Federal Register: October 23, 2009 (Volume 74, Number 204)
DOCID: fr23oc09-88 FR Doc E9-25486
SECURITIES AND EXCHANGE COMMISSION
Securities and Exchange Commission
NOTICE: NOTICES
DOCID: fr23oc09-88
SUBJECT CATEGORY:
Proposed Collection; Comment Request
DOCUMENT SUMMARY:
Upon Written Request, Copies Available From: U.S. Securities and Exchange Commission, Office of Investor Education and Advocacy, Washington, DC 205490213.
Extension:
Rule 17i6; SEC File No. 270532; OMB Control No. 32350588.
Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 \1\ the Securities and Exchange Commission (``Commission'') has submitted to the Office of Management and Budget requests for extension of the previously approved collections of information discussed below. The Code of Federal Regulations citation to this collection of information is the following: 17 CFR 240.17i6.
\1\ 44 U.S.C. 3501 et seq.
Section 231 of the GrammLeachBliley Act of 1999 \2\ (the
``GLBA'') amended Section 17 of the Securities Exchange Act of 1934 to
create a regulatory framework under which a holding company of a
brokerdealer (``investment bank holding company'' or ``IBHC'') may
voluntarily be supervised by the Commission as a supervised investment
bank holding company (or ``SIBHC'').\3\ In 2004, the Commission
promulgated rules, including Rule 17i6, to create a framework for the
Commission to supervise SIBHCs.\4\ This framework includes
qualification criteria for SIBHCs, as well as recordkeeping and
reporting requirements. Among other things, this regulatory framework
for SIBHCs is intended to provide a basis for nonU.S. financial
regulators to treat the Commission as the principal U.S. consolidated
homecountry supervisor for SIBHCs and their affiliated broker dealers.\5\
\2\ Pub. L. No. 106102, 113 Stat. 1338 (1999).
\3\ See 15 U.S.C. 78q(i).
\4\ See Exchange Act Release No. 49831 (Jun. 8, 2004), 69 FR 34472 (Jun. 21, 2004).
\5\ See H.R. Conf. Rep. No. 106434, 165 (1999). See also
Exchange Act Release No. 49831, at 6 (Jun. 8, 2004), 69 FR 34472, at 34473 (Jun. 21, 2004).
Pursuant to Section 17(i)(3)(A) of the Exchange Act, an SIBHC must
make and keep records, furnish copies thereof, and make such reports as
the Commission may require by rule.\6\ Rule 17i6 requires that an
SIBHC file with the Commission certain monthly and quarterly reports
and an annual audit report. The reports and notices required to be
filed pursuant to Rule 17i6 must be preserved for a period of not less than three years.\7\
\6\ 15 U.S.C. 78q(i)(3)(A).
\7\ 17 CFR 240.17i5(b)(3).
The collections of information required by Rule 17i6 are necessary to allow the Commission adequately to supervise the activities of these SIBHCs and to effectively determine whether supervision of an IBHC as an SIBHC is necessary or appropriate in furtherance of the purposes of Section 17 of the Act. Rule 17i6 also enhances the Commission's supervision of an SIBHC's subsidiary brokerdealers through collection of additional information and inspections of affiliates of those brokerdealers. Without these reports, the Commission would be unable to adequately supervise an SIBHC, nor would it be able to determine whether continued supervision of an IBHC as an SIBHC were necessary and appropriate in furtherance of the purposes of Section 17 of the Act.
We estimate that three IBHCs will file Notices of Intention with
the Commission to be supervised by the Commission as SIBHCs. An SIBHC
will require about 8 hours to prepare and file each monthly report
required by this rule (or approximately 96 hours per year).\8\ On
average, it will take an SIBHC about 16 hours each quarter (or 64 hours
each year) \9\ to prepare and file the quarterly reports required by
this rule. An SIBHC will require about 200 hours to prepare and file
the annual audit reports required by this rule. Consequently, the total
annual burden of Rule 17i6 on all SIBHCs is approximately 984 hours.\10\
\8\ The SIBHC must file with the Commission a monthly report
within 30 calendar days after the end of each month that does not
coincide with a fiscal quarter end. Consequently, the SIBHC must
file a monthly report 8 times each year. (8 hours x 8 months) = 64 hours/year.
\9\ (16 hours x 4 quarters in a year) = 64 hours/year.
\10\ (64 hours per year to prepare and file monthly reports + 64
hours each year to prepare and file quarterly reports + 200 hours
each year to prepare and file annual audit reports) x 3 SIBHCs = 984 hours.
Rule 17i6 requires that an SIBHC file certain monthly and
quarterly reports with the Commission, as well as an annual audit
report. The average cost for an SIBHC to prepare and file the monthly
reports is about $1,424 per month, and thus approximately $11,392 [[Page 54865]]
per year.\11\ On average, an SIBHC will incur a quarterly cost of
$2,848 to prepare and file the required quarterly reports, and thus
will incur an annual cost of $11,392 to file these reports.\12\
Finally, an SIBHC, on average, will incur an annual cost of $40,400 to
prepare and file an annual audit.\13\ Thus, the total dollar cost of the ongoing paperwork burden associated with Rule 17i6 is
approximately $189,552.\14\
\11\ We believe that an SIBHC would have a Senior Accountant
prepare and file these reports. According to the Securities Industry
Financial Management Association (or ``SIFMA''), the hourly cost of
a Senior Accountant is $178, as reflected in the SIFMA's Report on
Management and Professional Earnings for 2008, and modified to
account for an 1,800hour workyear and multiplied by 5.35 to
account for bonuses, firm size, employee benefits and overhead. ($178 x 8 hours) = $1,424. ($1,424 x 8 months) = $11,392.
\12\ We believe that an SIBHC would have a Senior Accountant
prepare and file these reports. The hourly cost of a Senior
Accountant is $178. ($178 x 16 hours) = $2,848. ($2,848 x 4 quarters) = $11,392.
\13\ We believe that an SIBHC would have a Senior Internal
Auditor work with accountants to prepare and file these reports.
According to the SIFMA, the hourly cost of a Senior Internal Auditor
is $202, as reflected in its Report on Management and Professional
Earnings for 2008, and modified to account for an 1,800hour work
year and multiplied by 5.35 to account for bonuses, firm size,
employee benefits and overhead. ($202 x 200 hours) = $40,400.
\14\ (($11,392 + $11,392 + $40,400) x 3 SIBHCs) = $189,552.
We believe that an IBHC likely will upgrade its information technology (``IT'') systems in order to more efficiently comply with certain of the SIBHC framework rules (including Rules 17i4, 17i5, 17i6 and 17i7), and that this would be a onetime cost. Depending on the state of development of the IBHC's IT systems, it would cost an IBHC between $1 million and $10 million to upgrade its IT systems to comply with the SIBHC framework of rules. Thus, on average, it would cost each of the three IBHCs about $5.5 million to upgrade their IT systems, or approximately $16.5 million in total. It is impossible to determine what percentage of the IT systems costs would be attributable to each Rule, so we allocated the total estimated upgrade costs equally (at 25% for each of the abovementioned Rules), with $4,125,000 attributable to Rule 17i6.
Written comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication.
Comments should be directed to Charles Boucher, Director/Chief
Information Officer, Securities and Exchange Commission, c/o Shirley
Martinson, 6432 General Green Way, Alexandria, Virginia 22312 or send an email to: PRA_Mailbox@sec.gov.
Dated: October 19, 2009.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E925486 Filed 102209; 8:45 am]
BILLING CODE 801101P
SUMMARY:
Agency Information Collection Activities; Proposals, Submissions, and Approvals
DOCUMENT BODY 2:
Upon Written Request, Copies Available From: U.S. Securities and Exchange Commission, Office of Investor Education and Advocacy, Washington, DC 205490213.
Extension:
Rule 17i6; SEC File No. 270532; OMB Control No. 32350588.
Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 \1\ the Securities and Exchange Commission (``Commission'') has submitted to the Office of Management and Budget requests for extension of the previously approved collections of information discussed below. The Code of Federal Regulations citation to this collection of information is the following: 17 CFR 240.17i6.
\1\ 44 U.S.C. 3501 et seq.
Section 231 of the GrammLeachBliley Act of 1999 \2\ (the
``GLBA'') amended Section 17 of the Securities Exchange Act of 1934 to
create a regulatory framework under which a holding company of a
brokerdealer (``investment bank holding company'' or ``IBHC'') may
voluntarily be supervised by the Commission as a supervised investment
bank holding company (or ``SIBHC'').\3\ In 2004, the Commission
promulgated rules, including Rule 17i6, to create a framework for the
Commission to supervise SIBHCs.\4\ This framework includes
qualification criteria for SIBHCs, as well as recordkeeping and
reporting requirements. Among other things, this regulatory framework
for SIBHCs is intended to provide a basis for nonU.S. financial
regulators to treat the Commission as the principal U.S. consolidated
homecountry supervisor for SIBHCs and their affiliated broker dealers.\5\
\2\ Pub. L. No. 106102, 113 Stat. 1338 (1999).
\3\ See 15 U.S.C. 78q(i).
\4\ See Exchange Act Release No. 49831 (Jun. 8, 2004), 69 FR 34472 (Jun. 21, 2004).
\5\ See H.R. Conf. Rep. No. 106434, 165 (1999). See also
Exchange Act Release No. 49831, at 6 (Jun. 8, 2004), 69 FR 34472, at 34473 (Jun. 21, 2004).
Pursuant to Section 17(i)(3)(A) of the Exchange Act, an SIBHC must
make and keep records, furnish copies thereof, and make such reports as
the Commission may require by rule.\6\ Rule 17i6 requires that an
SIBHC file with the Commission certain monthly and quarterly reports
and an annual audit report. The reports and notices required to be
filed pursuant to Rule 17i6 must be preserved for a period of not less than three years.\7\
\6\ 15 U.S.C. 78q(i)(3)(A).
\7\ 17 CFR 240.17i5(b)(3).
The collections of information required by Rule 17i6 are necessary to allow the Commission adequately to supervise the activities of these SIBHCs and to effectively determine whether supervision of an IBHC as an SIBHC is necessary or appropriate in furtherance of the purposes of Section 17 of the Act. Rule 17i6 also enhances the Commission's supervision of an SIBHC's subsidiary brokerdealers through collection of additional information and inspections of affiliates of those brokerdealers. Without these reports, the Commission would be unable to adequately supervise an SIBHC, nor would it be able to determine whether continued supervision of an IBHC as an SIBHC were necessary and appropriate in furtherance of the purposes of Section 17 of the Act.
We estimate that three IBHCs will file Notices of Intention with
the Commission to be supervised by the Commission as SIBHCs. An SIBHC
will require about 8 hours to prepare and file each monthly report
required by this rule (or approximately 96 hours per year).\8\ On
average, it will take an SIBHC about 16 hours each quarter (or 64 hours
each year) \9\ to prepare and file the quarterly reports required by
this rule. An SIBHC will require about 200 hours to prepare and file
the annual audit reports required by this rule. Consequently, the total
annual burden of Rule 17i6 on all SIBHCs is approximately 984 hours.\10\
\8\ The SIBHC must file with the Commission a monthly report
within 30 calendar days after the end of each month that does not
coincide with a fiscal quarter end. Consequently, the SIBHC must
file a monthly report 8 times each year. (8 hours x 8 months) = 64 hours/year.
\9\ (16 hours x 4 quarters in a year) = 64 hours/year.
\10\ (64 hours per year to prepare and file monthly reports + 64
hours each year to prepare and file quarterly reports + 200 hours
each year to prepare and file annual audit reports) x 3 SIBHCs = 984 hours.
Rule 17i6 requires that an SIBHC file certain monthly and
quarterly reports with the Commission, as well as an annual audit
report. The average cost for an SIBHC to prepare and file the monthly
reports is about $1,424 per month, and thus approximately $11,392 [[Page 54865]]
per year.\11\ On average, an SIBHC will incur a quarterly cost of
$2,848 to prepare and file the required quarterly reports, and thus
will incur an annual cost of $11,392 to file these reports.\12\
Finally, an SIBHC, on average, will incur an annual cost of $40,400 to
prepare and file an annual audit.\13\ Thus, the total dollar cost of the ongoing paperwork burden associated with Rule 17i6 is
approximately $189,552.\14\
\11\ We believe that an SIBHC would have a Senior Accountant
prepare and file these reports. According to the Securities Industry
Financial Management Association (or ``SIFMA''), the hourly cost of
a Senior Accountant is $178, as reflected in the SIFMA's Report on
Management and Professional Earnings for 2008, and modified to
account for an 1,800hour workyear and multiplied by 5.35 to
account for bonuses, firm size, employee benefits and overhead. ($178 x 8 hours) = $1,424. ($1,424 x 8 months) = $11,392.
\12\ We believe that an SIBHC would have a Senior Accountant
prepare and file these reports. The hourly cost of a Senior
Accountant is $178. ($178 x 16 hours) = $2,848. ($2,848 x 4 quarters) = $11,392.
\13\ We believe that an SIBHC would have a Senior Internal
Auditor work with accountants to prepare and file these reports.
According to the SIFMA, the hourly cost of a Senior Internal Auditor
is $202, as reflected in its Report on Management and Professional
Earnings for 2008, and modified to account for an 1,800hour work
year and multiplied by 5.35 to account for bonuses, firm size,
employee benefits and overhead. ($202 x 200 hours) = $40,400.
\14\ (($11,392 + $11,392 + $40,400) x 3 SIBHCs) = $189,552.
We believe that an IBHC likely will upgrade its information technology (``IT'') systems in order to more efficiently comply with certain of the SIBHC framework rules (including Rules 17i4, 17i5, 17i6 and 17i7), and that this would be a onetime cost. Depending on the state of development of the IBHC's IT systems, it would cost an IBHC between $1 million and $10 million to upgrade its IT systems to comply with the SIBHC framework of rules. Thus, on average, it would cost each of the three IBHCs about $5.5 million to upgrade their IT systems, or approximately $16.5 million in total. It is impossible to determine what percentage of the IT systems costs would be attributable to each Rule, so we allocated the total estimated upgrade costs equally (at 25% for each of the abovementioned Rules), with $4,125,000 attributable to Rule 17i6.
Written comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication.
Comments should be directed to Charles Boucher, Director/Chief
Information Officer, Securities and Exchange Commission, c/o Shirley
Martinson, 6432 General Green Way, Alexandria, Virginia 22312 or send an email to: PRA_Mailbox@sec.gov.
Dated: October 19, 2009.
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E925486 Filed 102209; 8:45 am]
BILLING CODE 801101P