ARTICLE
18 March 2019

FRB Amends Capital Plan Rule, Provides Instructions For 2019 CCAR Exercise

CW
Cadwalader, Wickersham & Taft LLP

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Cadwalader, established in 1792, serves a diverse client base, including many of the world's leading financial institutions, funds and corporations. With offices in the United States and Europe, Cadwalader offers legal representation in antitrust, banking, corporate finance, corporate governance, executive compensation, financial restructuring, intellectual property, litigation, mergers and acquisitions, private equity, private wealth, real estate, regulation, securitization, structured finance, tax and white collar defense.
The Federal Reserve Board ("FRB") amended the "capital plan rule" to limit the scope of potential objections to a firm's capital plan on the basis of "qualitative deficiencies in the firm's capital planning process."
United States Finance and Banking

The Federal Reserve Board ("FRB") amended the " capital plan rule" to limit the scope of potential objections to a firm's capital plan on the basis of "qualitative deficiencies in the firm's capital planning process." With the exception for firms that have received a qualitative objection in the immediately prior year, the FRB will not issue a qualitative objection to any firm, beginning on January 1, 2021.

Separately, the FRB provided instructions for the 18 firms that are subject to the 2019 Comprehensive Capital Analysis and Review ("CCAR") exercise. The FRB's annual CCAR is an evaluation of the "capital adequacy" of the largest U.S. bank holding companies and the U.S. intermediate holding companies of foreign banking organizations.

The FRB final rule is effective immediately.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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