US Agencies (FDIC, FED and OCC) announced that the temporary changes to the supplementary leverage ratio, or SLR, for depository institutions will expire as scheduled on March 31, 2021. Amid the volatility caused by COVID-19 pandemic, the Agencies introduced, on May 15, 2020, temporary modifications to the supplementary leverage ratio to exclude U.S. Treasury securities and central bank reserves. Although the Treasury market has stabilized since then, FED may still need to address the current design and calibration of the supplementary leverage ratio to ensure that this ratio remains effective in an environment of higher reserves. Thus, FED will soon invite public comment on several potential modifications to the supplementary leverage ratio. The proposal and comments will contribute to ongoing discussions with the Department of the Treasury and other regulators on future work to ensure resilience of the Treasury market.
Keywords: Americas, US, Banking, COVID-19, Supplementary Leverage Ratio, Regulatory Capital, Basel, FED, US Agencies
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