FDIC Federal Register Citations
Register: August 17, 2007 (Volume 72, Number 159)]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
SUMMARY: In accordance with requirements of the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501 et seq.), the FDIC hereby gives notice that it
is submitting to the Office of Management and Budget (OMB) a request
for OMB review and approval of the renewal or revision of the
information collection systems described below. The collection would
provide information on the features and effectiveness of small-dollar
programs offered by FDIC-insured financial institutions.
DATES: Comments must be submitted on or before September 17, 2007.
ADDRESSES: Interested parties are invited to submit written comments on
the collection of information entitled: Pilot Study of Small Dollar
Loan Programs. All comments should refer to the name of the collection.
Comments may be submitted by any of the following methods: http://www.FDIC.gov/regulations/laws/federal/propose.html..
Include the name and number of
the collection in the subject line of the message. Mail: Leneta G. Gregorie (202.898.3719), Counsel, Federal
Deposit Insurance Corporation, Room F-1064, 550 17th Street, NW.,
Washington, DC 20429. Hand Delivery: Comments may be hand-delivered to the guard
station at the rear of the 550 17th Street Building (located on F
Street), on business days between 7 a.m. and 5 p.m.
A copy of the comments may also be submitted to the OMB Desk
Officer for the FDIC, Office of Information and Regulatory Affairs,
Office of Management and Budget, New Executive Office Building, Room
10235, Washington, DC 20503.
FOR FURTHER INFORMATION CONTACT: Interested members of the public may
obtain additional information about the collection, including a copy of
the proposed collection and related instructions without charge, by
contacting Leneta G. Gregorie, at the address identified above.
Proposal To Seek OMB Approval for the Following New Collection of
Title: Pilot Study of Small-Dollar Loan Programs.
OMB Number: 3064-NEW.
Frequency of Response: Pilot study application--one time;
evaluation reports--quarterly for two years.
Affected Public: Insured depository institutions that apply
are accepted to participate in the pilot study.
Estimated Number of Respondents: Pilot study application--40;
Program evaluation reports--20 to 40.
Estimated Time per Response: Pilot study
average of 2 hours per respondent; Program evaluation reports--
estimated average of 5 hours per respondent.
Estimated Total Annual Burden: Pilot study application--40
respondents times 2 hours per respondent = 80 hours; Program evaluation
reports--20 to 40 respondents times 5 hours per respondent times 4
(quarterly). Total burden = 80 + 800 = 880 hours.
General Description of Collection: In recognition of the huge
demand for small-dollar, unsecured loans, as evidenced by the
proliferation around the country of payday lenders, the FDIC, on
December 4, 2006, proposed and sought comment on guidelines for such
proposed guidelines addressed several aspects of product development,
including affordability and streamlined underwriting. Based on the
comments received, the FDIC issued final guidelines on June 19, 2007,
entitled ``Affordable Small-Dollar Loan Guidelines'' (http://www.fdic.gov/news/news/financial/2007/fil07050.html).
The FDIC's goal
in issuing the guidelines is to encourage financial institutions to
offer small-dollar, unsecured loans in a safe and sound manner that is
also cost-effective and responsive to customer needs.
To further encourage the development by insured financial
institutions of small-dollar credit programs, the FDIC is contemplating
conducting a pilot study to assess the viability of such programs, with
the goal of demonstrating the extent of their profitability,
determining the degree to which customers of such programs migrate into
other banking products, determining the extent to which a savings
component results in increased savings and debt reduction, and
identifying program features which can be deemed ``best practices.''
Programs selected for the pilot may be either already in existence at a
bank or developed specifically for participation in the study.
Volunteers for the program must be well managed, well
institutions, and not be subject to any
enforcement actions. Banks interested in participating will provide a
description of their existing or proposed small-dollar loan program to
the FDIC. Key features of a preferred small-dollar lending program
might include loan amounts of up to $1,000; amortization periods longer
than a single pay cycle and up to 36 months for closed end credit, or
minimum payments which reduce principal (i.e., do not result in
negative amortization) for open end credit; annual percentage rates
(APR) below 36 percent; no prepayment penalties; origination fees
limited to the amount necessary to cover actual costs; a savings
component; and a financial education component.
The pilot study will require the quarterly collection of data
participating institutions, to the extent such data are not currently
included in the Call Reports or other standard regulatory reports, to
evaluate program success. For this purpose, the FDIC anticipates that
the following (or similar) information will be collected from
participating institutions on a quarterly basis: The total number and total dollar amount of small-dollar
loans made under the pilot program; Average loan term and average dollar size of such loans; Average interest rates charged, average fees levied, and
average calculations of APR, as required by the Truth in Lending Act; Aggregate delinquency, charge-off, and workout financing
data; Profitability and/or break-even data for the overall
program; The total number and total dollar amount of linked savings
accounts opened as part of the program; Information as to duration and withdrawal rates of linked
savings accounts; Data on utilization rates of any financial education
component; Information regarding whether customers of the program
migrated to other bank products; and To the extent possible, whether offering affordable loan
products helped to wean customers off of high-cost debt.
The preferred method for collecting these data is electronic submission
through the existing FDIConnect data interface system to minimize
burden on respondents. The survey will be conducted quarterly, fifteen
days after the deadline for banks to file their mandatory Call Reports.
The study will conform to privacy rules and will not request any
information that could be used to identify individual bank customers,
such as name, address, or account number. All data from participating
insured institutions will remain confidential. It is the intent of the
FDIC to publish only general findings of the study.
Request for Comment
Comments are invited on: (a) Whether these collections of
information are necessary for the proper performance of the FDIC's
functions, including whether the information has practical utility; (b)
the accuracy of the estimate of the burden of the information
collections, including the validity of the methodology and assumptions
used; (c) ways to enhance the quality, utility, and clarity of the
information to be collected; and (d) ways to minimize the burden of the
information collections on respondents, including through the use of
automated collection techniques or other forms of information
technology. All comments will become a matter of public record.
Dated at Washington, DC, this 14th day of August, 2007.
Federal Deposit Insurance Corporation.
Robert E. Feldman,
[FR Doc. E7-16215 Filed 8-16-07; 8:45 am]