FIL-41-2004 Attachment B

[Federal Register: April 12, 2004 (Volume 69, Number 70)]

[Rules and Regulations]

[Page 19085-19093]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr12ap04-3]

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FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 335

RIN 3064-AC79

Securities of Nonmember Insured Banks

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Interim final rule; request for comment.

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SUMMARY: The FDIC is adopting, on an interim basis, a final rule

amending its securities disclosure regulations applicable to banks with

securities registered under section 12 of the Securities Exchange Act

of 1934 (Exchange Act). This amendment implements the requirements of

the Exchange Act, as amended by the Sarbanes-Oxley Act of 2002, which

mandates electronic filing of reports related to beneficial ownership

of securities by the directors, executive officers, and principal

shareholders of public companies. Current provisions of the FDIC's

securities disclosure regulations prohibit electronically transmitted

filings or submissions of materials in electronic format to the FDIC.

The amended rules provide an exception to this prohibition, requiring

electronically transmitted filings of beneficial ownership reports by

bank directors, officers and principal shareholders to disclose

securities transactions and ownership. Related technical or procedural

provisions are also being amended as appropriate.

DATES: These amendments are effective on June 11, 2004. Written

comments must be received by the FDIC not later than June 11, 2004.

These amendments may be immediately followed by the affected party.

ADDRESSES: You may submit comments, identified by RIN number, by any of

the following methods:

Federal eRulemaking Portal: http://www.regulations.gov.

Follow the instructions for submitting comments.

Agency Website: http://www.fdic.gov/regulations/laws/federal/propose.html

E-mail: comments@fdic.gov. Include RIN number in

the subject line of the message.

Mail: Robert E. Feldman, Executive Secretary,

Attention: Comments/Legal ESS, Federal Deposit Insurance Corporation,

550 17th Street, NW., Washington, DC 20429.

Hand Delivery/Courier: Comments may be hand-

delivered to the guard station located at the rear of the 550 17th

Street Building (located on F Street) on business days between 7 a.m.

and 5 p.m.

Comments may be inspected and photocopied in the FDIC Public

Information Center, Room 100, 801 17th Street, NW., Washington, D.C.

20429, between 9 a.m. and 4:30 p.m. on business days, and the FDIC may

post the comments on its Web site at http://www.fdic.gov/regulations/laws/federal/propose.html

FOR FURTHER INFORMATION CONTACT: Dennis Chapman, Senior Staff

Accountant, Division of Supervision and Consumer Protection, (202) 898-

8922; Mary Frank, Senior Financial Analyst, Division of Supervision and

Consumer Protection, (202) 898-8903; or Carl J. Gold, Counsel, Legal

Division, (202) 898-8702, Federal Deposit Insurance Corporation, 550

17th Street, NW., Washington, DC 20429.

SUPPLEMENTARY INFORMATION:

I. Background and Authority for This Final Rule

a. Appropriate Federal Banking Agency Authority Under the Exchange Act

Section 12(i) of the Securities Exchange Act of 1934 as amended (15

[[Page 19086]]

U.S.C. 78l(i)) authorizes the Federal banking agencies (the FDIC, the

Board of Governors of the Federal Reserve System (FRB), the Office of

the Comptroller of the Currency (OCC), and the Office of Thrift

Supervision (OTS)) to enforce sections 10A(m) (standards relating to

audit committees), 12 (securities registration), 13 (periodic

reporting), 14(a) (proxies and proxy solicitation), 14(c) (information

statements), 14(d) (tender offers), 14(f) (arrangements for changes in

directors), and 16 (beneficial ownership and reporting) of the Exchange

Act, and sections 302 (corporate responsibility for financial reports),

303 (improper influence on conduct of audits), 304 (forfeiture of

certain bonuses and profits), 306 (insider trades during pension

blackout periods), 401(b) (disclosure of pro forma financial

information), 404 (management assessment of internal controls), 406

(code of ethics for senior financial officers), and 407 (disclosure of

audit committee financial expert) of the Sarbanes-Oxley Act of 2002, in

regard to the depository institutions for which each Federal banking

agency is, respectively, the primary federal supervisor. The Exchange

Act seeks to protect investors by requiring accurate, reliable, and

timely corporate securities disclosures.

The FDIC is authorized, in administering the above-listed statutory

provisions, to promulgate regulations applicable to the securities of

insured banks (including foreign banks having an insured branch) which

are neither members of the Federal Reserve System nor District banks

(collectively referred to as ``state nonmember banks''). These

regulations must be substantially similar to the regulations of the

Securities and Exchange Commission (SEC) under the listed sections of

the Exchange Act, unless the FDIC publishes its reasons for deviating

from the SEC's rules.

b. Section 16 of the Exchange Act

Section 16 of the Exchange Act applies to every person who is the

beneficial owner of more than 10 percent of a class of equity security

registered under section 12 of the Exchange Act and to each officer and

director of the issuer of the security (collectively, ``reporting

persons,'' ``insiders,'' or ``filers''). Upon becoming a reporting

person, or upon the section 12 registration of that class of

securities, section 16(a) requires a reporting person to file an

initial report with the SEC (or in the case of an insured depository

institution, its appropriate Federal banking agency) disclosing the

amount of his or her beneficial ownership of all equity securities of

the issuer. To keep this information current, section 16(a) also

requires reporting persons to report changes in their beneficial

ownership. Prior to the Sarbanes-Oxley Act, insiders of state nonmember

banks with a class of equity securities registered under section 12 of

the Exchange Act filed these beneficial ownership reports on paper. In

the case of insiders connected to state nonmember banks, reports were

filed using FDIC Forms F-7, F-8, and F-8A.

c. Sarbanes-Oxley Act Amendments to Section 16

As amended by section 403 of the Sarbanes-Oxley Act of 2002, Public

Law No. 107-204 (July 30, 2002), section 16(a) of the Exchange Act (15

U.S.C. 78p(a)) requires electronic submission of certain beneficial

ownership reports submitted on or after July 30, 2003. The SEC or,

respectively, the appropriate Federal banking agency, is required to

make those filings available to the public on the Internet.

Institutions with Web sites are required to post their insiders' change

in beneficial ownership reports on their Internet Web sites. In

addition, section 16, as amended by Sarbanes-Oxley, requires filing of

beneficial ownership reports before the end of the second business day

following the day on which the subject transaction was executed

(effective for transactions on or after August 29, 2002).

d. Agency Action to Implement Sarbanes-Oxley

On August 27, 2002, the SEC adopted rule amendments to implement

the accelerated filing deadline for beneficial ownership reports [see

SEC Release No. 34-46421 (Sept. 3, 2002) [67 FR 56462]]. These

amendments have, since their adoption, been applicable to insiders of

state nonmember banks in accordance with section 335.601 of the FDIC

rules. Previously, beneficial ownership reports filed by insiders of

state nonmember banks were filed with the FDIC within 10 days from the

end of the month of the transaction. On May 7, 2003, the SEC issued a

final rule implementing the electronic submission requirements for

beneficial ownership reports as required by section 16 of the Exchange

Act as amended [SEC Release No. 34-47809 (May 13, 2003) [68 FR 25788]].

On July 30, 2003, the FDIC, FRB, and OCC established an interagency

electronic filing system for these beneficial ownership reports, hosted

on the FDIC's Web site. See FIL-60-2003, Federal Banking Agencies

Announce New Interagency Electronic Filing System for Beneficial

Ownership Reports (July 28, 2003) [http://www.fdic.gov/news/news/financial/2003/fil0360.html.

] The OTS joined this filing system on

October 27, 2003. See OTS 03-36, Office of Thrift Supervision Joins the

FDIC's Interagency Electronic Filing System for Beneficial Ownership

Reports (October 30, 2003) [http://www.ots.treas.gov/docs/7/77336.html.]

Since July 30, 2003, the filing of beneficial ownership reports using

the electronic interagency filing system has been authorized for

insiders of state nonmember banks to provide a period to test the

efficacy of the system.

II. Discussion of Interim Final Rule

a. Current Part 335

The FDIC's securities disclosure regulations, which contain

registration and reporting requirements applicable to state nonmember

banks with securities registered under section 12 of the Exchange Act

(registered banks), are contained in 12 CFR part 335. Before the

effective date of section 403 of the Sarbanes-Oxley Act, part 335 of

the FDIC rules prohibited any electronically transmitted filings or

submissions of materials in electronic format to the FDIC. In regard to

the filing of beneficial ownership reports, that prohibition was

superseded by section 403 of the Sarbanes-Oxley Act of 2002, which

amended section 16 of the Exchange Act.

b. Electronic Filing Requirements

As amended, 12 CFR part 335 will make clear that, except in limited

circumstances described below, beneficial ownership reports by state

nonmember bank insiders will be filed electronically with the FDIC,

consistent with timeframes provided in section 16 of the Exchange Act

and SEC regulations. Mandated electronic filing benefits members of the

investing public and the financial community by making information

contained in the filings available to them immediately after receipt by

the FDIC. Electronically filed information concerning insiders'

transactions in registered bank equity securities will be publicly

accessible substantially sooner and more readily than before. The

electronic format of the filed information facilitates research and

data analysis by investors and the public. The accelerated filing

requirements of section 16(a) of the Exchange Act that took effect on

August 29, 2002, also make electronic filing of beneficial ownership

reports more useful to the public. Finally, the FDIC believes that

investors want electronic access to these forms, that reports of

insiders' transactions in equity

[[Page 19087]]

securities of registered banks provide useful information as to

management's views of the bank's performance or prospects, and that

more timely and transparent access to reports will be useful to

investors.

As required by section 12(i) of the Exchange Act, the amended 12

CFR part 335 is substantially similar to the Exchange Act regulations

of the SEC.\1\ Should a reason for deviating from SEC regulations

become apparent in the future, the FDIC will consider amending its

rules. The FDIC is adopting other technical provisions which address

the forms on which beneficial ownership reports are filed. Also, to

improve consistency with SEC requirements, the FDIC is revising the

names of its existing beneficial ownership report Forms F-7, F-8 and F-

8A. These Forms will be renamed as FDIC Forms 3, 4 and 5, respectively.

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\1\ The FDIC's rules, at 12 CFR 335.101(b), provide that part

335 generally incorporates the SEC's rules issued under Sections 12,

13, 14, and 16 of the Exchange Act.

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c. Hardship Exemption

As discussed, 12 CFR part 335 as amended requires all beneficial

ownership reports to be electronically submitted on the FDIC's

interagency Beneficial Ownership Filings system. If all or part of a

filing cannot be made electronically without undue burden or expense, a

reporting person may apply for a continuing hardship exemption under

the new section 12 CFR 335.801(b)(6).

A filer may apply in writing for a continuing hardship exemption if

all or part of a filing or group of filings otherwise to be filed in

electronic format cannot be so filed without undue burden or expense.

Such written application must be made at least ten business days prior

to the required due date of the filing(s) or the proposed filing date,

as appropriate, or within such shorter period as may be permitted by

the FDIC. The written application for the exemption must include the

following information:

(1) The reason(s) that the necessary hardware and software are not

available without unreasonable burden and expense;

(2) The burden and expense involved to employ alternative means to

make the electronic submission; and/or

(3) The reasons for not submitting electronically the document or

group of documents, as well as justification for the requested time

period for the exemption.

If the FDIC determines that the grant of the exemption is

appropriate and consistent with the public interest and the protection

of investors, it will so notify the applicant. Upon such notification

the filer must submit the document for which the exemption is granted

in paper format on the required due date specified in the applicable

form, rule or regulation, or the proposed filing date, as appropriate.

Additional provisions applicable to the continuing hardship exemption

and detailed procedures for seeking the exemption are set forth in the

text of the amended regulation.

d. Filing Date Adjustment

Instead of pursuing a hardship exemption, an electronic filer may

request a filing date adjustment under this rule where the filer

attempts in good faith to file a document with the FDIC in a timely

manner but the filing is delayed due to technical difficulties beyond

the filer's control. In those instances, the filer may request an

adjustment of the document's filing date. The FDIC may grant the

request if it appears that the adjustment is appropriate and consistent

with the public interest and the protection of investors.

e. Potential Liability in Case of Transmission Errors

The SEC's rules governing electronic filings provide that an

electronic filer ``shall not be subject to the liability and anti-fraud

provisions of the federal securities laws with respect to an error or

omission in an electronic filing resulting solely from electronic

transmission errors beyond the control of the filer, where the filer

corrects the error or omission by the filing of an amendment in

electronic format as soon as reasonably practicable after the

electronic filer becomes aware of the error or omission.'' 17 CFR

232.103. The FDIC believes that this regulation presents a reasonable

approach to transmission errors and that it applies to electronic

filings made with the FDIC as well. See 12 CFR 335.101(b).

Nevertheless, the FDIC invites comments on whether it is necessary or

appropriate for the FDIC to add a similar provision to its own rule,

and if so, the appropriate scope of such a provision.

III. Regulatory Analysis and Procedure

a. Administrative Procedure Act (APA)

Public Comment Waiver and Effective Date. Pursuant to the

Administrative Procedure Act, 5 U.S.C. 553(b), the FDIC finds good

cause to issue this interim final rule without first seeking public

comment. Section 553(b) of the APA does not apply to rules of agency

organization, procedure, or practice, or when the agency for good cause

finds that notice and public comment on the rules being promulgated are

impracticable or unnecessary. The FDIC finds that this is a procedural

rule, and that, in addition, there is good cause to issue the rule

before providing an opportunity for public comment.

The portions of 12 CFR part 335 that are being amended are

procedural and do not affect filers' substantive rights. The APA

exemption for procedural rules applies to a rule that does not itself

affect the substantive rights of those affected, even though the rule

``may alter the manner in which the parties present themselves or their

viewpoints to the agency.'' JEM Broadcasting Co., Inc. v. FCC, 22 F.3d

320, 326-27 (D.C. Cir. 1994). Therefore, the APA's notice and comment

procedures are not applicable.

In addition, as discussed above, the Sarbanes-Oxley Act mandates

that certain beneficial ownership reports be filed electronically.

Therefore, the current outright prohibition in 12 CFR part 335 on

electronic filing is obsolete. Also, as noted, the SEC has made

electronic filing mandatory and the Exchange Act requires that the FDIC

issue regulations substantially similar to those of the SEC or publish

its reasons for not doing so. Therefore, public comment on whether to

continue to prohibit the electronic filing of these reports is

impracticable and unnecessary. This constitutes good cause for not

providing notice and an opportunity for public comment prior to

amending the rule.

Although notice and comment are not required, we are nonetheless

interested in receiving any comments that may improve this rule before

it is adopted in final form. We therefore request comment on all

aspects of this interim rule. We also invite filing persons to submit

feedback on their use of this system. Following the comment period, the

FDIC will consider any comments and will finalize the rule, including

making any necessary changes.

b. Paperwork Reduction Act

Reports of beneficial ownership are considered to be a collection

of information under the Paperwork Reduction Act (44 U.S.C. 3501 et

seq.) The FDIC has previously obtained Office of Management and Budget

(OMB) approval of this collection of information under control number

3064-0030. OMB has reviewed and approved the collection as revised to

take into account electronic filing. It is estimated that there will be

1,800

[[Page 19088]]

responses annually, cumulatively resulting in 1,100 burden hours.

c. Regulatory Flexibility Act

A regulatory flexibility analysis is required only when the agency

must publish a notice of proposed rulemaking (5 U.S.C. 603, 604). As

already noted, the FDIC has determined that a notice of proposed

rulemaking is not required. Accordingly, no regulatory flexibility

analysis is required.

d. Small Business Regulatory Flexibility Enforcement Fairness Act

Section 804 of the Small Business Regulatory Flexibility

Enforcement Fairness Act (``SBREFA''), 5 U.S.C. 801 et al., defines

``rule'' to exclude any rule of agency organization, procedure, or

practice that does not substantially affect the rights or obligations

of non-agency parties. The amendments to Part 335 are technical and

ministerial applications of the statute and affect only procedural

matters. Therefore, the rule is not covered by covered by SBREFA and is

not being reported to Congress.

List of Subjects in 12 CFR Part 335

Accounting, Banks, banking, Confidential business information,

Reporting and recordkeeping requirements, Securities.

For the reasons set forth in the preamble, Part 335 of chapter III of

title 12 of the Code of Federal Regulations is amended to read as

follows:

PART 335--SECURITIES OF NONMEMBER INSURED BANKS

1. The authority citation for part 335 continues to read as follows:

Authority: 15 U.S.C. 78l(i).

2. Section 335.101 is amended by revising the second sentence of

paragraph (a) to read as follows:

Sec. 335.101 Scope of part, authority and OMB control number.

(a) * * * The FDIC is vested with the powers, functions, and duties

vested in the Securities and Exchange Commission (the Commission or

SEC) to administer and enforce the provisions of sections 10A(m), 12,

13, 14(a), 14(c), 14(d), 14(f), and 16 of the Securities Exchange Act

of 1934, as amended (the Exchange Act) (15 U.S.C. 78l, 78m, 78n(a),

78n(c), 78n(d), 78n(f), and 78(p)), and sections 302, 303, 304, 306,

401(b), 404, 406, and 407 of the Sarbanes-Oxley Act of 2002 (15 U.S.C.

7241, 7242, 7243, 7244, 7261, 7262, 7264, and 7265) regarding nonmember

banks with one or more classes of securities subject to the

registration provisions of sections 12(b) and 12(g) of the Exchange

Act.

* * * * *

3. Section 335.111 is amended by revising the sixth sentence to read as

follows:

Sec. 335.111 Forms and schedules.

* * * Forms 3 (Sec. 335.611), 4 (Sec. 335.612), and 5 (Sec.

335.613) are FDIC forms which are issued under section 16 of the

Exchange Act and can be obtained from the Accounting and Securities

Disclosure Section, Division of Supervision and Consumer Protection,

Federal Deposit Insurance Corporation, 550 17th Street NW., Washington,

DC 20429.

4. Section 335.601 is revised to read as follows:

Sec. 335.601 Requirements of section 16 of the Securities Exchange

Act of 1934.

Persons subject to section 16 of the Act with respect to securities

registered under this part shall follow the applicable and currently

effective SEC regulations issued under section 16 of the Act (17 CFR

240.16a-1 through 240.16e-1(1), except that the forms described in

Sec. 335.611 (FDIC Form 3), Sec. 335.612 (FDIC Form 4), and Sec.

335.613 (FDIC Form 5) shall be used in lieu of SEC Form 3 (17 CFR

249.103), Form 4 (17 CFR 249.104), and Form 5 (17 CFR 249.105),

respectively. Copies of FDIC Forms 3, 4, 5 and the instructions thereto

can be obtained from the Accounting and Securities Disclosure Section,

Division of Supervision and Consumer Protection, Federal Deposit

Insurance Corporation, 550 17th Street NW., Washington, DC 20429.

5. Section 335.611 is amended by revising the title to read as follows:

Sec. 335.611 Initial statement of beneficial ownership of securities

(Form 3).

* * * * *

6. Section 335.612 is amended by revising the title to read as follows:

Sec. 335.612 Statement of changes in beneficial ownership of

securities (Form 4).

* * * * *

7. Section 335.613 is amended by revising the title to read as follows:

Sec. 335.613 Annual statement of beneficial ownership of securities

(Form 5).

* * * * *

8. Section 335.701 is amended by revising paragraphs (a) and (b) to

read as follows:

Sec. 335.701 Filing requirements, public reference, and

confidentiality.

(a) Filing requirements. Unless otherwise indicated in this part,

one original and four conformed copies of all papers required to be

filed with the FDIC under the Exchange Act or regulations thereunder

shall be filed at its office in Washington, DC. Official filings made

at the FDIC's office in Washington, DC should be addressed as follows:

Attention: Accounting and Securities Disclosure Section, Division of

Supervision and Consumer Protection, Federal Deposit Insurance

Corporation, 550 17th Street NW., Washington, DC 20429. Material may be

filed by delivery to the FDIC through the mails or otherwise. The date

on which papers are actually received by the designated FDIC office

shall be the date of filing thereof if all of the requirements with

respect to the filing have been complied with.

(b) Inspection. Except as provided in paragraph (c) of this

section, all information filed regarding a security registered with the

FDIC will be available for inspection at the Federal Deposit Insurance

Corporation, Accounting and Securities Disclosure Section, Division of

Supervision and Consumer Protection, 550 17th Street, NW., Washington,

DC. Beneficial ownership report forms that are electronically submitted

to the FDIC through the interagency Beneficial Ownership Filings system

will be made available on the FDIC's Web site (http://www.fdic.gov).

* * * * *

9. Section 335.801 is amended by revising paragraph (b) to read as

follows:

Sec. 335.801 Inapplicable SEC regulations; FDIC substituted

regulations; additional information.

* * * * *

(b) Electronic filings. (1) The FDIC does not participate in the

SEC's EDGAR (Electronic Data Gathering Analysis and Retrieval)

electronic filing program (17 CFR part 232). The FDIC does not permit

electronically transmitted filings or submissions of materials in

electronic format to the FDIC, with the exception of beneficial

ownership report filings on FDIC Forms 3, 4 and 5.

(2) All reporting persons must file beneficial ownership report

Forms 3, 4 and 5, including amendments and exhibits thereto, in

electronic format using the Internet based, interagency Beneficial

Ownership Filings system, which is accessible through the FDICconnect

Business Center, except that a reporting person that has obtained a

continuing hardship exemption under these rules may file the forms with

the FDIC in paper format. For information and answers to questions

regarding beneficial ownership and the

[[Page 19089]]

completion and filing of the forms, please contact the FDIC Accounting

and Securities Disclosure Section in Washington DC. For information and

answers to technical questions or problems relating to the use of

FDICconnect, contact the FDICconnect Project Team toll-free at 877-275-

3342 or by mail at 3501 North Fairfax Drive, Arlington, VA 22226.

(3) Electronic filings of FDIC beneficial ownership report Forms 3,

4, and 5 must be submitted to the FDIC through the interagency

Beneficial Ownership Filings system. Beneficial ownership reports and

any amendments are deemed filed with the FDIC upon electronic receipt

on business days from 8 a.m. through 10 p.m., Eastern Standard Time or

Eastern Daylight Saving Time, whichever is currently in effect (Eastern

Time). Business days include each day, except Saturdays, Sundays and

Federal holidays. All filings submitted electronically to the FDIC

commencing after 10 p.m. Eastern Time on business days shall be deemed

filed as of 8 a.m. on the following business day. All filings submitted

electronically to the FDIC on non-business days shall be deemed filed

as of 8 a.m. on the following business day.

(4) Adjustment of the filing date. If an electronic filer in good

faith attempts to file a beneficial ownership report with the FDIC in a

timely manner but the filing is delayed due to technical difficulties

beyond the electronic filer's control, the electronic filer may request

an adjustment of the filing date of such submission. The FDIC may grant

the request if it appears that such adjustment is appropriate and

consistent with the public interest and the protection of investors.

(5) Exhibits. (i) Exhibits to an electronic filing that have not

previously been filed with the FDIC shall be filed in electronic

format, absent a hardship exemption.

(ii) Previously filed exhibits, whether in paper or electronic

format, may be incorporated by reference into an electronic filing to

the extent permitted by applicable SEC rules under the Exchange Act. An

electronic filer may, at its option, restate in electronic format an

exhibit incorporated by reference that originally was filed in paper

format.

(iii) Any document filed in paper format in violation of mandated

electronic filing requirements shall not be incorporated by reference

into an electronic filing.

(6) Continuing Hardship Exemption. The FDIC will not accept in

paper format any beneficial ownership report filing required to be

submitted electronically under this part unless the filer satisfies the

requirements for a continuing hardship exemption:

(i) A filer may apply in writing for a continuing hardship

exemption if all or part of a filing or group of filings otherwise to

be filed in electronic format cannot be so filed without undue burden

or expense. Such written application shall be made at least ten

business days prior to the required due date of the filing(s) or the

proposed filing date, as appropriate, or within such shorter period as

may be permitted. The written application shall be sent to the

Accounting and Securities Disclosure Section, Division of Supervision

and Consumer Protection, Federal Deposit Insurance Corporation, 550

17th Street NW., Washington, DC 20429, and shall contain the

information set forth in paragraph (6)(ii) of this subsection.

(A) The application shall not be deemed granted until the applicant

is notified by the FDIC.

(B) If the FDIC denies the application for a continuing hardship

exemption, the filer shall file the required document in electronic

format on the required due date or the proposed filing date or such

other date as may be permitted.

appropriate and consistent with the public interest and the protection

of investors and so notifies the applicant, the filer shall follow the

procedures set forth in paragraph (6)(iii) of this subsection.

(ii) The request for the continuing hardship exemption shall

include, but not be limited to, the following:

(A) The reason(s) that the necessary hardware and software are not

available without unreasonable burden and expense;

(B) The burden and expense involved to employ alternative means to

make the electronic submission; and/or

group of documents, as well as justification for the requested time

period for the exemption.

(iii) If the request for a continuing hardship exemption is

granted, the electronic filer shall submit the document or group of

documents for which the exemption is granted in paper format on the

required due date specified in the applicable form, rule or regulation,

or the proposed filing date, as appropriate. The paper format

document(s) shall have placed at the top of page 1, or at the top of an

attached cover page, a legend in capital letters:

IN ACCORDANCE WITH 12 CFR 335.801(b), THIS (SPECIFY DOCUMENT) IS

BEING FILED IN PAPER PURSUANT TO A CONTINUING HARDSHIP EXEMPTION.

(iv) Where a continuing hardship exemption is granted with respect

to an exhibit only, the paper format exhibit shall be filed with the

FDIC under cover of SEC Form SE (17 CFR 249.444). Form SE shall be

filed as a paper cover sheet to all exhibits to beneficial ownership

reports submitted to the FDIC in paper form pursuant to a hardship

exemption.

(v) Form SE shall be submitted along with all exhibits filed in

paper form pursuant to a hardship exemption. Form SE may be filed up to

six business days prior to, or on the date of filing of, the electronic

form to which it relates but shall not be filed after such filing date.

If a paper exhibit is submitted in this manner, requirements that the

exhibit be filed with, provided with, or accompany the electronic

filing shall be satisfied.

Any requirements as to delivery or furnishing the information to

persons other than the FDIC shall not be affected by this section.

(7) Signatures. (i) Required signatures to, or within, any

electronic submission must be in typed form. When used in connection

with an electronic filing, the term ``signature'' means an electronic

entry or other form of computer data compilation of any letters or

series of letters or characters comprising a name, executed, adopted or

authorized as a signature.

(ii) Each signatory to an electronic filing shall manually sign a

signature page or other document authenticating, acknowledging or

otherwise adopting his or her signature that appears in typed form

within the electronic filing. Such document shall be executed before or

at the time the electronic filing is made and shall be retained by the

filer for a period of five years. Upon request, an electronic filer

shall furnish to the FDIC a copy of any or all documents retained

pursuant to this section.

(iii) Where the FDIC's rules require a filer to furnish to a

national securities exchange, a national securities association, or a

bank, paper copies of a document filed with the FDIC in electronic

format, signatures to such paper copies may be in typed form.

* * * * *

Note --The following forms will not appear in the Code of

Federal Regulations.

10. Amend Form F-7 (referenced in Sec. 335.111 and Sec. 335.611)

by:

a. Revising General Instruction 2(a);

b. Revising General Instruction 3(a);

c. Adding a note following General Instruction 3;

d. Revising General Instruction 5(b)(v);

[[Page 19090]]

e. Revising General Instruction 6;

f. Adding a new General Instruction 8;

g. Revising the short title of the Initial Statement of

BeneficialOwnership of Securities from Form F-7 to Form 3 in the form

heading;

h. Removing Item 3 and redesignating Items 4, 5, 6 and 7 to the

information preceding Table I as Items 3, 4, 5 and 6 to the information

preceding Table I; and

i. Revising newly redesignated Item 5 to the information preceding

Table I.

The revisions and additions read as follows:

Form 3 Initial Statement of Beneficial Ownership of Securities

* * * * *

General Instructions

* * * * *

2. When Form Must Be Filed

(a) This form must be filed within 10 days after the event by which

the person becomes a reporting person (i.e., officer, director, 10

percent holder or other person). This form and any amendment is deemed

filed with the appropriate Federal Banking Agency upon electronic

receipt on business days during the hours of 8 a.m. until 10 p.m.

Eastern Standard Time or Eastern Daylight Saving Time, whichever is

currently in effect. A form received after these business hours will be

deemed filed at 8:00 a.m. on the following business day. If this form

is submitted through FDICconnect on a non-business day, it will be

deemed filed at 8 a.m. on the following business day. Business days

include all weekdays that are not Federal holidays. A paper form

submitted by a reporting person that has obtained a hardship exemption

under FDIC rules will be deemed filed with the FDIC on the date it is

received by the FDIC. If this form is required to be filed on an

exchange, this form and any amendment is deemed filed with the exchange

on the date it is received by the exchange.

* * * * *

3. Where Form Must Be Filed

(a) A reporting person must file Form 3 in electronic format using

the secure, Internet-based, FDICconnect Business Center to access the

interagency Beneficial Ownership Filings system, except that a filing

person that has obtained a hardship exemption under applicable FDIC

rules (see 12 CFR 335.801(b)) may file the form in paper form. For

information and answers to questions regarding beneficial ownership and

the completion and filing of the forms please contact the FDIC Division

of Supervision and Consumer Protection, Accounting and Securities

Disclosure Section, 550 17th Street NW., Washington, DC 20429. For

technical questions or problems relating to the use of FDICconnect or

Designated Coordinator registration, contact FDICconnect toll-free at

877-275-3342 or via e-mail at FDICconnect@fdic.gov.

* * * * *

Note: If filing pursuant to a hardship exemption under FDIC

rules, file three copies of this form or any amendment, at least one

of which is signed, with the FDIC in accordance with applicable

rules. (Acknowledgement of receipt by the agency may be obtained by

enclosing a self-addressed stamped postcard or envelope identifying

the form or amendment filed.)

* * * * *

5. Holdings Required To Be Reported

* * * * *

(b) Beneficial Ownership Reported (Pecuniary Interest).

* * * * *

(v) Where more than one person beneficially owns the same equity

securities, such owners may file Form 3 individually or jointly. Joint

and group filings may be made by any designated beneficial owner.

Holdings of securities owned separately by any joint or group filer are

permitted to be included in the joint filing. Indicate the name and

address of the designated reporting person in Item 1 of Form 3 and

attach a list of the names and addresses of each other reporting

person. Joint and group filings must include all required information

for each beneficial owner, and such filings must be signed by each

beneficial owner, or on behalf of such owner by an authorized person.

Use the Filer Information screen in the interagency Beneficial

Ownership Filings system to submit additional joint or group filers'

names and related filing information required by this form.

If this form is being filed in paper form pursuant to a hardship

exemption and the space provided for signatures is insufficient, attach

a signature page. If this form is being filed in paper form, submit any

attached listing of names or signatures on another Form 3, copy of Form

3 or separate page of 8\1/2\ by 11 inch white paper, indicate the

number of pages comprising the report (form plus attachments) at the

bottom of each report page (e.g., 1 of 3, 2 of 3, 3 of 3), and include

the name of the designated filer and information required by Items 2

and 3 of the form on the attachment.

See SEC Rule 16a-3(i) regarding signatures.

* * * * *

6. Additional Information

(a) If space provided in the line items on this Form 3 is

insufficient, identify and enter additional information and footnotes

under Explanation of Responses.

(b) If the space provided in the line items on the paper Form 3 or

space provided for additional comments is insufficient, attach another

Form 3, copy of Form 3 or separate 8\1/2\ by 11 inch white paper to

Form 3, completed as appropriate to include the additional comments.

Each attached page must include information required in Items 1, 2 and

3 of the form. The number of pages comprising the report (form plus

attachments) shall be indicated at the bottom of each report page

(e.g., 1 of 3, 2 of 3, 3 of 3).

reference to such exhibit(s) under Explanation of Responses. If the

exhibit is being filed in paper form pursuant to a hardship exemption

under applicable FDIC rules, place the designation ``P'' (paper) next

to the name of the exhibit in the exhibit reference.

(d) If additional information is not reported in this manner, it

will be assumed that no additional information was provided.

* * * * *

8. Amendments

(a) If this form is filed as an amendment in order to add one or

more lines of ownership information to Table I or Table II of the form

being amended, provide each line being added, together with one or more

footnotes, under Explanation of Responses as necessary to explain the

addition of the line or lines. Do not repeat lines of ownership

information that were disclosed in the original form and are not being

amended.

(b) If this form is filed as an amendment in order to amend one or

more lines of ownership information that already were disclosed in

Table I orTable II of the form being amended, provide the complete line

or lines being amended, as amended, together with notes under

Explanation of Responses as necessary to explain the amendment of the

line or lines. Do not repeat lines of ownership information that were

disclosed in the original form and are not being amended.

other than or in addition to the purpose described in items (a) or (b)

of this GeneralInstruction 8, provide one or more notes under

Explanation of

[[Page 19091]]

Responses, as necessary, to explain the amendment.

* * * * *

Form 3 Initial Statement of Beneficial Ownership of Securities

* * * * *

5. If Amendment, Date Original Filed (Month/Day/Year)

* * * * *

11. Amend Form F-8 (referenced in Sec. 335.111 and Sec. 335.612)

by:

a. Revising General Instruction 1(a);

b. Revising General Instruction 2(a);

c. Adding a note following General Instruction 2;

d. Revising General Instruction 4(b)(v);

e. Revising General Instruction 6;

f. Adding a new General Instruction 9;

g. Revising the short title of the Statement of Changes in

Beneficial Ownership of Securities from Form F-8 to Form 4 in the form

heading;

h. Removing Item 3 and redesignating Items 4, 5, 6 and 7 to the

information preceding Table I as Items 3, 4, 5 and 6 to the information

preceding Table I; and

i. Revising newly redesignated Items 3 and 4 to the information

preceding Table I.

The revisions and additions read as follows:

Form 4 Statement of Changes in Beneficial Ownership of Securities

* * * * *

General Instructions

* * * * *

1. When Form Must Be Filed

(a) This form must be filed on or before the end of the second

business day following the day on which a transaction resulting in a

change in beneficial ownership has been executed (See SEC Rule 16a-

1(a)(2) and Instruction 4 regarding the meaning of ``beneficial

owner,'' and SEC Rule 16a-3(g) regarding determination of the date of

execution for specified transactions). This form and any amendment is

deemed filed with the FDIC upon electronic receipt on business days

during the hours of 8:00 a.m. until 10:00 p.m. Eastern Standard Time or

Eastern Daylight Saving Time, whichever is currently in effect. A form

received after these business hours will be deemed filed at 8:00 a.m.

on the following business day. If this form is submitted through

FDICconnect on a non-business day, it will be deemed filed at 8:00 a.m.

on the following business day. Business days include all weekdays that

are not Federal holidays. A paper form submitted by a reporting person

that has obtained a hardship exemption under applicable FDIC rules will

be deemed filed with the FDIC on the date it is received by the FDIC.

If this form is required to be filed on an exchange, this form and any

amendment is deemed filed with the exchange on the date it is received

by the exchange.

* * * * *

2. Where Form Must Be Filed

(a) A reporting person must file Form 4 in electronic format using