A User’s Guide for the Bank Holding Company Performance Report December 2020 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM A User’s Guide for the Bank Holding Company Performance Report December 2020 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM A User’s Guide for the Bank Holding Company Performance Report may be accessed on the Federal Reserve Board’s website at https://www.federalreserve.gov/publications/bhcpr_usersguide.htm. iii Foreword A User’s Guide for the Bank Holding Company Performance Report number, address, and telephone number of each Federal Reserve serves as an aid in using the Bank Holding Company Perfor- Bank are listed below. mance Report (BHCPR). The guide provides definitions of the financial ratios and items presented on each page of the BHCPR. District Federal Reserve Bank Telephone Number Number and Location (of Surveillance Staff) Questions or comments relating to this guide may be directed to the BHCPR Analyst, Surveillance—Metric Systems Section 1 Federal Reserve Bank of (617) 973-2832 Boston at the Board of Governors of the Federal Reserve System at 600 Atlantic Avenue (202) 728-5893 or [email protected]. Specific questions or com- Boston, MA 02106-2076 ments pertaining to information contained in an individual hold- 2 Federal Reserve Bank of (212) 720-5855 New York ing company’s performance report should be addressed to Sur- 33 Liberty Street veillance Staff of the appropriate Federal Reserve Bank (shown New York, NY 10045-0001 on the holding company’s BHCPR cover page). The district 3 Federal Reserve Bank of (215) 574-6406 Philadelphia Ten Independence Mall Philadelphia, PA 19106-1574 4 Federal Reserve Bank of (216) 579-2988 Cleveland 1455 East Sixth Street Cleveland, OH 44114-2566 5 Federal Reserve Bank of (804) 697-4419 Richmond 701 East Byrd Street Richmond, VA 23219-7622 6 Federal Reserve Bank of (404) 498-8246 Atlanta 1000 Peachtree Street, N.E. Atlanta, GA 30309-4470 7 Federal Reserve Bank of (312) 322-6390 Chicago 230 South LaSalle Street Chicago, IL 60604-0834 8 Federal Reserve Bank of (314) 444-6255 St. Louis 411 Locust Street St. Louis, MO 63102-2034 9 Federal Reserve Bank of (612) 204-5266 Minneapolis 90 Hennepin Avenue Minneapolis, MN 55480-0291 10 Federal Reserve Bank of (816) 881-2847 Kansas City 1 Memorial Drive Kansas City, MO 64198-0001 11 Federal Reserve Bank of (214) 922-6277 Dallas 2200 N. Pearl Street Dallas, TX 75201 12 Federal Reserve Bank of (213) 683-2316 San Francisco 101 Market Street San Francisco, CA 94105 v Contents 1 Introduction ...................................................................................................................................................... 1 2 Technical Information ........................................................................................................................................ 3 3 Sample Bank Holding Company Performance Report and Definition of Items .................................................. 7 Introductory Page ................................................................................................................................................ 9 Summary Ratios ................................................................................................................................................ 11 Income Statement—Revenues and Expenses .......................................................................................................... 15 Relative Income Statement and Margin Analysis .................................................................................................... 18 Non-Interest Income and Expenses ...................................................................................................................... 22 Assets ............................................................................................................................................................... 26 Liabilities and Changes in Capital ........................................................................................................................ 30 Percent Composition of Assets ............................................................................................................................ 34 Loan Mix and Analysis of Concentrations of Credit .............................................................................................. 38 Liquidity and Funding ....................................................................................................................................... 43 Derivatives and Off-Balance-Sheet Transactions .................................................................................................... 47 Derivative Instruments ....................................................................................................................................... 51 Derivatives Analysis ........................................................................................................................................... 54 Allowance and Net Loan and Lease Losses ........................................................................................................... 58 Past Due and Nonaccrual Assets .......................................................................................................................... 62 Past Due and Nonaccrual Loans and Leases ......................................................................................................... 66 Past Due and Nonaccrual Loans and Leases (continued) ........................................................................................ 69 Regulatory Capital Components and Ratios .......................................................................................................... 73 Insurance and Broker-Dealer Activities ................................................................................................................. 77 Foreign Activities ............................................................................................................................................... 81 Servicing, Securitization, and Asset Sale Activities—Part 1 ..................................................................................... 83 Servicing, Securitization, and Asset Sale Activities—Part 2 ..................................................................................... 87 Servicing, Securitization, and Asset Sale Activities—Part 3 ..................................................................................... 91 Parent Company Income Statement ..................................................................................................................... 96 Parent Company Balance Sheet .......................................................................................................................... 100 Parent Company Analysis—Part 1 ..................................................................................................................... 104 Parent Company Analysis—Part 2 ..................................................................................................................... 109 Appendix: Sample Peer Group Average Reports .................................................................................................. 113 1 1 Introduction The Bank Holding Company Performance Report (BHCPR) is to include savings and loan holding companies (SLHCs) and an analytical tool produced by the Federal Reserve System for intermediate holding companies (IHCs) of foreign banking orga- supervisory purposes, including on-site inspections, off-site sur- nizations. For purposes of the report, all references to “bank veillance and monitoring, and analyses performed in connec- holding company(ies)” or “BHC(s)” are inclusive of “savings tion with applications filed with the Federal Reserve regarding and loan holding company(ies)” and “intermediate holding com- mergers, acquisitions, and other matters. The BHCPR is designed pany(ies) of foreign banking organizations” unless otherwise to assist analysts and examiners in determining a holding com- noted. pany’s financial condition and performance based on financial statements, comparative ratios, trend analyses, and percentile No single financial ratio, percentile rank, or trend shown in the ranks relative to its peers. BHCPR should be assumed to be conclusive evidence of a spe- cific firm's financial condition. In appraising a holding compa- The BHCPR was designed for the analysis of each bank hold- ny’s financial condition, an analyst must make a judgment based ing company (BHC) that submitted a quarterly Form FR Y-9C. on an analysis of a variety of factors and interrelationships and Subsequently, the panel of FR Y-9C reporting firms expanded on peer group comparisons. 3 2 Technical Information Description • The Summary Ratios page presents selected key financial ratios to measure consolidated earnings and profitability, credit losses, The Bank Holding Company Performance Report (BHCPR) nonaccrual assets and other real estate owned (OREO), liquid- is a computer-generated report of current and historical finan- ity, capital, leverage, growth rates, and selected parent com- cial information produced quarterly for three groups of hold- pany ratios. ing companies supervised by the Federal Reserve: • The Consolidated Information section contains detailed income • top-tier holding companies that meet or exceed the consoli- and expense account items and ratios used to measure the dated assets threshold for FR Y-9C and FR Y-9LP reporting