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.
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