SEC streamlines disclosure requirements for banking organizations

New rules eliminate duplicative disclosure, mandate credit ratio disclosures that many banks already provide

In an effort to reduce duplication and update its statistical disclosure rules for bank holding companies, the US Securities and Exchange Commission (“SEC”) has adopted amendments that eliminate Guide 3 (Statistical Disclosure by Bank Holding Companies) and codify some, but not all, of those disclosure requirements in Regulation S-K.  

Many of the changes are driven by the SEC’s desire to eliminate the overlap between Guide 3’s requirements and what registrants must already disclose under US Generally Accepted Accounting Principles, International Financial Reporting Standards and other SEC rules.

For the most part, the SEC is reducing the Guide 3 disclosure requirements (e.g., by shortening some reporting periods) and providing registrants with more flexibility in their disclosure. One area where the SEC is mandating increased disclosure is with respect to certain credit ratios, although these are already commonly disclosed by most bank and savings and loan registrants with material lending portfolios.  

Registrants will be required to apply the final rules for the first fiscal year ending on or after December 15, 2021, and voluntary early compliance is permitted. Registrants filing initial registration statements are not required to apply the final rules until an initial registration statement is first filed containing financial statements for a period on or after the mandatory compliance date.