FED voted to affirm the countercyclical capital buffer (CCyB) at the current level of 0 percent. While making this determination, FED consulted with FDIC and OCC and followed the framework in its policy statement for setting the CCyB for private-sector credit exposures located in the United States. For FED to modify the CCyB amount in the future, banking organizations would have 12 months before the increase became effective, unless FED establishes an earlier effective date.
CCyB is a macro-prudential tool that can be used to increase the resilience of the financial system by raising capital requirements on internationally active banking organizations when there is an elevated risk of above-normal future losses and when the banking organizations are exposed to or are contributing to this elevated risk—either directly or indirectly. The buffer could also help moderate fluctuations in the supply of credit. CCyB is designed to be released to support lending and economic activity more broadly, when economic conditions deteriorate.
Related Link: Press Release
Keywords: Americas, US, Banking, FDIC, OCC, CCyB, Basel III, Macro-Prudential Policy, FED
Previous ArticleFASB Updates FAQs on the GAAP Financial Reporting Taxonomy
BIS Innovation Hub published the work program for 2021, with focus on suptech and regtech, next-generation financial market infrastructure, central bank digital currencies, open finance, green finance, and cyber security.
In an article published by SRB, Mairead McGuinness, the European Commissioner for Financial Services, Financial Stability, and Capital Markets Union, discussed the progress and next steps toward completion of the Banking Union.
EBA finalized the two sets of draft regulatory technical standards on the identification of material risk-takers and on the classes of instruments used for remuneration under the Investment Firms Directive (IFD).
EC published, in the Official Journal of the European Union, a notification that the European Court of Auditors (ECA) has published a special report on resolution planning in the Single Resolution Mechanism.
BoE published a scenario against which it will be stress testing banks in 2021, in addition to setting out the key elements of the 2021 stress test, guidance on the 2021 stress test, and the variable paths for the 2021 stress test.
PRA published a consultation paper (CP3/21) proposes rules regarding the timing of identity verification required for eligibility of depositor protection under the Financial Services Compensation Scheme (FSCS).
FSB published the work program for 2021, which reflects a strategic shift in priorities in the COVID-19 environment.
FCA announced that 50% firms have started using the new data collection platform RegData, which is slated to replace the existing platform known Gabriel.
Bundesbank published Version 5.0 of the derivation rules for completeness check at the form level, with respect to the data quality of the European harmonized reporting system.
FED finalized a rule that updates capital planning requirements to reflect the new framework from 2019 that sorts large banks into categories, with requirements that are tailored to the risks of each category.