Mr. Newman is counsel in Davis Polk’s Financial Institutions Group. [Full Bio]

The FDIC has issued a final rule to formalize longstanding expectations it has had for the parent company of a new industrial loan company (ILC).  The FDIC adopted the proposed rule issued in March 2020 with few changes.  The final rule requires a new ILC to enter into a written
Continue Reading FDIC Issues Final Rule on Supervision of ILC Holding Companies

The OCC has issued an interpretive letter confirming that national banks may take deposits that serve as reserves for fiat currency-pegged stablecoins.  The letter continues the series of actions taken or announced by Acting Comptroller Brian Brooks to clarify how traditional banking regulations apply to fintech activities—particularly when those activities
Continue Reading OCC Confirms that National Banks May Take Deposits that Serve as Reserves for Fiat-Pegged Stablecoins

The Federal Reserve’s recent updates to its regulations on confidential supervisory information and availability of information under the Freedom of Information Act include several meaningful modifications to adapt these rules for the digital age of emails, data rooms and slide decks and the modern organizational structure and operations of banking
Continue Reading 10 Key Takeaways from the Federal Reserve’s Final Rule on CSI and FOIA

The Federal Reserve has taken temporary measures (and has published FAQs) to (1) lift the net debit cap on and waive fees for daylight overdrafts for financially sound depository institutions, including U.S. branches and agencies of foreign banking organizations, and (2) provide a streamlined approval process for other depository
Continue Reading Federal Reserve Eases Daylight Overdraft Limits

The FDIC proposed a rule to formalize certain longstanding expectations it has for approving applications by new industrial loan companies (ILCs) that would be subsidiaries of a parent company that would not be subject to consolidated supervision by the Federal Reserve. The proposal would require a written agreement
Continue Reading Client Memorandum: FDIC Proposes Supervision of ILC Holding Companies

In a welcome move, two recent actions by the Federal Reserve, OCC and FDIC (the Banking Agencies) recognize the increasing role of fund complexes and passive investing.  The Banking Agencies have released a statement under the Federal Reserve’s Regulation O which acknowledges the reality that equity mutual funds may sometimes
Continue Reading Federal Banking Agencies Recognize the Rise of Index Funds and Passive Investing

The Federal Reserve has finalized its rules to further tailor the regulatory framework for enhanced prudential standards and the U.S. Basel III capital and liquidity requirements applicable to domestic banking organizations and foreign banking organizations (Final Tailoring Rules).  Compared to the proposed rules that the U.S. banking agencies
Continue Reading “Off the Rack”: Federal Reserve Finalizes Tailoring Rules with Few Changes

In a long-awaited milestone, the SEC has proposed an update of Guide 3, the industry guide for banking organizations.  The proposal eliminates a number of the current requirements under Guide 3 and streamlines many of those that remain.  The three “new” credit quality ratios in the proposal are, in practice,
Continue Reading Better Late Than Never: SEC Proposes Guide 3 Update

The future of resolution planning for U.S. global systemically important banking organizations (G-SIBs) has started to come into focus.  The FDIC and the Federal Reserve have recently laid out an ambitious agenda designed to put in place Resolution Planning 2.0.  This slide sets forth our collection of the
Continue Reading Resolution 2.0 – The Future of U.S. Resolution Planning for U.S. G-SIBs Starts to Come into Focus

The CRA was put in place over 40 years ago and bears the heavy hand of the woeful history of redlining upon any attempt to change it. But, it is long overdue for a rethink, especially in light of the major changes that have taken place in the banking sector,
Continue Reading Treasury Offers Roadmap to CRA Reform