FR Y-15 Reporting Changes Important Implications for Tailoring and Capital Surcharge

Total Page:16

File Type:pdf, Size:1020Kb

FR Y-15 Reporting Changes Important Implications for Tailoring and Capital Surcharge FR Y-15 reporting changes Important implications for tailoring and capital surcharge The Federal Reserve uses the Banking Organization Systemic Risk Report (FR Y-15) to monitor the systemic risk profile of the financial institutions which are subject to enhanced prudential standards under section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. In addition, the FR Y-15 is used to 1. facilitate the implementation of the surcharge for global systemically important banks (G-SIBs), 2. identify other institutions which may present significant systemic risk, and 3. analyze the systemic risk implications of proposed mergers and acquisitions 4. determine regulatory requirements, the macroprudential Tailoring Rules for US bank holding companies (BHCs) and intermediate holding companies (IHCs) The FR Y-15 quarterly report collects systemic risk data from US BHCs, covered savings and loan holding companies (SLHCs),1 and foreign banking organizations (FBOs) with $100 billion or more in combined US assets,2 and any US BHC designated as a global systemically important bank (G-SIB). Note: Thresholds have been revised based on the Tailoring Rule as discussed below. The FR Y 15 is not treated as confidential and is available quarterly from Board of Governors of the Federal Reserve System (the Board). On September 10, 2019, the Board published a notice requesting public comment on proposed revisions of the FR Y-15.3 The comment period for this notice expires on November 12, 2019. In addition to these changes, the Board has issued the final tailoring rule4 for US BHCs and FBOs. The rule included changes to several reports, including the FR Y-15, to implement the Tailoring Rule. With one exception, the final rule was substantively the same as the draft rule. FRY-15 revisions from the Tailoring Rule:5 • Removing firms with less than $100 billion from the overall reporting panel • Extending scope of the FR Y-15 to FBOs combined US operations (CUSO). • Adding three memo items to i) Schedule A and H (Total Consolidated Assets (M4), ii) Total Off-Balance Sheet Exposures (M5), and iii) Total Nonbank Assets (M6). Items M4 and M6 will pre-populated from the FR Y 9C and FR Y9LP, respectively, for BHCs and IHCs. For the combined CUSO view, these data will reported by the FBO (see FBO reporting below). • Adding new schedules H through N for FBOs to file the FR Y 15. These schedules mostly replicate schedules A through G • Adding a 2-column format to schedules H and N to capture the IHC and CUSO separately. • For FBOs: • Revising the cross-jurisdictional schedule by adding a new item to capture the number of claims and liabilities of non-US affiliates secured by eligible collateral • Excluding the reporting of average risk weighted assets from the Schedule N for the CUSO. The Board, in response, has provided a transition period and these changes will be effective with the June 30, 2020 report. Since much of the data is available from other regulatory reports or regulatory requirements, the most significant impact and challenges for building the reporting capability will be for the FBOs to obtain and calculate the FR Y-15 for CUSOs. Banking organizations will be required to first determine their category under this final rule (using March 31, 2019, June 30, 2019, September 30, 2019, and December 31, 2019 FR Y-15 data). Accordingly, an FBO would be required to comply with the category of standards applied to its CUSO beginning on October 1, 2020. Until that time, IHCs should determine their category under the tailoring framework consistent with the cross-jurisdictional activity schedule on the FR Y-15 that previously applied to them. Timeline for initial categorizations and reporting under the final Tailoring Rule4 Reporting unit Combined US US BHC Covered SLHCs US IHC operations Date for first Submission date of categorization Effective date of Effective date of Effective date of FR Y-15 as-of June under Tailoring final rule final rule final rule 30, 2020 Rule June 30, 2020 (Top-tier FBO will report the First as-of date for June 30, 2020 June 30, 2020 FR Y-15 on behalf of their US IHC and amended FR Y-15 CUSOs.) The September proposal contains additional changes to those finalized with the FR Y-15 tailoring changes, which, as proposed, would be for the December 2019 reporting data. Some of the specific proposed changes (effective to the FR Y-15 reports) are: • Adding a four-quarter cumulative amount of all purchases and sales of securities by security type (see table below). These data inputs would include a firm’s own account and purchases and sales from customer accounts. • The proposal adds derivatives to cross-jurisdictional schedule thus significantly increasing the cross- border positions reported What is being changed?6 Proposals to FR Y-15 out Additional details Is the data element reported for public comment somewhere else? 1 Schedule C – These items will include: Potential limited leveragability of Trade Substitutability Indicators • Purchases and sales Reporting and Compliance Engine (TRACE) Adding securities traded in of these securities The FINRA Rule 6700 Series (TRACE) sets the last 4 quarters to the • Purchases and sales forth member trade reporting obligations for memo section for the holding securities that meet the definition of companies own “TRACE-Eligible Security” as defined in Rule Reported in 4 categories: account and 6710(a). customer accounts • Securities issued by • Unless an exception applies, firms are public entities required to report to TRACE their Excludes: • Other fixed income transactions in TRACE-eligible securities Intercompany accounts Securities during the period of time • Listed equities • Committee on prescribed by the rule. • Other securities Uniform Securities • To comply with this requirement, firms Identification must have a process in place to Procedures (CUSIP) determine when a transaction in a netting TRACE-eligible Security has occurred. 2 Schedule D – Complexity Aligns the report with FFIEC 002 - Report of Assets and Liabilities Indicators Account Standard Updates of US Branches and Agencies of Foreign Adding an item for non- (ASU) ASU 2016-017 and Banks trading equity securities the FR Y 9C8 Schedule Q Item 1 with readily available fair values FFIEC 031 and 041 - Consolidated Reports of Condition and Income Schedule RC- Balance Sheet Item2.c 3 Schedule E – Cross- The addition of these No – net new jurisdictional Activity items will significantly Indicators increase the amount cross Adding memo section with jurisdictional positions 5 items. reported on the FR Y15 Foreign derivative claims The item M.1 can come Schedule C, Part II, collects information on on an ultimate risk basis directly from the FFIEC the reporter’s claims on an ultimate-risk (M.1) 009 basis and memorandum items providing additional details related to those claims. But the claims are not segregated to provide details for only derivatives Total cross-jurisdictional M.2 is derived from items M.2 is derived from items on the FR Y-15 claims (M.2) on the FR Y-15 Foreign derivative liabilities Since derivatives are No – net new on an immediate reported on an ultimate counterparty basis (M.3) risk basis on the FFIEC 009, M.3 will require a new reporting process to determine the immediate counterparty. This could cause difficulty since some liabilities may be included M.1 as part of the netting process. Foreign liabilities on an Item M.4 comes directly Column 1-5 Part I of FFIEC009, collects immediate from the FFIEC 009 information on the cross-border claims on counterparty basis (M.4) an “immediate-counterparty” basis. Total cross-jurisdictional Item M.5 is derived from Item M.5 is derived from items on the FR Y liabilities (M.5) items on the FR Y 15 15 Increasing importance FR Y-15 data is available publicly and increasingly utilized for evaluation of systemic risk factors – both for regulators and for peer analysis. The report has evolved from a report used to monitor systemic risk of individual institutions to now being used more broadly to identify systemic risk in specific markets given the granularity of this reporting. Much of the data also extends financial data into risk and operational data. Given the significant number of new and unique data elements that have been added, the data flows via the FR Y-15 provided to regulators should be prioritized by chief data officers (CDOs), Finance, Risk and other key stakeholders in a firm who have responsibility for data management and risk and operational data. Review and analysis of this report should be reviewed broadly with senior management and certain key elements with the board. Reporting elements used for risk-based indicators The table below shows the specific data elements that are used as risk-based indicators. Reporting entity US intermediate Combined US US bank holding holding companies operations (CUSO) companies (IHCs of foreign of foreign banking (BHCs) banking organizations organizations (FBOs)) (FBOs) FR Y-15, Schedule A, FR Y-15, Schedule H, FR Y-15, Schedule H, Size Line Item M4 Line Item M4, Column A Line Item M4, Column B Cross- jurisdictional FR Y-15, Schedule E, FR Y-15, Schedule L, FR Y-15, Schedule L, activity Line Item 5 Line Item 4, Column A Line Item 4, Column B FR Y-15, Schedule A, FR Y-15, Schedule H, FR Y-15, Schedule H, Nonbank assets Line Item M6 Line Item M6, Column A Line Item M6, Column B Short-term FR Y-15, Schedule G, FR Y-15, Schedule N, FR Y-15, Schedule N, wholesale funding Line Item 6 Line Item 6, Column A Line Item 6, Column
Recommended publications
  • Banking Policy Issues in the 115Th Congress
    Banking Policy Issues in the 115th Congress David W. Perkins Analyst in Macroeconomic Policy March 7, 2018 Congressional Research Service 7-5700 www.crs.gov R44855 Banking Policy Issues in the 115th Congress Summary The financial crisis and the ensuing legislative and regulatory responses greatly affected the banking industry. Many new regulations—mandated or authorized by the Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203) or promulgated under the authority of bank regulators—have been implemented in recent years. In addition, economic and technological trends continue to affect banks. As a result, Congress is faced with many issues related to the bank industry, including issues concerning prudential regulation, consumer protection, “too big to fail” (TBTF) banks, community banks, regulatory agency design and independence, and market and economic trends. For example, the Financial CHOICE Act (H.R. 10) and the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155) propose wide ranging changes to the financial regulatory system, and include provisions related to many of these banking issues. Prudential Regulation. This type of regulation is designed to ensure banks are safely profitable and unlikely to fail. Regulatory ratio requirements agreed to in the international agreement known as the Basel III Accords and the Volcker Rule are examples. Ratio requirements require banks to hold a certain amount of capital on their balance sheets to better enable them to avoid failure. The Volcker Rule prohibits certain trading activities and affiliations at banks. Proponents argue the rules appropriately balance the need for safety and soundness with regulatory burden.
    [Show full text]
  • Uniform Call Report Instruction Manual (PDF)
    UNIFORM CALL REPORT INSTRUCTIONS FOR PREPARING THE REPORT OF FINANCIAL CONDITION AND PERFORMANCE REQUIRED BY THE FARM CREDIT ADMINISTRATION 1 Contents General Instructions ........................................................................................... 4 Who must report and for what periods ................................................................... 4 Farm Credit System Banks ................................................................................ 5 Farm Credit System Associations ....................................................................... 5 Farm Credit System Service Institutions .............................................................. 5 Certification ....................................................................................................... 5 How and when to file reports ................................................................................ 5 Preparation of the call report ................................................................................ 6 Revised reports ................................................................................................ 10 Institution profile and branch office directory ........................................................ 11 Instructions for the report of financial conditions and related instructions ................. 12 Schedule RC: Balance Sheet ............................................................................ 12 Schedule RC.1: Memoranda ...........................................................................
    [Show full text]
  • A Large-Scale Evaluation of U.S. Financial Institutions' Standardized
    A Large-Scale Evaluation of U.S. Financial Institutions' Standardized Privacy Notices Lorrie Faith Cranor, Pedro Giovanni Leon, Blase Ur florrie, pedrogln, [email protected] Carnegie Mellon University, Pittsburgh, PA ABSTRACT Financial institutions in the United States are required by the Gramm-Leach-Bliley Act to provide annual privacy notices. In 2009, eight federal agencies jointly released a model privacy form for these disclosures. While the use of this model privacy form is not required, it has been widely adopted. We automatically evaluated 6,191 U.S. financial institutions' privacy notices. We found large variance in stated practices, even among institutions of the same type. While thousands of financial institutions share personal information without providing the opportunity for consumers to opt out, some institutions' practices are more privacy-protective. Regression analyses show that large institutions and those headquartered in the Northeastern region share consumers' personal information at higher rates than all other institutions. Furthermore, our analysis helped us uncover institutions that do not let consumers limit data sharing when legally required to do so, as well as institutions making self-contradictory statements. We discuss implications for privacy in the financial industry, issues with the design and use of the model privacy form, and future directions for standardized privacy notice. 1 1 Introduction When the United States Congress was considering the Gramm-Leach-Bliley Act of 1999 (GLBA), allowing the consolidation of different types of financial institutions, privacy ad- vocates argued that it was important to notify consumers about these institutions' data practices and allow consumers to limit the use and sharing of their data [19].
    [Show full text]
  • FFIEC June 2020 Call Report Supplemental Instructions
    FFIEC Federal Financial Institutions Examination Council Arlington, VA 22226 CALL REPORT DATE: June 30, 2020 SECOND 2020 CALL, NUMBER 292 SUPPLEMENTAL INSTRUCTIONS June 2020 Call Report Materials New Call Report data items take effect this quarter in Schedule RC-C, Part I, Loans and Leases, and Schedule RC-M, Memoranda, of the FFIEC 031, FFIEC 041, or FFIEC 051 Call Report forms to provide information about an institution’s eligible loan modifications under Section 4013 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and its participation in the Paycheck Protection Program (PPP), the PPP Liquidity Facility, and the Money Market Mutual Fund Liquidity Facility. No new topics have been added to the Supplemental Instructions for June 2020. However, the topic on “Recent Banking Agency Actions Affecting Regulatory Capital” in the March 2020 Supplemental Instructions has been updated and retitled “Banking Agencies’ Recent COVID-19-Related Activities Affecting the Call Report.” In addition, these Supplemental Instructions again include an Appendix providing information on certain sections of the CARES Act that affect accounting and regulatory reporting. This Appendix was initially added to the Supplemental Instructions for March 2020 and has been updated this quarter. In general, institutions with domestic offices only and total assets less than $5 billion as of June 30, 2019, were eligible to file the FFIEC 051 Call Report as of March 31, 2020, but such institutions had the option to file the FFIEC 041 Call Report instead as of that date. Institutions are expected to file the same report form, either the FFIEC 051 or the FFIEC 041, for each quarterly report date during 2020.
    [Show full text]
  • 031-041 General Instructions for the Call Report June 2020
    FFIEC 031 and 041 GENERAL INSTRUCTIONS GENERAL INSTRUCTIONS Schedules RC and RC-A through RC-V constitute the FFIEC 031 and FFIEC 041 versions of the Consolidated Report of Condition and its supporting schedules. Schedules RI and RI-A through RI-E constitute the FFIEC 031 and FFIEC 041 versions of the Consolidated Report of Income and its supporting schedules. The Consolidated Reports of Condition and Income are commonly referred to as the Call Report. For purposes of these General Instructions, the Financial Accounting Standards Board (FASB) Accounting Standards Codification is referred to as “ASC.” Unless the context indicates otherwise, the term “bank” in the Call Report instructions refers to both banks and savings associations. WHO MUST REPORT ON WHAT FORMS Every national bank, state member bank, insured state nonmember bank, and savings association is required to file a consolidated Call Report normally as of the close of business on the last calendar day of each calendar quarter, i.e., the report date. The specific reporting requirements for a bank depend upon the size of the bank, whether it has any "foreign" offices, and the capital standards applicable to the bank. Banks must file the appropriate report form as described below: (1) BANKS WITH FOREIGN OFFICES: Banks of any size that have any "foreign" offices (as defined below) must file quarterly the Consolidated Reports of Condition and Income for a Bank with Domestic and Foreign Offices (FFIEC 031). For purposes of these reports, all of the following constitute "foreign" offices: (a) An International Banking Facility (IBF); (b) A branch or consolidated subsidiary in a foreign country; and (c) A majority-owned Edge or Agreement subsidiary.
    [Show full text]
  • Federal Register/Vol. 86, No. 13/Friday, January 22, 2021
    6580 Federal Register / Vol. 86, No. 13 / Friday, January 22, 2021 / Proposed Rules the Board’s granting of relief to a bank regulations that impose additional the exemption, may be conditional or seeking relief from the requirements of reporting, disclosures, or other new unconditional, may apply to particular the Board’s SAR regulations, when such requirements on insured depository persons or classes of persons, and may relief would be beneficial from a safety- institutions generally to take effect on apply to transactions or classes of and-soundness and anti-money the first day of a calendar quarter that transactions. laundering regulatory perspective. The begins on or after the date on which the (ii) The Board will seek FinCEN’s proposed rule would be issued pursuant regulations are published in final concurrence with regard to any to the Board’s safety-and-soundness form.14 The proposed rule would not exemption request that would also authority over supervised institutions. impose additional reporting, disclosure, require an exemption from FinCEN’s The proposed rule will apply to small or other requirements; therefore the SAR regulations, and may consult with bank holding companies and their requirements of the RCDRIA do not FinCEN regarding other exemption nonbank subsidiaries and small state apply. requests. The Board also may consult member banks as well as Edge and However, the agencies invite with the other state and federal banking agreement corporations, and U.S. offices comments that further will inform the agencies and consider comments before of foreign banking organizations agencies’ consideration of RCDRIA. granting any exemption. supervised by the Federal Reserve.
    [Show full text]
  • Ffiec 051 Call Report Instruction Book Update
    FFIEC 051 CALL REPORT INSTRUCTION BOOK UPDATE JUNE 2020 IMPORTANT NOTE The June 2020 Call Report Instruction Book Update excludes updates pertaining to interim final rules (IFRs) and a final rule published by one or all of the banking agencies from March through June 2020 as well as Section 4013 of the 2020 Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which provides optional temporary relief from accounting for eligible loan modifications as troubled debt restructurings. The IFRs and final rule revise certain aspects of the agencies’ regulatory capital rule, amend the Federal Reserve Board’s (Board) Regulation D on reserve requirements, except certain insider loans from the Board’s Regulation O, and modify the Federal Deposit Insurance Corporation’s (FDIC) deposit insurance assessment rules. The agencies have received approvals from the U.S. Office of Management and Budget to implement changes to the Call Report arising from these interim final rules, the final rule, and Section 4013 of the CARES Act. Instructions for these Call Report changes are provided in the separate standalone June 2020 COVID-19 Related Supplemental Instructions (Call Report), which were attached to the agencies’ Financial Institution Letter for the Consolidated Reports of Condition and Income for Second Quarter 2020 and are available on the FFIEC Reporting Forms webpages for the Call Report and the FDIC Bank Financial Reports webpage. The June 2020 COVID-19 Related Supplemental Instructions (Call Report) include instructions for this quarter’s new Call Report items in Schedule RC-C, Part I, Loans and Leases, on eligible loan modifications under Section 4013 and Schedule RC-M, Memoranda, on U.S.
    [Show full text]
  • Over the Line: Asset Thresholds in Bank Regulation
    Over the Line: Asset Thresholds in Bank Regulation May 3, 2021 Congressional Research Service https://crsreports.congress.gov R46779 SUMMARY R46779 Over the Line: May 3, 2021 Asset Thresholds in Bank Regulation Marc Labonte As of December 31, 2020, there were over 5,000 banks in the United States. While certain kinds Specialist in of banks may be similar to each other, the industry as a whole is made of up institutions that Macroeconomic Policy differ in a variety of ways, in some ways quite drastically. How concentrated a bank is in loan making, how concentrated that lending is in specific loan types or geographic markets, how many David W. Perkins other financial services the bank provides, and how much risk it is willing to take on are just a Specialist in few characteristics across which banks may differ significantly. Perhaps the most striking Macroeconomic Policy disparity across the industry is bank size, typically measured as the value of the assets a bank owns. Nearly a fifth of banks hold less than $100 million in assets, and the industry median is about $300 million. Meanwhile, the largest U.S. bank has over $3 trillion in assets, with three others over or near $2 trillion. Relative to large banks, small banks also tend to focus more on traditional commercial bank activities such as loan making and deposit taking; be less or not at all involved in other activities such as securities dealing and derivatives; have fewer resources to dedicate to regulatory compliance; and individually pose less or no risk to the stability of the financial system.
    [Show full text]
  • Call Report Instruction Book Update March 2015
    CALL REPORT INSTRUCTION BOOK UPDATE MARCH 2015 FILING INSTRUCTIONS NOTE: This instruction book update is designed for two-sided (duplex) printing. The pages listed in the column below headed “Remove Pages” are no longer needed in the Instructions for Preparation of Consolidated Reports of Condition and Income and should be removed and discarded. The pages listed in the column headed “Insert Pages” are included in this instruction book update and should be filed promptly in your instruction book. Remove Pages Insert Pages i – v (3-13, 12-14) i – v (3-15) 2a – 4 (6-14) 2a – 4 (3-15) 13 – 14 (12-14) 13 – 14 (3-15) RI-7 – RI-8 (9-11) RI-7 – RI-8 (3-15) RI-23 – RI-24 (6-14) RI-23 – RI-24 (3-15) RI-35 – RI-36 (3-13) RI-35 – RI-39 (3-15) RC-C-36a – RC-C-36b (9-11) RC-C-36a – RC-C-36b (3-15) RC-D-9 – RC-D-10 (9-11) RC-D-9 – RC-D-10 (3-15) RC-E-19 – RC-E-20 (12-14) RC-E-19 – RC-E-20 (3-15) RC-L-5 – RC-L-8 (3-11, 6-12, 3-13) RC-L-5 – RC-L-8 (3-15) RC-L-19 – RC-L-20 (6-09) RC-L-19 – RC-L-20 (3-15) RC-M-5 – RC-M-6 (3-11) RC-M-5 – RC-M-6 (3-15) RC-O-5 – RC-O-6 (6-14) RC-O-5 – RC-O-6 (3-15) RC-O-9 – RC-O-12 (3-12) RC-O-9 – RC-O-12 (3-15) RC-O-29 – RC-O-30 (6-13) RC-O-29 – RC-O-30 (3-15) RC-R-1 – RC-R-65 RC-R-1 – RC-R-120 (3-15) A-5 – A-6 (3-13) A-5 – A-6 (3-15) A-10a – A-12b (6-09, 9-13) A-11 – A-12b (3-15) A-16a – A-16b (3-13) A-16a – A-16b (3-15) A-34a – A-34b (9-11) A-34a – A-34b (3-15) A-35 – A-38 (9-10, 9-12) A-35 – A-38 (3-15) A-43 – A-44 (9-10) A-43 – A-44 (3-15) A-66a – A-72 (6-02, 9-10, 6-12) A-67 – A-72 (3-15) A-75 – A-76 (9-10) A-75 – A-76
    [Show full text]
  • CRA Comment Letter
    Wednesday, April 8, 2020 Attention: Comment Processing Office of the Comptroller of the Currency 400 7th Street SW, Suite 3E-218 Washington, DC 20219 Robert E. Feldman, Executive Secretary Attention: Comments Federal Deposit Insurance Corporation 550 17th Street NW Washington, DC 20429 RE: OCC Docket ID OCC-2018-0008; FDIC RIN 3064-AF22 Dear Comptroller Otting and Chairman McWilliams: On December 12, 2019, the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) jointly issued a notice of proposed rulemaking (NPR, or proposal)1 proposing to significantly change regulations under the Community Reinvestment Act (CRA). We are pleased to offer comments on the NPR. We are researchers in the Housing Finance Policy Center2 at the Urban Institute, a Washington, DC, nonprofit research organization whose mission is “to open minds, shape decisions, and offer solutions through economic and social policy research.” The views we express are our own and should not be attributed to the Urban Institute, its trustees, or its funders. Introduction The Community Reinvestment Act, enacted in 1977, states that “regulated financial institutions have continuing and affirmative obligation to help meet the credit needs of the local communities in which they are chartered.”3 The CRA is a public disclosure statute. Bank regulators are required to periodically assess each “institution’s record of meeting the credit needs of its entire community, including low- and moderate- income (LMI) neighborhoods,” and to make much of the assessment and supporting details public.4 This is in stark contrast to safety and soundness examinations of banks, the unauthorized release of which is a criminal offense.5 Implementation of the CRA is the concurrent responsibility of the three federal agencies that supervise banks: the OCC, the FDIC, and the Federal Reserve.
    [Show full text]
  • Banking Policy Issues in the 116Th Congress
    Banking Policy Issues in the 116th Congress February 21, 2019 Congressional Research Service https://crsreports.congress.gov R45518 SUMMARY R45518 Banking Policy Issues in the 116th Congress February 21, 2019 Regulation of the banking industry has undergone substantial changes over the past decade. In response to the 2007-2009 financial crisis, many new bank regulations were David W. Perkins, implemented pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Coordinator Act of 2010 (Dodd-Frank Act; P.L. 111-203) or under the existing authorities of bank Analyst in Macroeconomic regulators to address apparent weaknesses in the regulatory regime. While some Policy observers view those changes as necessary and effective, others argued that certain regulations were unjustifiably burdensome. To address those concerns, the Economic Cheryl R. Cooper Growth, Regulatory Relief, and Consumer Protection Act of 2018 (P.L. 115-174) relaxed Analyst in Financial certain regulations. Opponents of that legislation argue it unnecessarily pared back Economics important safeguards, but proponents of deregulation argue additional pare backs are needed. Meanwhile, a variety of economic and technological trends continue to affect Darryl E. Getter banks. As a result, the 116th Congress faces many issues related to banking, including the Specialist in Financial following: Economics Safety and Soundness. Banks are subject to regulations designed to reduce the Marc Labonte likelihood of bank failures. Examples include requirements to hold a certain amount of Specialist in capital (which enables a bank to absorb losses without failing) and the so-called Volcker Macroeconomic Policy Rule (a ban on banks’ proprietary trading). In addition, anti-money laundering requirements aim to reduce the likelihood banks will execute transactions involving Rena S.
    [Show full text]
  • Supervisory Statement Determination of Depository Institution and Credit
    Supervisory Statement Determination of Depository Institution and Credit Union Asset Size For Purposes of Sections 1025 and 1026 of the Dodd-Frank Wall Street Reform and Consumer Protection Act The Federal Deposit Insurance Corporation (FDIC), Federal Reserve Board (FRB), Office of the Comptroller of the Currency (OCC), and National Credit Union Administration (NCUA) (the Prudential Regulators), and the Bureau of Consumer Financial Protection (CFPB) (collectively, the Agencies), are issuing this Supervisory Statement to provide clarity and transparency on how and when the Agencies will determine the total assets of an insured depository institution or an insured credit union for purposes of their supervisory and enforcement responsibilities under sections 1025 and 1026 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd- Frank). Background The subject of this Supervisory Statement is supervisory and enforcement authority over insured depository institutions and insured credit unions within the meaning of Dodd- Frank (Institutions) with respect to Federal consumer financial law. Sections 1025 and 1026 of Dodd-Frank address these matters. Under section 1025, the CFPB has exclusive supervisory authority and primary enforcement authority with respect to Institutions with total assets of more than $10 billion (Large Institutions) and any of their affiliates for purposes of Federal consumer financial law. Section 1026 confirms that the Prudential Regulators will retain supervisory and enforcement authority with respect to other Institutions for these purposes. The Dodd-Frank Act does not specify how or when to determine total asset size for purposes of sections 1025 and 1026. However, the Agencies believe that they should adopt reasonable policies and procedures that will allow them to fulfill their responsibilities in a manner consistent with the statute’s purposes.
    [Show full text]