Statistical Notices to Reporting Banks 1999/04
Statistical Notices should be received by all those responsible for the completion of Bank of England returns. To add names to the circulation list please contact us on 020 7601 3644.
This Statistical Notice covers the following topics:
- Year 2000 compliance for electronic reporters
- End of cumulative reporting on Forms A3 and BP
- Clarification of BT item 19CA (effective immediately)
- Reporting translation and revaluation adjustments on Forms CA and CB (effective immediately)
- Correction to BT/QX cross form validations (effective immediately)
- Individual Learning Accounts (effective immediately)
- Scottish Housing Associations (effective immediately)
- Further guidance on sight/time classification- uncleared funds (effective immediately)
- Reporting of LIFFE shares on Form BT (effective immediately)
- Amendment to the Classification of Accounts Guide (effective immediately)
- Contents page and contact list for insertion into the Yellow Folder (update)
1. Year 2000 compliance for electronic reporters
The electronic reporting system requires that files are compressed
and encrypted. Monetary & Financial Statistics Division
has recommended the PKZIP product (version 2.60 and later)
for
this purpose and any statements about year 2000 compliance
refer to PKZIP (2.60 and later) (see Statistical Notice 1998/08).
We are aware that some banks use WINZIP for encryption. These
banks should satisfy themselves that their version of the
software
is year 2000 compliant. WINZIP 6.3 and above are stated to
be year 2000 compliant to the best of the company’s
knowledge on WINZIP’s web
site.
Earlier WINZIP products may have some problems.
2. Ending of cumulative reporting on Forms A3 and BP
The Bank is planning to end "cumulative" reporting
(i.e. over the period of an accounting year) for quarterly reporters
of Forms A3 (banks’ income and expenditure) and BP (transactions
with non-residents), and move all banks over to "single
quarter" reporting during the financial year 2000.
The reason for making this change is to improve the analysis and accuracy of these data. They are used by the Office for National Statistics in the calculations of gross domestic product and dividend and interest flows in the national accounts (in the case of Form A3) and the balance of payments current account balance (in the case of Form BP). Accuracy of these data is covered by the Bank’s Firm Agreement with the ONS, which we have breached several times recently – mainly due to problems with cumulative reporters’ data.
Those banks affected by this change should have been contacted separately by letter. If you have not received your letter, or have any questions, please contact us on 0207 601 5360.
3. Clarification of BT item 19CA (effective
immediately)
Please record revaluations of non-sterling assets and liabilities
due to spot exchange rate movements (excluding revaluations
in financial derivatives) in BT item 19CA. If the asset or liability
is denominated in euros or one of the eleven EMU currencies
the revaluation should be recorded in euro 19CA, revaluations
of assets and liabilities denominated in other non-sterling
currencies should be recorded in the other currencies box as
before. Once a translation gain or loss is realised it should
be transferred to item euro 19CD or other currencies 19CD as
appropriate. If this distinction presents any difficulties for
reporting institutions, then all such revaluations should be
recorded in the other currencies box.
The relevant pages of the BT definitions are re-issued with this Statistical Notice to clarify the euro position.
| 19CA | Revaluations arising from movements in currency exchange rates (excluding revaluations in financial derivatives |
| Amended o/a Stats Notice 1999/04 | This item should include the actual or notional accounts containing the total current year profit (+) or loss (-) caused by translation differences resulting from the effects of exchange rate movements in spot exchange rates on the (sterling expressed) non-sterling assets and liabilities. Institutions whose base currency is sterling, and whose revaluation accounts are denominated as such for internal purposes, should still enter revaluations that relate to non-sterling assets and liabilities within 19CA. Revaluations relating to assets and liabilities denominated in euros or the eleven EMU currencies should be recorded in the euro column, the remaining revaluations relating to non-sterling assets and liabilities should be recorded in the other currencies column. If this distinction presents any difficulties for reporting institutions, then all such revaluations should be recorded in the other currencies box. Once a translation gain or loss is realised, e.g. because a non-sterling deposit or loan or part thereof is repaid, the gain or loss should be transferred to item 19CD. If material movements occur in this box for reasons other than the translation profit or loss in the latest month (e.g. when the cumulative unrealised profit or loss is transferred to 19CD at year-end, or through payments of dividends/receipts of funds from shareholders), it would be helpful if institutions could contact the Helpdesk on 0207 601 5360. Notional or actual profits/losses resulting from the maturing of forward positions at exchange rates different from current spot rates should not be entered here, but instead included within item 19CD - capital and other internal accounts. |
4. Reporting translation and revaluation adjustments
on Forms CA and CB (effective immediately)
Translation and revaluation adjustments which have been recorded
within euro 19CA on Form BT should be recorded against the
Euro
line of the column "Other liabilities" on Form CA
(CAL10) and also within the Euro line in column 1 of Form CB.
Adjustments relating to other non-sterling currencies should
continue to be recorded within the "Other currencies" lines
on these forms.
5. Correction to BT/QX cross form validations
(effective immediately)
The validations between Forms QX and BT for items 19B and 19CD
were removed from the QX section of the yellow folder in a previous
Statistical Notice. The BT
cross-form validations (200, 201
and 202) have now been amended, in line with the QX. This should
not affect reporting institutions’ systems as the BT cross-form
validations are not specific but refer the user to the validations
sections of the associated forms. The wording on the QX form
itself will be amended when/if a re-issue of the form becomes
unavoidable.
6. Individual Learning Accounts (ILAs) (effective
immediately)
Institutions should report ILAs as normal personal sector deposits.
There are no plans to introduce further boxes on Form BT (as
were introduced for ISAs) for ILAs.
7. Scottish housing associations/companies (effective
immediately)
A query recently arose with the Financial Services Authority
regarding the treatment of Scottish housing companies for risk
weighting purposes. This stems from the 1996 Housing Act, under
which the housing associations in both England and Wales were
effectively included in the 50% risk weighting category. However,
the Housing Act did not apply in Scotland because they chose
not to adopt the Act when it was introduced. They have now decided
to implement a similar version of regulation, which means that
housing companies that are registered with Scottish Homes will
be regulated through a contractual agreement rather than through
legislation.
Although the contractual arrangement in Scotland will be technically different from the legislative arrangement used in England and Wales, in the light of the close similarities between the two methods of regulation, Scottish housing companies will be treated on a par with housing associations in England and Wales. Accordingly, so long as the loans to them are fully secured by a first priority charge on the housing company residential property that is being rented, the loans will attract a 50% weighting.
The opportunity has also been taken to revise the definition of those loans which attract the 50% weighting, to remove certain types of loan which could not be made following the introduction of the 1996 Housing Act. For any institutions that still have loans outstanding that met these terms, they can continue to attract 50% weighting so long as the terms of the outstanding loans do not change.
Revised QX definitions pages are re-issued with this Statistical Notice. The BE and Q1(D) definitions do not specifically mention Scottish housing associations/companies.
| XF | Other loans and advances including reverse repos (Items 29, 30 and 31 from Form BT) |
| Amended o/a Stats Notice 1999/04 | Report mortgage loans to housing associations registered with the Housing Corporation, Scottish Homes and Tai Cymru (Housing for Wales), and to housing companies that are registered with Scottish Homes, which are fully secured by a first priority charge on housing association residential property which is rented. |
8. Further guidance on sight/time classification –
uncleared funds (effective immediately)
If a customer has the right to withdraw funds instantly, without
interest, tax relief or other penalty, from their deposit account,
the account should be recorded as a sight deposit. Uncleared
funds, such as cheques paid into the account, should not affect
the classification of the deposit account between sight and
time.
The relevant pages of the BT definitions are re-issued with this Statistical Notice.
| 2 | Sight deposits |
| Amended o/a Stats Notice 1999/04 | Savings deposits, deposit accounts and deposit receipts can be entered under either sight or time deposits (see below) depending on the terms for withdrawal. It is the features of the account and not the commercial title of the account which determines the classification. For example, a so-called "Instant Access Savings Account" may be classified as either sight or time - if there is any penalty incurred when withdrawing the entire balance (excluding uncleared cheques and funds), either on demand or by close of business on the day following that on which the deposit was made, then the account should be classified as a time deposit. |
8. Reporting of LIFFE shares on Form BT (effective
immediately)
LIFFE shares (effectively a permit to trade on the exchange)
should be treated as fixed assets and hence recorded in BT
item
35B. This is because a) they are not income yielding, and b)
this is consistent with the treatment of LIFFE advised for
statutory
accounting purposes. If any reclassifications arise from this
guidance, please inform the Helpdesk on 0207 601 5360.
The relevant pages of the BT definitions are re-issued with this Statistical Notice.
| 35B | Fixed assets, commodities owned etc. |
| Amended o/a Stats Notice 1999/04 | These consist of land, premises, equipment, vehicles, commodities (including silver) and other assets owned or recorded as such by the reporting institution. Do not include gold bullion, see item 35A. Fixed assets such as premises and equipment should, preferably, be reported net of depreciation, in which case depreciation must not be reported under internal accounts (item 19C above). Include any plant and equipment leased out by the reporting institution under operating leases and in under finance leases, but exclude plant and equipment leased out under finance leases by the reporting institution, which should be entered under item 21B, 23 or 29. LIFFE shares (effectively a permit to trade on the exchange
should be recorded in item 35B. This is because a) they
are not income yielding, and b) this is consistent with
the treatment of LIFFE advised for statutory accounting
purposes. |
10. Amendment to the Classification of Accounts Guide
(effective immediately)
Please see the attached re-issued page regarding a change to
the CMI list (Armenia).
10. Contents page and contact list for insertion into
the Yellow Folder (update)
Attached
Bank of England
Monetary & Financial Statistics Division
28 May 1999
