Featured Product

    FED Extends Information Collection on Leveraged Lending

    October 18, 2019

    FED adopted the proposal to extend for three years, without revision, the recordkeeping provisions associated with guidance on leveraged lending (FR 4203; OMB No. 7100-0354). FED did not receive any comments to the related consultation, the comment period for which expired on September 03, 2019. The reporting frequency of FR 4203 is occasional and there are no reporting forms associated with this information collection.

    The guidance outlines high-level principles related to safe-and-sound leveraged lending activities. The guidance includes a number of voluntary recordkeeping provisions that apply to financial institutions engaged in leveraged lending activities, for which FED is the primary federal supervisor; these financial institutions include bank holding companies, savings and loan holding companies, state member banks, and state-chartered branches and agencies of foreign banks that engage in such activities. The guidance states that institutions should maintain:

    • Well-defined underwriting standards that, among other things, define acceptable leverage levels and describe amortization expectations for senior and subordinate debt
    • Sound management information systems that enable management to identify, aggregate, and monitor leveraged exposures and comply with policy across all business lines
    • Strong pipeline management policies and procedures that, among other things, provide for real-time information on exposures and limits and exceptions to the timing of expected distributions and approved hold levels
    • Guidelines for conducting periodic portfolio and pipeline stress tests to quantify the potential impact of economic and market conditions on the institution's asset quality, earnings, liquidity, and capital

    Many community banks are not subject to the guidance because they do not engage in leveraged lending. The limited number of community and smaller institutions that are involved in leveraged lending activities may discuss with FED how to implement these collections of information in a manner that is appropriate for the complexity of their exposures and activities. The estimated number of respondents for this information collection is 40.

     

    Related Link: Federal Register Notice

     

    Keywords: Americas, US, Banking, FR 4203, Leveraged Lending, Information Collection, Credit Risk, Reporting, FED

    Featured Experts
    Related Articles
    News

    HKMA Finalizes Policy Modules on Group-Wide Approach and Remuneration

    The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.

    July 29, 2021 WebPage Regulatory News
    News

    EBA Guide to Monitor Threshold for Intermediate Parent Undertakings

    The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).

    July 28, 2021 WebPage Regulatory News
    News

    PRA Finalizes Approach to Supervision of International Banks

    In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.

    July 26, 2021 WebPage Regulatory News
    News

    FCA Issues PS21/9 on Implementation of Investment Firms Regime

    The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.

    July 26, 2021 WebPage Regulatory News
    News

    EBA Proposes Regulatory Standards to Identify Shadow Banking Entities

    The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.

    July 26, 2021 WebPage Regulatory News
    News

    IOSCO Proposes Recommendations on ESG Ratings and Data Providers

    The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.

    July 26, 2021 WebPage Regulatory News
    News

    ESMA Group Issues Recommendations on RFR Switch in Interdealer Market

    The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.

    July 26, 2021 WebPage Regulatory News
    News

    ECB Study Assesses Impact of Basel III Finalization Package

    The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.

    July 26, 2021 WebPage Regulatory News
    News

    ISDA Finds FRTB Results in Higher Capital Charges for Carbon Trading

    The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.

    July 26, 2021 WebPage Regulatory News
    News

    PRA Updates Remuneration Policy Statement Templates and Tables

    The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.

    July 26, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 7311