Just around the end-of-year holiday, the Federal Reserve Board proposed several rules related to capital requirements for US banks. The much anticipated proposed rulemakings, which were required by Sections 165 and 166 of the Dodd-Frank Act, only addressed a portion of the regulatory capital questions. The proposed regulations affect bank holding companies with consolidated assets of $50 billion or more and those nonbank financial institutions deemed to be systemically important.

Many market participants expected that the notice of proposed rulemaking would address aspects of the Collins amendment (Section 171, DFA) regarding the types of financial instruments that would be eligible for inclusion within Tier 1 capital. However, the proposed regulation did not address Section 171 and also did not address the implementation of the Basel III framework in the US.

Please see full briefing below for more information.