November 25, 2014
Federal Reserve Board announces proposed enhanced prudential standards for regulation and supervision of General Electric Capital Corporation
For release at 3:30 p.m. EST
The Federal Reserve Board on Tuesday invited public comment on enhanced prudential standards for the regulation and supervision of General Electric Capital Corporation (GECC), a nonbank financial company that the Financial Stability Oversight Council has designated for supervision by the Board.
In light of the substantial similarity of GECC’s activities and risk profile to that of a similarly-sized bank holding company, the Board is proposing to apply enhanced prudential standards to GECC that are generally similar to those that apply to large bank holding companies. Those similar standards include requirements for risk-based and leverage capital, capital planning, stress testing, liquidity, and risk management.
The proposed order would also apply certain additional prudential standards to GECC in light of certain unique aspects related to GECC’s activities, risk profile, and structure. Those standards include additional independence requirements for GECC’s board of directors, and restrictions on intercompany transactions between GECC and General Electric Corporation. GECC would also be subject to the enhanced supplementary leverage ratio, which is applicable to the largest, most systemic U.S. banking organizations. Finally, the proposed order would require GECC to file certain reports with the Board that are similar to the reports required of large bank holding companies.
Comments on the proposed order will be received through 60 days from publication in the Federal Register.
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