Comment deadline on Fed proposal on capital plan and stress test rules

The Federal Reserve Board has issued an invitation for public comment on a proposal to modify its capital plan and stress testing rules for the 2017 cycle. Among other changes, the proposal would tailor the Federal Reserve's Comprehensive Capital Analysis and Review (CCAR). It would remove the qualitative assessment of CCAR for large and noncomplex firms, or bank holding companies and intermediate holding companies of foreign banking organizations with total consolidated assets between $50 billion and $250 billion, on-balance sheet foreign exposure of less than $10 billion, and total consolidated nonbank assets of less than $75 billion. The proposed rule would take effect for the 2017 CCAR. The proposal would reinforce the Federal Reserve's less stringent expectations for these less systemic firms, which are generally engaged in traditional banking activities. The proposed rule would also reduce certain reporting requirements for these firms, which would continue to be subject to the quantitative requirements of CCAR, as well as normal supervision by the Federal Reserve regarding their capital planning. Comments on the proposal are due by November 25, 2016.