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Home Articles posted by Luigi L. De Ghenghi (Page 5)
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Basel Committee Chairman Addresses Calibration of Basel III Leverage Ratio

Basel Committee Chairman Stefan Ingves has delivered a speech discussing the Basel III leverage ratio and its role in the Basel framework, noting that while the Basel Committee has recently agreed on a common measure of bank leverage, the issue of calibration (i.e., the percentage level of the leverage ratio) is still open.  Significantly, Chairman Ingves stated that “[e]ven though the leverage ratio has been designed as a backstop, it must be a meaningful backstop if it is to serve its intended purpose.”  In this respect, Chairman Ingves noted the following in his speech:

  • “Only now that we have an agreed [measure of leverage] can the [Basel] Committee begin to turn to the issue of calibration, and the relationship of the leverage ratio to the risk-based framework.
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Visual Summaries of Final Dodd-Frank Enhanced Prudential Standards

We have prepared two visual summaries of the Federal Reserve’s Dodd-Frank enhanced prudential standards final rule.  One visual summary focuses on requirements that apply to U.S. bank holding companies (BHCs) and the other focuses on requirements that apply to foreign banks, including the U.S. intermediate holding company (IHC) requirement.

Visual Summary for U.S. BHCs >>

Visual Summary for Foreign Banks >> Read More

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Dodd-Frank Enhanced Prudential Standards Final Rule

Today, the Federal Reserve published a final rule establishing Dodd-Frank enhanced prudential standards for U.S. bank holding companies with ≥$50 billion in total consolidated assets (Large U.S. BHCs) and foreign banking organizations with ≥$50 billion in total consolidated assets (Large FBOs).

By way of background, Section 165 of the Dodd-Frank Act requires the Federal Reserve to establish enhanced prudential standards, including heightened capital standards, liquidity standards, single counterparty credit limits, enhanced risk management requirements, capital stress testing requirements (final rules already issued) and an early remediation framework, for Large U.S.…  Read More

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Davis Polk Enhanced Prudential Standards Resources Website

Ahead of next week’s Dodd-Frank enhanced prudential standards (EPS) final rule, we have created an EPS resources website: USBasel3.com/EPS.  The website contains background materials and Davis Polk’s analysis and visuals on EPS proposals for large domestic and foreign banking organizations, U.S. Basel III, stress testing, liquidity, risk governance, counterparty credit exposures and other prudential regulatory developments.

Over the coming weeks, we will be preparing a series of materials relating to the EPS final rule, including high-level overviews, blacklines, comparisons, memos and visuals. …  Read More

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Federal Reserve to Vote on Final Dodd-Frank Enhanced Prudential Standards

The Federal Reserve has scheduled an open meeting for Tuesday, February 18, 2014, at 3:15 p.m., to vote on a final rule establishing Dodd-Frank enhanced prudential standards for U.S. bank holding companies with ≥$50 billion in total consolidated assets (Large U.S. BHCs) and foreign banking organizations with ≥$50 billion in total consolidated assets (Large FBOs).

By way of background, Section 165 of the Dodd-Frank Act requires the Federal Reserve to establish enhanced prudential standards, including heightened capital standards, liquidity standards, single counterparty credit limits, enhanced risk management requirements, capital stress testing requirements (final rules already issued) and an early remediation framework, for Large U.S.…  Read More

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Governor Tarullo Outlines Federal Reserve’s Prudential Regulatory Priorities for 2014

In his written testimony before the Senate Banking Committee on Dodd-Frank implementation, Federal Reserve Board Governor Daniel K. Tarullo outlined the Federal Reserve’s prudential regulatory and supervisory priorities for 2014.  As discussed further in this blog post, these priorities include, among other things: (1) finalizing, in the “near term,” Dodd-Frank enhanced prudential standards for large domestic and foreign banking firms; (2) proposing, “fairly soon,” to implement the Basel Committee’s risk-based capital surcharge for global systemically important banks (G-SIBs); (3) finalizing, in the “coming months,” higher Basel III supplementary leverage ratio standards for the 8 U.S.…  Read More

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