Twitter RSS

Capital and Prudential Standards Blog

magnify
formats

Fed Governor Tarullo Discusses G-SIB Surcharge Implementation

Today, Federal Reserve Governor Daniel K. Tarullo delivered a speech that, among other things, provided a preview of the forthcoming proposal to implement the GSIB risk-based capital surcharge.

 

While our proposal will use the GSIB risk-based capital surcharge framework developed by the BCBS as a starting point, it will strengthen the BCBS framework in two important respects. First, the surcharge levels for U.S. GSIBs will be higher than the levels required by the BCBS, noticeably so for some firms. Second, the surcharge formula will directly take into account each U.S. Read More

Comments Off.
formats

Blackline of Supplementary Leverage Ratio (SLR) Denominator Final Rule

Today, the U.S. banking agencies issued a final rule regarding the denominator of the Basel III supplementary leverage ratio (SLR).  We have prepared a blackline that compares the text of the final rule against the proposed rule that was issued in April 2014.

View Davis Polk SLR Denominator Final Rule Blackline

Comments Off.
formats

Blackline of U.S. Liquidity Coverage Ratio Final Rule

Today, the U.S. banking agencies issued a final rule to implement the Basel III liquidity coverage ratio (LCR).  We have prepared a blackline that compares the text of the final rule against the proposed rule that was issued in 2013.

View Davis Polk LCR Final Rule Blackline

 

Comments Off.
formats

Overview of Basel Committee’s Pillar 3 Disclosure Proposal

The Basel Committee has published a proposal to significantly revise the Pillar 3 capital disclosure standards for internationally active banks.  By way of background, Pillar 3 of the Basel framework aims to promote market discipline through qualitative and quantitative regulatory disclosure requirements.

The main objectives of today’s proposed changes include further enhancing the comparability and consistency of disclosures (both across time and across banks) and providing greater transparency of banks’ internal capital calculation models and methodologies.

Overall themes.  The new disclosure requirements embody, among others, the following overall themes:

  • Longer and more detailed disclosures. 
  •  Read More

Comments Off.
formats

Blackline of Federal Reserve’s Proposed Revisions to Capital Planning and Stress Testing Rules

Today, the Federal Reserve issued a proposal to revise certain aspects of its capital planning and stress testing regulations.  We have prepared a blackline (available here) showing these proposed changes.

Key changes:  The proposal would, among other things:

  • Shift the start date of the capital plan and stress test cycles from October 1 of a calendar year to January 1 of the following calendar year.  A large (≥$50 billion) bank holding company (“BHC“) would be required to submit its capital plan and stress test results to the Federal Reserve by April 5, three months later than under current regulations. 
  •  Read More

Comments Off.
formats

Dodd-Frank Concentration Limit on Financial Institution M&A Transactions: Visual Memorandum

The Federal Reserve has issued a proposal to implement the financial sector concentration limit in Section 622 of the Dodd-Frank Act. The concentration limit generally prohibits a financial company from merging or consolidating with, acquiring all or substantially all of the assets of, or otherwise acquiring control of another company if the “liabilities” of the resulting financial company, calculated using methodologies in the proposal, exceed 10% of aggregate financial sector liabilities. We have prepared a visual memorandum (available here) that uses diagrams, formulas, tables and examples to illustrate key aspects of the Federal Reserve’s concentration limit proposal.…  Read More

Comments Off.