Regulations and guidance federal reserve bank of chicago. Branches and agencies of foreign banking organizations. Act amended the bank holding company act the bhc act. Taxation and leverage inside bank holding companies. A new sentence on construction loans without permanent takeout commitments was. Aug 18, 2020 for additional information on parent only liquidity and cash flow, see section 4010.
The funding of subsidiaries equity, double leverage, and. The federal reserves bank holding company supervision manual. External link bank holding company supervision manual board provides guidance for federal reserve system examiners to conduct inspections of bank holding companies and their nonbank subsidiaries. Bank holding company supervision manual federal reserve. March 2,2004 by overnight mail and electronic delivery. Holding companies to act as sources of strength to their subsidiary.
The parent bank holding company has a pro forma d ebt to equity ratio of 1. Double leverage, risk, bank holding companies, consolidation. If the bank is controlled by a multi bank holding company, then the holding company portion of these procedures will only be performed at the largest statechartered subsidiary bank. The office of the comptroller of the currencys occ comptrollers handbook is prepared for use by occ examiners in connection with their examination and supervision of national banks, federal savings associations, and federal branches and federal agencies of foreign banking organizations collectively, banks. Interagency policy statement on funding and liquidity risk management march 17, 2010.
The supervisory objectives of the inspection program are to ascertain whether the financial strength of the bank holding company is being maintained on an ongoing basis and to determine the effects or consequences of transactions between a holding company or its nonbanking subsidiaries and its subsidiary banks. The board should enhance its supervisory processes as a. The supplement includes new or revised supervisory information and examiner guidance on the following topics. The bank holding company supervision manual is prepared by federal reserve supervision personnel to provide guidance to examiners as they conduct inspections of bank holding companies bhcs and their nonbank subsidiaries as well as savings and loan holding companies slhcs. Consolidated supervision of bank holding companies and the. Federal reserve bank holding company supervision manual. Bank holding company, supervision manual, section 20002010. Federal reserve system 20a, bank holding company supervision manual, revised edition, march, three lines of defense in effective risk management and control, iia position paper jan 20. The office of the comptroller of the currency occ, board of governors of the federal reserve system frb, federal deposit insurance corporation fdic, the office of thrift supervision ots, and the national credit union administration ncua collectively, the agencies in conjunction with the conference of state bank supervisors csbs. A users guide for the bank holding company performance report serves as an aid in using the bank holding company performance report bhcpr. Use of the manual the bank holding company supervision manual is presented in sections which have been grouped together into parts that have in common a central theme pertaining to holding company supervision. New regulatory framework for the supervision of bank holding. Thus, with this provision the bank holding company act of. Federal register application of the rficd rating system.
The funding of subsidiaries equity, double leverage, and the risk of bank holding companies. Origin of longterm debt, shortterm debt, unamortizing debt, and the. Nov 03, 2016 supervision news flash november 3, 2016. Provides guidance for conducting inspections of bank holding companies and their nonbank subsidiaries. The foundation of the occs supervision of the largest national banks is our continuous, onsite presence of examiners at each of our 15 largest banking companies. These manuals are intended to provide guidance to supervisory personnel in planning and conducting examinations and inspections and are to be used in conjunction with other supervisory guidance and manuals. Dec 15, 2020 2 herein, the term industrial bank means any insured statechartered bank that is an industrial bank, industrial loan company, or other similar institution that is excluded from the definition of bank in the bank holding company act pursuant to 12 u. The new supplement includes guidance on the following subjects. Bank secrecy act manual antimoney laundering examination manual.
Bank holding company supervision manual board of governors of. Supervision manuals the federal reserve board these manuals are available for download from the federal reserve boards web site. The determination of fair market value or cost of providing services is the responsibility of the holding company. Publication of the december 2003 update to the bank. Sections 604 and 605 of the conference report broaden the supervisory powers afforded to the federal reserve board to supervise the activities of holding companies and their non bank subsidiaries. Publication of the may 2003 update to the commercial bank. See the march 10, 2010, interagency policy statement. Mar 09, 2021 the federal reserve board of governors in washington dc. The effect of consolidation for the interplay between risk. Section 2010 supervision of subsidiaries section 2020 intercompany transactions section 4010 parent company financial factors section 4060 consolidated earnings section 4070 bhc rating system. If a holding company, bank, nonbanking subsidiary or foreign banking organization changes its legal name or location, is a report of change in organizational structure fr y10 required.
Bank holding company supervision manual provides the following guidance on transactions subject to section 23b. Bank holding company supervision manual, supplements. Act, bhcs became subject to regulation and supervision by t. Enacted on july 21, 2010, the doddfrank wall street reform and consumer protection act the doddfrank act or the act provides the most comprehensive legislative reform of the u.
Feb 01, 2001 the december 2000 update to the bank holding company supervision manual, supplement no. Safety and soundness federal reserve bank of kansas city. Consider whether or not the holding company provides managerial support or has the means to provide capital to its subsidiary banks if necessary. Commercial bank examination manual section 4090 bank holding company supervision manual section 2127 trading and capitalmarkets activities manual section 3010. The bhc act also limits the types of activities that bank holding companies may conduct, either directly or through nonbank subsidiaries. Supervision and regulation letters federal reserve. Bank holding companies subject to this policy statement also may exclude from debt until december 31, 2010, any subordinated debt associated with refinanced issuances of trust preferred securities originally issued on or prior to december 31, 2005, provided that the refinancing does not increase the bank holding company s outstanding amount of. Consolidated supervision of banks and financial conglomerates. Bank holding company supervision manual, section 2 124. The manual comprises the federal reserve systems regulatory, supervisory, and inspection guidance for bank holding companies bhcs. The purpose of a bhc is to serve as a source of strength and capital for a subsidiary bank, diversify activities, and provide liquidity and a market for bhc common stock.
Section 3000 provides information on permissible nonbank activities. Mar 05, 2020 the bank holding company supervision manual provides guidance for conducting inspections of bank holding companies and their nonbank subsidiaries. Comments of american bankers association securities. A bank holding company bhc or savings and loan holding company slhc is one that controls one or more banksthrifts but does not necessarily engage in banking itself. Each bank is different and may present specific issues. The january 2010 update to thebank holding company supervision manualhas been published supplement no. Bank holding company performance, risk, and busy board of. Aug 01, 2000 the june 2000 update to the bank holding company supervision manual, supplement no. The manual comprises the federal reserve systems bank holding company supervisory and inspection guidance. Bank holding company structure and utility supervision. Frank act, which was enacted in 2010, included a 3year moratorium on.
The federal reserve is the consolidated supervisor for all bank, financial, and savings and loan holding companies referenced as bank holding companies in this article. An fr y10 must be submitted to the appropriate federal reserve bank within 30 days of the change. Supervision training and reference tool start modules federal reserve system computerbased training modules applicable to various areas of banking and bank regulation. Aimed at addressing the causes of the financial crisis of the last few years, the act, among other things, provides for a more comprehensive, macro perspective for identifying and taking action in response to emerging risks in financial sectors and closing regulatory gaps. The fdics supervision of industrial loan companies. Riskfocused framework for supervision of large complex institutions. New regulatory framework for the supervision of bank. Bank holding company supervision manual supplement 54february 2020 this supplement re. Section 2010 supervision of subsidiaries section 2020 intercompany transactions section 4010 parent company financial factors.
Revisiting the bank holding company structure core. Orders issued under section 4 of the bank holding company. Banking law manual, third edition is a legal reference on the principles of federal banking regulation for banking organizations, including commercial banks, thrift institutions and their holding companies, along with some consideration of the regulation of other institutions some as credit unions, agricultural lenders, and mortgage lenders. The federal reserve board of governors in washington dc.
Prudential regulators view of compliance programs sifma. Bank holding company supervision manual supplement 17december 1999. The bank holding company is in compliance with the ongoing requirements of this policy statement and meets the requirements of 225. Bank holding company supervision manual supplement 50july 2016 bhc supervision manual july 2016. Apr 15, 2010 the january 2010 update to thebank holding company supervision manualhas been published supplement no. Bank holding company act bhca or a noncommunity bank, which refers to an institution that may involve more complexity than a traditional community bank in terms of its business model, products, services, activities, market segments, funding, delivery channels, geographic footprint. Bank holding company performance, risk, and busy board. The supervisory objectives of the inspection program are to ascertain whether the financial strength of the bank holding company is being maintained on an ongoing basis and to. Manual is prepared by federal reserve supervi sion personnel to. A representative from the fdic and frb, if applicable. Bank holding company supervision manual supplement 25 december 2003 bhc supervision manual december 2003 page 3. Bank holding company supervision manual federal reserve system provides guidance for conducting inspections of bank holding companies and their nonbank subsidiaries.
The bank holding company supervision manual provides guidance for conducting inspections of bank holding companies and their nonbank subsidiaries. Supervision news flash federal reserve bank of richmond. All nonbank affiliates of a bank holding company are subject to extensive regulation and supervision by the federal reserve. Federal deposit insurance corporation 12 cfr part 354 rin. Specific modules of interest to holding company directors and management include. The guide provides definitions of the financial ratios and items presented. The manual comprises the federal reserve systems bank holding company bhc supervisory and inspection guidance. In addition to supervising bank holding companies, the federal reserve, under the grammleachbliley act of 1999 glba, has umbrella supervision powers with respect to financial holding companies. Bank holding company supervision manual supplement 17december 1999 bhc supervision manual december 1999 page 4. For example, part i provides an overview of the supervisory process of holding companies. If the holding company has debt, consider and comment on the following. Citibank is one of the banks in our large bank program. These 15 banking companies account for approximately.
Over the past several months, weve seen a few bank holding companies in the fifth district raise subordinated debt, and have seen that others are in the planning phase. The letter presents a tailored supervisory approach for regional banking organizations, which are defined as companies with total consolidated assets of between. Effects from the parent exposure to subsidiaries inside bank holding companies. The manual is a compilation of formalized procedures and board supervisory. Federal reserve guidelines and instructions for examinations of edge corporations.
387 1218 1000 14 192 164 1144 794 410 420 693 119 971 540 313 1469 1071 417 393 426 20 576 796 597 264 91 1 902 1396 690 353