37235Federal Register / Vol. 79, No. 126 / Tuesday, July 1, 2014 / Proposed Rules
December 1 (for the stress test beginning
October 1, 2014) or March 1 (for the
stress test beginning January 1, 2016,
and all stress tests thereafter) of the
calendar year.
* * * * *
■ 4. Section 46.6 is amended by revising
paragraph (a)(2) to read as follows:
§ 46.6 Stress test methodologies and
practices.
(a) * * *
(2) The potential impact on the
covered institution’s regulatory capital
levels and ratios applicable to the
covered institution under 12 CFR part 3
or part 167, as applicable, and any other
capital ratios specified by the OCC,
incorporating the effects of any capital
actions over the planning horizon and
maintenance by the covered institution
of an allowance for loan losses
appropriate for credit exposures
throughout the planning horizon. Until
December 31, 2015, or such other date
specified by the OCC, a covered
institution is not required to calculate
its risk-based capital requirements using
the internal ratings-based and advanced
measurement approaches as set forth in
12 CFR 3, subpart E.
* * * * *
■ 5. Section 46.7 is amended by revising
paragraphs (a) and (b) to read as follows:
§ 46.7 Reports to the Office of the
Comptroller of the Currency and the Federal
Reserve Board.
(a) $10 to $50 billion covered
institution. A $10 to $50 billion covered
institution must report to the OCC and
to the Board of Governors of the Federal
Reserve System, on or before March 31
(for the stress test beginning October 1,
2014) and on or before July 31 (for the
stress test beginning January 1, 2016,
and all stress tests thereafter), the results
of the stress test in the manner and form
specified by the OCC.
(b) Over $50 billion covered
institution. An over $50 billion covered
institution must report to the OCC and
to the Board of Governors of the Federal
Reserve System, on or before January 5
(for the stress test beginning October 1,
2014) and on or before April 7 (for the
stress test beginning January 1, 2016,
and all stress tests thereafter), the results
of the stress test in the manner and form
specified by the OCC.
* * * * *
■ 6. In § 46.8, the heading for paragraph
(a) is republished for reader reference,
and paragraphs (a)(1), and (2) are
revised to read as follows:
§ 46.8 Publication of disclosures
(a) Publication date—(1) Over $50
billion covered institution. (i) Prior to
January 1, 2016, an over $50 billion
covered institution must publish a
summary of the results of its annual
stress test in the period starting March
15 and ending March 31 (for the stress
test cycle beginning October 1, 2014).
(ii) Effective January 1, 2016, an over
$50 billion covered institution must
publish a summary of the results of its
annual stress test in the period starting
June 15 and ending July 15 (for the
stress test cycle beginning January 1,
2016, and for all stress tests thereafter)
provided:
(A) Unless the OCC determines
otherwise, if the over $50 billion
covered institution is a consolidated
subsidiary of a bank holding company
or savings and loan holding company
subject to supervisory stress tests
conducted by the Board of Governors of
the Federal Reserve System pursuant to
12 CFR part 252, then within the June
15 to July 15 period such covered
institution may not publish the required
summary of its annual stress test earlier
than the date that the Board of
Governors of the Federal Reserve
System publishes the supervisory stress
test results of the covered bank’s parent
holding company.
(B) If the Board of Governors of the
Federal Reserve System publishes the
supervisory stress test results of the
covered institution’s parent holding
company prior to June 15, then such
covered institution may publish its
stress test results prior to June 15, but
no later than July 15, through actual
publication by the covered institution or
through publication by the parent
holding company pursuant to paragraph
(b) of this section.
(2) $10 to $50 billion covered
institution. (i) Prior to January 1, 2016,
a $10 to $50 billion covered institution
must publish a summary of the results
of its annual stress test in the period
starting June 15 and ending June 30 (for
the stress test cycle beginning October 1,
2014).
(ii) Effective January 1, 2016, a $10 to
$50 billion covered institution must
publish a summary of the results of its
annual stress test in the period starting
October 15 and ending October 31 (for
the stress test cycle beginning January 1,
2016, and for all stress tests thereafter).
* * * * *
Dated: June 11, 2014.
Thomas J. Curry,
Comptroller of the Currency.
[FR Doc. 2014–14416 Filed 6–30–14; 8:45 am]
BILLING CODE P
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 325
RIN 3064–AE18
Annual Stress Test
AGENCY: Federal Deposit Insurance
Corporation.
ACTION: Proposed rule with request for
public comment.
SUMMARY: The Federal Deposit
Insurance Corporation (the
‘‘Corporation’’ or ‘‘FDIC’’) requests
comment on this proposed rule that
revises FDIC Rules and Regulations
regarding the annual stress testing
requirements for state non-member
banks and state savings associations
with total consolidated assets of more
than $10 billion (‘‘covered banks’’). Our
regulations, which implement section
165(i)(2) of the Dodd-Frank Wall Street
Reform and Consumer Protection Act
(the ‘‘Dodd-Frank Act’’), requires
covered banks to conduct annual stress
tests and report the results of such stress
test to the Corporation and the Board of
Governors of the Federal Reserve
System (‘‘Board’’) and publicly disclose
a summary of the results of the required
stress tests. The FDIC proposes to
modify the ‘‘as-of’’ dates for financial
data (that covered banks will use to
perform their stress tests) as well as the
reporting dates and public disclosure
dates of the annual stress tests for both
$10 billion to $50 billion covered banks
and $50 billion covered banks. The
revisions to our regulations would
become effective January 1, 2016.
DATES: Comments should be received on
or before September 2, 2014.
ADDRESSES: You may submit comments
by any of the following methods:
• Federal eRulemaking Portal: http://
www.regulations.gov. Follow the
instructions for submitting comments.
• Agency Web site: http://
www.FDIC.gov/regulations/laws/
federal/.
• Mail: Robert E. Feldman, Executive
Secretary, Attention: Comments/Legal
ESS, Federal Deposit Insurance
Corporation, 550 17th Street NW.,
Washington, DC 20429.
• Hand Delivered/Courier: The guard
station at the rear of the 550 17th Street
Building (located on F Street), on
business days between 7:00 a.m. and
5:00 p.m.
• E-Mail: comments@FDIC.gov.
Instructions: Comments submitted
must include ‘‘FDIC’’ and ‘‘RIN [ ].’’
Comments received will be posted
without change to http://www.FDIC.gov/
VerDate Mar<15>2010 16:47 Jun 30, 2014 Jkt 232001 PO 00000 Frm 00005 Fmt 4702 Sfmt 4702 E:\FR\FM\01JYP1.SGM 01JYP1
tkelley on DSK3SPTVN1PROD with PROPOSALS
December 1 (for the stress test beginning
October 1, 2014) or March 1 (for the
stress test beginning January 1, 2016,
and all stress tests thereafter) of the
calendar year.
* * * * *
■ 4. Section 46.6 is amended by revising
paragraph (a)(2) to read as follows:
§ 46.6 Stress test methodologies and
practices.
(a) * * *
(2) The potential impact on the
covered institution’s regulatory capital
levels and ratios applicable to the
covered institution under 12 CFR part 3
or part 167, as applicable, and any other
capital ratios specified by the OCC,
incorporating the effects of any capital
actions over the planning horizon and
maintenance by the covered institution
of an allowance for loan losses
appropriate for credit exposures
throughout the planning horizon. Until
December 31, 2015, or such other date
specified by the OCC, a covered
institution is not required to calculate
its risk-based capital requirements using
the internal ratings-based and advanced
measurement approaches as set forth in
12 CFR 3, subpart E.
* * * * *
■ 5. Section 46.7 is amended by revising
paragraphs (a) and (b) to read as follows:
§ 46.7 Reports to the Office of the
Comptroller of the Currency and the Federal
Reserve Board.
(a) $10 to $50 billion covered
institution. A $10 to $50 billion covered
institution must report to the OCC and
to the Board of Governors of the Federal
Reserve System, on or before March 31
(for the stress test beginning October 1,
2014) and on or before July 31 (for the
stress test beginning January 1, 2016,
and all stress tests thereafter), the results
of the stress test in the manner and form
specified by the OCC.
(b) Over $50 billion covered
institution. An over $50 billion covered
institution must report to the OCC and
to the Board of Governors of the Federal
Reserve System, on or before January 5
(for the stress test beginning October 1,
2014) and on or before April 7 (for the
stress test beginning January 1, 2016,
and all stress tests thereafter), the results
of the stress test in the manner and form
specified by the OCC.
* * * * *
■ 6. In § 46.8, the heading for paragraph
(a) is republished for reader reference,
and paragraphs (a)(1), and (2) are
revised to read as follows:
§ 46.8 Publication of disclosures
(a) Publication date—(1) Over $50
billion covered institution. (i) Prior to
January 1, 2016, an over $50 billion
covered institution must publish a
summary of the results of its annual
stress test in the period starting March
15 and ending March 31 (for the stress
test cycle beginning October 1, 2014).
(ii) Effective January 1, 2016, an over
$50 billion covered institution must
publish a summary of the results of its
annual stress test in the period starting
June 15 and ending July 15 (for the
stress test cycle beginning January 1,
2016, and for all stress tests thereafter)
provided:
(A) Unless the OCC determines
otherwise, if the over $50 billion
covered institution is a consolidated
subsidiary of a bank holding company
or savings and loan holding company
subject to supervisory stress tests
conducted by the Board of Governors of
the Federal Reserve System pursuant to
12 CFR part 252, then within the June
15 to July 15 period such covered
institution may not publish the required
summary of its annual stress test earlier
than the date that the Board of
Governors of the Federal Reserve
System publishes the supervisory stress
test results of the covered bank’s parent
holding company.
(B) If the Board of Governors of the
Federal Reserve System publishes the
supervisory stress test results of the
covered institution’s parent holding
company prior to June 15, then such
covered institution may publish its
stress test results prior to June 15, but
no later than July 15, through actual
publication by the covered institution or
through publication by the parent
holding company pursuant to paragraph
(b) of this section.
(2) $10 to $50 billion covered
institution. (i) Prior to January 1, 2016,
a $10 to $50 billion covered institution
must publish a summary of the results
of its annual stress test in the period
starting June 15 and ending June 30 (for
the stress test cycle beginning October 1,
2014).
(ii) Effective January 1, 2016, a $10 to
$50 billion covered institution must
publish a summary of the results of its
annual stress test in the period starting
October 15 and ending October 31 (for
the stress test cycle beginning January 1,
2016, and for all stress tests thereafter).
* * * * *
Dated: June 11, 2014.
Thomas J. Curry,
Comptroller of the Currency.
[FR Doc. 2014–14416 Filed 6–30–14; 8:45 am]
BILLING CODE P
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 325
RIN 3064–AE18
Annual Stress Test
AGENCY: Federal Deposit Insurance
Corporation.
ACTION: Proposed rule with request for
public comment.
SUMMARY: The Federal Deposit
Insurance Corporation (the
‘‘Corporation’’ or ‘‘FDIC’’) requests
comment on this proposed rule that
revises FDIC Rules and Regulations
regarding the annual stress testing
requirements for state non-member
banks and state savings associations
with total consolidated assets of more
than $10 billion (‘‘covered banks’’). Our
regulations, which implement section
165(i)(2) of the Dodd-Frank Wall Street
Reform and Consumer Protection Act
(the ‘‘Dodd-Frank Act’’), requires
covered banks to conduct annual stress
tests and report the results of such stress
test to the Corporation and the Board of
Governors of the Federal Reserve
System (‘‘Board’’) and publicly disclose
a summary of the results of the required
stress tests. The FDIC proposes to
modify the ‘‘as-of’’ dates for financial
data (that covered banks will use to
perform their stress tests) as well as the
reporting dates and public disclosure
dates of the annual stress tests for both
$10 billion to $50 billion covered banks
and $50 billion covered banks. The
revisions to our regulations would
become effective January 1, 2016.
DATES: Comments should be received on
or before September 2, 2014.
ADDRESSES: You may submit comments
by any of the following methods:
• Federal eRulemaking Portal: http://
www.regulations.gov. Follow the
instructions for submitting comments.
• Agency Web site: http://
www.FDIC.gov/regulations/laws/
federal/.
• Mail: Robert E. Feldman, Executive
Secretary, Attention: Comments/Legal
ESS, Federal Deposit Insurance
Corporation, 550 17th Street NW.,
Washington, DC 20429.
• Hand Delivered/Courier: The guard
station at the rear of the 550 17th Street
Building (located on F Street), on
business days between 7:00 a.m. and
5:00 p.m.
• E-Mail: comments@FDIC.gov.
Instructions: Comments submitted
must include ‘‘FDIC’’ and ‘‘RIN [ ].’’
Comments received will be posted
without change to http://www.FDIC.gov/
VerDate Mar<15>2010 16:47 Jun 30, 2014 Jkt 232001 PO 00000 Frm 00005 Fmt 4702 Sfmt 4702 E:\FR\FM\01JYP1.SGM 01JYP1
tkelley on DSK3SPTVN1PROD with PROPOSALS
37236 Federal Register / Vol. 79, No. 126 / Tuesday, July 1, 2014 / Proposed Rules
1 77 FR 62417 (Oct. 15, 2012) (FDIC); 77 FR 61238
(October 9, 2012) (OCC); 77 FR 62396 (October 12,
2012) (FRB).
2 12 CFR 325.202. A $10 billion to $50 billion
covered bank is a state nonmember bank or state
savings association with average total consolidated
assets greater than $10 billion but less than $50
billion. A $50 billion covered bank is a state
nonmember bank or state savings association with
average total consolidated assets that are not less
than $50 billion.
3 On an annual basis, prior to the start of the
stress testing period and no later than November 15,
the FDIC provides to covered banks a minimum of
three economic scenarios (baseline, adverse, and
severely adverse) and additional scenarios as the
FDIC determines appropriate for the covered banks
to use in performing their stress tests.
4 12 CFR 325.203; in addition, certain covered
banks with significant amounts of trading activities
(as determined by the FDIC) may be required to
include trading and counterparty components in
their adverse and severely adverse scenarios. For
these covered banks, the FDIC selects an as-of date
between October 1 and December 1 of that calendar
year for the data used in this component. This date
is communicated to the covered banks no later than
5 12 CFR 325.204(a); 12 CFR 325.206(a).
6 12 CFR 325.204(a); 12 CFR 325.206(a).
7 12 CFR 325.207(b).
regulations/laws/federal/, including any
personal information provided.
FOR FURTHER INFORMATION CONTACT:
Ryan Sheller, (202) 412–4861, Section
Chief, Large Bank Supervision, Division
of Risk Management and Supervision;
Mark G. Flanigan, Counsel, (202) 898–
7426, Jason Fincke, Counsel, (202) 898–
3659, or Grace Pyun, Senior Attorney,
(202) 898–3609, Legal Division, Federal
Deposit Insurance Corporation, 550 17th
Street NW., Washington, DC, 20429.
SUPPLEMENTARY INFORMATION:
I. Background
A. Part 325 Subpart C —Annual Stress
Test
Section 165(i) of the Dodd-Frank Act
requires two types of stress tests.
Section 165(i)(1) requires the Board to
conduct annual stress tests of holding
companies with $50 billion or more in
total consolidated assets (‘‘supervisory
stress tests’’). Section 165(i)(2) requires
the federal banking agencies to issue
regulations requiring financial
companies with more than $10 billion
in total consolidated assets to conduct
annual stress testes themselves (‘‘bank-
run stress tests’’). Part 325 Subpart C of
the FDIC Rules and Regulations
implements Section 165(i)(2) and
requires FDIC-insured state non-member
banks and FDIC-insured state-chartered
savings associations with total
consolidated assets of more than $10
billion (‘‘covered banks’’) to conduct
annual stress tests. Section 165(i)(2)(C)
of the Dodd-Frank Act also requires the
Corporation, in coordination with the
Board and the Federal Insurance Office,
to issue consistent and comparable
regulations to implement the
requirements of this section. In October
2012, the FDIC, the Office of the
Comptroller of the Currency, and the
Board issued final rules implementing
the company-run stress tests required by
the Dodd-Frank Act.1
Part 325 Subpart C identifies two
categories for ‘‘covered banks’’: A state
nonmember bank or state savings
association that has total consolidated
assets from (1) $10 billion to $50 billion
or (2) over $50 billion.2 For both types
of covered banks, the bank-run stress
test must assess the potential impact of
different scenarios 3 on the capital of the
covered bank and certain related items
over a forward-looking, nine-quarter
planning horizon, taking into account
all relevant exposures and activities.4
Part 325 Subpart C also provides
several timeframes for the testing,
reporting, and publication of the bank-
run stress tests, which vary depending
on the category into which the covered
bank falls. Under the current rule, the
stress test cycle begins October 1 of a
calendar year and ends on September 30
of the following calendar year. Covered
banks use financial data as of September
30 (the ‘‘as of date’’) of the preceding
calendar year to make projections that
estimate their financial position under
the different stress scenarios and to
report and publish the results of their
annual stress test in the following
calendar year. Covered banks with $10
billion to $50 billion in total assets must
report the results of their stress tests by
March 31 and publish a summary of
their results between June 15 and June
30.5 Over $50 billion covered banks are
required to report the results of their
annual stress test by January 5 of each
calendar year and publish a summary of
their results between March 15 and
March 31.6 These testing, reporting, and
publication milestones are consistent
across the Federal banking agencies’
annual stress testing rules.
A covered bank that is a consolidated
subsidiary of a bank holding company
or savings and loan holding company is
generally permitted to publish
abbreviated disclosures of its annual
stress test results with the parent
holding company’s summary and on the
same timeline as the parent holding
company.7 The FDIC requires that
specific information be included in the
disclosure to reflect the changes in the
covered bank’s capital ratios and the
reasons for those changes.
B. Overview of Proposed Rule
The FDIC is aware that the current
testing and reporting dates for $10
billion to $50 billion and $50 billion
covered banks occur at the beginning
and end of the calendar year when there
are competing regulatory and reporting
deadlines that must be met. The FDIC is
also aware that the testing reporting and
publication cycles occur when covered
banks are typically most resource-
constrained. Furthermore, conducting
stress testing during the first quarter of
a calendar year may also make it
difficult for covered banks to make
timely modifications to strategic and
operational plans for the following year
that address any issues identified in the
bank-run stress test results.
For these reasons, the FDIC is
proposing to modify the dates of the
stress test cycle and the corresponding
reporting and publication deadlines as
of January 1, 2016. The stress testing
cycle that, under the current rule, begins
on October 1, 2015, would instead begin
on January 1, 2016. Under the proposed
rule, covered banks would conduct
bank-run stress tests using financial data
as of December 31 of the preceding
calendar year, which represents a 90-
day shift from September 30 in the
current rule. The FDIC would provide
the economic scenarios to be used by
covered banks in their bank-run stress
tests no later than February 15 rather
than November 15, as is provided under
the existing rule. For those certain
covered banks with significant amounts
of trading activities that are required to
include trading and counterparty
components in their adverse and
severely adverse scenarios, the FDIC
will select an as-of date between January
1 and March 1 of that calendar year for
the data used in this component. The
FDIC will communicate this date to the
covered banks no later than March 1.
Under the proposed rule all $10
billion to $50 billion covered banks
would be required to conduct and
submit the results of their bank-run
stress tests to the FDIC by July 31 and
publish those results during a period
beginning on October 15 and ending
October 31. Over $50 billion covered
banks would be required to conduct and
submit the results of their bank-run
stress tests to the FDIC by April 7 and
publish those results during a period
beginning on June 15 and ending on
July 15.
Furthermore, a covered bank that is a
consolidated subsidiary of a bank
holding company or savings and loan
holding company that is required to
conduct an annual company-run stress
test under applicable regulations of the
Board may continue to elect to conduct
its stress test and report to the FDIC on
the same timeline as its parent bank
holding company or savings and loan
VerDate Mar<15>2010 16:47 Jun 30, 2014 Jkt 232001 PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 E:\FR\FM\01JYP1.SGM 01JYP1
tkelley on DSK3SPTVN1PROD with PROPOSALS
1 77 FR 62417 (Oct. 15, 2012) (FDIC); 77 FR 61238
(October 9, 2012) (OCC); 77 FR 62396 (October 12,
2012) (FRB).
2 12 CFR 325.202. A $10 billion to $50 billion
covered bank is a state nonmember bank or state
savings association with average total consolidated
assets greater than $10 billion but less than $50
billion. A $50 billion covered bank is a state
nonmember bank or state savings association with
average total consolidated assets that are not less
than $50 billion.
3 On an annual basis, prior to the start of the
stress testing period and no later than November 15,
the FDIC provides to covered banks a minimum of
three economic scenarios (baseline, adverse, and
severely adverse) and additional scenarios as the
FDIC determines appropriate for the covered banks
to use in performing their stress tests.
4 12 CFR 325.203; in addition, certain covered
banks with significant amounts of trading activities
(as determined by the FDIC) may be required to
include trading and counterparty components in
their adverse and severely adverse scenarios. For
these covered banks, the FDIC selects an as-of date
between October 1 and December 1 of that calendar
year for the data used in this component. This date
is communicated to the covered banks no later than
5 12 CFR 325.204(a); 12 CFR 325.206(a).
6 12 CFR 325.204(a); 12 CFR 325.206(a).
7 12 CFR 325.207(b).
regulations/laws/federal/, including any
personal information provided.
FOR FURTHER INFORMATION CONTACT:
Ryan Sheller, (202) 412–4861, Section
Chief, Large Bank Supervision, Division
of Risk Management and Supervision;
Mark G. Flanigan, Counsel, (202) 898–
7426, Jason Fincke, Counsel, (202) 898–
3659, or Grace Pyun, Senior Attorney,
(202) 898–3609, Legal Division, Federal
Deposit Insurance Corporation, 550 17th
Street NW., Washington, DC, 20429.
SUPPLEMENTARY INFORMATION:
I. Background
A. Part 325 Subpart C —Annual Stress
Test
Section 165(i) of the Dodd-Frank Act
requires two types of stress tests.
Section 165(i)(1) requires the Board to
conduct annual stress tests of holding
companies with $50 billion or more in
total consolidated assets (‘‘supervisory
stress tests’’). Section 165(i)(2) requires
the federal banking agencies to issue
regulations requiring financial
companies with more than $10 billion
in total consolidated assets to conduct
annual stress testes themselves (‘‘bank-
run stress tests’’). Part 325 Subpart C of
the FDIC Rules and Regulations
implements Section 165(i)(2) and
requires FDIC-insured state non-member
banks and FDIC-insured state-chartered
savings associations with total
consolidated assets of more than $10
billion (‘‘covered banks’’) to conduct
annual stress tests. Section 165(i)(2)(C)
of the Dodd-Frank Act also requires the
Corporation, in coordination with the
Board and the Federal Insurance Office,
to issue consistent and comparable
regulations to implement the
requirements of this section. In October
2012, the FDIC, the Office of the
Comptroller of the Currency, and the
Board issued final rules implementing
the company-run stress tests required by
the Dodd-Frank Act.1
Part 325 Subpart C identifies two
categories for ‘‘covered banks’’: A state
nonmember bank or state savings
association that has total consolidated
assets from (1) $10 billion to $50 billion
or (2) over $50 billion.2 For both types
of covered banks, the bank-run stress
test must assess the potential impact of
different scenarios 3 on the capital of the
covered bank and certain related items
over a forward-looking, nine-quarter
planning horizon, taking into account
all relevant exposures and activities.4
Part 325 Subpart C also provides
several timeframes for the testing,
reporting, and publication of the bank-
run stress tests, which vary depending
on the category into which the covered
bank falls. Under the current rule, the
stress test cycle begins October 1 of a
calendar year and ends on September 30
of the following calendar year. Covered
banks use financial data as of September
30 (the ‘‘as of date’’) of the preceding
calendar year to make projections that
estimate their financial position under
the different stress scenarios and to
report and publish the results of their
annual stress test in the following
calendar year. Covered banks with $10
billion to $50 billion in total assets must
report the results of their stress tests by
March 31 and publish a summary of
their results between June 15 and June
30.5 Over $50 billion covered banks are
required to report the results of their
annual stress test by January 5 of each
calendar year and publish a summary of
their results between March 15 and
March 31.6 These testing, reporting, and
publication milestones are consistent
across the Federal banking agencies’
annual stress testing rules.
A covered bank that is a consolidated
subsidiary of a bank holding company
or savings and loan holding company is
generally permitted to publish
abbreviated disclosures of its annual
stress test results with the parent
holding company’s summary and on the
same timeline as the parent holding
company.7 The FDIC requires that
specific information be included in the
disclosure to reflect the changes in the
covered bank’s capital ratios and the
reasons for those changes.
B. Overview of Proposed Rule
The FDIC is aware that the current
testing and reporting dates for $10
billion to $50 billion and $50 billion
covered banks occur at the beginning
and end of the calendar year when there
are competing regulatory and reporting
deadlines that must be met. The FDIC is
also aware that the testing reporting and
publication cycles occur when covered
banks are typically most resource-
constrained. Furthermore, conducting
stress testing during the first quarter of
a calendar year may also make it
difficult for covered banks to make
timely modifications to strategic and
operational plans for the following year
that address any issues identified in the
bank-run stress test results.
For these reasons, the FDIC is
proposing to modify the dates of the
stress test cycle and the corresponding
reporting and publication deadlines as
of January 1, 2016. The stress testing
cycle that, under the current rule, begins
on October 1, 2015, would instead begin
on January 1, 2016. Under the proposed
rule, covered banks would conduct
bank-run stress tests using financial data
as of December 31 of the preceding
calendar year, which represents a 90-
day shift from September 30 in the
current rule. The FDIC would provide
the economic scenarios to be used by
covered banks in their bank-run stress
tests no later than February 15 rather
than November 15, as is provided under
the existing rule. For those certain
covered banks with significant amounts
of trading activities that are required to
include trading and counterparty
components in their adverse and
severely adverse scenarios, the FDIC
will select an as-of date between January
1 and March 1 of that calendar year for
the data used in this component. The
FDIC will communicate this date to the
covered banks no later than March 1.
Under the proposed rule all $10
billion to $50 billion covered banks
would be required to conduct and
submit the results of their bank-run
stress tests to the FDIC by July 31 and
publish those results during a period
beginning on October 15 and ending
October 31. Over $50 billion covered
banks would be required to conduct and
submit the results of their bank-run
stress tests to the FDIC by April 7 and
publish those results during a period
beginning on June 15 and ending on
July 15.
Furthermore, a covered bank that is a
consolidated subsidiary of a bank
holding company or savings and loan
holding company that is required to
conduct an annual company-run stress
test under applicable regulations of the
Board may continue to elect to conduct
its stress test and report to the FDIC on
the same timeline as its parent bank
holding company or savings and loan
VerDate Mar<15>2010 16:47 Jun 30, 2014 Jkt 232001 PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 E:\FR\FM\01JYP1.SGM 01JYP1
tkelley on DSK3SPTVN1PROD with PROPOSALS