Regulatory Capital Rules: Removal of Certain Capital Rules That Are No Longer Effective Following the Implementation of the Revised Capital Rules, 17737-17744 [2018-06881]
Download as PDF
<![CDATA[
17737
Rules and Regulations
Federal Register
Vol. 83, No. 79
Tuesday, April 24, 2018
This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents.
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Parts 303, 308, 324, 325, 327,
333, 337, 347, 349, 360, 362, 363, 364,
365, and 390
RIN 3064–AE51
Regulatory Capital Rules: Removal of
Certain Capital Rules That Are No
Longer Effective Following the
Implementation of the Revised Capital
Rules
Federal Deposit Insurance
Corporation (FDIC).
ACTION: Final rule.
AGENCY:
This final rule rescinds
certain capital regulations of the FDIC’s
codified rules (superseded capital rules)
that were no longer effective following
the January 1, 2015 implementation of
the revised capital rules. The final rule
also makes conforming changes to
sections in the FDIC’s codified rules that
refer to the superseded capital rules.
The FDIC has concluded that good
cause exists to publish this rule as final
without a period of notice and comment
and with an effective date as of the date
of its publication in the Federal Register
because this final rule rescinds the
superseded capital rules and other
sections of the FDIC’s codified rules that
refer to the superseded capital rules and
imposes no new requirement on FDICsupervised institutions.
DATES: The final rule is effective April
24, 2018.
FOR FURTHER INFORMATION CONTACT:
Benedetto Bosco, Chief, Capital Policy
Section; bbosco@fdic.gov, Capital
Markets Branch, Division of Risk
Management Supervision, (202) 898–
6888; Catherine Wood, Counsel,
cawood@fdic.gov; Michael Phillips,
Supervisory Counsel, mphillips@
fdic.gov, Supervision and Legislation
Branch, Legal Division, Federal Deposit
Insurance Corporation, 550 17th Street
NW, Washington, DC 20429.
jstallworth on DSKBBY8HB2PROD with RULES
SUMMARY:
VerDate Sep<11>2014
14:18 Apr 23, 2018
Jkt 244001
SUPPLEMENTARY INFORMATION:
I. Background
In 2014, the FDIC comprehensively
revised and strengthened its capital
regulations applicable to FDICsupervised institutions (revised capital
rule).1 The revised capital rule was
codified in part 324 of the FDIC’s
codified rules (effective January 1, 2014,
for advanced approaches banking
organizations) and was effective for all
non-advanced approaches FDICsupervised institutions on January 1,
2015. Before the effective dates of the
revised capital rule, FDIC-supervised
institutions were subject to the
superseded capital rules in part 325 and
subparts Y and Z of part 390 of the
FDIC’s codified rules. The superseded
capital rules remain in the Code of
Federal Regulations (CFR), even though
they were no longer effective for any
FDIC-supervised institution since
January 1, 2015. Maintaining the
superseded capital rules in the FDIC’s
codified rules could result in confusion
and therefore this final rule removes the
superseded capital rules.
II. Description of the Final Rule
The final rule rescinds part 325,
subpart A—Minimum Capital
Requirements, subpart B—Prompt
Corrective Action and appendices A
through D, as the rules contained
therein have been superseded by part
324. Under the final rule, the annual
stress testing rule will remain in part
325. Part 325 will be retitled to Annual
Stress Test and the stress testing rule
will be renumbered to reflect the
removed capital rules. Similarly, the
final rule removes the superseded
capital rules contained in part 390
subpart Y—Prompt Corrective Action
and part 390, subpart Z—Capital and
related appendices. Under the final rule,
sections in part 390 that are not
removed will remain codified in part
390, including certain enforcement
authorities related to savings
association’s capital requirements. The
final rule also makes conforming
technical changes to provisions of the
FDIC’s codified rules that refer to part
325 for state nonmember banks and
subparts Y and Z of part 390 for state
savings associations in conjunction with
the FDIC’s capital rules. However, this
final rule does not impact the legal
1 79
PO 00000
FR 20754 (April 14, 2014).
Frm 00001
Fmt 4700
Sfmt 4700
status of any reference to the superseded
capital rules in outstanding compliance
and enforcement orders, agreements,
and memoranda of understanding
entered into by the FDIC prior to the
effective date of this final rule.
Regardless of whether an outstanding
enforcement order refers to the
superseded capital rule, all FDICsupervised institutions are subject to the
revised capital rule and must be in
compliance with the minimum capital
requirements in part 324.2
III. Administrative Procedure Act
The Administrative Procedure Act
(APA) does not require an agency to
publish a notice of proposed rulemaking
(NPR) in the Federal Register if an
‘‘agency for good cause finds (and
incorporates the finding and a brief
statement of reasons therefor in the
rules issued) that notice and public
procedure thereon are impracticable,
unnecessary, or contrary to the public
interest.’’ 3 The FDIC finds that for
purposes of the rescission of the
superseded capital rules, good cause
exists to not publish a notice of
proposed rulemaking in the Federal
Register and, therefore, is issuing this
rule as a final rule. The FDIC believes
that a notice of proposed rulemaking is
unnecessary for such purposes because
the FDIC published three NPRs and an
interim final rule for comment before
issuing the revised capital rules in
2014.4 The comment period for those
NPRs and interim final rule provided
sufficient public notice that the revised
2 Generally FDIC-supervised institutions can
demonstrate compliance with outstanding
enforcement orders referencing the superseded
capital rule by calculating their capital ratios under
the revised capital rule. The FDIC made a finding
during the interagency capital rulemaking process
in 2013 that the revised capital rule is more
stringent than the superseded capital rule.
Therefore, an FDIC-supervised institution subject to
an enforcement order under the superseded capital
rule may demonstrate its compliance using its ratios
as calculated under the revised capital rule.
3 5 U.S.C. 553(b).
4 Concerning the NPRs for the revised capital
rules, see 77 FR 52792 (August 30, 2012); 77 FR
52888 (August 30, 2012); 77 FR 52978 (August 30,
2012). The interim final rule for the revised capital
rules was issued in September 10, 2013 (78 FR
55340). In the preamble to the interim final rule, the
FDIC stated: ‘‘The interim final rule will replace the
FDIC’s general risk-based capital rules, advanced
approaches rule, market risk rule, and leverage
rules in accordance with the transition provisions
described below.’’ Also, section 324.1(f) of the
revised capital rules states the timing for the
implementation of the revised capital rules. See 12
CFR 324.1(f).
E:\FR\FM\24APR1.SGM
24APR1
17738
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules and Regulations
capital rules would replace the
superseded capital rules for all FDICsupervised institutions as of January 1,
2015. This final rule solely removes the
obsolete provisions of, and references
to, the superseded capital rules in the
CFR and imposes no new requirement
on FDIC-supervised institutions.
Accordingly, the FDIC concludes that
good cause exists to publish the rule as
final without a notice and opportunity
to comment.
Section 553(d)(3) of the APA provides
that, for good cause found and
published with the rule, an agency does
not have to comply with the
requirement that a substantive rule be
published not less than 30 days before
its effective date.5 The final rule will be
effective immediately upon its
publication in the Federal Register. The
FDIC invokes the good cause exception
to the APA’s 30-day publication
requirement for the reasons discussed
above.
to, an information collection unless it
displays a currently valid Office of
Management and Budget (OMB) control
number. The FDIC reviewed the rule
and determined that it does not create
any new, or revise any existing,
collection of information under section
3504(h) of the Paperwork Reduction Act
of 1980. Consequently, no information
collection request will be submitted to
the OMB for review.
IV. Regulatory Analyses
The FDIC has determined that the
final rule will not affect family wellbeing within the meaning of section 654
of the Treasury and General
Government Appropriations Act,
enacted as part of the Omnibus
Consolidated and Emergency
Supplemental Appropriations Act of
1999 (Pub. L. 105–277, 112 Stat. 2681).
A. Regulatory Flexibility Act
jstallworth on DSKBBY8HB2PROD with RULES
The Regulatory Flexibility Act, 5
U.S.C. 601 et seq. (RFA), requires an
agency, in connection with a notice of
proposed rulemaking, to prepare an
Initial Regulatory Flexibility Analysis
describing the impact of the proposed
rule on small entities (defined by the
Small Business Administration for
purposes of the RFA to include banking
entities with total assets of $550 million
or less) or to certify that the proposed
rule would not have a significant
economic impact on a substantial
number of small entities. The RFA also
requires an agency, in connection with
a final rule, to prepare a Final
Regulatory Flexibility Act (FRFA)
analysis describing the impact of the
final rule on small entities. Neither an
IRFA nor FRFA is required, however, if
the rule is issued under the APA
provision allowing the agency to forego
notice and comment rulemaking for
good cause. Therefore, the FDIC has not
prepared either an IRFA or an FRFA in
connection with this final rule.
Nevertheless, the FDIC notes that the
final rule does not impose any burden
on small banking entities as it only
rescinds obsolete provisions in the
FDIC’s CFR.
B. Paperwork Reduction Act
In accordance with the requirements
of the Paperwork Reduction Act of 1995
(44 U.S.C. 3501–3521), the FDIC may
not conduct or sponsor, and a
respondent is not required to respond
55
U.S.C. 553(d)(3).
VerDate Sep<11>2014
14:18 Apr 23, 2018
C. Small Business Regulatory
Enforcement Fairness Act
The Office of Management and Budget
has determined that the final rule is not
a ‘‘major rule’’ within the meaning of
the Small Business Regulatory
Enforcement Fairness Act of 1996 (Title
II, Pub. L. 104–121).
D. The Treasury and General
Government Appropriations Act, 1999—
Assessment of Federal Regulations and
Policies on Families
E. Plain Language
Section 722 of the Gramm-LeachBliley Act requires the federal banking
agencies to use plain language in all
final rules published after January 1,
2000. The FDIC has sought to present
the final rule in a simple and
straightforward manner.
F. Riegle Community Development and
Regulatory Improvement Act of 1994
Under the Riegle Community
Development and Regulatory
Improvement Act of 1994, 12 U.S.C.
4802, (RCDRIA), there is a requirement
that ‘‘[n]ew regulations and
amendments to regulations prescribed
by a Federal banking agency which
impose additional reporting,
disclosures, or other new requirements
on insured depository institutions shall
take effect on the first day of a calendar
quarter which begins on or after the date
on which the regulations are published
in final form’’ absent a good cause
determination by the agency.6 The final
rule imposes no additional reporting,
disclosure, or other new requirements
on insured depository institutions and
therefore is not subject to the effective
date requirement in RCDRIA.
6 12
Jkt 244001
PO 00000
U.S.C. 4802(b).
Frm 00002
Fmt 4700
Sfmt 4700
List of Subjects
12 CFR Part 303
Administrative practice and
procedure, Bank deposit insurance,
Banks, banking, Reporting and
recordkeeping requirements, Savings
associations.
12 CFR Part 308
Administrative practice and
procedure, Bank deposit insurance,
Banks, banking, Claims, Crime, Equal
access to justice, Fraud, Investigations,
Lawyers, Penalties.
12 CFR Part 324
Administrative practice and
procedure, Banks, banking, Reporting
and recordkeeping requirements,
Savings associations.
12 CFR Part 325
Banks, banking, Reporting and
recordkeeping requirement.
12 CFR Part 327
Bank deposit insurance, Banks,
banking, Savings associations.
12 CFR Part 333
Banks, banking.
12 CFR Part 337
Banks, banking, Reporting and
recordkeeping requirements, Securities.
12 CFR Part 347
Authority delegations (Government
agencies), Bank deposit insurance,
Banks, banking, Credit, Foreign banking,
Investments, Reporting and
recordkeeping requirements, U.S.
Investments abroad.
12 CFR Part 349
Administrative practice and
procedure, Banks, banking, Holding
companies, Reporting and
recordkeeping requirements, Savings
associations, Swaps.
12 CFR Part 360
Savings associations.
12 CFR Part 362
Administrative practice and
procedure, Authority delegations
(Government agencies), Bank deposit
insurance, Banks, banking, Investments,
Reporting and recordkeeping
requirements.
12 CFR Part 363
Accounting, Administrative practice
and procedure, Banks, banking,
Reporting and recordkeeping
requirements.
12 CFR Part 364
Banks, banking, Information.
E:\FR\FM\24APR1.SGM
24APR1
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules and Regulations
12 CFR Part 365
Banks, banking, Mortgages.
12 CFR Part 390
Administrative practice and
procedure, Advertising, Aged, Civil
rights, Conflict of interests, Credit,
Crime, Equal employment opportunity,
Fair housing, Government employees,
Individuals with disabilities, Reporting
and recordkeeping requirements,
Savings associations.
§ 303.184 Moving an insured branch of a
foreign bank.
1829, 1829b, 1831i, 1831m(g)(4), 1831o,
1831p–1, 1832(c), 1884(b), 1972, 3102,
3108(a), 3349, 3909, 4717, 5412(b)(2)(C),
5414(b)(3); 15 U.S.C. 78(h) and (i), 78o(c)(4),
78o–4(c), 78o–5, 78q–1, 78s, 78u, 78u–2,
78u–3, 78w, 6801(b), 6805(b)(1); 28 U.S.C.
2461 note; 31 U.S.C. 330, 5321; 42 U.S.C.
4012a; Pub.L. 104–134, sec. 3100(s), 110 Stat.
1321; Pub.L. 109–351, 120 Stat. 1966; Pub. L.
111–203, 124 Stat. 1376; Pub.L. 114–74, sec.
701, 129 Stat. 584.
*
■
(4) Is well-capitalized as defined in
subpart H of part 324 of this chapter;
and
*
*
*
*
*
■ 5. Section 303.184 is amended by
revising paragraph (d)(1)(ii) to read as
follows:
For the reasons stated in the
preamble, the Federal Deposit Insurance
Corporation amends 12 CFR parts 303,
308, 324, 325, 327, 333, 337, 347, 349,
360, 362, 363, 364, 365, and 390 as
follows:
*
*
*
*
(d) * * *
(1) * * *
(ii) The applicant is at least
adequately capitalized as defined in
subpart H of part 324 of this chapter;
*
*
*
*
*
■ 6. Section 303.200 is amended by
revising paragraphs (a)(2) and (b) to read
as follows:
PART 303—FILING PROCEDURES
§ 303.200
Authority and Issuance
1. The authority citation for part 303
continues to read as follows:
■
Authority: 12 U.S.C. 378, 1464, 1813, 1815,
1817, 1818, 1819(a) (Seventh and Tenth),
1820, 1823, 1828, 1831a, 1831e, 1831o,
1831p–1, 1831w, 1835a, 1843(l), 3104, 3105,
3108, 3207; 5414; 15 U.S.C. 1601–1607.
2. Section 303.2 is amended by
revising paragraphs (b), (ee), and (ff) to
read as follows:
■
§ 303.2
Definitions.
*
*
*
*
*
(b) Adjusted part 324 total assets
means adjusted 12 CFR part 324 total
assets as calculated and reflected in the
FDIC’s Report of Examination.
*
*
*
*
*
(ee) Tier 1 capital shall have the same
meaning as provided in § 324.2 of this
chapter.
(ff) Total assets shall have the same
meaning as provided in § 324.401(g) of
this chapter.
*
*
*
*
*
■ 3. Section 303.64 is amended by
revising paragraph (a)(4)(i) to read as
follows:
jstallworth on DSKBBY8HB2PROD with RULES
§ 303.64
Processing.
(a) * * *
(4) * * *
(i) Immediately following the merger
transaction, the resulting institution will
be well-capitalized pursuant to subpart
H of part 324 of this chapter (12 CFR
part 324); and
*
*
*
*
*
■ 4. Section 303.181 is amended by
revising paragraph (c)(4) to read as
follows:
§ 303.181
*
Definitions.
*
*
(c) * * *
VerDate Sep<11>2014
*
14:18 Apr 23, 2018
Scope.
(a) * * *
(2) Definitions of the capital
categories referenced in this Prompt
Corrective Action subpart may be found
in subpart H of part 324 of this chapter.
(b) Institutions covered. Restrictions
and prohibitions contained in subpart H
of part 324 of this chapter apply
primarily to state nonmember banks and
insured branches of foreign banks, as
well as to directors and senior executive
officers of those institutions. Portions of
subpart H of part 324 of this chapter
also apply to all insured depository
institutions that are deemed to be
critically undercapitalized.
*
*
*
*
*
■ 7. Section 303.241 is amended by
revising paragraph (c)(4) to read as
follows:
§ 303.241 Reduce or retire capital stock or
capital debt instruments.
*
*
*
*
*
(c) * * *
(4) If the proposal involves a series of
transactions affecting Tier 1 capital
components which will be
consummated over a period of time
which shall not exceed twelve months,
the application shall certify that the
insured depository institution will
maintain itself as a well-capitalized
institution as defined in part 324 of this
chapter both before and after each of the
proposed transactions;
*
*
*
*
*
PART 308—RULES OF PRACTICE AND
PROCEDURE
8. The authority citation for part 308
continues to read as follows:
■
Authority: 5 U.S.C. 504, 554–557; 12
U.S.C. 93(b), 164, 505, 1464, 1467(d), 1467a,
1468, 1815(e), 1817, 1818, 1819, 1820, 1828,
*
Jkt 244001
17739
PO 00000
Frm 00003
Fmt 4700
Sfmt 4700
9. Section 308.200 is revised to read
as follows:
§ 308.200
Scope.
The rules and procedures set forth in
this subpart apply to banks, insured
branches of foreign banks and senior
executive officers and directors of banks
that are subject to the provisions of
section 38 of the Federal Deposit
Insurance Act (section 38) (12 U.S.C.
1831o) and subpart H of part 324 of this
chapter.
■ 10. Section 308.202 is amended by
revising paragraphs (a)(1)(i)(A) and
(a)(1)(ii) to read as follows:
§ 308.202 Procedures for reclassifying a
bank based on criteria other than capital.
(a) * * *
(1) * * *
(i) Grounds for reclassification. (A)
Pursuant to § 324.403(d) of this chapter,
the FDIC may reclassify a wellcapitalized bank as adequately
capitalized or subject an adequately
capitalized or undercapitalized
institution to the supervisory actions
applicable to the next lower capital
category if:
(1) The FDIC determines that the bank
is in unsafe or unsound condition; or
(2) The FDIC, pursuant to section
8(b)(8) of the FDI Act (12 U.S.C.
1818(b)(8)), deems the bank to be
engaged in an unsafe or unsound
practice and not to have corrected the
deficiency.
*
*
*
*
*
(ii) Prior notice to institution. Prior to
taking action pursuant to § 324.403(d) of
this chapter, the FDIC shall issue and
serve on the bank a written notice of the
FDIC’s intention to reclassify it.
*
*
*
*
*
■ 11. Section 308.204 is amended by
revising paragraphs (b)(2) and (c) to read
as follows:
§ 308.204
Enforcement of directives.
*
*
*
*
*
(b) * * *
(2) Failure to implement capital
restoration plan. The failure of a bank
to implement a capital restoration plan
required under section 38, or subpart H
of part 324 of this chapter, or the failure
of a company having control of a bank
E:\FR\FM\24APR1.SGM
24APR1
17740
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules and Regulations
to fulfill a guarantee of a capital
restoration plan made pursuant to
section 38(e)(2) of the FDI Act shall
subject the bank to the assessment of
civil money penalties pursuant to
section 8(i)(2)(A) of the FDI Act.
(c) Other enforcement action. In
addition to the actions described in
paragraphs (a) and (b) of this section,
the FDIC may seek enforcement of the
provisions of section 38 or subpart H of
part 324 of this chapter through any
other judicial or administrative
proceeding authorized by law.
*
*
*
*
*
PART 324—CAPITAL ADEQUACY OF
FDIC-SUPERVISED INSTITUTIONS
12. The authority citation for part 324
continues to read as follows:
■
Authority: 12 U.S.C. 1815(a), 1815(b),
1816, 1818(a), 1818(b), 1818(c), 1818(t),
1819(Tenth), 1828(c), 1828(d), 1828(i),
1828(n), 1828(o), 1831o, 1835, 3907, 3909,
4808; 5371; 5412; Pub.L. 102–233, 105 Stat.
1761, 1789, 1790 (12 U.S.C. 1831n note);
Pub.L. 102–242, 105 Stat. 2236, 2355, as
amended by Pub.L. 103–325, 108 Stat. 2160,
2233 (12 U.S.C. 1828 note); Pub.L. 102–242,
105 Stat. 2236, 2386, as amended by Pub.L.
102–550, 106 Stat. 3672, 4089 (12 U.S.C.
1828 note); Pub.L. 111–203, 124 Stat. 1376,
1887 (15 U.S.C. 78o–7 note).
§§ 325.201 through 325.207
as §§ 325.1 through 325.7]
[Redesignated
18. Redesignate §§ 325.201 through
325.207 as §§ 325.1 through 325.7,
respectively.
■ 19. Amend newly redesignated
§ 325.1 by revising paragraph (c)(5) to
read as follows:
■
*
*
*
*
*
(b) * * *
(2) * * *
(iii) * * *
22 These rules include the regulatory
capital requirements set forth at 12 CFR
part 3 (OCC); 12 CFR part 217 (Board);
12 CFR part 324 (FDIC).
*
*
*
*
*
*
*
*
*
*
(c) * * *
(5) Notice and comment procedures:
In exercising its authority to require
different or additional stress tests and
different or additional scenarios
(including components for the
scenarios) under paragraph (c)(2) of this
section, the Corporation will apply
notice and response procedures in the
same manner and to the same extent as
the notice and response procedures in
12 CFR 324.5, as appropriate.
*
*
*
*
*
PART 337—UNSAFE AND UNSOUND
BANKING PRACTICES
PART 327—ASSESSMENTS
■
26. The authority citation for part 337
continues to read as follows:
Authority: 12 U.S.C. 375a(4), 375b,
1463(a)(1), 1816, 1818(a), 1818(b), 1819,
1820(d), 1828(j)(2), 1831, 1831f, 5412.
■
21. The authority citation for part 327
continues to read as follows:
22. Appendix A to subpart A of part
327 is amended by revising footnote 5
in section VI to read as follows:
§ 337.6
*
*
*
*
*
*
VI. * * *
5 Market risk is defined in 12 CFR 324.202.
Appendix C to Subpart A to Part 327—
Description of Concentration Measures
Authority: 12 U.S.C. 5365(i)(2), 12 U.S.C.
5412(b)(2)(C), 12 U.S.C. 1818, 12 U.S.C.
1819(a)(Tenth), 12 U.S.C. 1831o, and 12
U.S.C. 1831p–1.
I. * * *
A. * * *
5. * * *
Higher-risk securitizations are defined as
securitization exposures (except
securitizations classified as trading book),
where, in aggregate, more than 50 percent of
the assets backing the securitization meet
either the criteria for higher-risk C & I loans
or securities, higher-risk consumer loans, or
nontraditional mortgage loans, except those
classified as trading book. A securitization
exposure is as defined in 12 CFR 324.2, as
it may be amended from time to time. * * *
15. The heading for part 325 is revised
to read as set forth above.
■
Subparts A and B [Removed]
16. Remove subparts A and B.
Subpart C [Amended]
17. Remove the heading for subpart C.
27. Section 337.6 is amended by
revising footnote 12 in paragraph
(a)(3)(i) and the second sentence in
footnote 13 in paragraph (a)(3)(iii) to
read as follows:
■
Appendix A to Subpart A of Part 327—
Method to Derive Pricing Multipliers
and Uniform Amount
14. The authority citation for part 325
continues to read as follows:
jstallworth on DSKBBY8HB2PROD with RULES
Conversions from mutual to stock
20. Remove appendices A, B, C, and
D.
■
■
Jkt 244001
§ 333.4
form.
Appendices A, B, C, and D [Removed]
PART 325—ANNUAL STRESS TEST
14:18 Apr 23, 2018
25. Section 333.4 is amended by
revising the fourth sentence in
paragraph (a) to read as follows:
(a) Scope. * * * As determined by
the Board of Directors of the FDIC on a
case-by-case basis, the requirements of
paragraphs (d), (e), and (f) of this section
do not apply to mutual-to-stock
conversions of insured mutual state
savings banks whose capital category
under § 324.403 of this chapter is
‘‘undercapitalized’’, ‘‘significantly
undercapitalized’’ or ‘‘critically
undercapitalized’’. * * *
*
*
*
*
*
23. Appendix C to subpart A of part
327 is amended by revising the
appendix heading and the first and
second sentences in the first paragraph
in section I.A.5 to read as follows:
VerDate Sep<11>2014
Authority: 12 U.S.C. 1816, 1818, 1819
(‘‘Seventh’’, ‘‘Eighth’’ and ‘‘Tenth’’), 1828,
1828(m), 1831p–1(c).
■
§ 325.1 Authority, purpose, and
reservation of authority.
■
§ 324.22 Regulatory capital adjustments
and deductions.
■
24. The authority citation for part 333
continues to read as follows:
■
Authority: 12 U.S.C. 1441, 1813, 1815,
1817–19, 1821.
13. Section 324.22 is amended by
revising footnote 22 in paragraph
(b)(2)(iii) to read as follows:
■
■
PART 333—EXTENSION OF
CORPORATE POWERS
■
*
PO 00000
*
*
Frm 00004
*
Fmt 4700
*
Sfmt 4700
Brokered deposits.
*
*
*
*
(a) * * *
(3) * * *
(i) * * *
12 For the most part, the capital
measure terms are defined in the
following regulations: FDIC—12 CFR
part 324, subpart H; Board of Governors
of the Federal Reserve System—12 CFR
part 208; and Office of the Comptroller
of the Currency—12 CFR part 6.
*
*
*
*
*
(iii) * * *
13 * * * Provisions specifying the
effective date of determination of capital
category are generally published in the
following regulations: FDIC—12 CFR
324.402; Board of Governors of the
Federal Reserve System—12 CFR part
208, subpart D; and Office of the
Comptroller of the Currency—12 CFR
6.3.
*
*
*
*
*
E:\FR\FM\24APR1.SGM
24APR1
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules and Regulations
PART 347—INTERNATIONAL
BANKING
28. The authority citation for part 347
continues to read as follows:
■
Authority: 12 U.S.C. 1813, 1815, 1817,
1819, 1820(d), 1828, 3103, 3104, 3105, 3108,
3109; Title IX, Pub. L. 98–181, 97 Stat. 1153
(12 U.S.C. 3901 et seq.).
29. Section 347.102 is amended by
revising paragraphs (u) and (v) to read
as follows:
■
§ 347.102
Definitions.
*
*
*
*
*
(u) Tier 1 capital means Tier 1 capital
as defined in § 324.2 of this chapter.
(v) Well capitalized means well
capitalized as defined in § 324.403 of
this chapter.
Subpart B—Retail Foreign Exchange
Transactions
30. The authority citation for part 349,
subpart B, continues to read as follows:
■
Authority: 12 U.S.C. 1813(q), 1818, 1819,
and 3108; 7 U.S.C. 2(c)(2)(E), 27 et seq.
31. Section 349.20 is revised to read
as follows:
■
Capital requirements.
An FDIC-supervised insured
depository institution offering or
entering into retail forex transactions
must be well capitalized as defined by
12 CFR part 324, unless specifically
exempted by the FDIC in writing.
PART 360—RESOLUTION AND
RECEIVERSHIP RULES
32. The authority citation for part 360
continues to read as follows:
■
Authority: 12 U.S.C. 1821(d)(1),
1821(d)(10)(C), 1821(d)(11), 1821(e)(1),
1821(e)(8)(D)(i), 1823(c)(4), 1823(e)(2); Sec.
401(h), Pub. L. 101–73, 103 Stat. 357.
33. Section 360.5 is amended by
revising paragraph (b) to read as follows:
■
§ 360.5 Definition of qualified financial
contracts.
jstallworth on DSKBBY8HB2PROD with RULES
*
*
*
*
*
(b) Repurchase agreements. The
following agreements shall be deemed
‘‘repurchase agreements’’ under section
11(e)(8)(D)(v) of the Federal Deposit
Insurance Act, as amended (12 U.S.C.
1821(e)(8)(D)(v)): A repurchase
agreement on qualified foreign
government securities is an agreement
or combination of agreements (including
master agreements) which provides for
the transfer of securities that are direct
obligations of, or that are fully
guaranteed by, the central governments
VerDate Sep<11>2014
14:18 Apr 23, 2018
34. Section 360.9 is amended by
revising paragraph (e)(6) to read as
follows:
■
§ 360.9 Large-bank deposit insurance
determination modernization.
*
PART 349—DERIVATIVES
§ 349.20
(as set forth at 12 CFR 324.2 (definition
of sovereign exposure), as may be
amended from time to time) of the
OECD-based group of countries (as
generally discussed in 12 CFR 324.32)
against the transfer of funds by the
transferee of such securities with a
simultaneous agreement by such
transferee to transfer to the transferor
thereof securities as described above, at
a date certain not later than one year
after such transfers or on demand,
against the transfer of funds.
*
*
*
*
*
Jkt 244001
*
*
*
*
(e) * * *
(6) Notwithstanding the general
requirements of this paragraph (e), on a
case-by-case basis, the FDIC may
accelerate, upon notice, the
implementation timeframe of all or part
of the requirements of this section for a
covered institution that: Has a
composite rating of 3, 4, or 5 under the
Uniform Financial Institution’s Rating
System, or in the case of an insured
branch of a foreign bank, an equivalent
rating; is undercapitalized, as defined
under the prompt corrective action
provisions of 12 CFR part 324; or is
determined by the appropriate Federal
banking agency or the FDIC in
consultation with the appropriate
Federal banking agency to be
experiencing a significant deterioration
of capital or significant funding
difficulties or liquidity stress,
notwithstanding the composite rating of
the institution by its appropriate Federal
banking agency in its most recent report
of examination. In implementing this
paragraph (e)(6), the FDIC must consult
with the covered institution’s primary
federal regulator and consider the:
Complexity of the institution’s deposit
systems and operations, extent of the
institution’s asset quality difficulties,
volatility of the institution’s funding
sources, expected near-term changes in
the institution’s capital levels, and other
relevant factors appropriate for the FDIC
to consider in its roles as insurer and
possible receiver of the institution.
*
*
*
*
*
PART 362—ACTIVITIES OF INSURED
STATE BANKS AND INSURED
SAVINGS ASSOCIATIONS
Authority: 12 U.S.C. 1816, 1818,
1819(a)(Tenth), 1828(j), 1828(m), 1828a,
1831a, 1831e, 1831w, 1843(l).
36. Section 362.2 is amended by
revising paragraphs (s) and (t) to read as
follows:
■
§ 362.2
Definitions.
*
*
*
*
*
(s) Tier one capital has the same
meaning as set forth in part 324 of this
chapter for an insured State nonmember
bank or insured state savings
association. For other state-chartered
depository institutions, the term ‘‘tier
one capital’’ has the same meaning as
set forth in the capital regulations
adopted by the appropriate Federal
banking agency.
(t) Well-capitalized has the same
meaning set forth in part 324 of this
chapter for an insured State nonmember
bank or insured state savings
association. For other state-chartered
depository institutions, the term ‘‘wellcapitalized’’ has the same meaning as
set forth in the capital regulations
adopted by the appropriate Federal
banking agency.
■ 37. Section 362.4 is amended by
revising paragraph (e)(3) to read as
follows:
§ 362.4
banks.
Subsidiaries of insured State
*
*
*
*
*
(e) * * *
(3) Use such regulatory capital
amount for the purposes of the bank’s
assessment risk classification under part
327 of this chapter and its categorization
as a ‘‘well-capitalized’’, an ‘‘adequately
capitalized’’, an ‘‘undercapitalized’’, or
a ‘‘significantly undercapitalized’’
institution as defined in § 324.403(b) of
this chapter, provided that the capital
deduction shall not be used for
purposes of determining whether the
bank is ‘‘critically undercapitalized’’
under part 324 of this chapter.
■ 38. Section 362.17 is amended by
revising paragraph (d) to read as
follows:
§ 362.17
Definitions.
*
*
*
*
*
(d) Tangible equity and Tier 2 capital
have the same meaning as set forth in
part 324 of this chapter.
*
*
*
*
*
PART 363—ANNUAL INDEPENDENT
AUDITS AND REPORTING
REQUIREMENTS
39. The authority citation for part 363
continues to read as follows:
■
35. The authority citation for part 362
continues to read as follows:
■
PO 00000
Frm 00005
Fmt 4700
Sfmt 4700
17741
Authority: 12 U.S.C. 1831m.
E:\FR\FM\24APR1.SGM
24APR1
17742
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules and Regulations
40. Appendix A to part 363 is
amended by revising Table 1 to
Appendix A to read as follows:
Appendix A to Part 363—Guidelines
and Interpretations
■
*
*
*
*
*
TABLE 1 TO APPENDIX A—DESIGNATED FEDERAL LAWS AND REGULATIONS APPLICABLE TO:
State
non-member
banks
State member
banks
National banks
Savings
associations
Insider Loans—Parts and/or Sections of Title 12 of the United States Code
375a ...............................
375b ...............................
1468(b) ..........................
1828(j)(2) .......................
1828(j)(3)(B) ..................
Loans to Executive Officers of Banks .................
Extensions of Credit to Executive Officers, Directors, and Principal Shareholders of Banks.
Extensions of Credit to Executive Officers, Directors, and Principal Shareholders.
Extensions of Credit to Officers, Directors, and
Principal Shareholders.
Extensions of Credit to Officers, Directors, and
Principal Shareholders.
√
√
√
√
(A)
(A)
(A)
(A)
........................
........................
........................
√
........................
........................
√
........................
(B)
........................
(C)
........................
Parts and/or Sections of Title 12 of the Code of Federal Regulations
31 ...................................
32 ...................................
215 .................................
337.3 ..............................
390.338 (state savings
associations).
Extensions of Credit to Insiders ..........................
Lending Limits .....................................................
Loans to Executive Officers, Directors, and Principal Shareholders of Member Banks.
Limits on Extensions of Credit to Executive Officers, Directors, and Principal Shareholders of
Insured Nonmember Banks.
Loans by Savings Associations to Their Executive Officers, Directors, and Principal Shareholders.
√
√
√
........................
........................
√
........................
........................
(D)
........................
........................
(E)
........................
........................
√
........................
........................
........................
........................
√
Dividend Restrictions—Parts and/or Sections of Title 12 of the United States Code
56 ...................................
60 ...................................
1467a(f) .........................
1831o(d)(1) ....................
Prohibition on Withdrawal of Capital and Unearned Dividends.
Dividends and Surplus Fund ...............................
Declaration of Dividend .......................................
Prompt Corrective Action—Capital Distributions
Restricted.
√
√
........................
........................
√
........................
√
√
........................
√
........................
........................
√
........................
√
√
Parts and/or Sections of Title 12 of the Code of Federal Regulations
5 Subpart E ...................
6.6 ..................................
208.5 ..............................
208.45 ............................
324.405 ..........................
390.342–.348 (state savings associations).
390.455 (state savings
associations).
Payment of Dividends .........................................
Prompt Corrective Action—Restrictions on
Undercapitalized Institutions.
Dividends and Other Distributions .......................
Prompt Corrective Action—Restrictions on
Undercapitalized Institutions.
Prompt Corrective Action—Restrictions on
Undercapitalized Institutions.
Capital Distributions .............................................
Prompt Corrective Action—Restrictions
Undercapitalized Institutions.
on
√
√
........................
........................
........................
........................
........................
........................
........................
........................
√
√
........................
........................
........................
........................
........................
........................
√
........................
........................
........................
........................
√
........................
........................
........................
√
(A) Subsections (g) and (h) of section 22 of the Federal Reserve Act [12 U.S.C. 375a, 375b]
(B) Applies only to insured Federal branches of foreign banks.
(C) Applies only to insured State branches of foreign banks.
(D) See 12 CFR 337.3.
(E) See 12 CFR 390.338 (state savings associations).
jstallworth on DSKBBY8HB2PROD with RULES
PART 364—STANDARDS FOR SAFETY
AND SOUNDNESS
41. The authority citation in part 364
continues to read as follows:
■
Authority: 12 U.S.C. 1818 and 1819
(Tenth), 1831p–1; 15 U.S.C. 1681b, 1681s,
1681w, 6801(b), 6805(b)(1).
VerDate Sep<11>2014
14:18 Apr 23, 2018
Jkt 244001
42. Appendix A to part 364 is
amended by revising the last sentence in
section I.A. to read as follows:
■
Appendix A to Part 364—Interagency
Guidelines Establishing Standards for
Safety and Soundness
*
*
*
*
A. * * *
* * * Nothing in these Guidelines limits
the authority of the FDIC pursuant to section
38(i)(2)(F) of the FDI Act (12 U.S.C. 1831o)
and part 324 of title 12 of the Code of Federal
Regulations.
*
*
*
*
I. * * *
PO 00000
Frm 00006
Fmt 4700
Sfmt 4700
E:\FR\FM\24APR1.SGM
24APR1
*
*
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules and Regulations
PART 365—REAL ESTATE LENDING
STANDARDS
43. The authority citation for part 365
continues to read as follows:
■
Authority: 12 U.S.C. 1828(o) and 5101 et
seq.
44. Appendix A to subpart A of part
365 is amended by revising footnote 2
to the ‘‘Loans in Excess of the
Supervisory Loan-to-Value Limits’’
section to read as follows:
■
Appendix A to Subpart A of Part 365—
Interagency Guidelines for Real Estate
Lending Policies
*
*
*
*
*
Loans in Excess of the Supervisory
Loan-to-Value Limits
*
*
*
*
*
2 For state non-member banks and
state savings associations, ‘‘total
capital’’ refers to that term described in
12 CFR 324.2.
*
*
*
*
*
PART 390—REGULATIONS
TRANSFERRED FROM THE OFFICE OF
THRIFT SUPERVISION
45. The authority citation for part 390
is revised to read as follows:
■
Authority: 12 U.S.C. 1819.
§ 390.101
[Amended]
46. Section 390.101 is amended in
paragraph (f) by removing ‘‘subpart Z’’
and adding in its place ‘‘12 CFR part
324.’’
■
47. Section 390.264 is revised to read
as follows:
■
§ 390.264 Real estate lending standards;
purpose and scope.
This section, and § 390.265, issued
pursuant to section 18(o) of the Federal
Deposit Insurance Act, (12 U.S.C.
1828(o)), prescribe standards for real
estate lending to be used by State
savings associations and all their
includable subsidiaries, as defined in
part 324 of this chapter, over which the
State savings associations exercise
control, in adopting internal real estate
lending policies.
■ 48. The appendix to § 390.265 is
amended by revising footnote 4 to read
as follows:
jstallworth on DSKBBY8HB2PROD with RULES
§ 390.265
*
*
Real estate lending standards.
*
*
*
Appendix to § 390.265—Interagency
Guidelines for Real Estate Lending
Policies
*
*
*
*
*
For the state member banks, the term
‘‘total capital’’ is defined at 12 CFR 217.2. For
4
VerDate Sep<11>2014
14:18 Apr 23, 2018
Jkt 244001
insured state non-member banks, the term
‘‘total capital’’ is defined at 12 CFR 324.2. For
national banks, the term ‘‘total capital’’ is
defined at 12 CFR 3.2. For state savings
associations, the term ‘‘total capital’’ is
defined at 12 CFR 324.2.
*
*
*
*
*
49. Section 390.316 is amended by
revising paragraph (c) to read as follows:
■
§ 390.316
With recourse.
*
*
*
*
*
(c) This definition does not apply for
purposes of determining the capital
adequacy requirements under part 324
of this chapter.
50. Section 390.341 is amended by
revising paragraphs (a), (c)(1)(i)(G), and
(d)(2)(ii) to read as follows:
■
§ 390.341 Inclusion of subordinated debt
securities and mandatorily redeemable
preferred stock as supplementary capital.
(a) Scope. A State savings association
must comply with this section in order
to include subordinated debt securities
or mandatorily redeemable preferred
stock (‘‘covered securities’’) in
supplementary capital (tier 2 capital)
under part 324 of this chapter. If a State
savings association does not include
covered securities in supplementary
capital, it is not required to comply with
this section.
*
*
*
*
*
(c) * * *
(1) * * *
(i) * * *
(G) State or refer to a document
stating that the State savings association
must obtain FDIC approval before the
voluntarily prepayment of principal on
subordinated debt securities, the
acceleration of payment of principal on
subordinated debt securities, or the
voluntarily redemption of mandatorily
redeemable preferred stock (other than
scheduled redemptions), if the State
savings association is undercapitalized,
significantly undercapitalized, or
critically undercapitalized as described
in subpart H of part 324 of this chapter,
fails to meet the regulatory capital
requirements in part 324, or would fail
to meet any of these standards following
the payment.
*
*
*
*
*
(d) * * *
(2) * * *
(ii) The State savings association is at
least adequately capitalized under
subpart H of part 324 of this chapter and
meets the regulatory capital
requirements in part 324.
*
*
*
*
*
■ 51. Section 390.343 is amended by
revising paragraphs (b) and (d) to read
as follows:
PO 00000
Frm 00007
Fmt 4700
Sfmt 4700
§ 390.343
17743
What is a capital distribution?
*
*
*
*
*
(b) Your payment to repurchase,
redeem, retire or otherwise acquire any
of your shares or other ownership
interests, any payment to repurchase,
redeem, retire, or otherwise acquire debt
instruments included in your total
capital under part 324 of this chapter,
and any extension of credit to finance
an affiliate’s acquisition of your shares
or interests;
*
*
*
*
*
(d) Any other distribution charged
against your capital accounts if you
would not be well capitalized, as set
forth in subpart H of part 324 of this
chapter, following the distribution; and
*
*
*
*
*
■ 52. Section 390.344 is amended by
revising the definition of Capital to read
as follows:
§ 390.344 Definitions applicable to capital
distributions.
*
*
*
*
*
Capital means total capital, as
computed under part 324 of this
chapter.
*
*
*
*
*
§ 390.345
[Amended]
53. Section 390.345 is amended as
follows:
■ a. In paragraph (a)(3), by removing
‘‘§ 390.453(b)(2)’’ and adding in its place
‘‘subpart H of part 324 of this chapter.’’
■ b. In paragraph (b), by removing
‘‘§ 390.453(b)(1)’’ and ‘‘subpart Z’’
wherever they appear and add in their
place ‘‘subpart H of part 324 of this
chapter.’’
■
54. Section 390.348 is amended by
revising paragraph (a) to read as follows:
■
§ 390.348 Will the FDIC permit my capital
distribution?
*
*
*
*
*
(a) You will be undercapitalized,
significantly undercapitalized, or
critically undercapitalized as set forth in
subpart H of part 324 of this chapter,
following the capital distribution. If so,
the FDIC will determine if your capital
distribution is permitted under 12
U.S.C. 1831o(d)(1)(B).
*
*
*
*
*
■ 55. Section 390.362 is amended by
revising paragraphs (a)(1)(i) and (iii) to
read as follows:
§ 390.362
Who must give prior notice?
(a) * * *
(1) * * *
(i) You do not comply with all
minimum capital requirements under
part 324 of this chapter;
*
*
*
*
*
E:\FR\FM\24APR1.SGM
24APR1
17744
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules and Regulations
(iii) The FDIC has notified you, in
connection with its review of a capital
restoration plan required under section
38 of the Federal Deposit Insurance Act
or subpart H of part 324 of this chapter
or otherwise, that a notice is required
under §§ 390.360 through 390.368; or
*
*
*
*
*
§§ 390.450 through 390.455
Reserved]
[Removed and
56. Remove and reserve §§ 390.450
through 390.455.
■
(a) * * *
(1) * * *
(i) * * *
(A) Pursuant to § 324.403(d) of this
chapter, the FDIC may reclassify a well
capitalized State savings association as
adequately capitalized or subject an
adequately capitalized or
undercapitalized institution to the
supervisory actions applicable to the
next lower capital category if:
(1) The FDIC determines that the State
savings association is in unsafe or
unsound condition; or
(2) The FDIC deems the State savings
association to be engaged in an unsafe
or unsound practice and not to have
corrected the deficiency.
*
*
*
*
*
(ii) Prior notice to institution. Prior to
taking action pursuant to § 324.403(d) of
this chapter, the FDIC shall issue and
serve on the State savings association a
written notice of the FDIC’s intention to
reclassify the State savings association.
*
*
*
*
*
Subpart Z—[Removed and Reserved]
jstallworth on DSKBBY8HB2PROD with RULES
[FR Doc. 2018–06881 Filed 4–23–18; 8:45 am]
BILLING CODE 6714–01–P
VerDate Sep<11>2014
14:18 Apr 23, 2018
Jkt 244001
[Docket No. FAA–2017–0637; Special
Conditions No. 25–724–SC]
Special Conditions: Textron Aviation
Inc. Model 700 Airplane; Occupant
Protection for Side-Facing Seats
Installed Forward of Aft-Facing Seats
These special conditions are
issued for the Textron Aviation Inc.
(Textron) Model 700 airplane. This
airplane will have a novel or unusual
design feature when compared to the
state of technology envisioned in the
airworthiness standards for transportcategory airplanes. This design feature
is side-facing seats installed forward of
aft-facing seats. The applicable
airworthiness regulations do not contain
adequate or appropriate safety standards
for this design feature. These special
conditions contain the additional safety
standards that the Administrator
considers necessary to establish a level
of safety equivalent to that established
by the existing airworthiness standards.
DATES: This action is effective on
Textron on April 24, 2018. Send your
comments by June 8, 2018.
ADDRESSES: Send comments identified
by docket number FAA–2017–0637
using any of the following methods:
• Federal eRegulations Portal: Go to
https://www.regulations.gov/and follow
the online instructions for sending your
comments electronically.
• Mail: Send comments to Docket
Operations, M–30, U.S. Department of
Transportation (DOT), 1200 New Jersey
Avenue SE, Room W12–140, West
Building Ground Floor, Washington,
DC, 20590–0001.
• Hand Delivery or Courier: Take
comments to Docket Operations in
Room W12–140 of the West Building
Ground Floor at 1200 New Jersey
Avenue SE, Washington, DC, between 9
a.m. and 5 p.m., Monday through
Friday, except Federal holidays.
• Fax: Fax comments to Docket
Operations at 202–493–2251.
Privacy: The FAA will post all
comments it receives, without change,
to https://www.regulations.gov/,
including any personal information the
commenter provides. Using the search
function of the docket website, anyone
can find and read the electronic form of
all comments received into any FAA
SUMMARY:
§ 390.457 Procedures for reclassifying a
State savings association based on criteria
other than capital.
Dated at Washington, DC, on March 20,
2018.
By order of the Board of Directors.
Federal Deposit Insurance Corporation.
Valerie Best,
Assistant Executive Secretary.
14 CFR Part 25
Federal Aviation
Administration (FAA), DOT.
ACTION: Final special conditions; request
for comments.
57. Section 390.457 is amended by
revising paragraphs (a)(1)(i)(A) and
(a)(1)(ii) to read as follows:
58. Remove and reserve subpart Z.
Federal Aviation Administration
AGENCY:
■
■
DEPARTMENT OF TRANSPORTATION
PO 00000
Frm 00008
Fmt 4700
Sfmt 4700
docket, including the name of the
individual sending the comment (or
signing the comment for an association,
business, labor union, etc.). DOT’s
complete Privacy Act Statement can be
found in the Federal Register published
on April 11, 2000 (65 FR 19477–19478).
Docket: Background documents or
comments received may be read at
https://www.regulations.gov/ at any time.
Follow the online instructions for
accessing the docket or go to Docket
Operations in Room W12–140 of the
West Building Ground Floor at 1200
New Jersey Avenue SE, Washington,
DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
FOR FURTHER INFORMATION CONTACT:
Alan Sinclair, FAA, Airframe and Cabin
Safety Section, AIR–675, Transport
Standards Branch, Policy and
Innovation Division, Aircraft
Certification Service, 1601 Lind Avenue
SW, Renton, Washington 98057–3356;
telephone 425–227–2195; facsimile
425–227–1320.
SUPPLEMENTARY INFORMATION: The
substance of these special conditions
has been published in the Federal
Register for public comment in several
prior instances with no substantive
comments received. The FAA therefore
finds it unnecessary to delay the
effective date and finds that good cause
exists for making these special
conditions effective upon publication in
the Federal Register.
Comments Invited
We invite interested people to take
part in this rulemaking by sending
written comments, data, or views. The
most helpful comments reference a
specific portion of the special
conditions, explain the reason for any
recommended change, and include
supporting data.
We will consider all comments we
receive by the closing date for
comments. We may change these special
conditions based on the comments we
receive.
Background
On November 20, 2014, Textron
applied for a type certificate for their
new Model 700 airplane. The Model 700
airplane is a turbofan-powered
executive-jet airplane with seating for
two crewmembers and 12 passengers.
This airplane will have a maximum
takeoff weight of 38,514 pounds.
Type Certification Basis
Under the provisions of title 14, Code
of Federal Regulations (14 CFR) 21.17,
Textron must show that the Model 700
airplane meets the applicable provisions
of 14 CFR part 25, as amended by
E:\FR\FM\24APR1.SGM
24APR1
]]>Agencies
[Federal Register Volume 83, Number 79 (Tuesday, April 24, 2018)]
[Rules and Regulations]
[Pages 17737-17744]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-06881]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
========================================================================
Federal Register / Vol. 83, No. 79 / Tuesday, April 24, 2018 / Rules
and Regulations
[[Page 17737]]
FEDERAL DEPOSIT INSURANCE CORPORATION
12 CFR Parts 303, 308, 324, 325, 327, 333, 337, 347, 349, 360, 362,
363, 364, 365, and 390
RIN 3064-AE51
Regulatory Capital Rules: Removal of Certain Capital Rules That
Are No Longer Effective Following the Implementation of the Revised
Capital Rules
AGENCY: Federal Deposit Insurance Corporation (FDIC).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule rescinds certain capital regulations of the
FDIC's codified rules (superseded capital rules) that were no longer
effective following the January 1, 2015 implementation of the revised
capital rules. The final rule also makes conforming changes to sections
in the FDIC's codified rules that refer to the superseded capital
rules. The FDIC has concluded that good cause exists to publish this
rule as final without a period of notice and comment and with an
effective date as of the date of its publication in the Federal
Register because this final rule rescinds the superseded capital rules
and other sections of the FDIC's codified rules that refer to the
superseded capital rules and imposes no new requirement on FDIC-
supervised institutions.
DATES: The final rule is effective April 24, 2018.
FOR FURTHER INFORMATION CONTACT: Benedetto Bosco, Chief, Capital Policy
Section; [email protected], Capital Markets Branch, Division of Risk
Management Supervision, (202) 898-6888; Catherine Wood, Counsel,
[email protected]; Michael Phillips, Supervisory Counsel,
[email protected], Supervision and Legislation Branch, Legal Division,
Federal Deposit Insurance Corporation, 550 17th Street NW, Washington,
DC 20429.
SUPPLEMENTARY INFORMATION:
I. Background
In 2014, the FDIC comprehensively revised and strengthened its
capital regulations applicable to FDIC-supervised institutions (revised
capital rule).\1\ The revised capital rule was codified in part 324 of
the FDIC's codified rules (effective January 1, 2014, for advanced
approaches banking organizations) and was effective for all non-
advanced approaches FDIC-supervised institutions on January 1, 2015.
Before the effective dates of the revised capital rule, FDIC-supervised
institutions were subject to the superseded capital rules in part 325
and subparts Y and Z of part 390 of the FDIC's codified rules. The
superseded capital rules remain in the Code of Federal Regulations
(CFR), even though they were no longer effective for any FDIC-
supervised institution since January 1, 2015. Maintaining the
superseded capital rules in the FDIC's codified rules could result in
confusion and therefore this final rule removes the superseded capital
rules.
---------------------------------------------------------------------------
\1\ 79 FR 20754 (April 14, 2014).
---------------------------------------------------------------------------
II. Description of the Final Rule
The final rule rescinds part 325, subpart A--Minimum Capital
Requirements, subpart B--Prompt Corrective Action and appendices A
through D, as the rules contained therein have been superseded by part
324. Under the final rule, the annual stress testing rule will remain
in part 325. Part 325 will be retitled to Annual Stress Test and the
stress testing rule will be renumbered to reflect the removed capital
rules. Similarly, the final rule removes the superseded capital rules
contained in part 390 subpart Y--Prompt Corrective Action and part 390,
subpart Z--Capital and related appendices. Under the final rule,
sections in part 390 that are not removed will remain codified in part
390, including certain enforcement authorities related to savings
association's capital requirements. The final rule also makes
conforming technical changes to provisions of the FDIC's codified rules
that refer to part 325 for state nonmember banks and subparts Y and Z
of part 390 for state savings associations in conjunction with the
FDIC's capital rules. However, this final rule does not impact the
legal status of any reference to the superseded capital rules in
outstanding compliance and enforcement orders, agreements, and
memoranda of understanding entered into by the FDIC prior to the
effective date of this final rule. Regardless of whether an outstanding
enforcement order refers to the superseded capital rule, all FDIC-
supervised institutions are subject to the revised capital rule and
must be in compliance with the minimum capital requirements in part
324.\2\
---------------------------------------------------------------------------
\2\ Generally FDIC-supervised institutions can demonstrate
compliance with outstanding enforcement orders referencing the
superseded capital rule by calculating their capital ratios under
the revised capital rule. The FDIC made a finding during the
interagency capital rulemaking process in 2013 that the revised
capital rule is more stringent than the superseded capital rule.
Therefore, an FDIC-supervised institution subject to an enforcement
order under the superseded capital rule may demonstrate its
compliance using its ratios as calculated under the revised capital
rule.
---------------------------------------------------------------------------
III. Administrative Procedure Act
The Administrative Procedure Act (APA) does not require an agency
to publish a notice of proposed rulemaking (NPR) in the Federal
Register if an ``agency for good cause finds (and incorporates the
finding and a brief statement of reasons therefor in the rules issued)
that notice and public procedure thereon are impracticable,
unnecessary, or contrary to the public interest.'' \3\ The FDIC finds
that for purposes of the rescission of the superseded capital rules,
good cause exists to not publish a notice of proposed rulemaking in the
Federal Register and, therefore, is issuing this rule as a final rule.
The FDIC believes that a notice of proposed rulemaking is unnecessary
for such purposes because the FDIC published three NPRs and an interim
final rule for comment before issuing the revised capital rules in
2014.\4\ The comment period for those NPRs and interim final rule
provided sufficient public notice that the revised
[[Page 17738]]
capital rules would replace the superseded capital rules for all FDIC-
supervised institutions as of January 1, 2015. This final rule solely
removes the obsolete provisions of, and references to, the superseded
capital rules in the CFR and imposes no new requirement on FDIC-
supervised institutions. Accordingly, the FDIC concludes that good
cause exists to publish the rule as final without a notice and
opportunity to comment.
---------------------------------------------------------------------------
\3\ 5 U.S.C. 553(b).
\4\ Concerning the NPRs for the revised capital rules, see 77 FR
52792 (August 30, 2012); 77 FR 52888 (August 30, 2012); 77 FR 52978
(August 30, 2012). The interim final rule for the revised capital
rules was issued in September 10, 2013 (78 FR 55340). In the
preamble to the interim final rule, the FDIC stated: ``The interim
final rule will replace the FDIC's general risk-based capital rules,
advanced approaches rule, market risk rule, and leverage rules in
accordance with the transition provisions described below.'' Also,
section 324.1(f) of the revised capital rules states the timing for
the implementation of the revised capital rules. See 12 CFR
324.1(f).
---------------------------------------------------------------------------
Section 553(d)(3) of the APA provides that, for good cause found
and published with the rule, an agency does not have to comply with the
requirement that a substantive rule be published not less than 30 days
before its effective date.\5\ The final rule will be effective
immediately upon its publication in the Federal Register. The FDIC
invokes the good cause exception to the APA's 30-day publication
requirement for the reasons discussed above.
---------------------------------------------------------------------------
\5\ 5 U.S.C. 553(d)(3).
---------------------------------------------------------------------------
IV. Regulatory Analyses
A. Regulatory Flexibility Act
The Regulatory Flexibility Act, 5 U.S.C. 601 et seq. (RFA),
requires an agency, in connection with a notice of proposed rulemaking,
to prepare an Initial Regulatory Flexibility Analysis describing the
impact of the proposed rule on small entities (defined by the Small
Business Administration for purposes of the RFA to include banking
entities with total assets of $550 million or less) or to certify that
the proposed rule would not have a significant economic impact on a
substantial number of small entities. The RFA also requires an agency,
in connection with a final rule, to prepare a Final Regulatory
Flexibility Act (FRFA) analysis describing the impact of the final rule
on small entities. Neither an IRFA nor FRFA is required, however, if
the rule is issued under the APA provision allowing the agency to
forego notice and comment rulemaking for good cause. Therefore, the
FDIC has not prepared either an IRFA or an FRFA in connection with this
final rule. Nevertheless, the FDIC notes that the final rule does not
impose any burden on small banking entities as it only rescinds
obsolete provisions in the FDIC's CFR.
B. Paperwork Reduction Act
In accordance with the requirements of the Paperwork Reduction Act
of 1995 (44 U.S.C. 3501-3521), the FDIC may not conduct or sponsor, and
a respondent is not required to respond to, an information collection
unless it displays a currently valid Office of Management and Budget
(OMB) control number. The FDIC reviewed the rule and determined that it
does not create any new, or revise any existing, collection of
information under section 3504(h) of the Paperwork Reduction Act of
1980. Consequently, no information collection request will be submitted
to the OMB for review.
C. Small Business Regulatory Enforcement Fairness Act
The Office of Management and Budget has determined that the final
rule is not a ``major rule'' within the meaning of the Small Business
Regulatory Enforcement Fairness Act of 1996 (Title II, Pub. L. 104-
121).
D. The Treasury and General Government Appropriations Act, 1999--
Assessment of Federal Regulations and Policies on Families
The FDIC has determined that the final rule will not affect family
well-being within the meaning of section 654 of the Treasury and
General Government Appropriations Act, enacted as part of the Omnibus
Consolidated and Emergency Supplemental Appropriations Act of 1999
(Pub. L. 105-277, 112 Stat. 2681).
E. Plain Language
Section 722 of the Gramm-Leach-Bliley Act requires the federal
banking agencies to use plain language in all final rules published
after January 1, 2000. The FDIC has sought to present the final rule in
a simple and straightforward manner.
F. Riegle Community Development and Regulatory Improvement Act of 1994
Under the Riegle Community Development and Regulatory Improvement
Act of 1994, 12 U.S.C. 4802, (RCDRIA), there is a requirement that
``[n]ew regulations and amendments to regulations prescribed by a
Federal banking agency which impose additional reporting, disclosures,
or other new requirements on insured depository institutions shall take
effect on the first day of a calendar quarter which begins on or after
the date on which the regulations are published in final form'' absent
a good cause determination by the agency.\6\ The final rule imposes no
additional reporting, disclosure, or other new requirements on insured
depository institutions and therefore is not subject to the effective
date requirement in RCDRIA.
---------------------------------------------------------------------------
\6\ 12 U.S.C. 4802(b).
---------------------------------------------------------------------------
List of Subjects
12 CFR Part 303
Administrative practice and procedure, Bank deposit insurance,
Banks, banking, Reporting and recordkeeping requirements, Savings
associations.
12 CFR Part 308
Administrative practice and procedure, Bank deposit insurance,
Banks, banking, Claims, Crime, Equal access to justice, Fraud,
Investigations, Lawyers, Penalties.
12 CFR Part 324
Administrative practice and procedure, Banks, banking, Reporting
and recordkeeping requirements, Savings associations.
12 CFR Part 325
Banks, banking, Reporting and recordkeeping requirement.
12 CFR Part 327
Bank deposit insurance, Banks, banking, Savings associations.
12 CFR Part 333
Banks, banking.
12 CFR Part 337
Banks, banking, Reporting and recordkeeping requirements,
Securities.
12 CFR Part 347
Authority delegations (Government agencies), Bank deposit
insurance, Banks, banking, Credit, Foreign banking, Investments,
Reporting and recordkeeping requirements, U.S. Investments abroad.
12 CFR Part 349
Administrative practice and procedure, Banks, banking, Holding
companies, Reporting and recordkeeping requirements, Savings
associations, Swaps.
12 CFR Part 360
Savings associations.
12 CFR Part 362
Administrative practice and procedure, Authority delegations
(Government agencies), Bank deposit insurance, Banks, banking,
Investments, Reporting and recordkeeping requirements.
12 CFR Part 363
Accounting, Administrative practice and procedure, Banks, banking,
Reporting and recordkeeping requirements.
12 CFR Part 364
Banks, banking, Information.
[[Page 17739]]
12 CFR Part 365
Banks, banking, Mortgages.
12 CFR Part 390
Administrative practice and procedure, Advertising, Aged, Civil
rights, Conflict of interests, Credit, Crime, Equal employment
opportunity, Fair housing, Government employees, Individuals with
disabilities, Reporting and recordkeeping requirements, Savings
associations.
Authority and Issuance
For the reasons stated in the preamble, the Federal Deposit
Insurance Corporation amends 12 CFR parts 303, 308, 324, 325, 327, 333,
337, 347, 349, 360, 362, 363, 364, 365, and 390 as follows:
PART 303--FILING PROCEDURES
0
1. The authority citation for part 303 continues to read as follows:
Authority: 12 U.S.C. 378, 1464, 1813, 1815, 1817, 1818, 1819(a)
(Seventh and Tenth), 1820, 1823, 1828, 1831a, 1831e, 1831o, 1831p-1,
1831w, 1835a, 1843(l), 3104, 3105, 3108, 3207; 5414; 15 U.S.C. 1601-
1607.
0
2. Section 303.2 is amended by revising paragraphs (b), (ee), and (ff)
to read as follows:
Sec. 303.2 Definitions.
* * * * *
(b) Adjusted part 324 total assets means adjusted 12 CFR part 324
total assets as calculated and reflected in the FDIC's Report of
Examination.
* * * * *
(ee) Tier 1 capital shall have the same meaning as provided in
Sec. 324.2 of this chapter.
(ff) Total assets shall have the same meaning as provided in Sec.
324.401(g) of this chapter.
* * * * *
0
3. Section 303.64 is amended by revising paragraph (a)(4)(i) to read as
follows:
Sec. 303.64 Processing.
(a) * * *
(4) * * *
(i) Immediately following the merger transaction, the resulting
institution will be well-capitalized pursuant to subpart H of part 324
of this chapter (12 CFR part 324); and
* * * * *
0
4. Section 303.181 is amended by revising paragraph (c)(4) to read as
follows:
Sec. 303.181 Definitions.
* * * * *
(c) * * *
(4) Is well-capitalized as defined in subpart H of part 324 of this
chapter; and
* * * * *
0
5. Section 303.184 is amended by revising paragraph (d)(1)(ii) to read
as follows:
Sec. 303.184 Moving an insured branch of a foreign bank.
* * * * *
(d) * * *
(1) * * *
(ii) The applicant is at least adequately capitalized as defined in
subpart H of part 324 of this chapter;
* * * * *
0
6. Section 303.200 is amended by revising paragraphs (a)(2) and (b) to
read as follows:
Sec. 303.200 Scope.
(a) * * *
(2) Definitions of the capital categories referenced in this Prompt
Corrective Action subpart may be found in subpart H of part 324 of this
chapter.
(b) Institutions covered. Restrictions and prohibitions contained
in subpart H of part 324 of this chapter apply primarily to state
nonmember banks and insured branches of foreign banks, as well as to
directors and senior executive officers of those institutions. Portions
of subpart H of part 324 of this chapter also apply to all insured
depository institutions that are deemed to be critically
undercapitalized.
* * * * *
0
7. Section 303.241 is amended by revising paragraph (c)(4) to read as
follows:
Sec. 303.241 Reduce or retire capital stock or capital debt
instruments.
* * * * *
(c) * * *
(4) If the proposal involves a series of transactions affecting
Tier 1 capital components which will be consummated over a period of
time which shall not exceed twelve months, the application shall
certify that the insured depository institution will maintain itself as
a well-capitalized institution as defined in part 324 of this chapter
both before and after each of the proposed transactions;
* * * * *
PART 308--RULES OF PRACTICE AND PROCEDURE
0
8. The authority citation for part 308 continues to read as follows:
Authority: 5 U.S.C. 504, 554-557; 12 U.S.C. 93(b), 164, 505,
1464, 1467(d), 1467a, 1468, 1815(e), 1817, 1818, 1819, 1820, 1828,
1829, 1829b, 1831i, 1831m(g)(4), 1831o, 1831p-1, 1832(c), 1884(b),
1972, 3102, 3108(a), 3349, 3909, 4717, 5412(b)(2)(C), 5414(b)(3); 15
U.S.C. 78(h) and (i), 78o(c)(4), 78o-4(c), 78o-5, 78q-1, 78s, 78u,
78u-2, 78u-3, 78w, 6801(b), 6805(b)(1); 28 U.S.C. 2461 note; 31
U.S.C. 330, 5321; 42 U.S.C. 4012a; Pub.L. 104-134, sec. 3100(s), 110
Stat. 1321; Pub.L. 109-351, 120 Stat. 1966; Pub. L. 111-203, 124
Stat. 1376; Pub.L. 114-74, sec. 701, 129 Stat. 584.
0
9. Section 308.200 is revised to read as follows:
Sec. 308.200 Scope.
The rules and procedures set forth in this subpart apply to banks,
insured branches of foreign banks and senior executive officers and
directors of banks that are subject to the provisions of section 38 of
the Federal Deposit Insurance Act (section 38) (12 U.S.C. 1831o) and
subpart H of part 324 of this chapter.
0
10. Section 308.202 is amended by revising paragraphs (a)(1)(i)(A) and
(a)(1)(ii) to read as follows:
Sec. 308.202 Procedures for reclassifying a bank based on criteria
other than capital.
(a) * * *
(1) * * *
(i) Grounds for reclassification. (A) Pursuant to Sec. 324.403(d)
of this chapter, the FDIC may reclassify a well-capitalized bank as
adequately capitalized or subject an adequately capitalized or
undercapitalized institution to the supervisory actions applicable to
the next lower capital category if:
(1) The FDIC determines that the bank is in unsafe or unsound
condition; or
(2) The FDIC, pursuant to section 8(b)(8) of the FDI Act (12 U.S.C.
1818(b)(8)), deems the bank to be engaged in an unsafe or unsound
practice and not to have corrected the deficiency.
* * * * *
(ii) Prior notice to institution. Prior to taking action pursuant
to Sec. 324.403(d) of this chapter, the FDIC shall issue and serve on
the bank a written notice of the FDIC's intention to reclassify it.
* * * * *
0
11. Section 308.204 is amended by revising paragraphs (b)(2) and (c) to
read as follows:
Sec. 308.204 Enforcement of directives.
* * * * *
(b) * * *
(2) Failure to implement capital restoration plan. The failure of a
bank to implement a capital restoration plan required under section 38,
or subpart H of part 324 of this chapter, or the failure of a company
having control of a bank
[[Page 17740]]
to fulfill a guarantee of a capital restoration plan made pursuant to
section 38(e)(2) of the FDI Act shall subject the bank to the
assessment of civil money penalties pursuant to section 8(i)(2)(A) of
the FDI Act.
(c) Other enforcement action. In addition to the actions described
in paragraphs (a) and (b) of this section, the FDIC may seek
enforcement of the provisions of section 38 or subpart H of part 324 of
this chapter through any other judicial or administrative proceeding
authorized by law.
* * * * *
PART 324--CAPITAL ADEQUACY OF FDIC-SUPERVISED INSTITUTIONS
0
12. The authority citation for part 324 continues to read as follows:
Authority: 12 U.S.C. 1815(a), 1815(b), 1816, 1818(a), 1818(b),
1818(c), 1818(t), 1819(Tenth), 1828(c), 1828(d), 1828(i), 1828(n),
1828(o), 1831o, 1835, 3907, 3909, 4808; 5371; 5412; Pub.L. 102-233,
105 Stat. 1761, 1789, 1790 (12 U.S.C. 1831n note); Pub.L. 102-242,
105 Stat. 2236, 2355, as amended by Pub.L. 103-325, 108 Stat. 2160,
2233 (12 U.S.C. 1828 note); Pub.L. 102-242, 105 Stat. 2236, 2386, as
amended by Pub.L. 102-550, 106 Stat. 3672, 4089 (12 U.S.C. 1828
note); Pub.L. 111-203, 124 Stat. 1376, 1887 (15 U.S.C. 78o-7 note).
0
13. Section 324.22 is amended by revising footnote 22 in paragraph
(b)(2)(iii) to read as follows:
Sec. 324.22 Regulatory capital adjustments and deductions.
* * * * *
(b) * * *
(2) * * *
(iii) * * *
\22\ These rules include the regulatory capital requirements set
forth at 12 CFR part 3 (OCC); 12 CFR part 217 (Board); 12 CFR part 324
(FDIC).
* * * * *
PART 325--ANNUAL STRESS TEST
0
14. The authority citation for part 325 continues to read as follows:
Authority: 12 U.S.C. 5365(i)(2), 12 U.S.C. 5412(b)(2)(C), 12
U.S.C. 1818, 12 U.S.C. 1819(a)(Tenth), 12 U.S.C. 1831o, and 12
U.S.C. 1831p-1.
0
15. The heading for part 325 is revised to read as set forth above.
Subparts A and B [Removed]
0
16. Remove subparts A and B.
Subpart C [Amended]
0
17. Remove the heading for subpart C.
Sec. Sec. 325.201 through 325.207 [Redesignated as Sec. Sec. 325.1
through 325.7]
0
18. Redesignate Sec. Sec. 325.201 through 325.207 as Sec. Sec. 325.1
through 325.7, respectively.
0
19. Amend newly redesignated Sec. 325.1 by revising paragraph (c)(5)
to read as follows:
Sec. 325.1 Authority, purpose, and reservation of authority.
* * * * *
(c) * * *
(5) Notice and comment procedures: In exercising its authority to
require different or additional stress tests and different or
additional scenarios (including components for the scenarios) under
paragraph (c)(2) of this section, the Corporation will apply notice and
response procedures in the same manner and to the same extent as the
notice and response procedures in 12 CFR 324.5, as appropriate.
* * * * *
Appendices A, B, C, and D [Removed]
0
20. Remove appendices A, B, C, and D.
PART 327--ASSESSMENTS
0
21. The authority citation for part 327 continues to read as follows:
Authority: 12 U.S.C. 1441, 1813, 1815, 1817-19, 1821.
0
22. Appendix A to subpart A of part 327 is amended by revising footnote
5 in section VI to read as follows:
Appendix A to Subpart A of Part 327--Method to Derive Pricing
Multipliers and Uniform Amount
* * * * *
VI. * * *
\5\ Market risk is defined in 12 CFR 324.202.
0
23. Appendix C to subpart A of part 327 is amended by revising the
appendix heading and the first and second sentences in the first
paragraph in section I.A.5 to read as follows:
Appendix C to Subpart A to Part 327--Description of Concentration
Measures
I. * * *
A. * * *
5. * * *
Higher-risk securitizations are defined as securitization
exposures (except securitizations classified as trading book),
where, in aggregate, more than 50 percent of the assets backing the
securitization meet either the criteria for higher-risk C & I loans
or securities, higher-risk consumer loans, or nontraditional
mortgage loans, except those classified as trading book. A
securitization exposure is as defined in 12 CFR 324.2, as it may be
amended from time to time. * * *
* * * * *
PART 333--EXTENSION OF CORPORATE POWERS
0
24. The authority citation for part 333 continues to read as follows:
Authority: 12 U.S.C. 1816, 1818, 1819 (``Seventh'', ``Eighth''
and ``Tenth''), 1828, 1828(m), 1831p-1(c).
0
25. Section 333.4 is amended by revising the fourth sentence in
paragraph (a) to read as follows:
Sec. 333.4 Conversions from mutual to stock form.
(a) Scope. * * * As determined by the Board of Directors of the
FDIC on a case-by-case basis, the requirements of paragraphs (d), (e),
and (f) of this section do not apply to mutual-to-stock conversions of
insured mutual state savings banks whose capital category under Sec.
324.403 of this chapter is ``undercapitalized'', ``significantly
undercapitalized'' or ``critically undercapitalized''. * * *
* * * * *
PART 337--UNSAFE AND UNSOUND BANKING PRACTICES
0
26. The authority citation for part 337 continues to read as follows:
Authority: 12 U.S.C. 375a(4), 375b, 1463(a)(1), 1816, 1818(a),
1818(b), 1819, 1820(d), 1828(j)(2), 1831, 1831f, 5412.
0
27. Section 337.6 is amended by revising footnote 12 in paragraph
(a)(3)(i) and the second sentence in footnote 13 in paragraph
(a)(3)(iii) to read as follows:
Sec. 337.6 Brokered deposits.
* * * * *
(a) * * *
(3) * * *
(i) * * *
\12\ For the most part, the capital measure terms are defined in
the following regulations: FDIC--12 CFR part 324, subpart H; Board of
Governors of the Federal Reserve System--12 CFR part 208; and Office of
the Comptroller of the Currency--12 CFR part 6.
* * * * *
(iii) * * *
\13\ * * * Provisions specifying the effective date of
determination of capital category are generally published in the
following regulations: FDIC--12 CFR 324.402; Board of Governors of the
Federal Reserve System--12 CFR part 208, subpart D; and Office of the
Comptroller of the Currency--12 CFR 6.3.
* * * * *
[[Page 17741]]
PART 347--INTERNATIONAL BANKING
0
28. The authority citation for part 347 continues to read as follows:
Authority: 12 U.S.C. 1813, 1815, 1817, 1819, 1820(d), 1828,
3103, 3104, 3105, 3108, 3109; Title IX, Pub. L. 98-181, 97 Stat.
1153 (12 U.S.C. 3901 et seq.).
0
29. Section 347.102 is amended by revising paragraphs (u) and (v) to
read as follows:
Sec. 347.102 Definitions.
* * * * *
(u) Tier 1 capital means Tier 1 capital as defined in Sec. 324.2
of this chapter.
(v) Well capitalized means well capitalized as defined in Sec.
324.403 of this chapter.
PART 349--DERIVATIVES
Subpart B--Retail Foreign Exchange Transactions
0
30. The authority citation for part 349, subpart B, continues to read
as follows:
Authority: 12 U.S.C. 1813(q), 1818, 1819, and 3108; 7 U.S.C.
2(c)(2)(E), 27 et seq.
0
31. Section 349.20 is revised to read as follows:
Sec. 349.20 Capital requirements.
An FDIC-supervised insured depository institution offering or
entering into retail forex transactions must be well capitalized as
defined by 12 CFR part 324, unless specifically exempted by the FDIC in
writing.
PART 360--RESOLUTION AND RECEIVERSHIP RULES
0
32. The authority citation for part 360 continues to read as follows:
Authority: 12 U.S.C. 1821(d)(1), 1821(d)(10)(C), 1821(d)(11),
1821(e)(1), 1821(e)(8)(D)(i), 1823(c)(4), 1823(e)(2); Sec. 401(h),
Pub. L. 101-73, 103 Stat. 357.
0
33. Section 360.5 is amended by revising paragraph (b) to read as
follows:
Sec. 360.5 Definition of qualified financial contracts.
* * * * *
(b) Repurchase agreements. The following agreements shall be deemed
``repurchase agreements'' under section 11(e)(8)(D)(v) of the Federal
Deposit Insurance Act, as amended (12 U.S.C. 1821(e)(8)(D)(v)): A
repurchase agreement on qualified foreign government securities is an
agreement or combination of agreements (including master agreements)
which provides for the transfer of securities that are direct
obligations of, or that are fully guaranteed by, the central
governments (as set forth at 12 CFR 324.2 (definition of sovereign
exposure), as may be amended from time to time) of the OECD-based group
of countries (as generally discussed in 12 CFR 324.32) against the
transfer of funds by the transferee of such securities with a
simultaneous agreement by such transferee to transfer to the transferor
thereof securities as described above, at a date certain not later than
one year after such transfers or on demand, against the transfer of
funds.
* * * * *
0
34. Section 360.9 is amended by revising paragraph (e)(6) to read as
follows:
Sec. 360.9 Large-bank deposit insurance determination modernization.
* * * * *
(e) * * *
(6) Notwithstanding the general requirements of this paragraph (e),
on a case-by-case basis, the FDIC may accelerate, upon notice, the
implementation timeframe of all or part of the requirements of this
section for a covered institution that: Has a composite rating of 3, 4,
or 5 under the Uniform Financial Institution's Rating System, or in the
case of an insured branch of a foreign bank, an equivalent rating; is
undercapitalized, as defined under the prompt corrective action
provisions of 12 CFR part 324; or is determined by the appropriate
Federal banking agency or the FDIC in consultation with the appropriate
Federal banking agency to be experiencing a significant deterioration
of capital or significant funding difficulties or liquidity stress,
notwithstanding the composite rating of the institution by its
appropriate Federal banking agency in its most recent report of
examination. In implementing this paragraph (e)(6), the FDIC must
consult with the covered institution's primary federal regulator and
consider the: Complexity of the institution's deposit systems and
operations, extent of the institution's asset quality difficulties,
volatility of the institution's funding sources, expected near-term
changes in the institution's capital levels, and other relevant factors
appropriate for the FDIC to consider in its roles as insurer and
possible receiver of the institution.
* * * * *
PART 362--ACTIVITIES OF INSURED STATE BANKS AND INSURED SAVINGS
ASSOCIATIONS
0
35. The authority citation for part 362 continues to read as follows:
Authority: 12 U.S.C. 1816, 1818, 1819(a)(Tenth), 1828(j),
1828(m), 1828a, 1831a, 1831e, 1831w, 1843(l).
0
36. Section 362.2 is amended by revising paragraphs (s) and (t) to read
as follows:
Sec. 362.2 Definitions.
* * * * *
(s) Tier one capital has the same meaning as set forth in part 324
of this chapter for an insured State nonmember bank or insured state
savings association. For other state-chartered depository institutions,
the term ``tier one capital'' has the same meaning as set forth in the
capital regulations adopted by the appropriate Federal banking agency.
(t) Well-capitalized has the same meaning set forth in part 324 of
this chapter for an insured State nonmember bank or insured state
savings association. For other state-chartered depository institutions,
the term ``well-capitalized'' has the same meaning as set forth in the
capital regulations adopted by the appropriate Federal banking agency.
0
37. Section 362.4 is amended by revising paragraph (e)(3) to read as
follows:
Sec. 362.4 Subsidiaries of insured State banks.
* * * * *
(e) * * *
(3) Use such regulatory capital amount for the purposes of the
bank's assessment risk classification under part 327 of this chapter
and its categorization as a ``well-capitalized'', an ``adequately
capitalized'', an ``undercapitalized'', or a ``significantly
undercapitalized'' institution as defined in Sec. 324.403(b) of this
chapter, provided that the capital deduction shall not be used for
purposes of determining whether the bank is ``critically
undercapitalized'' under part 324 of this chapter.
0
38. Section 362.17 is amended by revising paragraph (d) to read as
follows:
Sec. 362.17 Definitions.
* * * * *
(d) Tangible equity and Tier 2 capital have the same meaning as set
forth in part 324 of this chapter.
* * * * *
PART 363--ANNUAL INDEPENDENT AUDITS AND REPORTING REQUIREMENTS
0
39. The authority citation for part 363 continues to read as follows:
Authority: 12 U.S.C. 1831m.
[[Page 17742]]
0
40. Appendix A to part 363 is amended by revising Table 1 to Appendix A
to read as follows:
Appendix A to Part 363--Guidelines and Interpretations
* * * * *
Table 1 to Appendix A--Designated Federal Laws and Regulations Applicable to:
--------------------------------------------------------------------------------------------------------------------------------------------------------
State member State non- Savings
National banks banks member banks associations
--------------------------------------------------------------------------------------------------------------------------------------------------------
Insider Loans--Parts and/or Sections of Title 12 of the United States Code
--------------------------------------------------------------------------------------------------------------------------------------------------------
375a......................................... Loans to Executive Officers of Banks. [radic] [radic] (A) (A)
375b......................................... Extensions of Credit to Executive [radic] [radic] (A) (A)
Officers, Directors, and Principal
Shareholders of Banks.
1468(b)...................................... Extensions of Credit to Executive ............... ............... ............... [radic]
Officers, Directors, and Principal
Shareholders.
1828(j)(2)................................... Extensions of Credit to Officers, ............... ............... [radic] ...............
Directors, and Principal
Shareholders.
1828(j)(3)(B)................................ Extensions of Credit to Officers, (B) ............... (C) ...............
Directors, and Principal
Shareholders.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Parts and/or Sections of Title 12 of the Code of Federal Regulations
--------------------------------------------------------------------------------------------------------------------------------------------------------
31........................................... Extensions of Credit to Insiders..... [radic] ............... ............... ...............
32........................................... Lending Limits....................... [radic] ............... ............... ...............
215.......................................... Loans to Executive Officers, [radic] [radic] (D) (E)
Directors, and Principal
Shareholders of Member Banks.
337.3........................................ Limits on Extensions of Credit to ............... ............... [radic] ...............
Executive Officers, Directors, and
Principal Shareholders of Insured
Nonmember Banks.
390.338 (state savings associations)......... Loans by Savings Associations to ............... ............... ............... [radic]
Their Executive Officers, Directors,
and Principal Shareholders.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Dividend Restrictions--Parts and/or Sections of Title 12 of the United States Code
--------------------------------------------------------------------------------------------------------------------------------------------------------
56........................................... Prohibition on Withdrawal of Capital [radic] [radic] ............... ...............
and Unearned Dividends.
60........................................... Dividends and Surplus Fund........... [radic] [radic] ............... ...............
1467a(f)..................................... Declaration of Dividend.............. ............... ............... ............... [radic]
1831o(d)(1).................................. Prompt Corrective Action--Capital [radic] [radic] [radic] [radic]
Distributions Restricted.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Parts and/or Sections of Title 12 of the Code of Federal Regulations
--------------------------------------------------------------------------------------------------------------------------------------------------------
5 Subpart E.................................. Payment of Dividends................. [radic] ............... ............... ...............
6.6.......................................... Prompt Corrective Action-- [radic] ............... ............... ...............
Restrictions on Undercapitalized
Institutions.
208.5........................................ Dividends and Other Distributions.... ............... [radic] ............... ...............
208.45....................................... Prompt Corrective Action-- ............... [radic] ............... ...............
Restrictions on Undercapitalized
Institutions.
324.405...................................... Prompt Corrective Action-- ............... ............... [radic] ...............
Restrictions on Undercapitalized
Institutions.
390.342-.348 (state savings associations).... Capital Distributions................ ............... ............... ............... [radic]
390.455 (state savings associations)......... Prompt Corrective Action-- ............... ............... ............... [radic]
Restrictions on Undercapitalized
Institutions.
--------------------------------------------------------------------------------------------------------------------------------------------------------
(A) Subsections (g) and (h) of section 22 of the Federal Reserve Act [12 U.S.C. 375a, 375b]
(B) Applies only to insured Federal branches of foreign banks.
(C) Applies only to insured State branches of foreign banks.
(D) See 12 CFR 337.3.
(E) See 12 CFR 390.338 (state savings associations).
PART 364--STANDARDS FOR SAFETY AND SOUNDNESS
0
41. The authority citation in part 364 continues to read as follows:
Authority: 12 U.S.C. 1818 and 1819 (Tenth), 1831p-1; 15 U.S.C.
1681b, 1681s, 1681w, 6801(b), 6805(b)(1).
0
42. Appendix A to part 364 is amended by revising the last sentence in
section I.A. to read as follows:
Appendix A to Part 364--Interagency Guidelines Establishing Standards
for Safety and Soundness
* * * * *
I. * * *
A. * * *
* * * Nothing in these Guidelines limits the authority of the
FDIC pursuant to section 38(i)(2)(F) of the FDI Act (12 U.S.C.
1831o) and part 324 of title 12 of the Code of Federal Regulations.
* * * * *
[[Page 17743]]
PART 365--REAL ESTATE LENDING STANDARDS
0
43. The authority citation for part 365 continues to read as follows:
Authority: 12 U.S.C. 1828(o) and 5101 et seq.
0
44. Appendix A to subpart A of part 365 is amended by revising footnote
2 to the ``Loans in Excess of the Supervisory Loan-to-Value Limits''
section to read as follows:
Appendix A to Subpart A of Part 365--Interagency Guidelines for Real
Estate Lending Policies
* * * * *
Loans in Excess of the Supervisory Loan-to-Value Limits
* * * * *
\2\ For state non-member banks and state savings associations,
``total capital'' refers to that term described in 12 CFR 324.2.
* * * * *
PART 390--REGULATIONS TRANSFERRED FROM THE OFFICE OF THRIFT
SUPERVISION
0
45. The authority citation for part 390 is revised to read as follows:
Authority: 12 U.S.C. 1819.
Sec. 390.101 [Amended]
0
46. Section 390.101 is amended in paragraph (f) by removing ``subpart
Z'' and adding in its place ``12 CFR part 324.''
0
47. Section 390.264 is revised to read as follows:
Sec. 390.264 Real estate lending standards; purpose and scope.
This section, and Sec. 390.265, issued pursuant to section 18(o)
of the Federal Deposit Insurance Act, (12 U.S.C. 1828(o)), prescribe
standards for real estate lending to be used by State savings
associations and all their includable subsidiaries, as defined in part
324 of this chapter, over which the State savings associations exercise
control, in adopting internal real estate lending policies.
0
48. The appendix to Sec. 390.265 is amended by revising footnote 4 to
read as follows:
Sec. 390.265 Real estate lending standards.
* * * * *
Appendix to Sec. 390.265--Interagency Guidelines for Real Estate
Lending Policies
* * * * *
\4\ For the state member banks, the term ``total capital'' is
defined at 12 CFR 217.2. For insured state non-member banks, the
term ``total capital'' is defined at 12 CFR 324.2. For national
banks, the term ``total capital'' is defined at 12 CFR 3.2. For
state savings associations, the term ``total capital'' is defined at
12 CFR 324.2.
* * * * *
0
49. Section 390.316 is amended by revising paragraph (c) to read as
follows:
Sec. 390.316 With recourse.
* * * * *
(c) This definition does not apply for purposes of determining the
capital adequacy requirements under part 324 of this chapter.
0
50. Section 390.341 is amended by revising paragraphs (a),
(c)(1)(i)(G), and (d)(2)(ii) to read as follows:
Sec. 390.341 Inclusion of subordinated debt securities and
mandatorily redeemable preferred stock as supplementary capital.
(a) Scope. A State savings association must comply with this
section in order to include subordinated debt securities or mandatorily
redeemable preferred stock (``covered securities'') in supplementary
capital (tier 2 capital) under part 324 of this chapter. If a State
savings association does not include covered securities in
supplementary capital, it is not required to comply with this section.
* * * * *
(c) * * *
(1) * * *
(i) * * *
(G) State or refer to a document stating that the State savings
association must obtain FDIC approval before the voluntarily prepayment
of principal on subordinated debt securities, the acceleration of
payment of principal on subordinated debt securities, or the
voluntarily redemption of mandatorily redeemable preferred stock (other
than scheduled redemptions), if the State savings association is
undercapitalized, significantly undercapitalized, or critically
undercapitalized as described in subpart H of part 324 of this chapter,
fails to meet the regulatory capital requirements in part 324, or would
fail to meet any of these standards following the payment.
* * * * *
(d) * * *
(2) * * *
(ii) The State savings association is at least adequately
capitalized under subpart H of part 324 of this chapter and meets the
regulatory capital requirements in part 324.
* * * * *
0
51. Section 390.343 is amended by revising paragraphs (b) and (d) to
read as follows:
Sec. 390.343 What is a capital distribution?
* * * * *
(b) Your payment to repurchase, redeem, retire or otherwise acquire
any of your shares or other ownership interests, any payment to
repurchase, redeem, retire, or otherwise acquire debt instruments
included in your total capital under part 324 of this chapter, and any
extension of credit to finance an affiliate's acquisition of your
shares or interests;
* * * * *
(d) Any other distribution charged against your capital accounts if
you would not be well capitalized, as set forth in subpart H of part
324 of this chapter, following the distribution; and
* * * * *
0
52. Section 390.344 is amended by revising the definition of Capital to
read as follows:
Sec. 390.344 Definitions applicable to capital distributions.
* * * * *
Capital means total capital, as computed under part 324 of this
chapter.
* * * * *
Sec. 390.345 [Amended]
0
53. Section 390.345 is amended as follows:
0
a. In paragraph (a)(3), by removing ``Sec. 390.453(b)(2)'' and adding
in its place ``subpart H of part 324 of this chapter.''
0
b. In paragraph (b), by removing ``Sec. 390.453(b)(1)'' and ``subpart
Z'' wherever they appear and add in their place ``subpart H of part 324
of this chapter.''
0
54. Section 390.348 is amended by revising paragraph (a) to read as
follows:
Sec. 390.348 Will the FDIC permit my capital distribution?
* * * * *
(a) You will be undercapitalized, significantly undercapitalized,
or critically undercapitalized as set forth in subpart H of part 324 of
this chapter, following the capital distribution. If so, the FDIC will
determine if your capital distribution is permitted under 12 U.S.C.
1831o(d)(1)(B).
* * * * *
0
55. Section 390.362 is amended by revising paragraphs (a)(1)(i) and
(iii) to read as follows:
Sec. 390.362 Who must give prior notice?
(a) * * *
(1) * * *
(i) You do not comply with all minimum capital requirements under
part 324 of this chapter;
* * * * *
[[Page 17744]]
(iii) The FDIC has notified you, in connection with its review of a
capital restoration plan required under section 38 of the Federal
Deposit Insurance Act or subpart H of part 324 of this chapter or
otherwise, that a notice is required under Sec. Sec. 390.360 through
390.368; or
* * * * *
Sec. Sec. 390.450 through 390.455 [Removed and Reserved]
0
56. Remove and reserve Sec. Sec. 390.450 through 390.455.
0
57. Section 390.457 is amended by revising paragraphs (a)(1)(i)(A) and
(a)(1)(ii) to read as follows:
Sec. 390.457 Procedures for reclassifying a State savings association
based on criteria other than capital.
(a) * * *
(1) * * *
(i) * * *
(A) Pursuant to Sec. 324.403(d) of this chapter, the FDIC may
reclassify a well capitalized State savings association as adequately
capitalized or subject an adequately capitalized or undercapitalized
institution to the supervisory actions applicable to the next lower
capital category if:
(1) The FDIC determines that the State savings association is in
unsafe or unsound condition; or
(2) The FDIC deems the State savings association to be engaged in
an unsafe or unsound practice and not to have corrected the deficiency.
* * * * *
(ii) Prior notice to institution. Prior to taking action pursuant
to Sec. 324.403(d) of this chapter, the FDIC shall issue and serve on
the State savings association a written notice of the FDIC's intention
to reclassify the State savings association.
* * * * *
Subpart Z--[Removed and Reserved]
0
58. Remove and reserve subpart Z.
Dated at Washington, DC, on March 20, 2018.
By order of the Board of Directors.
Federal Deposit Insurance Corporation.
Valerie Best,
Assistant Executive Secretary.
[FR Doc. 2018-06881 Filed 4-23-18; 8:45 am]
BILLING CODE 6714-01-P
