66024 Federal Register / Vol. 83, No. 245 / Friday, December 21, 2018 / Proposed Rules
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the
Currency
12 CFR Parts 3 and 50
[Docket ID OCC–2018–0037]
RIN 1557–AE56
FEDERAL RESERVE SYSTEM
12 CFR Parts 217 and 249
[Docket No. R–1628]
RIN 7100–AF21
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Parts 324 and 329
RIN 3064–AE96
Proposed Changes to Applicability
Thresholds for Regulatory Capital and
Liquidity Requirements
AGENCY: Office of the Comptroller of the
Currency, Treasury; the Board of
Governors of the Federal Reserve
System; and the Federal Deposit
Insurance Corporation.
ACTION: Notice of proposed rulemaking
with request for public comment.
SUMMARY: The Office of the Comptroller
of the Currency, the Board of Governors
of the Federal Reserve System, and the
Federal Deposit Insurance Corporation
(collectively, the agencies) are inviting
comment on a proposal that would
establish risk-based categories for
determining applicability of
requirements under the regulatory
capital rule, the liquidity coverage ratio
rule, and the proposed net stable
funding ratio rule for large U.S. banking
organizations. The proposal would
establish four categories of standards
and apply tailored capital and liquidity
requirements for banking organizations
subject to each category. The proposal is
consistent with a separate proposal
issued by the Board that would apply
certain prudential standards for large
U.S. banking organizations based on the
same categories. The proposal would
not amend the capital and liquidity
requirements currently applicable to an
intermediate holding company of a
foreign banking organization or its
subsidiary depository institutions. This
proposal also would not amend the
requirements applicable to Federal
branches or agencies of foreign banking
organizations.
DATES: Comments must be received by
January 22, 2019.
ADDRESSES: Comments should be
directed to: OCC: You may submit
comments to the OCC by any of the
methods set forth below. Commenters
are encouraged to submit comments
through the Federal eRulemaking Portal
or email, if possible. Please use the title
‘‘Proposed Changes to Thresholds
Applicable to Regulatory Capital and
Liquidity Requirements’’ to facilitate the
organization and distribution of the
comments. You may submit comments
by any of the following methods:
• Federal eRulemaking Portal—
‘‘regulations.gov’’: Go to
www.regulations.gov. Enter ‘‘Docket ID
OCC–2018–0037’’ in the Search Box and
click ‘‘Search.’’ Click on ‘‘Comment
Now’’ to submit public comments. Click
on the ‘‘Help’’ tab on the
Regulations.gov home page to get
information on using Regulations.gov,
including instructions for submitting
public comments.
• Email: regs.comments@
occ.treas.gov.
• Mail: Legislative and Regulatory
Activities Division, Office of the
Comptroller of the Currency, 400 7th
Street SW, Suite 3E–218, Washington,
DC 20219.
• Hand Delivery/Courier: 400 7th
Street SW, Suite 3E–218, Washington,
DC 20219.
• Fax: (571) 465–4326.
Instructions: You must include
‘‘OCC’’ as the agency name and ‘‘Docket
ID OCC–2018–0037’’ in your comment.
In general, the OCC will enter all
comments received into the docket and
publish them on the Regulations.gov
website without change, including any
business or personal information that
you provide such as name and address
information, email addresses, or phone
numbers. Comments received, including
attachments and other supporting
materials, are part of the public record
and subject to public disclosure. Do not
include any information in your
comment or supporting materials that
you consider confidential or
inappropriate for public disclosure.
You may review comments and other
related materials that pertain to this
rulemaking action by any of the
following methods:
• Viewing Comments Electronically:
Go to www.regulations.gov. Enter
‘‘Docket ID OCC–2018–0037’’ in the
Search box and click ‘‘Search.’’ Click on
‘‘Open Docket Folder’’ on the right side
of the screen and then ‘‘Comments.’’
Comments and supporting materials can
be filtered by clicking on ‘‘View all
documents and comments in this
docket’’ and then using the filtering
tools on the left side of the screen. Click
on the ‘‘Help’’ tab on the
Regulations.gov home page to get
information on using Regulations.gov.
The docket may be viewed after the
close of the comment period in the same
manner as during the comment period.
• Viewing Comments Personally: You
may personally inspect comments at the
OCC, 400 7th Street SW, Washington,
DC 20219. For security reasons, the OCC
requires that visitors make an
appointment to inspect comments. You
may do so by calling (202) 649–6700 or,
for persons who are hearing impaired,
TTY, (202) 649–5597. Upon arrival,
visitors will be required to present valid
government-issued photo identification
and submit to security screening in
order to inspect comments.
Board: You may submit comments,
identified by Docket No. R–1628, by any
of the following methods:
• Agency Website: http://
www.federalreserve.gov. Follow the
instructions for submitting comments at
http://www.federalreserve.gov/
generalinfo/foia/ProposedRegs.cfm.
• Email: regs.comments@
federalreserve.gov. Include docket
number in the subject line of the
message.
• FAX: (202) 452–3819 or (202) 452–
3102.
• Mail: Ann E. Misback, Secretary,
Board of Governors of the Federal
Reserve System, 20th Street and
Constitution Avenue NW, Washington,
DC 20551. All public comments will be
made available on the Board’s website at
http://www.federalreserve.gov/
generalinfo/foia/ProposedRegs.cfm as
submitted, unless modified for technical
reasons or to remove personally
identifiable information at the
commenter’s request. Accordingly,
comments will not be edited to remove
any identifying or contact information.
Public comments may also be viewed
electronically or in paper in Room 3515,
1801 K Street NW (between 18th and
19th Streets NW), between 9:00 a.m. and
5:00 p.m. on weekdays.
FDIC: You may submit comments,
identified by RIN 3064–AE96, by any of
the following methods:
• Agency Website: http://
www.FDIC.gov/regulations/laws/
federal/propose.html. Follow
instructions for submitting comments
on the Agency website.
• Mail: Robert E. Feldman, Executive
Secretary, Attention: Comments/Legal
ESS, Federal Deposit Insurance
Corporation, 550 17th Street NW,
Washington, DC 20429.
• Hand Delivered/Courier: Comments
may be hand-delivered to the guard
station at the rear of the 550 17th Street
Building (located on F Street) on
VerDate Sep<11>2014 00:38 Dec 21, 2018 Jkt 247001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\21DEP4.SGM 21DEP4
amozie on DSK3GDR082PROD with PROPOSALS4
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the
Currency
12 CFR Parts 3 and 50
[Docket ID OCC–2018–0037]
RIN 1557–AE56
FEDERAL RESERVE SYSTEM
12 CFR Parts 217 and 249
[Docket No. R–1628]
RIN 7100–AF21
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Parts 324 and 329
RIN 3064–AE96
Proposed Changes to Applicability
Thresholds for Regulatory Capital and
Liquidity Requirements
AGENCY: Office of the Comptroller of the
Currency, Treasury; the Board of
Governors of the Federal Reserve
System; and the Federal Deposit
Insurance Corporation.
ACTION: Notice of proposed rulemaking
with request for public comment.
SUMMARY: The Office of the Comptroller
of the Currency, the Board of Governors
of the Federal Reserve System, and the
Federal Deposit Insurance Corporation
(collectively, the agencies) are inviting
comment on a proposal that would
establish risk-based categories for
determining applicability of
requirements under the regulatory
capital rule, the liquidity coverage ratio
rule, and the proposed net stable
funding ratio rule for large U.S. banking
organizations. The proposal would
establish four categories of standards
and apply tailored capital and liquidity
requirements for banking organizations
subject to each category. The proposal is
consistent with a separate proposal
issued by the Board that would apply
certain prudential standards for large
U.S. banking organizations based on the
same categories. The proposal would
not amend the capital and liquidity
requirements currently applicable to an
intermediate holding company of a
foreign banking organization or its
subsidiary depository institutions. This
proposal also would not amend the
requirements applicable to Federal
branches or agencies of foreign banking
organizations.
DATES: Comments must be received by
January 22, 2019.
ADDRESSES: Comments should be
directed to: OCC: You may submit
comments to the OCC by any of the
methods set forth below. Commenters
are encouraged to submit comments
through the Federal eRulemaking Portal
or email, if possible. Please use the title
‘‘Proposed Changes to Thresholds
Applicable to Regulatory Capital and
Liquidity Requirements’’ to facilitate the
organization and distribution of the
comments. You may submit comments
by any of the following methods:
• Federal eRulemaking Portal—
‘‘regulations.gov’’: Go to
www.regulations.gov. Enter ‘‘Docket ID
OCC–2018–0037’’ in the Search Box and
click ‘‘Search.’’ Click on ‘‘Comment
Now’’ to submit public comments. Click
on the ‘‘Help’’ tab on the
Regulations.gov home page to get
information on using Regulations.gov,
including instructions for submitting
public comments.
• Email: regs.comments@
occ.treas.gov.
• Mail: Legislative and Regulatory
Activities Division, Office of the
Comptroller of the Currency, 400 7th
Street SW, Suite 3E–218, Washington,
DC 20219.
• Hand Delivery/Courier: 400 7th
Street SW, Suite 3E–218, Washington,
DC 20219.
• Fax: (571) 465–4326.
Instructions: You must include
‘‘OCC’’ as the agency name and ‘‘Docket
ID OCC–2018–0037’’ in your comment.
In general, the OCC will enter all
comments received into the docket and
publish them on the Regulations.gov
website without change, including any
business or personal information that
you provide such as name and address
information, email addresses, or phone
numbers. Comments received, including
attachments and other supporting
materials, are part of the public record
and subject to public disclosure. Do not
include any information in your
comment or supporting materials that
you consider confidential or
inappropriate for public disclosure.
You may review comments and other
related materials that pertain to this
rulemaking action by any of the
following methods:
• Viewing Comments Electronically:
Go to www.regulations.gov. Enter
‘‘Docket ID OCC–2018–0037’’ in the
Search box and click ‘‘Search.’’ Click on
‘‘Open Docket Folder’’ on the right side
of the screen and then ‘‘Comments.’’
Comments and supporting materials can
be filtered by clicking on ‘‘View all
documents and comments in this
docket’’ and then using the filtering
tools on the left side of the screen. Click
on the ‘‘Help’’ tab on the
Regulations.gov home page to get
information on using Regulations.gov.
The docket may be viewed after the
close of the comment period in the same
manner as during the comment period.
• Viewing Comments Personally: You
may personally inspect comments at the
OCC, 400 7th Street SW, Washington,
DC 20219. For security reasons, the OCC
requires that visitors make an
appointment to inspect comments. You
may do so by calling (202) 649–6700 or,
for persons who are hearing impaired,
TTY, (202) 649–5597. Upon arrival,
visitors will be required to present valid
government-issued photo identification
and submit to security screening in
order to inspect comments.
Board: You may submit comments,
identified by Docket No. R–1628, by any
of the following methods:
• Agency Website: http://
www.federalreserve.gov. Follow the
instructions for submitting comments at
http://www.federalreserve.gov/
generalinfo/foia/ProposedRegs.cfm.
• Email: regs.comments@
federalreserve.gov. Include docket
number in the subject line of the
message.
• FAX: (202) 452–3819 or (202) 452–
3102.
• Mail: Ann E. Misback, Secretary,
Board of Governors of the Federal
Reserve System, 20th Street and
Constitution Avenue NW, Washington,
DC 20551. All public comments will be
made available on the Board’s website at
http://www.federalreserve.gov/
generalinfo/foia/ProposedRegs.cfm as
submitted, unless modified for technical
reasons or to remove personally
identifiable information at the
commenter’s request. Accordingly,
comments will not be edited to remove
any identifying or contact information.
Public comments may also be viewed
electronically or in paper in Room 3515,
1801 K Street NW (between 18th and
19th Streets NW), between 9:00 a.m. and
5:00 p.m. on weekdays.
FDIC: You may submit comments,
identified by RIN 3064–AE96, by any of
the following methods:
• Agency Website: http://
www.FDIC.gov/regulations/laws/
federal/propose.html. Follow
instructions for submitting comments
on the Agency website.
• Mail: Robert E. Feldman, Executive
Secretary, Attention: Comments/Legal
ESS, Federal Deposit Insurance
Corporation, 550 17th Street NW,
Washington, DC 20429.
• Hand Delivered/Courier: Comments
may be hand-delivered to the guard
station at the rear of the 550 17th Street
Building (located on F Street) on
VerDate Sep<11>2014 00:38 Dec 21, 2018 Jkt 247001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\21DEP4.SGM 21DEP4
amozie on DSK3GDR082PROD with PROPOSALS4
66025Federal Register / Vol. 83, No. 245 / Friday, December 21, 2018 / Proposed Rules
1 Covered intermediate holding companies shall
remain subject to this part as in effect on October
31, 2018, until the Board amends the liquidity risk
measurement standards applicable to the
subsidiaries of foreign banking organizations in
effect on October 31, 2018.
2 Banking organizations subject to the agencies’
capital rule include national banks, state member
banks, insured state nonmember banks, savings
associations, and top-tier bank holding companies
and savings and loan holding companies domiciled
in the United States not subject to the Board’s Small
Bank Holding Company and Savings and Loan
Holding Company Policy Statement (12 CFR part
225, appendix C, and 12 CFR 238.9), excluding
certain savings and loan holding companies that are
substantially engaged in insurance underwriting or
commercial activities or that are estate trusts, and
bank holding companies and savings and loan
holding companies that are employee stock
ownership plans.
3 See 79 FR 61440 (October 10, 2014), codified at
12 CFR part 50 (OCC), 12 CFR part 249 (Board), and
12 CFR part 329 (FDIC).
4 These enhanced liquidity standards require a
bank holding company to establish and maintain
robust liquidity risk management practices, perform
internal stress tests for determining the adequacy of
their liquidity resources, and maintain a buffer of
highly liquid assets to cover cash flow needs under
stress. See 12 CFR part 252.
5 For depository institution holding companies
with $50 billion or more, but less than $250 billion,
in total consolidated assets and less than $10 billion
in on-balance sheet foreign exposure, the Board
separately adopted a modified LCR requirement,
described further below. 12 CFR 249 subpart G.
6 ‘‘Net Stable Funding Ratio: Liquidity Risk
Measurement Standards and Disclosure
Requirements; Proposed Rule,’’ 81 FR 35124 (June
1, 2016). For depository institution holding
companies with $50 billion or more, but less than
$250 billion, in total consolidated assets and less
than $10 billion in total on-balance sheet foreign
exposure, the Board separately proposed a modified
NSFR requirement.
business days between 7:00 a.m. and
5:00 p.m.
• Email: comments@FDIC.gov.
Include RIN 3064–AE96 on the subject
line of the message.
• Public Inspection: All comments
received must include the agency name
and RIN 3064–AE96 for this rulemaking.
All comments received will be posted
without change to http://www.fdic.gov/
regulations/laws/federal/, including any
personal information provided. Paper
copies of public comments may be
ordered from the FDIC Public
Information Center, 3501 North Fairfax
Drive, Room E–1002, Arlington, VA
22226 by telephone at (877) 275–3342 or
(703) 562–2200.
FOR FURTHER INFORMATION CONTACT:
OCC: Mark Ginsberg, Senior Risk
Expert, or Venus Fan, Risk Expert,
Capital and Regulatory Policy, (202)
649–6370; James Weinberger, Technical
Expert, Treasury & Market Risk Policy,
(202) 649–6360; or Carl Kaminski,
Special Counsel, Henry Barkhausen,
Counsel, or Daniel Perez, Attorney,
Chief Counsel’s Office, (202) 649–5490,
or for persons who are hearing
impaired, TTY, (202) 649–5597, Office
of the Comptroller of the Currency, 400
7th Street SW, Washington, DC 20219.
Board: Constance M. Horsley, Deputy
Associate Director, (202) 452–5239;
Elizabeth MacDonald, Manager, (202)
475–6216; Brian Chernoff, Senior
Supervisory Financial Analyst, (202)
452–2952; Sean Healey, Supervisory
Financial Analyst, (202) 912–4611;
Matthew McQueeney, Supervisory
Financial Analyst (202) 452–2942;
Christopher Powell, Supervisory
Financial Analyst, (202) 452–3442,
Division of Supervision and Regulation;
or Benjamin McDonough, Assistant
General Counsel (202) 452–2036; Asad
Kudiya, Counsel, (202) 475–6358; Mary
Watkins, Senior Attorney (202) 452–
3722; Alyssa O’Connor, Attorney, (202)
452–3886, Legal Division, Board of
Governors of the Federal Reserve
System, 20th and C Streets NW,
Washington, DC 20551. For the hearing
impaired only, Telecommunication
Device for the Deaf (TDD), (202) 263–
4869.
FDIC: Benedetto Bosco, Chief, Capital
Policy Section, bbosco@fdic.gov;
Stephanie Lorek, Senior Policy Analyst,
slorek@fdic.gov; Michael Maloney,
Senior Policy Analyst, mmaloney@
fdic.gov; regulatorycapital@fdic.gov;
Michael E. Spencer, Chief, Capital
Markets Strategies Section,
michspencer@fdic.gov; Eric W.
Schatten, Senior Policy Analyst,
eschatten@fdic.gov; Andrew D.
Carayiannis, Senior Policy Analyst,
acarayiannis@fdic.gov; Capital Markets
Branch, Division of Risk Management
Supervision, (202) 898–6888; Michael
Phillips, Acting Supervisory Counsel,
mphillips@fdic.gov; Catherine Wood,
Counsel, cawood@fdic.gov; Suzanne
Dawley, Counsel, sudawley@fdic.gov;
Andrew B. Williams II, Counsel,
andwilliams@fdic.gov; Catherine
Topping, Counsel, ctopping@fdic.gov; or
Alexander Bonander, Attorney,
abonander@fdic.gov; Supervision and
Legislation Branch, Legal Division,
Federal Deposit Insurance Corporation,
550 17th Street NW, Washington, DC
20429.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background and Summary of Proposal
II. Proposal
A. Scope of Application
B. Scoping Criteria for Proposed Categories
1. Size
2. Other Risk-Based Indicators
a. Cross-Jurisdictional Activity
b. Weighted Short-Term Wholesale
Funding
c. Nonbank Assets
d. Off-Balance Sheet Exposure
3. Alternative Scoping Criteria
4. Determination of Applicable Category of
Standards
C. Proposed Regulatory Framework
1. Category I Standards
2. Category II Standards
3. Category III Standards
4. Category IV Standards
III. Impact Analysis
IV. Administrative Law Matters
A. Paperwork Reduction Act
B. Regulatory Flexibility Act Analysis
C. Plain Language
D. OCC Unfunded Mandates Reform Act of
1995 Determination
E. Riegle Community Development and
Regulatory Improvement Act of 1994
I. Background and Summary of
Proposal
In 2013, the Office of the Comptroller
of the Currency (OCC), the Board of
Governors of the Federal Reserve
System (Board), and the Federal Deposit
Insurance Corporation (FDIC)
(collectively, the agencies) adopted a
revised regulatory capital rule (capital
rule) that, among other things,
addressed weaknesses in the regulatory
framework that became apparent in the
2007–2009 financial crisis.1 The capital
rule strengthened the capital
requirements applicable to banking
organizations 2 supervised by the
agencies by improving both the quality
and quantity of regulatory capital and
increasing the risk-sensitivity of capital
requirements. In addition, to improve
the banking sector’s resiliency to
liquidity stress and to improve the
ability of large and internationally
active banking organizations to monitor
and manage liquidity risk, the agencies
adopted the liquidity coverage ratio
(LCR) rule in 2014,3 and the Board
implemented enhanced liquidity
standards 4 for the largest depository
institution holding companies.
Companies subject to the LCR rule must
maintain an amount of high-quality
liquid assets (HQLA) equal to or greater
than their projected total net cash
outflows over a prospective 30 calendar-
day period.5 Finally, on June 1, 2016,
the agencies invited comment on a
proposed rule to implement a net stable
funding ratio (NSFR) requirement.6 The
proposed NSFR rule would establish a
quantitative metric to measure and help
ensure the stability of the funding
profile of a banking organization over a
one-year time horizon.
Many of the agencies’ current rules,
including the capital rule, the LCR rule,
and the proposed NSFR rule,
differentiate among banking
organizations based on one or more risk
indicators, such as total asset size and
foreign exposure. Specifically, the
capital rule categorizes banking
organizations into two groups: (i)
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1 Covered intermediate holding companies shall
remain subject to this part as in effect on October
31, 2018, until the Board amends the liquidity risk
measurement standards applicable to the
subsidiaries of foreign banking organizations in
effect on October 31, 2018.
2 Banking organizations subject to the agencies’
capital rule include national banks, state member
banks, insured state nonmember banks, savings
associations, and top-tier bank holding companies
and savings and loan holding companies domiciled
in the United States not subject to the Board’s Small
Bank Holding Company and Savings and Loan
Holding Company Policy Statement (12 CFR part
225, appendix C, and 12 CFR 238.9), excluding
certain savings and loan holding companies that are
substantially engaged in insurance underwriting or
commercial activities or that are estate trusts, and
bank holding companies and savings and loan
holding companies that are employee stock
ownership plans.
3 See 79 FR 61440 (October 10, 2014), codified at
12 CFR part 50 (OCC), 12 CFR part 249 (Board), and
12 CFR part 329 (FDIC).
4 These enhanced liquidity standards require a
bank holding company to establish and maintain
robust liquidity risk management practices, perform
internal stress tests for determining the adequacy of
their liquidity resources, and maintain a buffer of
highly liquid assets to cover cash flow needs under
stress. See 12 CFR part 252.
5 For depository institution holding companies
with $50 billion or more, but less than $250 billion,
in total consolidated assets and less than $10 billion
in on-balance sheet foreign exposure, the Board
separately adopted a modified LCR requirement,
described further below. 12 CFR 249 subpart G.
6 ‘‘Net Stable Funding Ratio: Liquidity Risk
Measurement Standards and Disclosure
Requirements; Proposed Rule,’’ 81 FR 35124 (June
1, 2016). For depository institution holding
companies with $50 billion or more, but less than
$250 billion, in total consolidated assets and less
than $10 billion in total on-balance sheet foreign
exposure, the Board separately proposed a modified
NSFR requirement.
business days between 7:00 a.m. and
5:00 p.m.
• Email: comments@FDIC.gov.
Include RIN 3064–AE96 on the subject
line of the message.
• Public Inspection: All comments
received must include the agency name
and RIN 3064–AE96 for this rulemaking.
All comments received will be posted
without change to http://www.fdic.gov/
regulations/laws/federal/, including any
personal information provided. Paper
copies of public comments may be
ordered from the FDIC Public
Information Center, 3501 North Fairfax
Drive, Room E–1002, Arlington, VA
22226 by telephone at (877) 275–3342 or
(703) 562–2200.
FOR FURTHER INFORMATION CONTACT:
OCC: Mark Ginsberg, Senior Risk
Expert, or Venus Fan, Risk Expert,
Capital and Regulatory Policy, (202)
649–6370; James Weinberger, Technical
Expert, Treasury & Market Risk Policy,
(202) 649–6360; or Carl Kaminski,
Special Counsel, Henry Barkhausen,
Counsel, or Daniel Perez, Attorney,
Chief Counsel’s Office, (202) 649–5490,
or for persons who are hearing
impaired, TTY, (202) 649–5597, Office
of the Comptroller of the Currency, 400
7th Street SW, Washington, DC 20219.
Board: Constance M. Horsley, Deputy
Associate Director, (202) 452–5239;
Elizabeth MacDonald, Manager, (202)
475–6216; Brian Chernoff, Senior
Supervisory Financial Analyst, (202)
452–2952; Sean Healey, Supervisory
Financial Analyst, (202) 912–4611;
Matthew McQueeney, Supervisory
Financial Analyst (202) 452–2942;
Christopher Powell, Supervisory
Financial Analyst, (202) 452–3442,
Division of Supervision and Regulation;
or Benjamin McDonough, Assistant
General Counsel (202) 452–2036; Asad
Kudiya, Counsel, (202) 475–6358; Mary
Watkins, Senior Attorney (202) 452–
3722; Alyssa O’Connor, Attorney, (202)
452–3886, Legal Division, Board of
Governors of the Federal Reserve
System, 20th and C Streets NW,
Washington, DC 20551. For the hearing
impaired only, Telecommunication
Device for the Deaf (TDD), (202) 263–
4869.
FDIC: Benedetto Bosco, Chief, Capital
Policy Section, bbosco@fdic.gov;
Stephanie Lorek, Senior Policy Analyst,
slorek@fdic.gov; Michael Maloney,
Senior Policy Analyst, mmaloney@
fdic.gov; regulatorycapital@fdic.gov;
Michael E. Spencer, Chief, Capital
Markets Strategies Section,
michspencer@fdic.gov; Eric W.
Schatten, Senior Policy Analyst,
eschatten@fdic.gov; Andrew D.
Carayiannis, Senior Policy Analyst,
acarayiannis@fdic.gov; Capital Markets
Branch, Division of Risk Management
Supervision, (202) 898–6888; Michael
Phillips, Acting Supervisory Counsel,
mphillips@fdic.gov; Catherine Wood,
Counsel, cawood@fdic.gov; Suzanne
Dawley, Counsel, sudawley@fdic.gov;
Andrew B. Williams II, Counsel,
andwilliams@fdic.gov; Catherine
Topping, Counsel, ctopping@fdic.gov; or
Alexander Bonander, Attorney,
abonander@fdic.gov; Supervision and
Legislation Branch, Legal Division,
Federal Deposit Insurance Corporation,
550 17th Street NW, Washington, DC
20429.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background and Summary of Proposal
II. Proposal
A. Scope of Application
B. Scoping Criteria for Proposed Categories
1. Size
2. Other Risk-Based Indicators
a. Cross-Jurisdictional Activity
b. Weighted Short-Term Wholesale
Funding
c. Nonbank Assets
d. Off-Balance Sheet Exposure
3. Alternative Scoping Criteria
4. Determination of Applicable Category of
Standards
C. Proposed Regulatory Framework
1. Category I Standards
2. Category II Standards
3. Category III Standards
4. Category IV Standards
III. Impact Analysis
IV. Administrative Law Matters
A. Paperwork Reduction Act
B. Regulatory Flexibility Act Analysis
C. Plain Language
D. OCC Unfunded Mandates Reform Act of
1995 Determination
E. Riegle Community Development and
Regulatory Improvement Act of 1994
I. Background and Summary of
Proposal
In 2013, the Office of the Comptroller
of the Currency (OCC), the Board of
Governors of the Federal Reserve
System (Board), and the Federal Deposit
Insurance Corporation (FDIC)
(collectively, the agencies) adopted a
revised regulatory capital rule (capital
rule) that, among other things,
addressed weaknesses in the regulatory
framework that became apparent in the
2007–2009 financial crisis.1 The capital
rule strengthened the capital
requirements applicable to banking
organizations 2 supervised by the
agencies by improving both the quality
and quantity of regulatory capital and
increasing the risk-sensitivity of capital
requirements. In addition, to improve
the banking sector’s resiliency to
liquidity stress and to improve the
ability of large and internationally
active banking organizations to monitor
and manage liquidity risk, the agencies
adopted the liquidity coverage ratio
(LCR) rule in 2014,3 and the Board
implemented enhanced liquidity
standards 4 for the largest depository
institution holding companies.
Companies subject to the LCR rule must
maintain an amount of high-quality
liquid assets (HQLA) equal to or greater
than their projected total net cash
outflows over a prospective 30 calendar-
day period.5 Finally, on June 1, 2016,
the agencies invited comment on a
proposed rule to implement a net stable
funding ratio (NSFR) requirement.6 The
proposed NSFR rule would establish a
quantitative metric to measure and help
ensure the stability of the funding
profile of a banking organization over a
one-year time horizon.
Many of the agencies’ current rules,
including the capital rule, the LCR rule,
and the proposed NSFR rule,
differentiate among banking
organizations based on one or more risk
indicators, such as total asset size and
foreign exposure. Specifically, the
capital rule categorizes banking
organizations into two groups: (i)
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