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Instructions for the Bank Regulatory Burden Evaluation Tool

This evaluation tool is intended to provide an estimate of the staff hours and cost that your banking firm devotes to compliance with regulations over a month's time, so that an estimate of the annual burden can be calculated.

Once you have loaded the tool, you should save it on your computer. The tool is an Excel spreadsheet in four forms, three for input data and the other calculates results. The data entry pages were not provided as paper sheets because the data must be entered into the spreadsheet so that it can perform its automatic calculations of your bank's total regulatory burden. Data is to be entered only on the "General Mgmt," "Lending" and "Deposit Taking" forms, in the yellow spaces. However, you probably will not fill in most of the yellow space, as described below. All four forms are set up to be printed, to make it easier for you to compile draft figures.

In the center of the top line of the "General Mgmt" form, enter the first day of the month that the estimates apply to. The format is month/day/year. For example, if you are filling out the form for September 2005 then enter 9/1/2005. Also enter your bank's name in the top right corner.

Six more bits of background data are needed in the next two lines: 1. the approximate assets of your banking organization in millions of dollars, 2. the total number of branches including headquarters, 3. the number of business days in the month under review, and, only if your bank's shares are publicly traded, the numbers of shareholders and shares outstanding, and 4. the approximate current market price.

The Input section includes three pages for general management regulations, lending regulations and deposit-taking regulations. Each section can be parceled out to the bank staffer who is best suited to estimate the values required.

Each of the three forms contains a list of specific regulations that impose time demands on the bank. The form asks for estimates of the hours spent and wage rate for the staffer who does the work for a set of tasks of each regulation. You should adjust the wage rate upward to account for benefits. For functions performed by more than one employee, approximate the average hourly cost of those that do the task. On the "General Mgmt" form, you can estimate direct dollar compliance costs other than staff-time, for non-staff consultants, attorneys, training, mailings, and other technical support. Space is also provided for other specific tasks that are not listed. Here you can add the regulatory burdens that are specific to your states, which were not included in the generic input forms.

Note that the tool focuses on the regulatory burden specific to banks. A small section is included for general regulations that apply to most firms, bank and others, so that the major costs of the Sarbanes-Oxley Act can be captured. The forms do not include many of the burdensome, non-bank-specific regulations, such as those from the Occupational Safety and Health Administration and Americans with Disabilities Act. The major expenses of accounting and auditing were also not included by similar reasoning.

Each line asks for an estimate of the hours spent in direct compliance actions directly, per branch, and/or per department other than compliance. You can allocate your bank's commitment in whichever column(s) work best for you; you do not have to enter something in every column. You can estimate time weekly or for the entire month. For example, suppose that you see the bank's compliance time for a particular task as an hour a week plus 6 hours a month. Then you would enter 1 under "Weekly" and 6 under "Monthly." If you enter a time estimate for any task then you must also enter a value under "Av. Hourly Wage ($)" for the computations to work. Similarly, if the time commitment is per branch or per department then you must also enter the number of branches/departments in the space provided.

Once you fill in the month, hours, wages and direct costs that are relevant to your institution, the tool will automatically calculate the total time and expense for the month on the "Results" form. The calculations will also estimate the annual total. If the month reported on is above or below the normal monthly average for a particular activity, you can adjust the data entered to the normal level to get a closer estimate of the actual annual burden.

ABA requests that you e-mail your Results to Rob Strand or fax them to 202-828-4547 so that an estimate of the regulatory burden for the entire banking industry can be compiled. Your data will be entered in our databank then destroyed; it will be kept strictly confidential.

Resources

​Questions? For more information, contact Rob Strand.