Agencies Adopt Final Rules Tailoring Enhanced Prudential Standards

October 28, 2019

The Federal Reserve Board and Federal Deposit Insurance Corporation have released two final rules to tailor the application of enhanced prudential standards to large U.S. and foreign banking organizations.

The final rules leave in place the core post-crisis regulatory framework created by the Dodd-Frank Act, while creating tiered thresholds that modify the stringency and applicability of the regulations. While the final rules include positive changes for most banking organizations, several institutions will be subject to certain increased standards and additional reporting requirements. The Agencies generally adopted the rules as proposed. The Board also indicated that some elements of the final rules may be subject to further revisions in forthcoming rulemakings, and further tailoring of certain related rules and regulatory reports is expected.

This linked alert memorandum offers a summary and analysis of the final rules, including several different visual perspectives of the tailoring framework.