The Fed Invites Comment on Proposal to Modify the Regulations for Capital Planning and Stress Testing

On June 12, the Fed invited comments on a proposal to modify the regulations for capital planning and stress testing.  The proposed rule includes a number of measures that would alter the capital planning and stress test processes.  Comments on the proposed rule will be accepted until August 11, 2014.  Press ReleaseProposal.

Fed Final Rule on Supervision and Regulation of Bank Holding Companies and Foreign Banks

On February 18, the Fed issued a final rule which establishes enhanced supervision standards for large U.S. bank holding companies and foreign banking organizations, as required by the Dodd-Frank Act.  The final rule will be effective for U.S. entities on January 1, 2015, and for foreign entities in either 2016 or 2018, depending on the type of entity.  Fed Release.   Fed Final Rule.

Volcker Rule Exclusion for TruPS CDOs

On January 14, the Fed, CFTC, FDIC, OCC and SEC issued an interim final rule which will permit banking entities to retain interests in certain collateralized debt obligations backed primarily by trust preferred securities (TruPS CDOs) if the following conditions are met: (i) the TruPS CDO was established and the interest was issued before May 19, 2010; (ii) the banking entity reasonably believes that the offering proceeds received by the TruPS CDO were invested primarily in Qualifying TruPS Collateral (as defined by the rule); and (iii) the banking entity’s interest in the TruPS CDO was acquired on or before December 10, 2013, the date the agencies issued final rules implementing section 619 of the Dodd-Frank Act (the Volcker Rule).  The agencies also released a non-exclusive list of issuers which meet the requirements of the interim final rule.  Comments must be submitted within 30 days of publication in the Federal Register.  Joint ReleaseJoint Interim Final RuleList of Excluded CDO Issuers.

Three Agencies Seek Comment on Joint Supplemental Guidance on Income Tax Allocation Agreements

On December 19, Fed, FDIC and OCC issued a statement seeking comment on supplemental guidance on income tax allocation agreements involving holding companies and insured depository institutions.  The proposed guidance will clarify ownership of any tax refundsReleaseProposed Addendum.

Three Agencies Issue FAQ Regarding CDOs Backed by Trust Preferred Securities Under the Volcker Rule

On December 19, Fed, FDIC and OCC issued Frequently Asked Questions to clarify rules applicable to investments in covered funds and whether collateralized debt obligations backed by trust preferred securities (TruPS CDOs) could be determined to be covered funds under the Volcker Rule.  The FAQs clarify that banking entities that have holdings in TruPS CDOs may use the conformance period to determine if they can be brought into conformance by July 21, 2015ReleaseFAQ.

Three Agencies Release Annual CRA Asset-Size Threshold Adjustments for Small and Intermediate Small Institutions

On December 19, the Fed, FDIC and OCC announced the annual adjustment to the asset-size thresholds used to define small bank, small savings association, intermediate small bank and intermediate small savings association under the Community Reinvestment ActRelease.

The Fed Issues Final Rule on Treatment of Uninsured U.S. Branches and Agencies of Foreign Banks Under Section 716 of Dodd-Frank

On December 24, the Fed issued the final rule clarifying the treatment of uninsured U.S. branches and agencies of foreign banks under Section 716 of the Dodd-Frank Act.  The final rule adopts the interim final rule issued on June 5, 2013Section 716 prohibits the provision of certain types of federal assistance to swaps entities.  Insured depository institutions that are swaps entities are eligible for a transition period of up to 24 months to comply and for certain statutory exceptions.  The final rule clarifies that, for purposes of section 716, uninsured U.S. branches and agencies of foreign banks are treated as insured depository institutionsReleaseFinal Rule.