FDIC Issues Notice of Proposed Rulemaking for Legal Entity Identifiers, Other Identifiers

The Federal Deposit Insurance Corporation, on behalf of a consortium of federal financial regulatory agencies, has issued a Notice of Proposed Rulemaking (NPR), in accordance with the Financial Data Transparency Act of 2022. The proposed rule would establish data standards for the collection of information reported by financial entities to the involved agencies, as well as the data these agencies report to the Federal Stability Oversight Council.

The FDIC’s announcement of the NPR (Aug. 9) includes more details about the NPR. The NPR was issued after the FDIC’s Board of Directors considered the recommendation to publish the proposed rules. For the FDIC, the joint rule would add a Subpart D to 12 C.F.R. Part 304, which is the FDIC’s regulation for forms, instructions, and reports.

Comments on the NPR are due within 60 days after publication in the Federal Register.

The agencies involved in the NPR are the Department of the Treasury; Board of Governors of the Federal Reserve System; Office of the Comptroller of the Currency; Consumer Financial Protection Bureau; Securities and Exchange Commission; Federal Housing Finance Agency; National Credit Union Administration; and Commodity Futures Trading Commission.

A key provision of the NPR would establish the ISO 17442 – Financial Services – Legal Entity Identifier (LEI) as a joint standard. The agencies also propose to adopt internationally recognized data element standards as joint standards for other common identifiers such as:

• Swaps and securities-based swaps (Unique Product Identifier as defined by ISO 4914)
• Structure and function of a financial instrument in the form of security or contract (Classification of Financial Instruments as defined under ISO 10962)
• Identification of financial securities (Financial Instrument Global Identifier as defined under ANSI X.9-145)
• Date fields (Date as defined by ISO 8601)
• identification of a U.S. state, possession, military “state” (per “Appendix B of Publication 28 “Postal Addressing Standards, Mailing Standards of the United States Postal Service”)
• Countries and their subdivisions (Geopolitical Entities, Names, and Codes as defined under ISO 3166)
• Currencies (ISO 4217 Currency Codes)

The Agencies also propose to establish data transmission and schema and taxonomy format used have four properties, derived from the properties of the FDTA:

1. Render data fully searchable and machine-readable
2. Enable high-quality data through schemas with accompany metadata per a machine-readable taxonomy or ontology
3. Ensure data elements or assets that exist to satisfy a regulatory requirement be consistently identified as such in the associated metadata
4. Be non-proprietary or available under an open license.