SEC proposes updated rules for bank disclosures

The Securities and Exchange Commission (SEC) has proposed to update the statistical disclosures that banks and savings and loans companies provide to investors.

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Further, the SEC rule would eliminate disclosures that overlap with U.S. GAAP (Generally Accepted Accounting Principles) or IFRS (International Financial Reporting Standards). The proposed rules would replace Industry Guide 3, Statistical Disclosure by Bank Holding Companies, with updated disclosure in a new subpart of Regulation S-K.

“Guide 3 has not been substantively updated for more than 30 years,” SEC Chair Jay Clayton said. “Today’s proposals are another example of how thoughtful reviews can improve disclosures for the benefit of investors and public companies.”

The Commission’s proposed rules reflect the issuance of new accounting standards for banking registrants since the SEC last updated Industry Guide 3. Specifically, the proposed rules would require disclosure about the distribution of assets, liabilities, and stockholders’ equity, the related interest income and expense, and interest rates and interest differential. It would also require disclosure for a weighted average yield of investments in debt securities by maturity, maturity analysis of the loan portfolio, an allocation of the allowance for credit losses and certain credit ratios, and information about bank deposits.

The proposal is open for public comment for 60 days after publication in the Federal Register.