Featured Product

    FED Extends Form FR 4199 on Basel II Pillar 2 Guidance

    February 04, 2019

    FED is adopting a proposal to extend for three years, without revision, the Basel II Interagency Pillar 2 Supervisory Guidance, also known as the Pillar 2 Guidance (FR 4199; OMB No. 7100-0320). The report is related to the advanced approaches framework, which requires certain banks and bank holding companies to use an internal ratings-based approach to calculate regulatory credit risk capital requirements and advance measurement approaches to calculate regulatory operational risk capital requirements.

    FED had published, on October 22, 2018, a proposal requesting public comment for 60 days on the extension, without revision, of FR 4199. The comment period for the proposal expired on December 21, 2018. FED did not receive any comments. A bank is required to comply with the advanced approaches framework if it meets either of two independent threshold criteria: consolidated total assets of USD 250 billion or more as reported on the most recent year-end regulatory reports, or consolidated total on-balance sheet foreign exposure of USD 10 billion or more at the most recent year-end.

    A bank holding company is required to comply with the advanced approaches framework if the bank holding company has either of the following:

    • Consolidated total assets (excluding assets held by an insurance underwriting subsidiary) of USD 250 billion or more, as reported on the most recent year-end regulatory reports
    • Consolidated total on-balance-sheet foreign exposure of USD 10 billion or more at the most recent year-end
    • A subsidiary depository institution that meets the criteria to be subject to the advanced approaches rule or elects to adopt the advanced approaches framework

    As of the end of 2017, 13 bank holding companies meet the above criteria and are, therefore, subject to the advanced approaches rule. Also, some banks or bank holding companies may voluntarily decide to adopt the advanced approaches framework. Both mandatory and voluntary respondents are required to meet certain qualification requirements before they can use the advanced approaches framework for risk-based capital purposes.

     

    Related Link: Federal Register Notice

    Keywords: Americas, US, Banking, FR 4199, Pillar 2, Basel II, Advanced Approach, IRB Approach, Capital Requirements, FED

    Featured Experts
    Related Articles
    News

    CBUAE Issues Regulation for Low-Risk Specialized Banks

    CBUAE has issued a regulation that introduces the licensing and supervision framework for low-risk, specialized banks.

    May 01, 2021 WebPage Regulatory News
    News

    APRA Proposes Guidance to Support Prudential Standard on Remuneration

    APRA is consulting on CPG 511—the draft Prudential Practice Guide on remuneration for banks, insurers, and superannuation licensees—with the comment period ending on July 23, 2021.

    April 30, 2021 WebPage Regulatory News
    News

    MAS Announces Grant Scheme to Spur Adoption of Regtech Solutions

    MAS announced a new RegTech grant scheme and an enhancement of the Digital Acceleration Grant (DAG) scheme to accelerate technology adoption in the financial sector.

    April 30, 2021 WebPage Regulatory News
    News

    PRA Review Finds Most Banks Compliant with Regulatory Reporting Rules

    PRA published a letter that sets out findings from the 2020 Internal Audit Review of the Collections function of a sample of non-systemic banks and building societies.

    April 30, 2021 WebPage Regulatory News
    News

    EIOPA Launches Consultation on Interbank Offered Rate Transitions

    EIOPA launched a consultation on the Interbank Offered Rate (IBOR) transitions, in context of the EU Benchmarks Regulation.

    April 30, 2021 WebPage Regulatory News
    News

    EIOPA Seeks Feedback on Approach to Blockchain and Smart Contracts

    EIOPA published a discussion paper on uses cases of, and the European approach to, blockchain and smart contracts in the insurance sector.

    April 29, 2021 WebPage Regulatory News
    News

    HKMA Outlines Work Priorities for 2021, Grants License to NH Bank

    HKMA granted a banking license to NongHyup Bank (also NH Bank), which is incorporated in the Republic of Korea.

    April 29, 2021 WebPage Regulatory News
    News

    PRA Proposes Options for Regulatory Framework for Non-Systemic Banks

    PRA published a discussion paper that explores options for developing a simpler but resilient prudential framework for banks and building societies that are neither systemically important nor internationally active.

    April 29, 2021 WebPage Regulatory News
    News

    ECB Issues Opinion on Proposal for Market Infrastructures Based on DLT

    ECB published an opinion on the proposal for a regulation on the pilot regime for market infrastructures based on distributed ledger technology.

    April 29, 2021 WebPage Regulatory News
    News

    EBA Proposes Standards to Determine Risk-Weight for Immovable Property

    EBA proposed regulatory technical standards that specify how to identify the appropriate risk-weights and conditions when assessing minimum loss given default (LGD) values for exposures secured by immovable property.

    April 29, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 6920