FDIC published a proposal to renew three currently approved collections of information under the titles of Credit Risk Retention (OMB Number: 3064-0183); Disclosure Requirements Associated with the Supplementary Leverage Ratio (OMB Number: 3064-0196); and Interagency Supervisory Guidance for the Supervisory Review Process of Capital Adequacy (Pillar 2) Related to the Implementation of the Basel II Advanced Capital Framework (OMB Number: 3064-0165). Comment period ends on September 12, 2018. No change has been proposed in the method or substance of these information collections.
Information collection on Credit Risk Retention impacts insured state non-member banks, insured state branches of foreign banks, state savings associations, and certain subsidiaries of these entities. Based on the Federal regulatory agencies' estimate, there are approximately 1,400 annual offerings subject to the Credit Risk Retention rule. This information collection request relates to the disclosure and record keeping requirements of the Credit Risk Retention Rule (12 CFR part 373). The Credit Risk Retention Rule was jointly issued by FDIC, OCC, FED, SEC and, with respect to the portions of the Rule addressing the securitization of residential mortgages, FHFA and the Department of Housing and Urban Development (HUD). The Credit Risk Retention Rule:
- Provides a menu of credit risk retention options from which securitizers can choose and sets out the standards, including disclosure and record keeping requirements, for each option
- Identifies the eligibility criteria, including certification and disclosure requirements, that must be met for asset-backed securities (ABS) offerings to qualify for certain exemptions
- Specifies the underwriting standards for commercial real estate (CRE) loans, commercial loans, and automobile loans, as well as disclosure, certification, and record keeping requirements, that must be met for ABS issuances collateralized by such loans to qualify for reduced credit risk retention
- Sets forth the circumstances under which retention obligations may be allocated by sponsors to originators, including disclosure and monitoring requirements
Information collection on Disclosure Requirements Associated with the Supplementary Leverage Ratio impacts insured state nonmember banks and state savings associations that are subject to the FDIC advanced approaches risk-based capital rules. For this information collection, the number of institutions subject to the disclosure requirements has decreased from eight to two. The supplementary leverage ratio regulations strengthen the definition of total leverage exposure and improve the measure of a banking organization's on- and off-balance sheet exposures. The rules are generally consistent with the the 2014 revisions of BCBS and promote consistency in the calculation of this ratio across jurisdictions. All banking organizations that are subject to the advanced approaches risk-based capital rules are required to disclose their supplementary leverage ratios.
Information collection titled "Interagency Supervisory Guidance for the Supervisory Review Process of Capital Adequacy (Pillar 2) Related to the Implementation of the Basel II Advanced Capital Framework" impacts insured state nonmember banks and certain subsidiaries of these entities. As part of the supervisory guidance, banks should state clearly the definition of capital used in any aspect of its internal capital adequacy assessment process (ICAAP) and document any changes in the internal definition of capital. Additionally, the board of directors are required approve the ICAAP of a bank, review it on a regular basis, and approve any changes. For this information collection, the number of institutions subject to the record keeping requirements has decreased from eight to two.
FDIC invites comments on whether the collections of information are necessary for the proper performance of FDIC's functions, including whether the information has practical utility and on the accuracy of the estimates of the burdens of the information collections, including the validity of the methodology and assumptions used. Comments are also invited on ways to enhance the quality, utility, and clarity of the information to be collected and on ways to minimize the burden of the collections of information on respondents, including through the use of automated collection techniques or other forms of information technology
Related Link: Proposed Rule in Federal Register
Keywords: Americas, US, Banking, Credit Risk Retention, Supplementary Leverage Ratio, Capital Adequacy, Disclosures, Reporting, FDIC
Previous ArticleEBA Single Rulebook Q&A: Fourth Update for April 2018
EC published Regulation 2021/25 that addresses amendments related to the financial reporting consequences of replacement of the existing interest rate benchmarks with alternative reference rates.
BIS published a bulletin, or a note, that examines the cyber threat landscape in the context of the pandemic and discusses policies to reduce risks to financial stability.
HM Treasury, also known as HMT, has updated the table containing the list of the equivalence decisions that came into effect in UK at the end of the transition period of its withdrawal from EU.
EBA published an erratum for technical package on phase 1 of the reporting framework 3.0.
APRA updated a frequently asked question (FAQ), for authorized deposit-taking institutions, on the measurement of credit risk weighted assets.
EBA published the quarterly risk dashboard, along with the results of the Risk Assessment Questionnaire survey among 60 banks and 15 market analysts.
ECB concluded the public consultation on the introduction of a digital euro in EU.
ECB published a guide that sets out the supervisory approach to consolidation in the banking sector.
The SRB Chair Elke König published an article setting out work priorities for 2021.
FDIC has selected 11 technology companies—including BearingPoint, Fed Reporter, Inc, and S&P Global Market Intelligence, LLC—for inclusion in the third and final phase of the rapid prototyping competition.