Saint Casimirs Savings Bank 2703 Foster Avenue Baltimore, Maryland 21224-3898 June 23, 2004 Steven F. Hanft Clearance Officer, Legal Division, Room MB-3046 Federal Deposit Insurance Corporation 550 17th Street, NW. Washington, DC 20429 Re: Consolidated Reports of Condition and Income, OMB Number: 3064-0052 Mr. Hanft or To Whomever It May Concern: I am writing to you to comment on one of the two proposed instructional changes that will affect how institutions report certain information in the Call Report and TFR. In particular, I think that the proposal to change the reporting requirements for “when-issued” securities from settlement date accounting to trade date accounting will cause problems in implementation, and require an unnecessary additional burden for the institutions that purchase or sell them. I think this proposal will require an unnecessary additional burden and cause problems in order to implement it because of several reasons. The primary reason is that at the time we agree to purchase a “when-issued” security, the trade date, sometimes we will not know the exact pool number or principal amount since the factor can change, the CUSIP, or the exact size of the pool until the settlement date. Sometimes on “when issued” securities if a payment is received on them or the principal balance changes between the trade date and settlement date, it can then in turn change the coupon rate of the security. All of these things mentioned above are somewhat common occurrences when dealing with “when-issued” mortgage-backed securities. Also, in reality the security is not truly purchased until the settlement date, since that is the date the actual transfer or exchange of funds for the security takes place. The proposal to change the reporting requirements for “when-issued” securities from settlement date accounting to trade date accounting will require that additional general ledger liability accounts be set up for the purchase of “when issued” securities in order to book the security on the trade date and actually settle on it on the settlement date. Overall, due to the reasons mentioned in the 2 preceding paragraphs, the proposal to change the reporting requirements for “when-issued” securities from settlement date accounting to trade date accounting will require: the addition to most institutions general ledgers several additional accounts, numerous adjustments to the various balances and records related to the security between the trade date and the settlement date, and impose what I think is an unnecessary additional burden on many financial institutions in order to implement it. Inevitably, in order to make all these new adjustments, and transfers between new general ledger accounts, the implementation of this proposal will result in additional bookkeeping errors. So I hope you will discontinue going any further with the proposal to change the reporting requirements for “when-issued” securities from settlement date accounting to trade date accounting as mentioned in OMB Number: 3064-0052. If you have any additional questions or need anything else, we can be reached by telephone at 410-276-0894 or the address listed at the top of this letter. Thank you for consideration of our comments in regards to this proposal. Sincerely, John P. Sabol, Jr. Controller St. Casimirs Savings Bank Certificate #32327 E-mail: jsabol@stcasimirssavbank.com & Ronald D. Jasion President St. Casimirs Savings Bank Certificate #32327 |
| Last Updated 06/30/2004 | regs@fdic.gov |