Rules and Regulations

Agencies Request Comments on the Following Proposed Rules

NCUA proposes amending fixed assets rule

The NCUA is proposing to amend the current version of its fixed assets rule, which was adopted on Sept. 18, 2013. The fixed assets rule 1) limits federal credit unions' (FCUs) investments in fixed assets, 2) establishes occupancy, planning, and disposal requirements for acquired and abandoned premises, and 3) prohibits certain transactions. The proposed rule would allow FCUs to exceed the current five percent aggregate investment limit on fixed assets without prior NCUA approval, provided FCUs establish their own fixed assets management policies and programs. The proposed rule also simplifies the partial occupancy requirement for premises that are acquired for future expansion purposes, and eliminates or streamlines certain aspects of the fixed assets waiver requirement in certain circumstances. Comments are due by Oct. 10.

SEC reproposes removing references to credit ratings and amending money market fund rule’s issuer diversification requirement

This is one of several releases relating to the use of security ratings by credit rating agencies in SEC rules and forms. The SEC is reproposing amendments to rule 2a-7 and Form N-MFP to remove credit rating references. The reproposal includes amendments related to rule 2a-7's issuer diversification provisions. In March 2011, the SEC originally proposed to replace references to credit references from two rules and four forms, including rule 2a-7 and Form N-MFP. On Sept. 2, 2014, the SEC published a correction to the RIN number. Comments are due by Oct. 14.

FRS proposes repealing Regulation AA, Unfair or Deceptive Acts or Practices

The Dodd-Frank Act eliminated the rulemaking authority of the Board of Governors under the Federal Trade Commission Act (FTC Act) to issue rules applicable to banks to define and prevent unfair or deceptive acts or practices. Accordingly, the Board proposes to repeal its Regulation AA. Notwithstanding the repeal of rule writing authority, the Board continues to have supervisory and enforcement authority regarding unfair or deceptive acts or practices under the FTC Act and the Dodd-Frank Act. Concurrent with this proposed repeal, the CFPB, FDIC, FRS, NCUA, and OCC are issuing a statement to clarify that the unfair or deceptive acts described in former credit practices rules remain unlawful. The interagency guidance clarifies that the agencies have supervisory and enforcement authority regarding the practices previously addressed in the former credit practices rules. Comments are due by Oct. 27.

FHFA proposes rule regarding housing goals for Fannie Mae and Freddie Mac

The FHFA is required to establish annual housing goals for mortgages purchased by Fannie Mae and Freddie Mac. The housing goals include separate categories for single-family and multifamily mortgages on housing that is affordable to low-income and very low-income families, among other categories. The proposed rule would update the benchmark levels for each of the housing goals and subgoals for 2015 through 2017. FHFA would adopt one of three different approaches for determining whether Fannie Mae or Freddie Mac has met one of the single-family housing goals. A number of changes and clarifications to the existing rules are also proposed concerning whether a particular mortgage purchase may be counted for purposes of the housing goals. Comments are due by Oct. 28.

CFPB proposes amendments to home mortgage disclosure rules

The proposed rule amends Regulation C to implement changes to the Home Mortgage Disclosure Act (HMDA) made by section 1094 of the Dodd-Frank Act. The CFPB proposes to revise the tests for determining which financial institutions and housing-related credit transactions are covered under HMDA. Also, the CFPB proposes to require financial institutions to report new data points identified in the Dodd-Frank Act, as well as other data points that the CFPB believes may be necessary to carry out the purposes of HMDA. Other changes are proposed to better align the requirements of Regulation C to existing industry standards where practicable. To improve the quality and timeliness of HMDA data, the CFPB is proposing to require financial institutions with large numbers of reported transactions to submit their HMDA data on a quarterly, rather than an annual, basis. Additional changes are proposed to clarify and provide additional guidance on existing requirements of Regulation C that financial institutions and other stakeholders have identified as confusing or unclear. Comments are due by Oct. 29.

Several agencies propose revisions to interagency Q&A regarding community reinvestment

The FDIC, FRS and OCC are requesting comment on proposed revisions to their Interagency Questions and Answers Regarding Community Reinvestment. The agencies proposed to revise three questions and answers that address alternative systems for delivering retail banking services and add examples of innovative or flexible lending practices. Other proposed revisions would address community development-related issues, including guidance on economic development and lending activities that are considered to revitalize or stabilize an underserved nonmetropolitan middle-income geography. The agencies also propose to add four new questions and answers clarifying how community development services are evaluated and providing general guidance on how examiners evaluate the responsiveness and innovativeness of an institution's loans, qualified investments, and community development services. Comments are due by Nov. 10.

FHFA proposes revision of FHLB membership regulations

The FHFA is proposing to revise its regulations governing Federal Home Loan Bank (FHLB) membership. The revisions primarily require each applicant and member to hold one percent of its assets in "home mortgage loans" initially and on an ongoing basis in order to satisfy the statutory requirement that an institution make long-term home mortgage loans. Each member would also be required on an ongoing basis to have at least 10 percent of its assets in "residential mortgage loans." The revisions would also define the term "insurance company" to exclude from FHLB membership captive insurers, but permit existing captive members to remain members for five years with certain restrictions on their ability to obtain advances. In addition, each FHLB would be required to review an insurance company’s audited financial statements when considering it for membership. The proposal also clarifies the standards by which an insurance company’s "principal place of business" is to be identified in determining the appropriate FHLB district for membership. Comments are due by Nov. 12.

Several agencies propose establishing swap margin and capital requirements

The FCA, FDIC, FHFA, FRS and OCC are seeking comment on a revised proposed joint rule to establish minimum margin and capital requirements for registered swap dealers, major swap participants, security-based swap dealers and major security-based swap participants for which one of the agencies is the prudential regulator. The Dodd-Frank Act requires the agencies to adopt rules jointly to establish capital requirements and margin requirements for swap dealers and participants and their counterparts for non-cleared security-based swaps. The agencies previously published a proposed rule on this subject on May 11, 2011, which was extended and reopened. In light of the significant differences from the 2011 proposal, the agencies are seeking comment on this revised proposed rule. Comments are due by Nov. 24.

Final Rules

Several agencies issue final rule revising the definition of eligible guarantee under the advanced approaches risk-based capital rule

The FDIC, FRS and OCC are adopting a final rule revising the definition of eligible guarantee in the agencies’ advanced approaches risk-based capital rule, adopted in the agencies’ regulatory 2013 capital rules. The FDIC's interim capital rule was published on Sept. 10, 2013 and adopted as a final rule on April 14, 2014. The FRS' and OCC's final rule was published on Oct. 11, 2013. This final rule removes the requirement that an eligible guarantee be made by an eligible guarantor for purposes of calculating the risk-weighted assets of an exposure (other than a securitization exposure) under the advanced approaches risk-based capital rule. The change to the definition of eligible guarantee applies to all banks, savings associations, bank holding companies, and savings and loan holding companies that are subject to the advanced approaches. The proposed rule was published in the Federal Register on May 1, 2014.

FDIC issues final rule rescinding OTS requirements for state savings associations to report CRA-related agreements

The FDIC is rescinding the rule, which was transferred from the OTS in 2011, requiring state savings associations to disclose and report all CRA-related agreements. FDIC regulations in Part 346 concerning reporting of CRA-related agreements will apply to all insured depository institutions for which the FDIC has been designated as the appropriate federal banking agency. The proposed rule was published on Dec. 19, 2013.

FDIC issues final rule rescinding regulations regarding post-employment activities of senior examiners

The FDIC is rescinding the rule, which was transferred from the OTS in 2011, regarding post-employment activities of senior examiners. The restrictions for post-employment activities of senior examiners of all insured depository institutions for which the FDIC has been designated as the appropriate federal banking agency will be found at 12 CFR part 336, subpart C. The proposed rule was published on Sept. 4, 2013.

CFPB issues rule clarifying applicability of Ability-to-Repay rule in certain situations involving successors-in-interest

The CFPB's interpretive rule clarifies that where a successor-in-interest (successor) who has previously acquired title to a dwelling agrees to be added as obligor or substituted for the existing obligor on a consumer credit transaction secured by that dwelling, the creditor’s written acknowledgement of the successor as obligor is not subject to the Bureau’s Ability-to-Repay Rule (ATR Rule) because such a transaction does not constitute an assumption as defined by Regulation Z. The ATR rule is found at 12 CFR §1026.43 and was issued in January 2013.

OCC issues final rule increasing marginal assessment rates for certain national banks and federal savings associations

The OCC is increasing marginal assessment rates for national banks and federal savings associations with assets of more than $40 billion. The increased rates will range between 0.32% and approximately 14%, depending on each institution's total assets as of its June 30, 2014 Call Report. The increased rates will be effective for the assessment due on Sept. 30, 2014. The OCC is also amending 12 CFR part 8 to make it consistent with the increased marginal assessment rates.

SEC issues rules and guidance on cross-border security-based swap activities

The SEC is adopting the first in a series of rules and guidance addressing the application of the Dodd-Frank Act to cross-border security-based swap activities. This rulemaking focuses on the application of a de minimis exception from the definition of "security-based swap dealer" in the cross-border context, and on the application of thresholds related to the definition of "major security-based swap participant" in the cross-border context. The SEC rule also allows market participants to satisfy certain Dodd-Frank obligations by complying with comparable foreign regulatory requirements. The proposed rule was published on May 23, 2013.Other matters included in the proposed rule will be addressed in subsequent rulemakings.

Treasury issues final rule replacing references to credit ratings in the liquid capital rule

The amendment to Treasury regulations issued under the Government Securities Act of 1986 provides a substitute standard of creditworthiness for use in the liquid capital rule and removes references to or requirement of reliance on credit ratings. It also finalizes several non-substantive, technical amendments to Government Security Act rules. The proposed rule was published on Sept. 27, 2011.

FHFA issues supplemental order regarding publication of stress-testing results

The FHFA has amended the template used by each of the twelve Federal Home Loan Banks to submit stress testing reports to the FHFA. Previous orders were effective on Nov. 26, 2013 and Dec. 13, 2013.

NCUA issues final rule amending voluntary liquidation regulation

The NCUA is issuing a final rule to amend its voluntary liquidation regulation to reduce administrative burdens on voluntarily liquidating federal credit unions (FCUs). Specifically, the final rule raises the asset-size thresholds that determine the frequency of required creditor notice publication; allows FCUs to use electronic media to meet the publication requirement while also enabling FCUs to issue share payouts to members by electronic payment methods; clarifies the existing calculation of pro rata distributions to members; and it requires that preliminary pro rata distributions to members, which voluntarily liquidating FCUs may issue pending the final payout, be limited to the National Credit Union Share Insurance Fund (NCUSIF) insured amount applicable to any given account or accounts. The proposed rule was published on March 3, 2014.

Several agencies issue final addendum to Interagency Policy Statement on Income Tax Allocation Agreements in a Holding Company Structure

The Addendum instructs insured depository institutions (IDIs) and their holding companies to review and revise their tax allocation agreements to expressly acknowledge that the holding company receives a tax refund as agent for the IDI. These agreements should also be consistent with laws applicable to transactions between IDIs and their affiliates. The Addendum includes a sample paragraph that IDIs could include in their tax allocation agreements to facilitate compliance. The original proposal was published in the Federal Register on Dec. 19, 2013.

CFPB issues rules of practice for issuing temporary cease-and-desist orders

On Sept. 26, 2013, the CFPB published an interim final rule establishing procedures governing the issuance of a temporary cease-and-desist order. The CFPB is now adopting the interim procedures without change.

FRS issues amendment to the identity theft red flags rule

In 2007, the Board published final rules and guidelines on identity theft "red flags" (Red Flags Rule), which implements section 615(e) of the Fair Credit Reporting Act (FCRA). In 2010, a definition for the term creditor was added to Section 615(e) of the FCRA. The Board is now amending the Red Flags Rule creditor definition to reflect the current definition in the FCRA. The proposed rule was published on Feb. 20, 2014.

FRS repeals Regulation DD

The Board is repealing its Regulation DD, 12 CFR part 230, which was issued to implement the Truth in Savings Act. Rulemaking authority for a number of consumer protection laws was transferred from the Board to the CFPB, and the CFPB currently has its interim final Regulation DD, which substantially duplicated the Board's Regulation DD. Since all of the entities formerly subject to the Board's rule are covered by the CFPB interim rule, the Board's version of Regulation DD is no longer necessary. The proposed rule was published on Feb. 20, 2014.

FRS repeals Regulation P

The Board is repealing its Regulation P, 12 CFR part 216, which governed the disclosure of nonpublic personal information by financial institutions and privacy notices. Rulemaking authority for a number of consumer protection laws was transferred from the Board to the CFPB, and the CFPB currently has an interim final Regulation P, which substantially duplicated the Board's rule. Since all of the entities formerly subject to the Board's rule are covered by the CFPB interim rule, the Board's version of Regulation P is no longer necessary. The proposed rule was published on Feb. 20, 2014.

OCC integrates national bank and savings association regulations

In an effort to streamline rules and to reduce duplication, the OCC is integrating into a single set of rules certain regulations relating to consumer protection in insurance sales, Bank Secrecy Act compliance, management interlocks, appraisals, disclosure and reporting of Community Reinvestment Act-related agreements and the Fair Credit Reporting Act. This rulemaking will not result in any substantive changes in the rules, but it will create a single set of rules for all institutions supervised by the OCC.

Several agencies issue joint final rule established enhanced supplementary leverage ratio standards for large banking organizations

The FDIC, FRS and OCC are adopting a final rule enhancing the leverage ratio standards for large, interconnected U.S. banking organizations. The final rule applies to any U.S. top tier bank holding company with more than $700 billion in total consolidated assets or more than $10 trillion in assets under custody, and any insured depository institutions of these bank holding companies. The proposed rule was published on Aug. 20, 2013.

NCUA issues final rule requiring capital plans and annual stress tests of certain federally insured credit unions

The NCUA is adopting a final rule requiring federally insured credit unions (FICUs) with assets of $10 billion or more to develop and submit capital plans annually to the NCUA. The rule also requires annual stress tests. The NCUA will run the stress testing for the first three years; subsequent stress tests may be conducted by the FICUs as approved by the NCUA. The proposed rule was published on Nov. 1, 2013 and is now adopted, with some modifications.

FDIC issues final rule adopting restrictions on sales of assets of a covered financial company by the FDIC

The Dodd-Frank Act prohibits certain sales of assets held by the FDIC in the course of liquidating a covered financial company, including sales of equity stakes in subsidiaries. This final rule prohibits individuals or entities that have, or may have, contributed to the failure of a "covered financial company" from buying a covered financial company's assets from the FDIC. The final rule establishes a self-certification process that is a prerequisite to the purchase of assets of a covered financial company from the FDIC. The proposed rule was published on Nov. 6, 2013.

FDIC issues final rule implementing risk-based and leverage capital requirements for FDIC-supervised institutions

The FDIC is adopting as final an interim rule revising risk-based and leverage capital requirements for FDIC-supervised institutions. The final rule also amends the market risk capital rule to apply to state savings associations. The interim final rule was published on Sept. 10, 2013.

FRS issues final rule implementing enhanced prudential standards for bank holding companies and foreign banking organizations

The Federal Reserve is adopting amendments to Regulation YY to implement certain enhanced prudential standards for bank holding companies and foreign banking organizations with total consolidated assets of $50 billion or more. The proposed rule for bank holding companies was published on Jan. 5, 2012 and the proposed rule for foreign banking organizations was published on Dec. 28, 2012. The final rule implements elements of both the domestic and foreign proposed rules, but makes several modifications, including: modifying the threshold for forming a U.S. intermediate holding company; adjusting the timing requirements for foreign banking organizations to establish a U.S. intermediate holding company; and not applying enhanced prudential standards to nonbank financial companies supervised by the Federal Reserve through this final rule. Public comment is requested only on Paperwork Reduction Act burden estimates.

OCC issues final technical amendments removing rules that transferred to the CFPB

The OCC is removing regulations concerning registration of mortgage loan originators and regulations relating to the privacy of consumer financial information. The CFPB assumed rulemaking authority for these rules on July 21, 2011. The OCC is also updating its website address, Freedom of Information Act (FOIA) portal address, and its physical address to reflect its move to a new headquarters building.

Treasury issues final rule requiring contract clauses on minority and women inclusion in Treasury contracts

Pursuant to the Dodd-Frank Act, the Treasury is amending its regulations to include a contract clause on minority and women inclusion. The contract terms are required for all service contracts, including contracts originating from the Treasury Departmental Offices. The proposed rule was published on Aug. 12, 2012.

FRS issues final rule adopting revised capital framework to the capital plan and stress test rules

On Sept. 30, 2013, the FRS issued two interim final rules amending the capital plan rule and stress test rules. The first interim rule required a bank holding company with total consolidated assets of $50 billion or more to estimate its tier 1 common ratio using the Board's Basel-I methodology, and when a banking organization would estimate its minimum regulatory capital ratios using the advanced approaches rule. The second interim final rule provided a one-year transition period during which bank holding companies and most state member banks with more than $10 billion but less than $50 billion in total consolidated assets were not required to reflect the Board's revised capital framework in their stress tests for the cycle that began on Oct. 1, 2013. This final rule adopts both final rules, with the exception that the final rule provides an additional year (until Oct 1, 2015) for companies to incorporate the advance approaches rule into their capital planning and company-run stress tests, and for the FRS to incorporate the advanced approaches rule in its supervisory stress tests.

Subscribe

Keep up with what’s new and noteworthy at the St. Louis Fed. Sign up now to have this free monthly e-newsletter emailed to you.

Subscription Options


Additional Fed Publications

Fed in Print: An index of the economic research conducted by the Fed.