FED issued an interim final rule expanding the applicability of its small bank holding company policy statement, as required by the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCP Act) of 2018. The interim final rule raises the statement's asset threshold from USD 1 billion to USD 3 billion in total consolidated assets. This interim final rule takes effect on publication in the Federal Register and comments will be accepted for 30 days after publication.
The policy statement facilitates the transfer of ownership of small community banks by allowing their holding companies to operate with higher levels of debt than would normally be permitted. While holding companies that meet the conditions of the policy statement are excluded from consolidated capital requirements, their depository institutions continue to be subject to minimum capital requirements. The statement also applies to savings and loan holding companies with less than USD 3 billion in total consolidated assets. The changes in this rule also impact certain regulatory reporting requirements.
FED is modifying, effective immediately, the respondent panel for the FR Y-9SP, FR Y-9C, and FR Y-9LP for bank holding companies and savings and loan holding companies with USD 1 billion or more but less than USD 3 billion in consolidated assets, to align the threshold in the Policy Statement. If these institutions meet the qualitative requirements, they will not be required to file the FR Y-9C and the FR Y-9LP (including regulatory capital information) and would instead file the FR Y-9SP. These changes would be consistent with the final rule’s changes to the Policy Statement and will reduce the regulatory reporting burden for these smaller institutions. Since most bank holding companies and savings and loan holding companies with less than USD 3 billion in consolidated assets have limited activities outside of their subsidiary banks, FED believes that relying on summary parent-only financials from the FR Y-9SP and detailed depository institution financials from the Consolidated Reports of Condition and Income (FFIEC 031, FFIEC 041, FFIEC 051; OMB No. 7100-0036)) is sufficient for supervisory purposes.
Comment Due Date: FR + 30 Days
Keywords: Americas, US, Banking, Small BHCs, EGRRCP Act, Reporting, Policy Statement, Proportionality, FED
Previous ArticleOCC Proposes to Revise Regulatory Reporting Requirements for Banks
BCBS amended the guidelines on sound management of risks related to money laundering and financing of terrorism (ML/FT).
EBA finalized the guidelines on treatment of structural foreign-exchange (FX) positions under Article 352(2) of the Capital Requirements Regulation (CRR).
FSB published a statement on the impact of COVID-19 pandemic on global benchmark transition.
IAIS published the list of Internationally Active Insurance Groups (IAIGs) publicly disclosed by group-wide supervisors.
FED has temporarily revised the reporting form on consolidated financial statements for holding companies (FR Y-9C; OMB No. 7100-0128).
EC launched a consultation on the review of the key elements of Solvency II Directive, with the comment period ending on October 21, 2020.
ECB launched a consultation on the guide that sets out supervisory approach to consolidation projects in the banking sector.
PRA published a letter that builds on the expectations set out in the supervisory statement (SS3/19) on enhancing banks' and insurers' approaches to managing the financial risks from climate change.
US Agencies (Farm Credit Administration, FDIC, FED, FHFA, and OCC) finalized changes to the swap margin rule to facilitate implementation of prudent risk management strategies at banks and other entities with significant swap activities.
IAIS published technical specifications, questionnaires, and templates for 2020 Insurance Capital Standard (ICS) and Aggregation Method data collections.