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Home Archive for category "Dodd-Frank" (Page 6)
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Davis Polk Blackline of OCC Lending Limits Final Rule vs. Interim Final Rule

Today, the OCC published a final rule to implement Section 610 of the Dodd Frank Act, which applies the lending limit statute to credit exposures arising from derivative transactions and securities financing transactions.

We have prepared a blackline of the final rule against the interim final rule on lending limits that was issued in June 2012.  Most of the changes are contained in Sections 32.1 (authority, purpose and scope), 32.2 (definitions), 32.6 (nonconforming loans and extensions of credit) and 32.9 (credit exposure arising from derivative and securities financing transactions).…  Read More

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Federal Reserve Publishes Summary Instructions for 2013 Dodd-Frank Company-Run Mid-Cycle Stress Tests

Today, the Federal Reserve published instructions to the 18 large U.S. bank holding companies (BHCs) that are required to submit the results of their Dodd-Frank company-run, mid-cycle stress tests to the Federal Reserve on July 5, 2013.

The Dodd-Frank Act and the Federal Reserve’s implementing regulations require large BHCs and non-bank financial companies that are designated as systemically important by the Financial Stability Oversight Council (FSOC) to conduct two company-run stress tests each year.

Internally-developed Stress Scenarios:  For the mid-cycle stress test, which is being conducted for the first time in 2013 by 18 BHCs, each BHC develops its own baseline, adverse and severely adverse scenarios to best reflect its individual operations and risks.  …  Read More

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Federal Reserve Governor Tarullo Delivers Speech Setting Forth Roadmap for U.S. Prudential Regulatory Reforms

Today, Federal Reserve Governor Daniel K. Tarullo delivered a speech setting forth a roadmap for prudential regulatory reforms in the United States.  Among other things, Governor Tarullo:

  • U.S. Basel III:  Appealed to other U.S. bank regulators to approve the U.S. Basel III final rules to avoid further implementation delays, noting that they can always seek further changes down the road.
  • Leverage Ratio:  Suggested that the Federal Reserve may require the largest U.S. firms to maintain a Basel III leverage ratio greater than the 3% agreed upon by the Basel Committee.
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Brown-Vitter Bill: Commentary and Analysis

The bill announced by Senators Sherrod Brown (D-Ohio) and David Vitter (R-La.) is the latest volley in the ongoing debate about whether financial reform has gone far enough in ending the risk that some banks are too big to fail. Although it is highly unlikely that the Brown-Vitter bill, in its current form, will become law, its erroneous assumptions and assertions, as well as the policy measures proposed by the bill, could resurface, either in other bills or as pressure on regulators to transform the financial regulatory landscape.…  Read More

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Federal Reserve Issues Final Rule for Determining When a Company is “Predominantly Engaged in Financial Activities” for Purposes of Title I of the Dodd-Frank Act

Today, the Federal Reserve issued a final rule for determining when a company is “predominantly engaged in financial activities” for purposes of Title I of the Dodd-Frank Act.  The rule will be used by the Financial Stability Oversight Council (FSOC) when it considers the potential designation of a nonbank financial company as systemically important.  Under Title I of the Dodd-Frank Act, a nonbank financial company can be designated as systemically important by the FSOC only if it is “predominantly engaged in financial activities.”

A nonbank financial company that is designated as systemically important by the FSOC will be subject to consolidated supervision by the Federal Reserve and a host of new Dodd-Frank enhanced prudential standards including capital, liquidity, stress testing, single counterparty credit limits, enhanced risk management standards, resolution planning requirements and an early remediation framework.…  Read More

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Summary of Basel Committee’s Proposed Framework for Measuring and Controlling Large Exposures

The Basel Committee has proposed a framework for measuring, reporting and limiting a bank’s exposures to single counterparties and groups of connected counterparties.  The proposed large exposures framework, which borrows a number of concepts from the Basel capital framework, is intended to ensure greater international consistency in regulatory and supervisory approaches to large exposures and to act as a backstop to risk-based capital requirements.  The Basel Committee expects national supervisors to implement the large exposures framework by January 1, 2019.

Comments on the proposed framework are due June 28, 2013. …  Read More

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