61804 Federal Register / Vol. 84, No. 219 / Wednesday, November 13, 2019 / Rules and Regulations
institution satisfies paragraphs (b)(1)(i)
(A) through (E) of this section and has
a supplementary leverage ratio of 6.0
percent or greater. For purposes of this
paragraph, a covered BHC means a U.S.
top-tier bank holding company with
more than $700 billion in total assets as
reported on the company’s most recent
Consolidated Financial Statement for
Bank Holding Companies (Form FR Y–
9C) or more than $10 trillion in assets
under custody as reported on the
company’s most recent Banking
Organization Systemic Risk Report
(Form FR Y–15).
(iii) A qualifying community banking
organization, as defined under § 324.12,
that has elected to use the community
bank leverage ratio framework under
§ 324.12 shall be considered to have met
the capital ratio requirements for the
well capitalized capital category in
paragraph (b)(1)(i)(A) through (D) of this
section.
* * * * *
PART 337—UNSAFE AND UNSOUND
BANKING PRACTICES
■ 62. The authority citation for part 337
continues to read as follows:
Authority: 12 U.S.C. 375a(4), 375b,
1463(a)(1), 1816, 1818(a), 1818(b), 1819,
1820(d), 1828(j)(2), 1831, 1831f, 5412.
■ 63. Section 337.3 is amended by
redesignating footnote 3 to paragraph (b)
as footnote 1 and revising it to read as
follows:
§ 337.3 Limits on extensions of credit to
executive officers, directors, and principal
shareholders of insured nonmember banks.
* * * * *
(b) * * *
1 For the purposes of § 337.3, an
insured nonmember bank’s capital and
unimpaired surplus shall have the same
meaning as found in § 215.2(f) of
Federal Reserve Board Regulation O
(§ 215.2(f) of this chapter). For a
qualifying community banking
organization (as defined in § 324.12 of
this chapter) that is subject to the
community bank leverage ratio
framework (as defined in § 324.12 of
this chapter), capital and unimpaired
surplus shall mean the FDIC-supervised
institution’s tier 1 capital (as defined in
§ 324.2 of this chapter) plus adjusted
allowances for credit losses or
allowances for loan and lease losses, as
applicable (as defined in § 324.2 of this
chapter).
* * * * *
PART 365—REAL ESTATE LENDING
STANDARDS
■ 64. The authority citation for part 365
continues to read as follows:
Authority: 12 U.S.C. 1828(o) and 5101 et
seq.
■ 65. Appendix A to subpart A of part
365 is amended:
■ a. In the first paragraph of the
appendix, redesignating footnote 5 as
footnote 1;
■ b. Following the heading
‘‘Supervisory Loan-to-Value-Limits’’ in
the table, by redesignating footnotes 1
and 2 as footnotes 2 and 3; and
■ c. Following the heading ‘‘Loans in
Excess of the Supervisory Loan-to-
Value-Limits,’’ redesignating the
footnote 2 as footnote 4 and revising it.
The revision reads as follows:
Appendix A to Subpart A of Part 365—
Interagency Guidelines for Real Estate
Lending Policies
* * * * *
Loans in Excess of the Supervisory
Loan-to-Value-Limits
4 For state non-member banks and
state savings associations, ‘‘total
capital’’ refers to that term described in
§ 324.2 of this chapter. For a qualifying
community banking organization (as
defined in § 324.12 of this chapter) that
is subject to the community bank
leverage ratio framework (as defined in
§ 324.12 of this chapter), ‘‘total capital’’
refers to the FDIC-supervised
institution’s tier 1 capital, as defined in
§ 324.2 of this chapter.
* * * * *
PART 390—REGULATIONS
TRANSFERRED FROM THE OFFICE OF
THRIFT SUPERVISION
■ 66. The authority citation for part 390
continues to read as follows:
Authority: 12 U.S.C. 1819.
■ 67. Section 390.344 is amended by
revising the definition of ‘‘Capital’’ to
read as follows:
§ 390.344 Definitions applicable to capital
distributions.
* * * * *
Capital means total capital, as
computed under part 324 of this
chapter. For a qualifying community
banking organization (as defined in
§ 324.12 of this chapter) that is subject
to the community bank leverage ratio
framework (as defined in § 324.12 of
this chapter), total capital means the
FDIC-supervised institution’s tier 1
capital, as defined under § 324.2 of this
chapter and calculated in accordance
with § 324.12(b) of this chapter.
* * * * *
Dated: September 17, 2019.
Joseph M. Otting,
Comptroller of the Currency.
By order of the Board of Governors of the
Federal Reserve System, October 7, 2019.
E. Misback,
Deputy Secretary of the Board.
Federal Deposit Insurance Corporation.
By order of the Board of Directors.
Dated at Washington, DC, on September
17, 2019.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2019–23472 Filed 11–12–19; 8:45 am]
BILLING CODE P
DEPARTMENT OF TREASURY
Office of the Comptroller of the
Currency
12 CFR Part 3
[Docket ID OCC–2017–0018]
RIN 1557–AE70
FEDERAL RESERVE SYSTEM
12 CFR Part 217
[Regulation Q; Docket No. R–1576]
RIN 7100–AE74
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 324
RIN 3064–AF18
Regulatory Capital Rule:
Simplifications to the Capital Rule
Pursuant to the Economic Growth and
Regulatory Paperwork Reduction Act
of 1996; Revised Effective Date
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: Final rule, announcement of
effective date, early adoption.
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 adopting
a final rule that permits insured
depository institutions and depository
institution holding companies not
subject to the advanced approaches
capital rule to implement certain
VerDate Sep<11>2014 19:15 Nov 12, 2019 Jkt 250001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4700 E:\FR\FM\13NOR2.SGM 13NOR2
institution satisfies paragraphs (b)(1)(i)
(A) through (E) of this section and has
a supplementary leverage ratio of 6.0
percent or greater. For purposes of this
paragraph, a covered BHC means a U.S.
top-tier bank holding company with
more than $700 billion in total assets as
reported on the company’s most recent
Consolidated Financial Statement for
Bank Holding Companies (Form FR Y–
9C) or more than $10 trillion in assets
under custody as reported on the
company’s most recent Banking
Organization Systemic Risk Report
(Form FR Y–15).
(iii) A qualifying community banking
organization, as defined under § 324.12,
that has elected to use the community
bank leverage ratio framework under
§ 324.12 shall be considered to have met
the capital ratio requirements for the
well capitalized capital category in
paragraph (b)(1)(i)(A) through (D) of this
section.
* * * * *
PART 337—UNSAFE AND UNSOUND
BANKING PRACTICES
■ 62. The authority citation for part 337
continues to read as follows:
Authority: 12 U.S.C. 375a(4), 375b,
1463(a)(1), 1816, 1818(a), 1818(b), 1819,
1820(d), 1828(j)(2), 1831, 1831f, 5412.
■ 63. Section 337.3 is amended by
redesignating footnote 3 to paragraph (b)
as footnote 1 and revising it to read as
follows:
§ 337.3 Limits on extensions of credit to
executive officers, directors, and principal
shareholders of insured nonmember banks.
* * * * *
(b) * * *
1 For the purposes of § 337.3, an
insured nonmember bank’s capital and
unimpaired surplus shall have the same
meaning as found in § 215.2(f) of
Federal Reserve Board Regulation O
(§ 215.2(f) of this chapter). For a
qualifying community banking
organization (as defined in § 324.12 of
this chapter) that is subject to the
community bank leverage ratio
framework (as defined in § 324.12 of
this chapter), capital and unimpaired
surplus shall mean the FDIC-supervised
institution’s tier 1 capital (as defined in
§ 324.2 of this chapter) plus adjusted
allowances for credit losses or
allowances for loan and lease losses, as
applicable (as defined in § 324.2 of this
chapter).
* * * * *
PART 365—REAL ESTATE LENDING
STANDARDS
■ 64. The authority citation for part 365
continues to read as follows:
Authority: 12 U.S.C. 1828(o) and 5101 et
seq.
■ 65. Appendix A to subpart A of part
365 is amended:
■ a. In the first paragraph of the
appendix, redesignating footnote 5 as
footnote 1;
■ b. Following the heading
‘‘Supervisory Loan-to-Value-Limits’’ in
the table, by redesignating footnotes 1
and 2 as footnotes 2 and 3; and
■ c. Following the heading ‘‘Loans in
Excess of the Supervisory Loan-to-
Value-Limits,’’ redesignating the
footnote 2 as footnote 4 and revising it.
The revision reads as follows:
Appendix A to Subpart A of Part 365—
Interagency Guidelines for Real Estate
Lending Policies
* * * * *
Loans in Excess of the Supervisory
Loan-to-Value-Limits
4 For state non-member banks and
state savings associations, ‘‘total
capital’’ refers to that term described in
§ 324.2 of this chapter. For a qualifying
community banking organization (as
defined in § 324.12 of this chapter) that
is subject to the community bank
leverage ratio framework (as defined in
§ 324.12 of this chapter), ‘‘total capital’’
refers to the FDIC-supervised
institution’s tier 1 capital, as defined in
§ 324.2 of this chapter.
* * * * *
PART 390—REGULATIONS
TRANSFERRED FROM THE OFFICE OF
THRIFT SUPERVISION
■ 66. The authority citation for part 390
continues to read as follows:
Authority: 12 U.S.C. 1819.
■ 67. Section 390.344 is amended by
revising the definition of ‘‘Capital’’ to
read as follows:
§ 390.344 Definitions applicable to capital
distributions.
* * * * *
Capital means total capital, as
computed under part 324 of this
chapter. For a qualifying community
banking organization (as defined in
§ 324.12 of this chapter) that is subject
to the community bank leverage ratio
framework (as defined in § 324.12 of
this chapter), total capital means the
FDIC-supervised institution’s tier 1
capital, as defined under § 324.2 of this
chapter and calculated in accordance
with § 324.12(b) of this chapter.
* * * * *
Dated: September 17, 2019.
Joseph M. Otting,
Comptroller of the Currency.
By order of the Board of Governors of the
Federal Reserve System, October 7, 2019.
E. Misback,
Deputy Secretary of the Board.
Federal Deposit Insurance Corporation.
By order of the Board of Directors.
Dated at Washington, DC, on September
17, 2019.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2019–23472 Filed 11–12–19; 8:45 am]
BILLING CODE P
DEPARTMENT OF TREASURY
Office of the Comptroller of the
Currency
12 CFR Part 3
[Docket ID OCC–2017–0018]
RIN 1557–AE70
FEDERAL RESERVE SYSTEM
12 CFR Part 217
[Regulation Q; Docket No. R–1576]
RIN 7100–AE74
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 324
RIN 3064–AF18
Regulatory Capital Rule:
Simplifications to the Capital Rule
Pursuant to the Economic Growth and
Regulatory Paperwork Reduction Act
of 1996; Revised Effective Date
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: Final rule, announcement of
effective date, early adoption.
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 adopting
a final rule that permits insured
depository institutions and depository
institution holding companies not
subject to the advanced approaches
capital rule to implement certain
VerDate Sep<11>2014 19:15 Nov 12, 2019 Jkt 250001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4700 E:\FR\FM\13NOR2.SGM 13NOR2
61805Federal Register / Vol. 84, No. 219 / Wednesday, November 13, 2019 / Rules and Regulations
1 See 84 FR 35234 (July 22, 2019). 2 82 FR 55309 (Nov. 21, 2017).
provisions of the final rule titled
Regulatory Capital: Simplifications to
the Capital Rule Pursuant to the
Economic Growth and Regulatory
Paperwork Reduction Act of 1996,
which was issued by the agencies in
July 22, 2019, (Capital Simplifications
Final Rule) on January 1, 2020, rather
than April 1, 2020, as initially provided.
Consistent with this approach, the
transitions provisions of the regulatory
capital rule are being amended to
provide that banking organizations not
subject to the advanced approaches
capital rule will be permitted to
implement the Capital Simplifications
Final Rule as of its revised effective date
in the quarter beginning January 1,
2020, or to wait until the quarter
beginning April 1, 2020.
DATES: This rule is effective January 1,
2020. The effective date for the
amendments to 12 CFR 3.21, 3.22,
3.300(b) and (d), 217.21, 217.22,
217.300(b) and (d), 324.21, 324.22, and
324.300(b) and (d) published on July 22,
2019 (84 FR 35234), is changed from
April 1, 2020, to January 1, 2020.
FOR FURTHER INFORMATION CONTACT:
OCC: David Elkes, Risk Expert, or
JungSup Kim, Risk Specialist, Capital
and Regulatory Policy (202) 649–6370;
or Carl Kaminski, Special Counsel, or
Daniel Perez, Senior Attorney, or Rima
Kundnani, Senior Attorney, Chief
Counsel’s Office, (202) 649–5490, for
persons who are deaf or 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; Juan
Climent, Manager, (202) 872–7526; or
Andrew Willis, Lead Financial
Institutions Policy Analyst, (202) 912–
4323, Division of Supervision and
Regulation; or Jay Schwarz, Special
Counsel (202) 452–2970; Gillian
Burgess, Senior Counsel (202) 736–
5564, or Mark Buresh, Senior Counsel
(202) 452–5270, 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;
Michael Maloney, Senior Policy
Analyst, mmaloney@fdic.gov;
regulatorycapital@fdic.gov; Capital
Markets Branch, Division of Risk
Management Supervision, (202) 898–
6888; or Michael Phillips, Counsel,
mphillips@fdic.gov; Supervision
Branch, Legal Division, Federal Deposit
Insurance Corporation, 550 17th Street
NW, Washington, DC 20429.
SUPPLEMENTARY INFORMATION: 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) adopted the Simplifications to
the Capital Rule Pursuant to the
Economic Growth and Regulatory
Paperwork Reduction Act of 1996
(Capital Simplifications Final Rule) to
simplify certain aspects of the capital
rule.1 The Capital Simplifications Final
Rule is responsive to the agencies’
March 2017 report to Congress pursuant
to the Economic Growth and Regulatory
Paperwork Reduction Act of 1996
(EGRPRA), in which the agencies
committed to meaningfully reduce
regulatory burden, especially on
community banking organizations. The
key elements of the Capital
Simplifications Final Rule apply solely
to banking organizations that are not
subject to the advanced approaches
capital rule (non-advanced approaches
banking organizations). Under the
Capital Simplifications Final Rule, non-
advanced approaches banking
organizations will be subject to simpler
regulatory capital requirements for
mortgage servicing assets, certain
deferred tax assets arising from
temporary differences, and investments
in the capital of unconsolidated
financial institutions than those
currently applied. The Capital
Simplifications Final Rule also
simplifies, for non-advanced approaches
banking organizations, the calculation
for the amount of capital issued by a
consolidated subsidiary of a banking
organization and held by third parties
(sometimes referred to as a minority
interest) that is includable in regulatory
capital.
The simpler capital requirements
described above are implemented
through the Capital Simplifications
Final Rule via amendments to 12 CFR
3.21, 3.22, 3.300, 217.21, 217.22,
217.300(b) and (d), 324.21, 324.22, and
324.300 that were originally effective
April 1, 2020. The agencies initially set
an effective date of April 1, 2020, for
those amendments to the capital rule, in
part, to give institutions sufficient time
to update their recordkeeping and
reporting systems. Subsequent to the
publication of the Capital
Simplifications Final Rule, the agencies
received letters from the banking
industry groups seeking the ability to
adopt the Capital Simplifications Final
Rule earlier than April 1, 2020. After
considering these requests, the agencies
have determined that allowing non-
advanced approaches banking
organizations to implement the Capital
Simplifications Final Rule in the first
quarter of 2020 would be appropriate.
Allowing non-advanced approaches
banking organizations to implement the
Capital Simplifications Final Rule in the
first quarter of 2020 would permit
banking organizations that have updated
their reporting systems to implement
the simplifications and obtain
regulatory burden relief one quarter
earlier than initially provided in the
Capital Simplifications Final Rule.
The agencies are adopting this direct
final rule to permit non-advanced
approaches banking organizations to
implement the sections of the Capital
Simplifications Final Rule that were
originally effective on April 1, 2020,
beginning on January 1, 2020.
Specifically, the sections in the Capital
Simplifications Final Rule that were
effective April 1, 2020, under that rule
are now effective January 1, 2020. Non-
advanced approaches banking
organizations can elect whether to
implement the changes in the quarter
beginning January 1, 2020, or to
implement them in the quarter
beginning April 1, 2020. The affected
sections are those related to mortgage
servicing assets, certain deferred tax
assets arising from temporary
differences, investments in the capital of
unconsolidated financial institutions,
and the calculation of minority interest
and will become mandatory as of April
1, 2020. If a non-advanced approaches
banking organization elects to adopt
these revisions for the quarter beginning
January 1, 2020, it must adopt all of
these revisions for that quarter and
thereafter. Consistent with the Capital
Simplifications Final Rule, the
transition provisions adopted by the
agencies in November 2017 will cease to
apply to non-advanced approaches
banking organizations in the quarter in
which the firm elects to adopt the these
portions of the Capital Simplifications
Final Rule.2 As a result, non-advanced
approaches banking organizations may
choose to begin implementing the
capital treatment under the Capital
Simplifications Final Rule for the
reporting period ending on March 31,
2020. All non-advanced approaches
banking organizations must implement
the capital treatment under the Capital
Simplifications Final Rule for the
reporting period ending on June 30,
2020.
VerDate Sep<11>2014 19:15 Nov 12, 2019 Jkt 250001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4700 E:\FR\FM\13NOR2.SGM 13NOR2
1 See 84 FR 35234 (July 22, 2019). 2 82 FR 55309 (Nov. 21, 2017).
provisions of the final rule titled
Regulatory Capital: Simplifications to
the Capital Rule Pursuant to the
Economic Growth and Regulatory
Paperwork Reduction Act of 1996,
which was issued by the agencies in
July 22, 2019, (Capital Simplifications
Final Rule) on January 1, 2020, rather
than April 1, 2020, as initially provided.
Consistent with this approach, the
transitions provisions of the regulatory
capital rule are being amended to
provide that banking organizations not
subject to the advanced approaches
capital rule will be permitted to
implement the Capital Simplifications
Final Rule as of its revised effective date
in the quarter beginning January 1,
2020, or to wait until the quarter
beginning April 1, 2020.
DATES: This rule is effective January 1,
2020. The effective date for the
amendments to 12 CFR 3.21, 3.22,
3.300(b) and (d), 217.21, 217.22,
217.300(b) and (d), 324.21, 324.22, and
324.300(b) and (d) published on July 22,
2019 (84 FR 35234), is changed from
April 1, 2020, to January 1, 2020.
FOR FURTHER INFORMATION CONTACT:
OCC: David Elkes, Risk Expert, or
JungSup Kim, Risk Specialist, Capital
and Regulatory Policy (202) 649–6370;
or Carl Kaminski, Special Counsel, or
Daniel Perez, Senior Attorney, or Rima
Kundnani, Senior Attorney, Chief
Counsel’s Office, (202) 649–5490, for
persons who are deaf or 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; Juan
Climent, Manager, (202) 872–7526; or
Andrew Willis, Lead Financial
Institutions Policy Analyst, (202) 912–
4323, Division of Supervision and
Regulation; or Jay Schwarz, Special
Counsel (202) 452–2970; Gillian
Burgess, Senior Counsel (202) 736–
5564, or Mark Buresh, Senior Counsel
(202) 452–5270, 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;
Michael Maloney, Senior Policy
Analyst, mmaloney@fdic.gov;
regulatorycapital@fdic.gov; Capital
Markets Branch, Division of Risk
Management Supervision, (202) 898–
6888; or Michael Phillips, Counsel,
mphillips@fdic.gov; Supervision
Branch, Legal Division, Federal Deposit
Insurance Corporation, 550 17th Street
NW, Washington, DC 20429.
SUPPLEMENTARY INFORMATION: 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) adopted the Simplifications to
the Capital Rule Pursuant to the
Economic Growth and Regulatory
Paperwork Reduction Act of 1996
(Capital Simplifications Final Rule) to
simplify certain aspects of the capital
rule.1 The Capital Simplifications Final
Rule is responsive to the agencies’
March 2017 report to Congress pursuant
to the Economic Growth and Regulatory
Paperwork Reduction Act of 1996
(EGRPRA), in which the agencies
committed to meaningfully reduce
regulatory burden, especially on
community banking organizations. The
key elements of the Capital
Simplifications Final Rule apply solely
to banking organizations that are not
subject to the advanced approaches
capital rule (non-advanced approaches
banking organizations). Under the
Capital Simplifications Final Rule, non-
advanced approaches banking
organizations will be subject to simpler
regulatory capital requirements for
mortgage servicing assets, certain
deferred tax assets arising from
temporary differences, and investments
in the capital of unconsolidated
financial institutions than those
currently applied. The Capital
Simplifications Final Rule also
simplifies, for non-advanced approaches
banking organizations, the calculation
for the amount of capital issued by a
consolidated subsidiary of a banking
organization and held by third parties
(sometimes referred to as a minority
interest) that is includable in regulatory
capital.
The simpler capital requirements
described above are implemented
through the Capital Simplifications
Final Rule via amendments to 12 CFR
3.21, 3.22, 3.300, 217.21, 217.22,
217.300(b) and (d), 324.21, 324.22, and
324.300 that were originally effective
April 1, 2020. The agencies initially set
an effective date of April 1, 2020, for
those amendments to the capital rule, in
part, to give institutions sufficient time
to update their recordkeeping and
reporting systems. Subsequent to the
publication of the Capital
Simplifications Final Rule, the agencies
received letters from the banking
industry groups seeking the ability to
adopt the Capital Simplifications Final
Rule earlier than April 1, 2020. After
considering these requests, the agencies
have determined that allowing non-
advanced approaches banking
organizations to implement the Capital
Simplifications Final Rule in the first
quarter of 2020 would be appropriate.
Allowing non-advanced approaches
banking organizations to implement the
Capital Simplifications Final Rule in the
first quarter of 2020 would permit
banking organizations that have updated
their reporting systems to implement
the simplifications and obtain
regulatory burden relief one quarter
earlier than initially provided in the
Capital Simplifications Final Rule.
The agencies are adopting this direct
final rule to permit non-advanced
approaches banking organizations to
implement the sections of the Capital
Simplifications Final Rule that were
originally effective on April 1, 2020,
beginning on January 1, 2020.
Specifically, the sections in the Capital
Simplifications Final Rule that were
effective April 1, 2020, under that rule
are now effective January 1, 2020. Non-
advanced approaches banking
organizations can elect whether to
implement the changes in the quarter
beginning January 1, 2020, or to
implement them in the quarter
beginning April 1, 2020. The affected
sections are those related to mortgage
servicing assets, certain deferred tax
assets arising from temporary
differences, investments in the capital of
unconsolidated financial institutions,
and the calculation of minority interest
and will become mandatory as of April
1, 2020. If a non-advanced approaches
banking organization elects to adopt
these revisions for the quarter beginning
January 1, 2020, it must adopt all of
these revisions for that quarter and
thereafter. Consistent with the Capital
Simplifications Final Rule, the
transition provisions adopted by the
agencies in November 2017 will cease to
apply to non-advanced approaches
banking organizations in the quarter in
which the firm elects to adopt the these
portions of the Capital Simplifications
Final Rule.2 As a result, non-advanced
approaches banking organizations may
choose to begin implementing the
capital treatment under the Capital
Simplifications Final Rule for the
reporting period ending on March 31,
2020. All non-advanced approaches
banking organizations must implement
the capital treatment under the Capital
Simplifications Final Rule for the
reporting period ending on June 30,
2020.
VerDate Sep<11>2014 19:15 Nov 12, 2019 Jkt 250001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4700 E:\FR\FM\13NOR2.SGM 13NOR2