GAO: Data Adequate to Regulate Interstate Banks

Regulators will have enough information to supervise banks that branch across state lines, even though the banks will file fewer call reports, according to a General Accounting Office report.

Currently, holding companies must operate separate banks in different states. Each affiliated bank files its own call report. Under interstate branching, a holding company could combine these banks into a single institution, which would file just one call report. This means regulators will have less information on lending and deposit-taking activities within individual states, GAO said.

But the agency said call reports are a poor source of this data; exams and reports required by the Home Mortgage Disclosure Act provide much more detailed information.

"At this time, there does not appear to be sufficient need to modify regulatory or statutory reporting requirements," the agency said.

Interstate branching takes effect June 1. Congress ordered GAO in late 1994 to investigate the law's effect on the banking agencies.