Federal Deposit Insurance Corporation

Capital: Notice of Proposed Rulemaking

 

On December 17, three entities – the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency – “published a notice of proposed rulemaking [] to provide an updated framework for measuring derivative counterparty credit exposure.” Release.

Federal Agencies Issue a Joint Statement on Banks and Credit Unions Sharing Resources to Improve Efficiency and Effectiveness of Bank Secrecy Act Compliance

 

On October 3, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network issued a statement to address instances in which certain banks and credit unions may decide to enter into collaborative arrangements to share resources to manage their Bank Secrecy Act and anti-money laundering obligations more efficiently and effectively. Joint Statement.

Federal Banking Agencies Issue Statement Regarding the Impact of the Act

 

On July 6, 2018, the Federal Reserve Board, the Federal Deposit Insurance Corporation and the Office of the Comptroller issued a joint statement describing the rules and related reporting requirements that are affected by the enactment of the Economic Growth, Regulatory Relief, and Consumer Protection Act (the “Act“). The federal banking agencies provide their interim positions on the applicability of the Act until their respective regulations are amended to incorporate the Act’s changes. Release.

Federal Banking Agencies Issue Final Rule to Exempt Commercial Real Estate Transactions of $500,000 or Less from Appraisal Requirements:

 

On April 2, 2018, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency issued a final rule that increases the threshold for commercial real estate transactions requiring an appraisal from $250,000 to $500,000. Press Release. Rule.

Federal Banking Agencies Finalize an 18-Month Examination Cycle for Small Banking Institutions

On December 12, 2016, the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board and the Office of the Comptroller of the Currency (OCC) finalized rules that generally allow well-capitalized and well-managed banks and savings associations with less than $1 billion in total assets to benefit from an 18-month examination cycle rather than a 12-month cycle.  Prior to the adoption of the interim final rules, only firms with total assets of less than $500 million were eligible to benefit from the extended 18-month cycle.  The final rules are meant, among other things, to reduce regulatory compliance costs for smaller institutions. Press Release. Final Rule.

Agencies Issue Advanced Notice of Proposed Rulemaking on Enhanced Cyber Risk Management Standards

 

On October 19, 2016, the Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency announced proposed rules relating to cybersecurity and risk management concerns that would apply to larger institutions under their purview. FDIC Press Release. Federal Reserve Press Release. OCC Press Release.

Agencies Publish Study on Banking Activities and Investments under Dodd-Frank

 

On September 8, 2016, the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation (FDIC) and Office of the Comptroller of the Currency (OCC) released a report detailing activities and investments that banking entities may engage in under state and federal law.

Pursuant to section 620 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), which requires the trio of federal banking agencies to conduct the study and report their findings to Congress, the report considers financial, operational, managerial and reputational risks associated with the permissible activities or investments and how banking entities work to mitigate those risks.

Each agency also offers specific recommendations regarding whether an activity or investment could harm the overall safety and soundness of the banking entity or broader financial system and any additional restrictions necessary to curb any such potential risks. Press release. Report.

Agencies Finalize Rule Exempting Certain Commercial and Financial End Users from Initial and Variation Margin Requirements

On August 1, 2016, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Federal Housing Finance Agency and the Farm Credit Administration announced a final rule that contains certain exemptions for “certain commercial and financial end users from margin requirements for certain swaps not cleared through a clearinghouse.”  The rule implemented without any changes the interim final rule from November 2015. Press Release. Press Release. Press Release. Press Release.

Agencies Permit Reduced Content Resolution Plan Submissions for Firms with Limited U.S. Operations

On June 10, 2016, the Federal Reserve Board and the Federal Deposit Insurance Corporation allowed 84 entities with limited activities in the United States “to file reduced content resolution plans for their next three resolution plans.”  These reports are required under federal law and relate to each entity’s planned response to various insolvency events. FDIC Release. FRB Release.

Banking Agencies Permit “Reduced Content” Living Wills for Smaller FBOs

On June 10, 2016, the Federal Reserve Board and Federal Deposit Insurance Corporation announced they are permitting 84 foreign banking organizations (not identified) with limited U.S. operations to file “reduced content” resolution plans for their next three resolution plans.  As reported, the decision is intended “to increase clarity and reduce burden by creating more certainty around future filing requirements.”  All of the 84 firms have less than $50 billion in total U.S. assets.  The agencies said “the reduced content plans should focus on changes the firms have made to their prior resolution plans, actions taken to improve the effectiveness of, or that may alter, those plans, and, where applicable, actions to ensure any subsidiary insured depository institution is adequately protected from the risks arising from the activities of nonbank subsidiaries of the firm.  The first of these reduced content plans must be submitted to the agencies by December 31, 2016. To file reduced content plans for the next three years, the firms must maintain less than $50 billion in U.S. assets and not experience any material events.