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Capital and Prudential Standards Blog

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Home Archive for category "Risk-Based Capital Ratio"
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Basel Committee’s Final Capital Standards for Bank Exposures to Central Counterparties (CCPs)

[Update:  We have prepared a blackline (available here) of the April 2014 final standards vs. the July 2012 interim standards.]  The Basel Committee has finalized its risk-based capital standards for bank exposures to central counterparties (CCPs).  The final standards will take effect on January 1, 2017. The interim standards that were published in July 2012 will continue to apply until that time.

Like the interim standards, the final standards distinguish between trade exposures and default fund exposures to CCPs and distinguish between exposures to qualifying CCPs (QCCPs) and non-QCCPs. …  Read More

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Overview of Basel Framework Implementation Progress (as of Q1 2014)

The Basel Committee has published the following table on the implementation progress of the Basel capital and liquidity framework for each member jurisdiction as of Q1 2014.  The Basel Committee has published implementation progress reports on a semi-annual basis since October 2011.

In addition, the Basel Committee report contains a schedule of future Regulatory Consistency Assessment Programme (RCAP) assessments.  Through RCAP, the Basel Committee monitors the adoption of regulations by its members, assesses their consistency with the Basel  framework and analyzes the quality of intended regulatory outcomes.…  Read More

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U.S. Intermediate Holding Company: Structuring and Regulatory Considerations for Foreign Banks – Visual Memorandum

Establishing a top-tier U.S. intermediate holding company (IHC) that complies with Dodd-Frank enhanced prudential standards involves complex structuring, regulatory, capital, liquidity, tax and corporate governance considerations as well as significant business, legal and operational analysis. We have prepared a visual memorandum (available here) that uses flowcharts, diagrams, comparison tables and timelines to explore key structuring and regulatory considerations for foreign banks that are required to establish an IHC.

View IHC Structuring Visual Memorandum Read More

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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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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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