2017-16736: Large Financial Institution Rating System; Regulations K and LL

Summary

The Board is seeking comment on a proposed new rating system for its supervision of large financial institutions. The proposed "Large Financial Institution Rating System" is closely aligned with the Federal Reserve's new supervisory program for large financial institutions. The proposed rating system would apply to all bank holding companies with total consolidated assets of $50 billion or more; all non-insurance, non-commercial savings and loan holding companies with total consolidated assets of $50 billion or more; and U.S. intermediate holding companies of foreign banking organizations established pursuant to the Federal Reserve's Regulation YY. The proposed rating system includes a new rating scale under which component ratings would be assigned for capital planning and positions, liquidity risk management and positions, and governance and controls; however, a standalone composite rating would not be assigned. The Federal Reserve proposes to assign initial ratings under the new rating system during 2018. The Federal Reserve is also seeking comment on proposed revisions to existing provisions in Regulations K and LL so they would remain consistent with certain features of the proposed rating system.

The agency’s own summary, as published.

What this changes

Amends 2 parts of the Code of Federal Regulations — the standing rules this notice rewrites.

• 12 CFR 211 International Banking Operations (Regulation K)
• 12 CFR 238 Savings and Loan Holding Companies (Regulation LL)