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On December 9, 2016, the US Federal Reserve announced the approval of technical amendments to its rule regarding risk-based capital surcharges for US-based global systemically important bank holding companies (GSIB surcharge rule), requiring those firms to hold additional amounts of risk-based capital to avoid restrictions on capital distributions and discretionary bonus payments. The changes would not materially alter the underlying rule approved by the Federal Reserve Board in July 2015.
The amendments are being adopted without change from the proposal released for comment earlier this year. The amendments would clarify that GSIBs: (i) must continue to calculate their surcharges using year-end data while reporting the underlying data on a quarterly basis; and (ii) should scale the values of their surcharge scores to billions of dollars when computing.
On the same day, the US Federal Reserve Board issued an interim final rule that extends the amount of time certain firms will have to complete Schedule G of the Banking Organization Systemic Risk Report (FR Y-15). The FR Y-15 reporting form collects systemic risk data from US bank holding companies, covered savings and loan holding companies and US intermediate holding companies of foreign banking organizations with total consolidated assets of $50 billion or more.
The extension applies to firms that have less than $10 trillion in assets under custody and less than $700 billion in total consolidated assets. Firms with less than $10 trillion in assets under custody, $250 billion or more in total consolidated assets (but less than $700 billion in total consolidated assets) or $10 billion or more in on-balance-sheet foreign exposure have been granted a one-year extension, until December 31, 2017, to begin filing Schedule G with the FR Y- 15 reports. Firms with less than $10 trillion in assets under custody, less than $250 billion in assets and less than $10 billion in on-balance-sheet foreign exposures have until June 2018 to begin submitting Schedule G.
Comments on the interim final rule must be received within 60 days following publication in the Federal Register. The final rule is available at: https://www.federalreserve.gov/newsevents/press/bcreg/bcreg20161209b2.pdf; and the
interim final rule is available at: https://www.federalreserve.gov/newsevents/press/bcreg/bcreg20161209b1.pdf.
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