December 21, 2015

Federal Reserve Board releases guidance to its examiners and banking institutions that consolidates capital planning expectations for all large financial institutions

For release at 1:00 p.m. EST

The Federal Reserve Board on Monday released guidance to its examiners and banking institutions that consolidates the capital planning expectations for all large financial institutions and clarifies differences in those expectations based on firm size and complexity. The guidance is designed to tailor the Federal Reserve's expectations for large financial institutions.

For the largest and most complex firms, the guidance clarifies expectations that have been previously communicated to firms, including through past Comprehensive Capital Analysis and Review (CCAR) exercises and related supervisory reviews. These firms are bank holding companies and intermediate holding companies of foreign banks subject to the Board's Large Institution Supervision Coordinating Committee framework, or firms with $250 billion or more in total consolidated assets or $10 billion or more in foreign exposures.

For firms with more than $50 billion, but less than $250 billion in total consolidated assets, as well as less than $10 billion in foreign exposures, the guidance clarifies the supervisory expectations to be applied for the firms' capital planning processes. In general, the guidance is tailored to reflect the lower systemic risk profile and less complex operations of these firms, as compared to the largest and most complex firms.

Bank holding companies with more than $50 billion in total consolidated assets are subject to the Board's CCAR, which evaluates the capital planning processes and capital adequacy of the largest U.S.-based bank holding companies, including the firms' planned capital actions such as dividend payments and share buybacks and issuances. Strong capital levels absorb losses and help ensure that banking organizations have the ability to lend to households and businesses even in times of financial and economic stress. The guidance is effective for the 2016 CCAR cycle.

SR 15-18: Federal Reserve Supervisory Assessment of Capital Planning and Positions for LISCC Firms and Large and Complex Firms

SR 15-19: Federal Reserve Supervisory Assessment of Capital Planning and Positions for Large and Noncomplex Firms

Last Update: December 21, 2015