American Bankers Association Backs Optional Semiannual Reporting

The American Bankers Association backed the SEC's plan to allow public companies to report twice a year instead of quarterly, while urging the agency to also reduce the amount of required disclosure (see prior coverage).

ABA said banks already report heavily elsewhere, noting that banks file detailed quarterly reports with banking regulators such as the Federal Reserve and the FDIC, publish earnings releases, and hold investor calls.

ABA said many banks may not use the option to file semiannually, noting that rating agencies, underwriters, and lenders may still demand quarterly financials. ABA also noted an accounting limit: auditors cannot give standard comfort letters on financial statements more than 135 days old, and semiannual reports would often sit 180 days or more apart; that gap could block some capital-markets deals.

ABA also acknowledged two downsides of semiannual reporting: (i) a mix of quarterly and semiannual filers would leave investors comparing mismatched data and (ii) longer gaps could leave companies holding material nonpublic information longer, raising Regulation FD and compliance concerns.

ABA said its main ask is simplification, urging the SEC to work with accounting standard-setters to reduce repetitive, low-value content and citing disclosures on derivatives, variable interest entities, fair value, loan modifications, and transfers of financial assets.