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Home Archive for category "OCC" (Page 3)
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Blackline of U.S. Liquidity Coverage Ratio Proposal: Federal Register Version vs. Draft Version

Today, the Office of the Federal Register released for public inspection the version of the U.S. liquidity coverage ratio (LCR) proposal that will be published in the Federal Register on November 29, 2013.  We have prepared a blackline of the rule text in the Federal Register version against the rule text in the Federal Reserve’s October 24 draft version of the U.S. LCR proposal.

A notable technical correction contained in the Federal Register version relates to the eligibility of a sovereign entity, U.S.…  Read More

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Davis Polk Visuals of the Federal Reserve’s 2014 Stress Test Scenarios

Yesterday, the Federal Reserve issued three hypothetical, supervisory scenarios that will be used in the 2014 capital planning and stress testing cycle.  The OCC issued substantively identical scenarios.

The baseline, adverse, and severely adverse scenarios each include 28 variables (16 domestic variables and 12 international variables), including economic activity, unemployment, exchange rates, prices, incomes and interest rates. The 28 variables include all of the variables provided last year and two new domestic variables—the yield on the 5-year Treasury bond and the prime rate.…  Read More

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Federal Reserve Issues 2014 CCAR Instructions and Supervisory Scenarios

Today, the Federal Reserve published instructions for the 2014 Comprehensive Capital Analysis and Review (CCAR).  Thirty bank holding companies with $50 billion or more of total consolidated assets will participate in the 2014 CCAR, including 18 bank holding companies that participated in the 2013 CCAR and 12 bank holding companies that will participate in CCAR for the first time.  The 2014 CCAR submissions are due by January 6, 2014.

The Federal Reserve also issued three hypothetical, supervisory scenarios that will be used in the 2014 capital planning and stress testing cycle.  …  Read More

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U.S. Basel III Liquidity Coverage Ratio Proposal: Visual Memorandum

The U.S. banking agencies have issued a proposal to implement the Basel III liquidity coverage ratio (LCR) in the United States. The LCR requires large banking organizations to maintain a minimum amount of liquid assets to withstand a 30-day standardized supervisory liquidity stress scenario. The U.S. LCR proposal is more stringent than the Basel Committee’s LCR framework in several significant respects.

Davis Polk’s visual memorandum uses diagrams, flowcharts, timelines, examples and comparison tables to illustrate key aspects of the U.S. LCR proposal.…  Read More

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Revised Tier 2 Eligibility Guidance in Federal Register Version of U.S. Basel III Final Rule

Today, the Federal Reserve’s and OCC’s U.S. Basel III final rule was published in the Federal Register.  There are a number of substantive, technical and stylistic differences between the Federal Register version and the July 2013 draft version of the U.S. Basel III final rule.  Among other things, the Federal Reserve and OCC clarified in the preamble to the Federal Register version that “subordinated debt instruments that qualify as tier 2 capital must be subordinated to general creditors, which generally means senior indebtedness, excluding trade creditors.” (emphasis added).…  Read More

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U.S. Banking Regulators Propose Dodd-Frank Company-Run Stress Test Guidance for Mid-Sized Banking Organizations

Beginning this fall, many U.S. banking organizations will be conducting their first annual Dodd-Frank company-run stress tests.  Today, the U.S. banking regulators (Federal Reserve, OCC and FDIC) proposed guidance setting forth supervisory expectations for stress tests conducted by national banks, state member and non-member banks, savings associations, bank holding companies and savings and loan holding companies with total consolidated assets of greater than $10 billion and less than $50 billion (collectively, “mid-sized firms”).

The proposed guidance is intended to help mid-sized firms conduct stress tests that are appropriately scaled to their size, complexity, risk profile, business mix and market footprint. …  Read More

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