Continuing the trend of Congressional attention to U.S. capital requirements for banking organizations, the United States House of Representatives has passed a bill that seeks to address the calculation of risk-weighted assets (RWAs) for operational risk under the U.S. Basel III capital rules (House Bill). The
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Andrew Rohrkemper
Mr. Rohrkemper is an associate in Davis Polk's Financial Institutions Group. [Full Bio]
A Clearer Path Ahead? New Survey on Incentives to Centrally Clear OTC Derivatives
The Financial Stability Board, Basel Committee on Banking Supervision, Committee on Payments and Market Infrastructures and International Organization of Securities Commissions announced late last week a survey focusing on the effects of post-crisis regulatory reforms on incentives to centrally clear over-the-counter (OTC) derivatives.
The G20 agreed in 2009 to promote…
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Basel Committee Finalizes Basel III Reforms
Six years after finalizing the first set of Basel III reforms to the capital framework for banking organizations, the Basel Committee on Banking Supervision has agreed on and released the final set of revisions to the Basel III capital standards (sometimes referred to as “Basel IV”).
The reforms include the…
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Bipartisan Senate Bill Advances from Committee Largely Unchanged
Posted in Bank Capital, Bank Regulation, Dodd-Frank, FDIC, Federal Reserve, Legislation, OCC, Regional Banks, U.S. Basel III, U.S. Congress
The Senate’s bipartisan regulatory relief bill advanced out of the Senate Banking Committee this week with only minor changes and remains on a path to a filibuster-proof majority. The bill would provide regulatory relief to regional, community and custody banks, among others—as described in two earlier posts here and here…
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Federal Reserve Maintains 0% Countercyclical Capital Buffer
Posted in U.S. Basel III
The Federal Reserve Board announced today that it will continue its policy of not deploying the countercyclical buffer (CCyB), a decision it reached after assessing the considerations in its September 2016 CCyB policy statement and consulting with the FDIC and OCC.
The CCyB is a macroprudential policy tool that the…
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Left Out in the Cold? The Bipartisan Senate Bill and G-SIBs, Other Large Banks and Foreign Banks
Posted in Bank Capital, Bank Regulation, Dodd-Frank, FDIC, Federal Reserve, Legislation, OCC, Regional Banks, U.S. Basel III, U.S. Congress
Does the bipartisan Senate bill described in our earlier post leave large banks, i.e., banking organizations with $250 billion or more in total consolidated assets, and foreign banking organizations (FBOs) entirely out in the cold? No, but the relief it provides to large banking organizations is quite limited, and it…
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U.S. Banking Agencies Delay the Phase-In of Certain Capital Rules for Non-Advanced Approaches Banking Organizations
The U.S. banking agencies (the Federal Reserve, OCC and FDIC) have delayed the last phase of the U.S. Basel III capital rules’ transition provisions relating to certain deductions from capital and limitations on the recognition of minority interests, which were scheduled to become effective January 1, 2018, for banking organizations…
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FSB Publishes 2017 G-SIB List
Posted in U.S. Basel III
On November 21, 2017, the Financial Stability Board (“FSB”) has published its 2017 list of global systemically important banking organizations (“G-SIBs”) as determined by its annual identification process using an assessment methodology designed by the Basel Committee on Banking Supervision (“BCBS”). The Royal Bank of Canada was added to the…
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Bipartisan Senate Bill Would Provide Welcome Relief to Regional and Community Banks
Posted in Bank Capital, Bank Regulation, FDIC, Federal Reserve, Legislation, OCC, Regional Banks, U.S. Basel III, U.S. Congress
The bipartisan Senate bill would open the door to welcome relief for regional and community bank holding companies (BHCs) by raising the statutory threshold for enhanced prudential standards from $50 billion to $250 billion in total consolidated assets. The bill, titled the Economic Growth, Regulatory Relief and Consumer Protection Act…
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House Passes Bill To Amend Treatment of Municipal Bonds under Liquidity Rules
By Luigi L. De Ghenghi & Andrew Rohrkemper on
Posted in U.S. Basel III
On Tuesday the House of Representatives passed a bill (H.R. 1624) that would require the federal banking agencies to amend their liquidity rules (including the LCR Rule) to treat all “municipal obligations” (as defined in the bill) as level 2B high quality liquid assets (HQLAs), provided that they are (a)…
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