to issuers to consider ways to improve the requirements for the benefit of investors and registrants.

The proposal will have a 60-day public comment period following its publication in the Federal Register.

Proposal highlights

The proposed rules would apply to bank holding companies, banks, savings-and-loan holding companies, and savings-and-loan associations (banking and savings and loan registrants).

The Commission’s proposed rules would require disclosure about the following:

• Distribution of assets, liabilities, and stockholders’ equity, the related interest income and expense, and interest rates and interest differential;
• Weighted average yield of investments in debt securities by maturity;
• Maturity analysis of the loan portfolio, including the amounts that have predetermined interest rates and floating or adjustable interest rates;
• An allocation of the allowance for credit losses and certain credit ratios; and
• Information about bank deposits including amounts that are uninsured.

Comments may be submitted by using the SEC’s Internet submission form or by sending an e-mail to rule-comments@sec.gov.