Financial Institution Letter
FIL-104-2005
October 20, 2005
RISK-BASED CAPITAL RULES
Advance Notice of Proposed Rulemaking on Modifications to the
Risk-Based Capital Framework
Federal Deposit Insurance Corporation
550 17th Street NW, Washington, D.C. 20429-9990
Summary: The federal bank and thrift regulatory agencies have jointly issued the attached
advance notice of proposed rulemaking (ANPR) on possible modifications to the risk-based
capital standards for all domestic banks, bank holding companies and savings associations. The
agencies are seeking public comment on the proposal. The FDIC will accept comments through
January 18, 2006.
Distribution:
FDIC-Supervised Banks (Commercial and Savings)
Suggested Routing:
Chief Executive Officer
Chief Financial Officer
Chief Accounting Officer
Related Topics:
Risk-Based Capital Rules
12 CFR Part 325
Basel II
Attachments:
. Chart 1, “QIS 4 Preliminary Change in Minimum
Capital Requirements of 26 Participating
Institutions: Basel I to Basel II”
. Joint Advance Notice of Proposed Rulemaking,
Risk-Based Capital Guidelines; Capital Adequacy
Guidelines; Capital Maintenance: Domestic Capital
Modifications
Contact:
Jason C. Cave, Chief, Capital Markets Policy
Section, at jcave@fdic.gov or (202) 898-3548
Bobby R. Bean, Senior Quantitative Risk Analyst,
at bbean@fdic.gov or (202) 898-3575
Highlights:
The modifications under consideration in the ANPR
are intended to:
• Modernize the risk-based capital rules to
ensure that the capital framework remains a
relevant and reliable measure of risks
present in the banking system.
• Minimize potentially material differences in
capital requirements that may arise between
banks that adopt Basel II and banks that
remain under the existing risk-based capital
rules.
• Maintain an operationally feasible capital
framework that is relatively simple to
implement for banking organizations subject
to the existing risk-based capital rules.
The modifications are designed to use currently
available data to implement any required changes,
with the intention of minimizing the burden associated
with compliance.
As required under section 2222 of the Economic
Growth and Regulatory Paperwork Reduction Act of
1996 (EGRPRA), the ANPR also solicits comments
on any outdated, unnecessary or unduly burdensome
requirements in the regulatory capital rules.Inactive
FIL-104-2005
October 20, 2005
RISK-BASED CAPITAL RULES
Advance Notice of Proposed Rulemaking on Modifications to the
Risk-Based Capital Framework
Federal Deposit Insurance Corporation
550 17th Street NW, Washington, D.C. 20429-9990
Summary: The federal bank and thrift regulatory agencies have jointly issued the attached
advance notice of proposed rulemaking (ANPR) on possible modifications to the risk-based
capital standards for all domestic banks, bank holding companies and savings associations. The
agencies are seeking public comment on the proposal. The FDIC will accept comments through
January 18, 2006.
Distribution:
FDIC-Supervised Banks (Commercial and Savings)
Suggested Routing:
Chief Executive Officer
Chief Financial Officer
Chief Accounting Officer
Related Topics:
Risk-Based Capital Rules
12 CFR Part 325
Basel II
Attachments:
. Chart 1, “QIS 4 Preliminary Change in Minimum
Capital Requirements of 26 Participating
Institutions: Basel I to Basel II”
. Joint Advance Notice of Proposed Rulemaking,
Risk-Based Capital Guidelines; Capital Adequacy
Guidelines; Capital Maintenance: Domestic Capital
Modifications
Contact:
Jason C. Cave, Chief, Capital Markets Policy
Section, at jcave@fdic.gov or (202) 898-3548
Bobby R. Bean, Senior Quantitative Risk Analyst,
at bbean@fdic.gov or (202) 898-3575
Highlights:
The modifications under consideration in the ANPR
are intended to:
• Modernize the risk-based capital rules to
ensure that the capital framework remains a
relevant and reliable measure of risks
present in the banking system.
• Minimize potentially material differences in
capital requirements that may arise between
banks that adopt Basel II and banks that
remain under the existing risk-based capital
rules.
• Maintain an operationally feasible capital
framework that is relatively simple to
implement for banking organizations subject
to the existing risk-based capital rules.
The modifications are designed to use currently
available data to implement any required changes,
with the intention of minimizing the burden associated
with compliance.
As required under section 2222 of the Economic
Growth and Regulatory Paperwork Reduction Act of
1996 (EGRPRA), the ANPR also solicits comments
on any outdated, unnecessary or unduly burdensome
requirements in the regulatory capital rules.Inactive