The following table identifies the changes made to this Subtopic.
This Subtopic provides guidance regarding the recognition, measurement and disclosure of debt and equity securities by financial institutions.
This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section
942-10-15.
The period of amortization or accretion for debt securities shall generally extend from the purchase date to the maturity date, unless other Topics are applicable.
In complying with the requirements in paragraph 942-320-50-1, financial institutions shall include in their disclosure all of the following major security types, although additional types also may be necessary: - a
Equity securities, segregated by any one of the following:
- 1
Industry type
- 2
Entity size
- 3
Investment objective.
- b
Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies
- c
Debt securities issued by states of the United States and political subdivisions of the states
- d
Debt securities issued by foreign governments
- e
Corporate debt securities
- f
Residential mortgage-backed securities
- ff
Commercial mortgage-backed securities
- fff
Collateralized debt obligations
- g
Other debt obligations.
(P) December 16, 2027; (N) December 16, 2028
270-10-65-1In complying with the requirements in paragraph 942-320-50-1, financial institutions shall include in their disclosure in interim and annual reporting periods all of the following major security types, although additional types also may be necessary: - a
Equity securities, segregated by any one of the following:
- 1
Industry type
- 2
Entity size
- 3
Investment objective.
- b
Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies
- c
Debt securities issued by states of the United States and political subdivisions of the states
- d
Debt securities issued by foreign governments
- e
Corporate debt securities
- f
Residential mortgage-backed securities
- ff
Commercial mortgage-backed securities
- fff
Collateralized debt obligations
- g
Other debt obligations.
Investments in mutual funds that invest only in U.S. government debt securities may be shown separately rather than grouped with other equity securities in the disclosures by major security type required by paragraph 942-320-50-2. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1For interim and annual reporting periods, investments in mutual funds that invest only in U.S. government debt securities may be shown separately rather than grouped with other equity securities in the disclosures by major security type required by paragraph 942-320-50-2. In complying with this requirement, financial institutions shall disclose the net carrying amount of debt securities based on at least 4 maturity groupings: - a
Within 1 year
- b
After 1 year through 5 years
- c
After 5 years through 10 years
- d
After 10 years.
Securities not due at a single maturity date, such as mortgage-backed securities, may be disclosed separately rather than allocated over several maturity groupings. If allocated, the basis for allocation also shall be disclosed. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1In complying with this requirement, financial institutions shall disclose the net carrying amount of debt securities in interim and annual reporting periods based on at least 4 maturity groupings: - a
Within 1 year
- b
After 1 year through 5 years
- c
After 5 years through 10 years
- d
After 10 years.
Securities not due at a single maturity date, such as mortgage-backed securities, may be disclosed separately rather than allocated over several maturity groupings. If allocated, the basis for allocation also shall be disclosed.A financial institution that is a public business entity shall disclose the fair value of the debt securities based on at least 4 maturity groupings: - a
Within 1 year
- b
After 1 year through 5 years
- c
After 5 years through 10 years
- d
After 10 years.
Securities not due at a single maturity date, such as mortgage-backed securities, may be disclosed separately rather than allocated over several maturity groupings. If allocated, the basis for allocation also shall be disclosed. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1A financial institution that is a public business entity shall disclose the fair value of the debt securities in interim and annual reporting periods based on at least 4 maturity groupings: - a
Within 1 year
- b
After 1 year through 5 years
- c
After 5 years through 10 years
- d
After 10 years.
Securities not due at a single maturity date, such as mortgage-backed securities, may be disclosed separately rather than allocated over several maturity groupings. If allocated, the basis for allocation also shall be disclosed.The carrying amount of investment assets that serve as collateral to secure public funds, securities sold under repurchase agreements, and other borrowings, that are not otherwise disclosed under Topic 860, shall be disclosed in the notes to financial statements. (P) December 16, 2027; (N) December 16, 2028
270-10-65-1For interim and annual reporting periods, the carrying amount of investment assets that serve as collateral to secure public funds, securities sold under repurchase agreements, and other borrowings, that are not otherwise disclosed under Topic 860, shall be disclosed in the notes to financial statements. The notes to financial statements shall include an explanation of the institution's accounting policy for securities, including the basis for classification.
Regulators of financial institutions can, under appropriate circumstances, conclude that the continued ownership of any asset represents an undue safety and soundness risk to an institution and, accordingly, require the divestiture of that asset. It was not intended that a regulator's overall divestiture authority be considered as an automatic impairment of an institution's ability to hold any security to maturity, since impairment would have precluded any use of the held-to-maturity category by regulated financial institutions. However, specific facts and circumstances could indicate that an institution does not have the ability to hold a security to maturity.
The federal regulatory agencies note that only in rare circumstances have examiners required a financial institution to dispose of mortgage securities that have become high-risk after acquisition. Such circumstances have occurred only when examiners have determined that there is a significant safety and soundness concern with respect to a particular institution that has arisen from its holdings of these assets. The agencies note that examiners' divestiture authority is not unique to high-risk mortgage securities but rather is the same authority they have with respect to any other security or asset. Thus, the mere existence of examiners' divestiture authority for high-risk mortgage securities should not preclude an institution from concluding it has the intent and ability to hold to maturity those securities that were non-high-risk when acquired.
See paragraphs
,
948-310-30-4, and
for additional guidance concerning mortgage loans held as long-term investments.