WASHINGTON - Coming revisions in the quarterly call report will require banks to break down in more detail sources of noninterest income, Federal Reserve Board Governor Roger W. Ferguson Jr. said Monday.
After leaving the quarterly call report unchanged last year while bankers tended to year-2000 issues, regulators plan to propose a slew of changes expected to take effect early next year.
In a speech to community bankers, Mr. Ferguson said one area being targeted is income from new activities. Specifically, he said regulators want "more detail on noninterest income including servicing, securitization, venture capital, and insurance revenues."
The revamped call reports also are expected to contain 80 new questions on securitizations and 18 on subprime lending.
The added disclosures dovetail with a common theme voiced by regulators over the last nine months. "It is our belief that more complete and analytically useful disclosures can help the marketplace to interpret risk profiles and price debt and equity more appropriately," Mr. Ferguson said.
Last month the Fed announced a working group headed by former Chase Manhattan Corp. chairman Walter V. Shipley designed to recommend what data banks and securities ought to make public. The government wants some help from the market in overseeing the increasingly complex financial services business, while the private sector is hoping added market discipline will lead to fewer regulatory burdens.
Echoing Fed Chairman Alan Greenspan's previous remarks, Mr. Ferguson told members of the Independent Community Bankers of America that they may not have to comply with the new capital rule being hammered out by international regulators through the Basel Committee on Banking Supervision. The evolving Basel Accord "entails a level of complexity that may not be necessary or practical for domestic institutions with more basic risk profiles," he said. "That incompatibility with domestic community banks has prompted discussions about implementing a second, more basic or streamlined capital adequacy standard."