dezembro 28 2023

Fund Finance Reporting Requirements Proposed by US Banking Regulators


On December 27, 2023, the US federal banking regulators proposed reporting requirements for bank loans and commitments to the fund finance sector.1 This change reflects not only the rapid growth in this sector but also the regulators’ desire to better understand and supervise concentrations of credit and risk in the US banking system.

While banks will not be required to report individual names of obligors, banks and borrowers should understand how they will be affected by the ways that regulators and investors use this new information.


Banks are required to file several types of reports with their regulators, including with respect to the bank’s financial condition, the results of its operations, and risk exposure.2 One of the most common regulatory reports is the quarterly Consolidated Reports of Condition and Income (“call report”), which banking regulators, including the OCC, use to assess a bank’s financial condition.

The information disclosed in regulatory reports, particularly in call reports, is important because reports often are used by regulators to make supervisory determinations and may be made publicly available to investors, depositors, and creditors. The information also is quite detailed, with the FFIEC 031-version of the call report running 89 pages.3

Banks are required to categorize credit exposures into many categories for reporting purposes, including loans secured by real estate, credit cards, loans to foreign governments, etc., and report the amount outstanding each quarter. Since 2010, banks have been required to report aggregate loans to nondepository financial institutions, which includes fund finance facilities.

Proposed Reporting Requirements

The proposal notes that loans to nondepository financial institutions have increased from $56 billion in 2010 to $786 billion in 2023. This constitutes approximately 6.4% of total bank lending. Additionally, the Financial Stability Oversight Council and others have raised concerns with the interconnection between banks and nondepository financial institutions.4 Further, issues related to management of fund banking activities were raised in connection with the failures of a number of regional banks earlier this year, particularly with respect to concentration risk management.

The proposal would require banks with $10 billion or more in total assets to disaggregate the category of loans to nondepository financial institutions into five new categories:

  1. Loans to mortgage credit intermediaries
  2. Loans to business credit intermediaries
  3. Loans to private equity funds
  4. Loans to consumer credit intermediaries
  5. Other loans to nondepository financial institutions

Additionally, banks with $10 billion or more in total assets would be required to report unused commitments to lend to nondepository financial institutions and disaggregate the information using the same five categories.


It seems likely that fund finance facilities, including subscription/capital call loans and NAV loans, would be reported in the new categories for loans and unused commitments to private equity funds. And it is unlikely that the regulators will abandon the proposed reporting requirements, so banks should consider if there are targeted changes to the new categorization and related definitions that would ease the reporting burden.

On their own, call reports do not create or trigger regulatory requirements. However, regulators use call reports to understand and monitor activities of banks and may intervene if they believe a reported metric is indicative of problematic or unsafe conduct. For example, the OCC requires the banks that it regulates to identify and measure categories of loans that constitute more than 25% of capital and more closely monitor and control such concentrations.6

Additionally, investors and competitors may use information from call reports to identify trends and opportunities. This can range from competitors being more likely to target a bank’s customers for a particular product to investors being less likely to invest in a bank that stops growing in certain categories.



1 88 Fed. Reg. 89,495 (Dec. 27, 2023).

2 12 U.S.C. §§ 161, 324, 1817, 1464.

3 FFIEC, Consolidated Reports of Condition and Income for a Bank with Domestic and Foreign Offices (Dec. 13, 2023).

4 FSOC, Annual Report 2023 at 34 (Dec. 14, 2023) (“The level of opacity in private credit markets can make it challenging for regulators to assess the buildup of risks in the sector.”); FSOC, Statement on Nonbank Financial Intermediation (Feb. 4, 2022); see also Federal Reserve, Statement on Safe and Sound Practices for Counterparty Credit Risk Management (Dec. 10, 2021); but see Federal Reserve, Financial Stability Report (May 2023) (“Risks to financial stability from leverage at private credit funds appear low”).

5 Regulators are more likely to intervene if a reported metric indicates that a bank has violated a legally binding limit, such as the limits on loans to one borrower, single-counterparty credit limits, or limitations on interbank liabilities. See 12 C.F.R. pts. 32, 206, 252.

6 OCC, Concentrations of Credit (Oct. 2020).

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