Federal Reserve

The Federal Reserve Board Issues Final Rule Adopting Amendments to the Board’s Regulatory Capital Rules for Non-Traditional Stock Corporations

On December 4, 2015, the Board of Governors of the Federal Reserve System (the “Board”) issued a final rule adopting amendments to the Board’s regulatory capital framework (“Regulation Q”) that was issued in June 2013. The final rule provides examples of how to apply the framework to depository institution holding companies that are not organized as traditional stock corporations and how instruments issued by such firms may qualify as regulatory capital. The final rule also issued a temporary exclusion from Regulation Q for savings and loan holding companies that are trusts and depository institution holding companies that are employee stock ownership plans – until the Board can propose appropriate rules for such entities. In addition, the Board extended the applicable compliance date with the revised capital framework to July 1, 2016. The final rule will take effect on January 1, 2016. Press Release. Final Rule.

Fed Announces Dates of Stress Test Releases

On February 12, the Fed announced that results from the latest supervisory stress tests conducted as part of Dodd-Frank will be released on March 5, and the related results from the Comprehensive Capital Analysis and Review, will be released on March 11.  Results for both exercises will be released at 4:30 p.m.  Release.

 

Financial Stability Oversight Council Announces Changes to Nonbank Designations as Systemically Important

On February 4, the Financial Stability Oversight Council (Council) today announced changes to certain practices relating to its process for reviewing nonbank financial companies for potential designation. Nonbank financial companies that are designated by the Council are subject to supervision by the Federal Reserve and enhanced standards.  The Council will, amongst other things, inform companies earlier when they come under review and make available to the public additional information about its designations process.  Release.

Federal Reserve Issues “Strategies for Improving the U.S. Payment System”

On January 26, 2015 the Federal Reserve issued a multi-faceted plan for collaborating with payment system stakeholders, including large and small businesses, emerging payments firms, card networks, payment processors, consumers and financial institutions to enhance the speed, safety and efficiency of the U.S. payment systemRelease.

Did an Obscure Remark in a Recent Regulatory Publication Signal a New Interpretation of the Anti-Tying Rules?

In 2003, the Federal Reserve released its proposed interpretation of the anti-tying provisions of the Bank Holding Company Act Amendments, in which it stated that market power and anti-competitive effects were not necessary elements of an illegal tying arrangement.  Despite substantial commentary on the Federal Reserve’s proposed interpretation from financial institutions and other regulators, including the Department of Justice, the Federal Reserve has not revised its proposed interpretation of the anti-tying provisions of the BHC Act.  This alert discusses a recent regulatory publication raising the possibility that the Federal Reserve may be revisiting its earlier stance.  For more information, please click here.